Meta Platforms, Inc. (META) Earnings Call Transcript & Summary

The Virtual Pacific Summit. I'm Liz Minick, I'm proud to be the Market Executive for Bank of America here in San Francisco and the East Bay. Bank of America is deeply committed to supporting this great region and working with partners like the Bay Area Council to address the incredible and unprecedented challenges we're facing. For much of this year, our cities and counties have experienced unimaginable events, a COVID-19 pandemic that has stricken millions and shut down our economy, and in recent days, the protests and demonstrations that have laid bare our country's unresolved and painful racial divide. We share a deep sense of pain and loss from what we are seeing and experiencing right now in the Bay Area and in many communities across the country. The urgency is clear for all of us to do more as we've heard every other speaker discuss today as well. That's why this week, Bank of America has announced a commitment of $1 billion to help local communities address economic and racial inequality accelerated by the pandemic, with an aim to assist people and communities of color that have experienced a greater impact from this health crisis. New commitment built on economic mobility and workforce development programs, Bank of America already invests here in the Bay Area. We will enhance the focus of that work and accelerate resources towards health care, jobs and reskilling, small business support and housing. It's in these difficult times that we must all come together to harness our collective strength, resources and spare to persevere. Through the turbulence, the great leadership of Mayors London Breed, Sam Liccardo and Libby Schaaf have provided the kind of bold, steady and calm leadership that reunites us in a time of immense challenge. Their early actions at the outset of COVID-19 pandemic helped a lot reverse impacts and prepared us to reopen. A civil unrest has unfolded following the death of George Floyd. Our mayors have again rallied to help us come together. On behalf of Bank of America, it's my great honor to introduce our next speakers and the gifted leader who will lead what's sure to be a rivetting discussion. Please join me in welcoming San Francisco Mayor, London Breed; San Jose Mayor, Sam Liccardo; Oakland Mayor, Libby Schaaf; and your moderator, Michael Matthews, Director of Public Policy for Facebook.

Great. Thank you, Liz, and thank you, Bank of America, for an incredible contribution and investment in supporting racial justice. And obviously, in these times, any time, and for many years, it's been an important part. So I really appreciate you and the company stepping up in such a big way. And want to introduce myself. My name is Michael Matthews, as mentioned, Public Policy Director for Facebook. We have 2, I think, of the 3 mayors at the moment. I know Mayor Breed is working through her -- with her team technically to get plugged in, so hopefully should be with us momentarily. I want to take a sort of point of privilege and just thank the 2 mayors -- or all 3 mayors for your steadfast leadership, Liz mentioned it as well, but I've been fortunate to live in a number of cities, great cities around this country over my time. And I have to say, in the middle of these dual crises, I cannot think of a better place to live at the moment with the leadership of the 3 of you and obviously with the governor as well taking on these incredible challenges, dire challenges. And so I really appreciate your efforts on this and so many others. It's been a pleasure working through. I will also not spend a lot of time talking and leave it to you guys to talk because nobody is here to see -- listen to me. So we'll get started.

There's obviously -- originally, this conversation was about COVID-19 and response. But obviously, with the killing of Mr. George Floyd, has brought to light huge challenges in the communities around this country, but most immediately right now, things you're facing in the community to foment justice as well as peace. And so why don't we start with a couple of questions with that. So obviously as you have seen over the past week, we've largely going on turning cities upside down with anguish and outrage over the horrific killing of Mr. Floyd. Can you talk briefly about how your cities have been responding and what some of the challenges you've been facing? Why don't we start alphabetically by city, and we'll change it up. But right now, we'll go with Mayor Schaaf, first. Sorry, Sam.

