Can the SF Zoo survive without a city lifeline? Officials consider up to $8.5 million loan

SAN FRANCISCO (KGO) -- The San Francisco Zoo is facing a financial crisis, and city leaders are proposing a short-term multimillion-dollar loan amid a budget deficit.

According to a city analysis obtained by ABC7 News, the other options for the city would cost even more. Because the zoo sits on city-owned land, San Francisco remains responsible for the property, buildings and every animal, regardless of who manages operations. The loan under consideration totals $6.5 million, with up to $2 million more available if the zoo meets specific performance milestones.

If the city found a new operator, estimated costs would exceed $42 million dollars. Even if the city shut down the zoo, it would take over $45 million to do so.

Zoo officials call it "the most fiscally responsible path forward for the Zoo and the City."

"The city cannot afford to take over the zoo and spend tens of millions of dollars to shut it down or keep it afloat," said San Francisco Mayor Daniel Lurie. "Instead, we are doing what our administration has always done and investing responsibly -- with accountability -- in San Francisco families."

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"First, we needed to see a change in leadership," Lurie told ABC7 Eyewitness News on Wednesday. "We saw that."

The zoo's former CEO Tanya Peterson stepped down after a tumultuous tenure and zoo officials say conditions have improved under new CEO Cassandra Castello, who officially took over in February.

"She's someone who has really shored up the management there," Lurie said. "And now we have to figure out what the future is for the zoo, but they needed some support."

"When new leadership identifies a problem and comes to the city with a clear, responsible plan to fix it, we should do everything in our power to support their efforts," said District 7 Supervisor Myrna Melgar. "This bridge loan gives the zoo the runway it needs to execute a real turnaround, one that is already showing results, and that I am proud to have helped make possible."

Castello's plan focuses on stabilizing finances, improving operations and accountability, and rebuilding attendance and community support.

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"When I stepped into this role, I knew we needed to identify the challenges quickly, develop a turnaround plan and work with our city partners to secure the support we need to see it through," Castello said. "This bridge loan is one piece of a much larger story: new leadership, a clear strategic direction and a team that is deeply committed to the animals in our care and the community we serve."

Officials said early signs are encouraging. They point to a record 63,000 visitors in January, the highest attendance for that month in the zoo's history.

Teamster 856, the labor union representing many zoo employees -- that was once sharply critical of management -- feels optimistic.

"Our members have already seen real change under Cassandra's leadership, more transparency, more collaboration, and a genuine commitment to doing right by the staff and the animals," said union rep Corey Hallman. "This bridge loan matters because it gives that progress time to take hold. We are in this together."

But not everyone agrees the loan is the right move. Justin Barker of SF Zoo Watch, a longtime critic of the San Francisco Zoological Society, the nonprofit that has run the zoo since 1993, argues that the operator should be replaced completely.

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"While we have, there is a new, CEO in place. It is the same nonprofit, that is running the zoo. So one person I don't think will actually solve the problems," Barker said.

Barkler points to the Oakland Zoo, which he believes has improved significantly under the Conservation Society of California, and emphasizes that the zoo world has changed. He believes Oakland's focus on conservation over attendance is the direction San Francisco should follow.

"And the difference is very clear. While the energy there is good, the animals are well cared for, they're in like, you know, pretty good conditions. If you support captivity, you know," Barkley said.

If approved, the loan would come with strict oversight. For example, the zoo would be required to report its financials quarterly and said it's already cooperating fully with the city's ongoing audit.