{"id":2763,"date":"2011-04-07T11:30:42","date_gmt":"2011-04-07T19:30:42","guid":{"rendered":"http:\/\/www.fogcityjournal.com\/wordpress\/?p=2763"},"modified":"2011-04-08T15:10:24","modified_gmt":"2011-04-08T23:10:24","slug":"supes-approve-twitter-tax-holiday-without-community-benefits","status":"publish","type":"post","link":"https:\/\/www.fogcityjournal.com\/wordpress\/2763\/supes-approve-twitter-tax-holiday-without-community-benefits\/","title":{"rendered":"Supes Approve Twitter Tax Holiday
Without Community Benefits"},"content":{"rendered":"
\"\"

Tax exemption legislation aimed at preventing Twitter, Inc. from relocating to Brisbane as well as revitalizing Mid-Market and the Tenderloin neighborhoods, was championed by District 6 Supervisor Jane Kim. Photos by Luke Thomas.<\/p><\/div>\n

By Luke Thomas<\/a><\/strong><\/p>\n

April 7, 2011<\/p>\n

The San Francisco Board of Supervisors passed a payroll tax exemption for Twitter, Inc. Tuesday, legislation that aims to \u201crevitalize\u201d a stretch of Mid-Market Street and the low-income Tenderloin neighborhood.<\/p>\n

The legislation was passed by an 8-3 vote amid concerns of gentrification impacts and without a promised Community Benefits Agreement (CBA). The legislation\u2019s sponsor, Supervisor Jane Kim, who said two weeks ago the legislation would be continued until a CBA had been formulated and ratified by the Board, told FCJ after the Board vote Tuesday the tax exemption legislation is not actionable until a CBA has been approved.<\/p>\n

\u201cTwo weeks was not enough time to have a good enough CBA come out of this and we weren\u2019t able to setup all the meetings,\u201d Kim told FCJ. \u201cTwitter is now meeting with our public stakeholders – that was something that they hadn\u2019t agreed to before – and the second thing is the trailing legislation is actually going to set up a process and so even the Twitter CBA is going to have to come to a public hearing before it gets approved.\u201d<\/p>\n

\u201cBefore Twitter gets the tax exemption, they have to have a public hearing on this CBA,\u201d Kim added.<\/p>\n

Kim estimated it would take approximately two months before a Twitter CBA agreement could be vetted by the public, ratified by the Board and signed into law.<\/p>\n

Supervisor David Campos, who said he supports efforts to revitalize Mid-Market, opposed the legislation on the grounds that a CBA had not been established or vetted prior to the vote, a misstep, he intimated, that will remove community leverage to eek out substantive community benefits in exchange for the tax exemption.<\/p>\n

\u201cMy preference would have been to see a Community Benefits Agreement that\u2019s already in place, that\u2019s actually finalized so that we can see for sure what it is that will be provided,\u201d Campos said, adding that community residents will have little or no impact on the final CBA. \u201cFor me, that is insufficient and that\u2019s a problem.\u201d<\/p>\n

\"\"

Supervsor David Campos<\/p><\/div>\n

Supervisor Ross Mirkarimi, who voted against the legislation, said the CBA was being used as a \u201cmarketing tool in order to really justify and rationalize the advancement and passage of this legislation.\u201d<\/p>\n

\u201cWe deserve – and so does the public – deserves the right of having a complete vetting of what that CBA looks like in a hearing that does not compromise the process, so that it doesn\u2019t look there\u2019s collusion or that there\u2019s any kind of undue influence because of due process as it relates to how a CBA is developed,\u201d Mirkarimi said<\/p>\n

\"\"

Supervsor Ross Mirkarimi<\/p><\/div>\n

The deal with Twitter, hatched by then Mayor Gavin Newsom while seeking higher office, provides the popular messaging service company a projected $72 million tax haven on future payroll and stock option taxes on new employees for six years. Headquartered in San Francisco, Twitter threatened to relocate to Brisbane unless the City provided the corporation with the tax giveaway – even while the City faces a projected $380 million budget deficit during the worst recession since the Great Depression.<\/p>\n

Supervisor John Avalos, who voted against the legislation, said businesses have a social responsibility to the communities in which they do business.<\/p>\n

\u201cI don\u2019t believe giving an exception to our payroll tax is the way to go,\u201d Avalos said. \u201cI believe that businesses in San Francisco and around the country should be socially responsible and part of that social responsibility is paying our taxes.\u201d<\/p>\n

\u201cAlso, if we give these tax breaks, we are aiding and abetting the exacerbation of these disparities in wealth,\u201d Avalos continued. \u201cWe should make sure that corporations are paying their fare share compared to middle-class people, working-class people. We\u2019re getting gamed – we\u2019re paying our taxes and we\u2019re losing services.\u201d<\/p>\n

With an expectation of increased rents in the area as a result of the job creation incentive, businesses and low-income residents would face displacement and gentrification threats, Avalos said.<\/p>\n

\u201cWe have to be concerned about displacement of current tenants and businesses,\u201d Avalos said. \u201cDuring the dot-com era, there were a lot of tenants who saw their apartment rents rise dramatically.\u201d<\/p>\n

\"\"