Great. And Michael, I always love listening to you. You are very wise and you are a leader here in the Bay Area, and I thank you for all your service. And I know more to come. It is unprecedented. We are deep in a triple pandemic of racism, COVID-19 and economic shutdown. And in my entire life, I have never seen anything like this. And I appreciate that you've shifted the focus today to include the civil unrest and the cries for racial justice. And I guess, if there are 2 things I want people to leave with, equality is not equity. We have to have conversations about race. We cannot delude ourselves that being color blind is our goal here. We have to recognize that race matters, and we have to take it into account. And in government, we've been somewhat hamstrung over the last several years by Prop 209, it is really time to reexamine things. If you treat everyone equally without recognizing how many obstacles, how much discrimination is already keeping people from starting at a very different level, you have completely missed the point. And so that is one realization that I hope is coming from this. And with regard to policing, it is about more than bad apples. This bad apple thing is a distraction. Yes, we have to have zero tolerance for racist police. We have to have zero tolerance for police who are so disrespectful of human life and dignity. We must have systems that weed them out and don't ever let them come into this profession. But it is much, much bigger than individual action. It is about culture, it is about practices and policy that for generation are producing hugely disparate outcomes based on a racial groups and to recognize that it's not just about the explicit races. It is about systems, it's about subconscious or implicit bias that everyone has, and it is about the systems. I'll give an example because California has started to recognize some of these things. California recently did away with a felony murder rule. If there are lawyers out there, you might remember that from law school, even if you're not a criminal lawyer. Because they recognize that this had such a disparate impact on people by race. The idea that if you were engaged in a theft of property, but in the course of that someone actually died, that because you have been committing a different felony crime that you were then responsible for murder, for the loss of life. That law was actually ended in California because of the recognition that it had such a disparate impact. That's an example. I don't know if that's the best example I could have come up with. But that's an example of laws and systems that don't seem to be racially biased by looking at them on the surface but are truly driving deep inequities and a sense of deep injustice in our cities. So thank you for allowing me to just share what's on my heart right now and on my mind. This has been an unbelievably painful time for those of us who are committed to justice, to the promise of a democracy for our cities. Thank you.

No, no. Thank you for elaborating. That's hugely powerful and helpful. Mayor Liccardo, same question.

Michael, I also want to echo Libby's thanks for your leadership and service, particularly around affordable housing issues where you've been such a great champion and particularly moving many of our corporate leaders in that direction, I really appreciate your work. Yes. Look, the murder of George Floyd at the hands of the police has exposed a very deep wound in our society, in each of our communities. And I think Libby's points are very well taken. When we have a housing crisis, black and brown families suffer the most. When we have a pandemic, black and brown families suffer the most. When we have a criminal justice system with abusive cops, black and brown families suffer the most. And so it's impossible to disaggregate race from this question of equity and how it is that we're going to be able to move together addressing the severe gaps we have in our society, and of course, the economic divide being most prominent among them. So we've got a lot of work to do. I believe there is opportunity in this crisis. I believe we are starting to have those generous conversations. And hopefully, we're going to give each other the space and time to be able to hear and listen to one another because I know there's a lot of anger, and that anger is righteous, but we also need to hear one another. And we're releasing a set of proposals now to really start to focus on, let's look very carefully at our use of force principles, for example, our policies. Not sure rubber bullets should be used in a crowded group and public, there's a lot of things we need to ask hard questions about, for example. And obviously, I know that many mayors throughout the country have taken on the pledge of the Obama Foundation to really look carefully at our use of force policies, engage with communities of color deeply to understand how we may be affecting people disparately. We've got a lot of work to do, but this is important work.

No. Very true. Is Mayor Breed on? I understand that -- she may be on, be able to hear her. I'll give a second here. And Libby, I don't know if your mic is on Libby. I couldn't hear you.

I said that she's trying hard to get on. I've been getting texts -- frustrated texts from her, so she has been trying, it's not for lack of trying.

Okay. No. Well, that's -- it's -- yes, trust me, there's no question about that. So what -- we may go back to this specific conversation when she joins because I think she also has an awful lot to offer about this as well, so I don't want to lose her.

Very much.

Okay. We'll switch gears just a little bit because as I've talked about, there's a lot in terms of this conversation about the pandemic, with this particular pandemic, how it's impacting our cities and counties, the challenges you all have faced? Obviously, I think we feel better about ourselves in this region relatively to some parts of the country about a lot of the quick action that you all have done that I think is going to have huge successes so far. But I wanted to sort of touch base a little bit more. Can you talk briefly about where we stand right now? And your outlook for fully reopening? Why don't we start -- change the order a little bit. Mayor Liccardo, why didn't you start, and then we'll go to Mayor Schaaf and work around.

Well, I think the good news is all of our communities working together have done an excellent job in flattening the curve, and I think we all know. We see the data, declining infection rates for most of our counties, though we know there are hotspots. And we're going to -- we have to expect those infections are going to grow, that the contagion is going to grow as our economy reopens. And just the real question is, are we going to be able to do the contact tracing and testing to catch up and make sure that we're able to control that spread and mitigate it? This is hard work, and none of us have done this before. We've all -- and we're all challenged mildly working across different agency boundaries. Of course, it's our counties that have the public health responsibilities. So Libby and I are in constant communication with them, begging and pleading for changes in orders of various kinds at the same time that we're trying to support the small businesses and folks, a lot of workers who are out of work and struggling. I have been so heartened though to see how the community has come together in so many ways, in my own county. We saw the Silicon Valley Strong effort. We've got more than 3,000 volunteers who're out there delivering food to the families in need, we're delivering about 2.8 million meals a week. We've raised more than $27 million. And thank you, Michael, by the way, for your help and some of that for small businesses, but primarily for families, who are struggling just to be able to pay for medicine or food or rent. And we're doing everything we can by imposing moratory on evictions and things like that, but we know this is going to be a much bigger challenge in the months ahead as the unemployment lingers on and as folks have these very steep rent bills to pay. So this is -- we know we're in for a long, tough slug, and we're just going to have to keep doing it together.

Very true. I believe Mayor Breed is with us. Can you check in, Mayor?

Yes. I dialed in.

I think she is there. Wonderful. So what we're doing in the middle of -- it's Michael Matthews, good to talk to you. You're on with Mayor Schaaf and Mayor Liccardo as well. We have started a couple of questions on the unrest and the George Floyd situation and circumstances. I do want to go back to get your thoughts on that, but this question right now, specifically on COVID-19, I'll go to Mayor Schaaf with sort of that question. I'll repeat it the question for you, Mayor Breed, and then we'll go back to capture your thoughts on how we're handling the justice and the peace question we're facing, and then we'll go from there, if that's okay with you?

Oh, it's fine. Thank you. Thank you for accommodating me.

No problem. So Mayor Schaaf, again, just an update for Mayor Breed, how the handling of the virus and your outlook for fully reopening?

So you all want clear answers from your leaders. And what I ask for everyone right now is to recognize that this is not your typical crisis. Generally, a crisis is an unexpected event, an earthquake, a market crash, something that is sudden, and then we recover from it. And what has been a true challenge of this crisis is that we are still in it. We certainly have a lot more tools and information to help us navigate in this moment, whether it's a lot of success that we've done in expanding testing, the standing up of contact tracing, those key factors, we have seen that what we've done, the tremendous sacrifice that people have made, has, in fact, flattened the curve and that our health care system has been able to absorb this swell of demand. But we're not through this yet. And so I guess, I ask your continued patience to hear us say that we don't know when the economy is going to reopen. What I do love and what should give you hope is there is kind of a hunger, I'd like to say that this crisis has unleashed the most entrepreneurial bureaucrats as far as rethinking how we utilize the public right of way, getting rid of permitting requirements. I mean there has been a real appetite to respond very nimbly, very quickly. Those are 2 words you don't always hear about government. And so that, I think, I'm very proud, at least of our organization, in how just fast and creative the response has been. And again, like Mayor Liccardo said, I think there are definitely some silver linings. I think there are some lessons that we're learning that we will keep once we've emerged from this. But we have to manage our expectations. We have to keep people before profits. And Mayor Liccardo referenced a reminder to folks that actually the mayors -- I mean, London -- Mayor Breed is in a little bit of a different situation because she is both a city and a county, the only one in California, by the way, with that distinction. The rest of us, this is a moment where your politicians are following doctors' orders. This is a moment where our health professionals who are not politicians are actually making the calls, and that's how it should be. And it's hard for us to welcome that. But it is what we must do in this moment. We are continuing to collaborate and have good exchange of information. But I, for one, am very frightened about what we're going to see in 2 weeks. We've seen huge numbers of gatherings, right? We've seen people together because of these demonstrations. And we're very worried to see what that's going to look like in our emergency rooms in 2 weeks and a potential bump in COVID cases.

No. It's hugely important. Mayor Breed, if you want to talk about the same question on sort of the COVID-19 and reopening, your thoughts on that? And then if you want to pivot from there to, as I mentioned, going back to having your thoughts on the other crisis we're having in terms of public safety and justice that's emanated from the killing of George Floyd and how you're dealing with that?