Supervisor John Avalos<\/p><\/div>\n

\u201cI am concerned about gentrification,\u201d Kim responded to FCJ inquiry. \u201cI\u2019ve said that over and over again and that\u2019s why I want a follow-up policy. I want economic revitalization so I want to address gentrification without risking losing a company like Twitter.\u201d<\/p>\n

Those Supervisors who voted for the legislation did so with reservations.<\/p>\n

Supervisor Scott Wiener said he supports broad payroll tax reform but said any type of reform will create \u201cwinners and losers.\u201d<\/p>\n

\u201cI\u2019m not an advocate of willy-nilly tax cuts,\u201d Weiner said. \u201cI don\u2019t think that\u2019s the way to go. But when you do it in a focused, well-targeted way, it can work.\u201d<\/p>\n

\"\"

Supervisor Scott Weiner (left) with Tenderloin Housing Clinic Executive Director Randy Shaw, a vociferous supporter of the tax exemption.<\/p><\/div>\n

\u201cI share concerns like some of my colleagues of the gentrifying impacts and whether the jobs and the benefits to our city and neighborhoods will materialize with the plan,\u201d Supervisor Eric Mar said.<\/p>\n

Mar said he \u201cstrongly\u201d supports the creation of a Community Advisory Committee \u201cthat gives empowerment to the people in the different neighborhoods to create the strongest possible Community Benefits Agreement to minimize the gentrifying impacts, and I\u2019m not going to deny that this tax break will have a gentrifying impact, but I\u2019ll just say that with Supervisor Kim\u2019s efforts, it will at least minimize and mitigate that and will give some public transparency to the process of creating the benefits agreement.\u201d<\/p>\n

Though he said he supports effort to provide Twitter a tax exemption, Mar said he is concerned other corporations would be lining up for targeted tax exemptions.<\/p>\n

\"\"

Supervisor Eric Mar<\/p><\/div>\n

\u201cI am enthusiastic that we all seem to realize our payroll tax system is broken,\u201d said Supervisor Mark Farrell. \u201cWe need to do everything we can in City Hall to make sure that we are on solid footing and create a solid economic environment in San Francisco that does not hamper our ability to create jobs, attract companies and want people to locate here in our City.\u201d<\/p>\n

\u201cIn regards to this legislation, I do think that it\u2019s unfortunate that is has devolved into a dialogue about one company,\u201d Farrell added. \u201cWhile I think that has been part of the debate, we cannot govern that way in City Hall. We cannot capitulate to one company time and time again. That doesn\u2019t work for the long haul.\u201d<\/p>\n

\"\"

Supervisor Mark Farrell with Tenderloin Housing Clinic Executive Director Randy Shaw, a vociferous supporter of the tax exemption.<\/p><\/div>\n

\u201cThis vote is a tough vote for me,\u201d said Supervisor Malia Cohen. \u201cI am extremely skeptical of how the conversation has turned to focus on one particular company and less about the larger issues that of which it attempts to satisfy, which is stimulating Mid-Market.\u201d<\/p>\n

\u201cThis legislation attracts people to the Mid-Market area which is very good but also could have a negative and unintended consequence of wooing businesses to leave say the South-East, San Bruno Avenue, Mission Street, Ocean Avenue, to go join down in the Mid-Market area to capitalize on some of these benefits. So, yes, it stimulates Mid-Market. Yes, that\u2019s awesome. But, however, it creates a void in the other respective surrounding neighborhoods. So I am very concerned about that. So I am in favor of the legislation \u2013 I will be voting for it \u2013 but it is with serious reservation and I am very aware of the mixed message we\u2019re sending to our small business community,\u201d Cohen added.<\/p>\n

\"\"

Supervsior Malia Cohen<\/p><\/div>\n

Kim introduced amendments to the legislation including removing several blocks from the tax exemption inclusion zone and shifting contractual responsibility from the Mayor\u2019s Office of Economic and Workforce Development to the City Administrator, a post interim Mayor Ed Lee, who supports the Twitter tax exemption, is expected to return to in January.<\/p>\n

\u201cAs you know, the City Administrator has the overall responsibility for the management and implementation of policies, rules and regulations, promulgated by the Mayor and the Board of Supervisors and the voters, and this is something that Mayor Lee is committed to and insuring in terms of advocating for our communities and our neighborhoods and the CBA,\u201d Kim said.<\/p>\n

The Board will convene for a second and final vote next Tuesday.<\/p>\n","protected":false},"excerpt":{"rendered":"

The legislation was passed by an 8-3 vote amid concerns of gentrification impacts and without a promised Community Benefits Agreement (CBA) in place. The legislation\u2019s sponsor, Supervisor Jane Kim, who said the legislation would be continued until a CBA had been formulated and ratified by the Board, told FCJ after the Board vote Tuesday the tax exemption legislation is not enforceable until a CBA has been approved.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[222,17],"tags":[],"class_list":["post-2763","post","type-post","status-publish","format-standard","hentry","category-news","category-politics"],"yoast_head":"\nSupes Approve Twitter Tax Holiday Without Community Benefits - Fog City Journal<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fogcityjournal.com\/wordpress\/2763\/supes-approve-twitter-tax-holiday-without-community-benefits\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Supes Approve Twitter Tax Holiday Without Community Benefits - Fog City Journal\" \/>\n<meta property=\"og:description\" content=\"The legislation was passed by an 8-3 vote amid concerns of gentrification impacts and without a promised Community Benefits Agreement (CBA) in place. 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