Yes. It's definitely been a very difficult time, especially for mayors across the country, not just because of what we see happening around the protests stemming from the frustration that people have around seeing people lose their lives at the hand -- African-American men in particular, lose their lives at the hands of law enforcement in a way that we have seen over the years, but for whatever reason, George Floyd and what happened there really sparks this outrage that I've never seen before. And as difficult as this has been for all of us, I am grateful that people are finally starting to really pay attention to this. Because what it's doing for me personally as an African-American woman, as someone who's unfortunately not only my cousin was killed by the police in San Francisco in 2006, but other young people that I had a hand in raising and supporting in the community, I've had situations where that occurred. So it's bringing back a lot of painful memories and frustrations around justice and the need for us to really not only focus on significant reforms in our police department, but more importantly, to make sure that we are rooting out people who are racists, officers that have a problem with people because of their race, their religion, their sexual orientation. And we don't have the luxury, especially for what we are seeing, the civil unrest. People are tired of it. And I'm glad that other non-African-Americans are finally paying attention like never before that this is something that we are going to have to grapple with, and we're going to have to make aggressive changes, aggressive changes. And I think part of the biggest challenges that we face in making those changes, because we've been working on them for years in San Francisco, you all know about the campaign around Eight Can't Wait that has been circulating. Well, we've already done all 8 in San Francisco with our advocacy and the work we've done, especially getting rid of the chokehold and the biggest challenge for us was the Police Officers Association. So I think that there are -- there's a sincere desire to want to see change. And I want to also say from so many officers, there's a sincere desire for them to want to see change within their department because many of them are serving because they want to serve in this capacity, they love what they do, they love the community, and they love to do what's right. But unfortunately, you have a number of officers that make it difficult for all of them to effectively do their jobs. And this is just an example of that. So it's really hurtful because I'm trying to process all this personally. It's painful. And also trying to manage and run a city and to make sure people are safe that we don't have violent situations. And doing all that, it is tough. But I also support and believe in the people who are out there, who are protesting, who are doing it peacefully, who are not doing it in a way that could harm other people, including our officers, who are doing it in a way that does not result in damaging and fires and other things and it's just -- there's a line that gets crossed and it goes from peaceful to vandalism and crime and other things and as mayors -- in some ways, as a black woman, I understand the feeling of wanting to go out and tear something apart and just lose it for a minute. But also, as a Mayor, I have a responsibility to protect everyone. So it's been really tough. And I think that we are doing our very best to try and manage this while also dealing with COVID-19. And as Mayor Schaaf said, I mean, we're going to see probably an uptick with all these mass gatherings. We're going to see an uptick in the number of cases probably in the next 2 weeks. And I am not only concerned about what COVID-19 is doing to our -- or what it will do to our communities if we don't handle this thing appropriately, I'm also concerned about what's happening with people's livelihood. Like, as Mayor, I still get my paycheck. Most of the employees in San Francisco, they still get their paychecks. We're paying our nonprofit. There are some people that actually are able to survive during this crisis financially. But -- I can do my own hair, but my hairdresser, who is basically out of savings, she is stressed out, she has other people who work in her shop, and they have -- they've got $2,500 onetime, and they have no other means of money, no other means of money, no other means. And I am most concerned about people who, even though we've had all the stimulus and this onetime money and all the stuff come down, it's not always reaching the people that we know need it the most. And so my biggest concern is what happens to them? What happens to people -- like I have no sympathy for someone who is filthy rich and who is saying, well, my company, my this, my that, it's not about them. It's about what happens to the employee, what happens to the janitor, what happens to those people who can't get the unemployment or they can't get the donations or they can't get the support? And here's the thing. We're going to be living in this COVID-19 world for probably the next 2 years. We are going to have to learn how to adjust. We are going to have to learn how to adjust to get our economy going. And when I say get our economy going, I mean get our economy going for those who need to work in order to make ends meet. And that is really what I'm focused on because I'm concerned about what is going to happen. And having the situation on top of other situation -- these situations like what happened to George Floyd and what is happening all over our country, they're not going to wait until we reopen. Things are exploding now. And so we're going to have to make the hard decisions, and that is exactly what I'm going to be doing.

No. That's -- thank you. That's -- there's a lot there to trust, to contemplate and to work on and things that you're working on. I'm going to pivot slightly, and we'll go with Mayor Schaaf, but obviously then Mayor Breed and then Mayor Liccardo. Related, but it's something that you've all been working very hard on even before COVID-19 was homelessness and the huge challenge we're facing in the Bay Area and have been for some time. We've seen the impact of the virus on the unsheltered residents, of course. And are there things being learned that might help us address the homelessness in the long term that may or may not be related to COVID, but in this whole crisis that we're in? Mayor Schaaf, why don't you start?

Well, thank you. So one thing -- to tie kind of these various issues together, one thing that we've known, but we're really trying to lift up is the connection between homelessness and structural racism and how we have to adjust many of our service models to take better account of that racism. And I'll give you an example of a change that we're working on implementing right now based on our race equity analysis of homelessness in Alameda County. We have many programs that offer someone emergency assistance if they're at risk of losing their housing. But you can only get it one time. So if you had accessed a program like that in the past, you can never use it again. You just have to go out on the street. And to recognize that racial discrimination does not go away after one time, the inability of families that are living in public housing are under very strict rental agreements that limit their ability to take in their family and friends that they want to help but cannot because of their economic situation. That will not go away after one time. And so that's the kind of reverse engineering of systemic or structural racism that we have got to do as we're moving forward around homelessness. Now specific to COVID-19, we are looking for opportunity to leverage our crisis response to COVID as a health issue and use that to put some permanent changes in place. And that is things like when we -- we, as mayors, are thought to have a first right of refusal in the FEMA-approved lease for the hotels and motels that are being used for emergency housing during the health crisis, we thought to make sure that there was a provision that allowed us to at least try and negotiate a purchase of those hotels and motels once the health crisis is gone. Similar in Oakland, we received 91 trailers from the State of California. We took our emergency, homelessness money and went to the time and expense of connecting each one of them to sewer and water to make sure that we could use them on a longer-term basis. And so those are some of the opportunities that we're trying to take advantage of. The last thing that I'll say as far as lessons learned, we doubled our shelter capacity in Oakland under -- in under just the last 2 years. And because we explored some innovative models like these cabin communities and safe RV parks that were physically distanced by design, that had more privacy built into them, we actually didn't have big outbreaks or the same health impacts as that traditional shelter model where everybody is living in a single room. So that was one lesson learned.

Got you. Mayor Breed?

Yes. I think that -- excuse me?

Go ahead. Yes, I can hear you. Go ahead.

Okay.

Yes, we can hear you.

Yes. I think that what's been tough, of course, is not only seeing all of the work that we've done in terms of opening new shelters, transitioning people into housing and all that we have done over the past couple of years, we saw it definitely go backwards. And as Mayor Schaaf mentioned, the cabin communities and the ability to have people separated from one another definitely was something I know that was very helpful in Oakland, and it is something that we are looking at to change here in San Francisco. We've been able to get a hold of over -- or get over 1,000 people into hotel rooms. We have gotten the same trailers that they got in Oakland and other parts of the state, 120 trailers that we have been able to move people into. We are exploring the cabin communities because we've seen tents pop up on our sidewalks and all over the city. We've set up a number of safe sleeping sites with restrooms and hand washing stations, and we've done pop-up testing and a number of other things. We've had to unfortunately empty our shelters for the most part because the congregate living settings were problematic for not only the people who were housed there, but also the staff. I think that what's going to happen -- I mean we've been able to move a lot faster than we have in the past, surprisingly, even though people may not see the difference on the streets. But the good news here is it's going to provide us with an opportunity to make changes. And in fact, today, we have a model of what a cabin community or what these particular cabins look like and how we can start to maybe invest in those and invest in more trailers and other things for people. The biggest challenge we have, of course, in San Francisco is real estate. And the good news about using this as a tool to help homeless as we try and transition people into permanent housing is it gives people their individual safe space. So it is going to continue to be a challenge for us, but I also think that one of the biggest issues we have are people who are suffering from mental illness and substance use disorder. And getting a handle on that has been -- proven to be a lot more difficult even with some changes that we've made to conservatorship, the ability to implement conservatorship in an effective way has been very difficult. And we are going to need really a bit more of a heavy-hand approach from my perspective on how we are able to force people who are mentally ill or who are mentally ill as a result of their addiction or what have you and chronically homeless and are at risk of, of course, unfortunately, dying on our streets, we need a tool. We need a tool to be able to force people into treatment and, in some cases, locked mental health beds because what's happening, as what happened just most recently where this man, who everyone in the neighborhood complained about him, and eventually, he beat a 90-year-old man to death, and now he's in jail. And he is clearly -- he should not be in jail, he should be in a mental institution getting the help and the support that he needs. And so we have to have an honest conversation because, again, people talk about taking away civil liberties and everything else. We are not going to be able to fully address this until we start really having the tools we need to be able to also force people into a treatment, but we will continue to do our very best to get more housing built, not just in San Francisco, we have to do it as a state. We have to provide easy access into affordable housing for people who are struggling and may not be able to manage their own life affairs. And so we just have to start incorporating this in what we do and not assume that every grown up has the ability to take care of themselves. This has to be a natural part of what we do to try and address this issue.

Absolutely. Mayor Liccardo, same thing to you. And I'm going to do a follow-up question for you to take up the next round on this. So I'll give them both to you. So it's the homelessness, but then I want to touch base on the broader -- I shouldn't say broader, but the economic damage that we're facing, budgets and what you're all addressing, cuts and revenue and other fun things that you all are facing, so I have seen they're similarly related? So why don't you take those 2, the homelessness and that, and then we'll go back to the other 2 mayors?

Why don't we get to the fun questions?

I know. I know.

That's why it is so -- Matt, you've been absolutely right about the need to finding different approaches to dealing with mental illness and particularly drug addiction related to methamphetamine. It's producing a lot of behavior out there that's of serious safety consequence, certainly to the individuals themselves, but also to others, and we need new approaches. I just want to -- going back to the base of the question, I think what this emergency has taught us is how to move quickly when we can get the rules out of the way. And hopefully, I think -- and I know this is true because I've had these conversations with Libby and London and many other mayors, it has been somewhat liberating. We are able to get an awful lot of folks housed at a far faster rate than we ever were before. More than 1,100, I think, in shelters of various kinds, some public, some motels and so forth and nearly 500 into permanent housing as well. And what is particularly helpful is the ability to move quickly to either acquire motels or to build housing at a rate we never could before. And I think Gavin Newsom and their team were brilliant in inserting some magic language in the recent allocation of funding we got in January, which was, it had a sequel exemption that has exempted us from going through the Environmental Quality Act for these very rapidly built, transitional or emergency housing developments, where we can use prefab and modular kinds of construction and build relatively cheaply and very quickly. So at, for example, $40,000 per unit, we're building right now 3 different projects, each one of them about 4 weeks it takes to get these things built. We're going to get about 500 people housed this way, and it's taking us 4 weeks what would otherwise take us 4 years. And that is because we are able to move very quickly by waiving a lot of rules at the city level and having that exemption at the state level. And I think we need to seize this opportunity in this crisis to really continue to drive forward, recognizing there is value in being able to move nimbly in a crisis where we've had such a challenge getting any traction. And so obviously, it doesn't always endure you to the neighborhoods where this gets built. They may be recalling me soon in my position as mayor in a couple of neighborhoods. But this is what we've got to do, right? And this is critical. And then the issue of the budget. We're -- look, we're all struggling mildly. We are -- the 3 of us were just on a phone call with Speaker Pelosi talking about what we hope will be a Heroes Act after the CARES Act. That will do wonders, I think, for a lot of local communities to keep us keeping the wheels on. I think in San Jose, we're going to be okay, not great. We're going to be okay this year. The brutal time is going to come next year and the year after because we know recessions have multiyear impacts on budgets. It's a 3- or 4-year slug. And it's really in the successive years where you don't have federal money falling from the trees and you got to figure out a way to keep firefighters employed and that is the real challenge. So for now, we're okay, really tough decisions in the months ahead.

Mayor Schaaf, budget cuts and challenges on governing?

Yes. I know. When are you going to get to the happy questions?

I'll have them. There'll be one.

I presented my city budget about 2 weeks ago, in fact, 2 weeks ago today, that cut $122 million out of our $1.6 billion annual budget, although some of that $122 million had to be cut out of the current fiscal year. So I'd say over 14 months, I had to cut $122 million. I will say that I'm grateful that 5 years ago, I instituted a Rainy Day policy for the first time in Oakland, and that alone probably saved 100 jobs. And so I'm pleased that by suspending some wise fiscal policies, suspending, not eliminating, we should be able to make that monumental set of cuts with minimal impacts on your services as well as preserving our commitment to equity. I know here I'm raising the issue of race once again, even in budget decisions, because we have to start addressing racial inequity in everything we do, and that includes the city budget. And London Breed, I want to commend you for an announcement that you made recently regarding budget priorities. We are -- we've worked very hard to make sure that particularly the services that make the biggest difference in our neighborhood that have often felt forgotten by city government. We're one of the first cities that actually took race equity into account in deciding which roads to pave. So again, everything we do has got to start making up for the wrongs that we have committed in the past. But I am pleased, again, creative, nimble city employees, same in our finance department, that we're able to -- like with a series of, hopefully, labor concessions, some freezes of vacant positions, some spending cuts and suspensions of wise fiscal policies that I intend to put right back as soon as we get out of this, we should be able to get through this without a huge impact on the people.

That's great. Mayor Breed?

Yes. I think that similar to what Mayor Schaaf is proposing in terms of money that we haven't spent yet, especially on positions we haven't billed, things we haven't done. We're talking about, even in this current fiscal year or after I've already signed the budget, it's $250 million deficit that we are trying to close. And the goal that I have from day 1 is to do so without cutting any jobs because this is so, I know, challenging for so many people financially right now. The budget conversations for next fiscal year, where we're talking about anywhere between $1.1 billion and $1.7 billion, that money has to come from somewhere. We have lost and will continue to lose significant hotel tax revenue, convention and visitors, and a number of other tourists and things that we rely on for our budget. A number of people are having real challenges around paying taxes and fees, especially our small businesses. So I think it is going to be hard for us, and we are going to do what we can to make sure that we hold on to those important programs that serve the community, that we know we desperately need. And in fact, if we can enhance those programs so that especially our kids and kids who are living in some of our low-income communities, we don't want them to suffer in any way because of this. So we have to be very deliberate about how we make adjustments even within our deficits and what we're dealing with. So we're going to do the best we can. And I will say, and I've said this to folks before, look, when I first got on the Board of Supervisors, we had about close to an $8 billion budget, and now we're over $12 billion. And we've been through challenging times before. And this is an opportunity for us to make some hard choices and to really get through this. And it's going to probably be painful for all of us. But I'm optimistic about our ability to do so, and it's going to be really hard for us. And we can't sit back and think that the federal government or even the state is going to come through for us. We hope that they will. But we, as cities, we can't rely on that. Our constituencies are -- they're counting on us. They're reaching out to us on a regular basis, and so we're going to have to deliver for them.

Got you. So we have about, per my watch and what other folks are telling me, about 7 minutes left and a hard stop. So I promised to a more positive question, and I will endeavor to do that, but I'm going to try to combine a couple of questions into one and leave you with a positive landing, if you would like. So I'll start with you, Mayor Liccardo. It's kind of a 2-parter. What lessons have you learned and -- from this pandemic? And what would you have done differently? And that's in line of thinking of a possible upswing in terms of outbreaks and challenges there. That's not exactly -- that's arguably the positive question. But the second part of this, are there any positives you can take from this experience? And you mentioned it a little bit earlier about being able to -- forcing us to be more nimble. But I wonder if you can sort of take a whack at combining those. What have you learned and what are the positives?

Thank you, Michael. Okay. One thing I've learned is, if you're going to be in a foxhole, you want to be in it with Mayor Libby Schaaf and Mayor London Breed because they are fighting hard and doing the right things. I can tell you, it is -- we've been on converse calls, I think, 2 or 3 times a week, all of us exchanging ideas with some of our other colleagues throughout the state. And we're blessed to have great leadership around as many of our cities here. Secondly, I have really taken away a gratefulness for creative city employees and others in our community who recognize that crisis gives us an opportunity to focus in ways we never could before. We're going to announce in the next week or 1.5 weeks a set of steps we're taking to finally get our arms around this digital divide that we've been working on for 3 or 4 years in my office. We've got probably between 11,000 and 14,000 students who cannot learn online right now because of the income gap, obviously, in our communities and obviously has a racial dimension. And because of some very creative partnerships and some pretty innovative things we're doing, small cell technology and elsewhere, we're going to be able to get connectivity to about 12,000 kids in a matter of 1.5 months, and we're doing some other really incredible things in the community that's going to expand for other families as well. We've been pushing and pushing on this, but it wasn't until we had this crisis, and it was really apparent kids couldn't learn did it really force a lot of partners that come to the table and say, "We got to do something." And that's really exciting. And I admire certainly Mayor Schaaf, I know has gotten some great help in the public sector -- or private sector, I should say, and kudos for her efforts. We're all starting to get traction on some of these challenges in ways that maybe we couldn't before. And setting up a food distribution system that covers 2.5 -- almost 3 million meals a week in this county, we never had that kind of extensive system put up in place, although we had great partners like Second Harvest Food Bank who are doing great work. It took a crisis for us to do that. So those are the kinds of things, I think, that we're really learning out of this that where we can focus and we can work together, we can get a lot done.

That's great. Thank you. Mayor Schaaf, same question, we've got about 5 minutes left. So if you chose to, you can take 2.5 minutes, that would be awesome.

Yes. So just on a very personal level, I've discovered that I love spending a little more time with my family. And I'm sure other people are having some kind of personal wake-up calls from working at home. And I'm just very blessed, and I -- it was a wake-up call that I had not been spending enough time with them. So I hope to not go back to my old bad habits when this is done. I continually challenge my employees. And Sam, you are right, like, I love who I'm in the foxhole with, whether that's the big city mayors of California under your great leadership, Sam, or my city staff. I keep on challenging us to be the silver lining city, what opportunities can we take advantage of in this moment, what are the lessons that we can learn that we don't forget and what are the changes that we can make that we keep in place like more use of the public right of way. Our Slow Streets movement has been phenomenal, and it has been a bright light in what is otherwise a very challenging time. And then the last thing I'll say, and maybe I don't know if this is a good analogy or not. But the last week has been unbelievably painful. I mean Oakland is a city that has a rich history of fighting for racial justice, and we have so much more work to do. The pain, the destruction, people tearing up your city is like tearing out your soul to a Mayor, like we lived for our cities. And I just have to hope that this is kind of like the experience of childbirth, where you're going through the most unbelievable, painful flesh-tearing experience, sorry to be so visceral, and in end, the product is something that brings you to a whole different level of love. And that is just my wish. I know it's probably a weird analogy, particularly if you haven't given birth to children with no drugs as I have done twice. But that is where I'm holding out hope that we are birthing a new world right now.

Yes. Thank you. Beautiful. Very beautiful. Mayor Breed, can you bring us home?

Well, I think Mayor Liccardo and Mayor Schaaf said everything that needed to be said. I mean I will tell you, the thing I have definitely appreciated the most in this whole thing is being able to work with incredible leaders like them and other mayors all over this country. We have depended on each other. We have gone to one another for advice. I mean the rent moratorium, I got that from Mayor Liccardo in San Jose. And to have these incredible leaders and to not feel like you're alone in addressing this very challenging time, it is really what has gotten me through. And I know that this is a hard time for all of us, but we've been through hard times before. And what gives me hope is the analogy that Mayor Schaaf mentioned is probably one of the best I've heard, so it may, as she said, seem awkward, but the fact is, we are hoping that this pain, that this suffering, that the challenges that we are experiencing now are not in vain, that we will see an even more beautiful product after we go through this. And I believe that that's going to be the case. I believe there will be change. I believe that people will look back on this experience and really appreciate what comes out of it. Because I'm appreciating my friends more, I'm appreciating my staff more, I'm appreciating the city more like never before because of this experience. And so I think that, that is probably what we are going to get and so we just all got to hang in there and do our very best to uplift and support one another through this process.

It's wonderful. Thank you. We're out of time. Thank you all 3 of you for the answers that you had, the thoughtfulness, your leadership and also bringing us to finishing this on a positive note. And again, thank you, Liz and Bank of America, for your incredible support for racial justice and equality. And I also want to thank the Bay Area Council, Mary, Jim, John and the entire staff, for putting this on and for having us. So thank you all, and hopefully, everyone has a terrific weekend.

Thanks, Michael.