[gavel] good afternoon everybody welcome to a special meeting of the San Francisco board of supervisors budget and finance committee. Monday, august 1, 2016. My name is mark farrell i will be chairing this committee. Im joined by katie tang as well as by supervisor norman yee and supervisor mar as well. I want to thank sfgov tv for covering the meeting today. Mdm. Clerk we have any announcements . Please silence all cell phone Electronic Devices. Thank you mdm. Clerk. All of you involved in our budget process this year as we started late today we just came from opposite signing with mayor we can only thank you for your participation at congratulations as well. With that mdm. Clerk one item number one, [reading code] thank you very much. I believe we have the mta to speak your . June supervisor. Real Estate Development manager. Thank you for editing in our proposal resolution. The nine year master license agreement with new Cingular Wireless pcs llc, it is another new source of revenue for the agency. So we are not here to spend money today personally here to make money. And we thank you for taking the time to we have two very slight minor amendment to the purple soul that we would like to request. One is just completing the name has all an omission in it and adding the pcs, to then entered and the budget analyst will bring that up. Also, a reference to the Planning Department a sequence determination committed by the sfmta a environmental agent. If you questions let me know. These agreements mure previously approved agreements back in november 2015. Thank you. Colleagues have any questions be one with the budget Analyst Report . Can we go to that . Good afternoon chairman farrell and members of as we show on the page 3 theres a scale of rent paid for each of these altered the plan on having 75 polls at this time. The rents range from 40005300 polls to scale proposal over 50. Our estimated revenue on this is 3. 1 million over the nine years that the agreement based on average 2016 of that 4100 dollar purple. It goes up by 2 per year. If you have questions . We recommend approval okay. Thank you will open this up to Public Comment. Anyone wish to comment on item number one . Not think so. Public comment is closed. [gavel] with that and have a motion supervisor tang thank good as i said on the past various different departments i can to support more of these Companies Utilizing existing City Property to put these antennas on versus deep inside communities in front of residences on. So, with that said i would like to make the motion to approve the minutes mta has approved and cement board as amended to the full board with a positive recommendation as a Committee Report did thank you mdm. Clerk motion by supervisor tang. Moved and seconded. We can take that without objection [gavel] mdm. Clerk please call item number two item number two, [reading code] thank you mdm. Clerk. I will turnover in the second two supervisor mar is a sponsor of this legislation before i do make a few comments on my own. Given i think the nature of this item for my perspective, this is one of the most misguided proposals ive seen during my time on the board of supervisors. It is one that will only serve to further divide us as a city. Is that of building the necessary bridges oh keep us together and for learning anything from the National President ial debate theres a clear difference between those that want to divide us and pit us against each other as a country some our not welcome in our country, and those who wish to unite us and i believe we are stronger together. In San Francisco this is no different. The past few years the number of actions in our city that sought to demonize the technology for causing if not all of the elements that we suffer as a city and for my perspective, the reality cannot be further from the tree. As a city, i dont think we should subscribe to the politics of donald trump and the republicans saying certain people are not welcome here in San Francisco. Its not the San Francisco i do up and its not the San Francisco i believe in. Members of our Technology Community are san franciscans. I believe for one believe we should embrace them and those one new to our city seek to engage them rather than demonize it is a philosophy i believe we should subscribe to at a National Level and we should walk the walk and talk the talk here in San Francisco as well. In terms of the legislation itself theres a few things i want to point out why i very much disagree with it. Aside from his overall thesis. First of all, i will not support legislation that is going to seek to push us into the next recession here in San Francisco. It may seem like a lifetime ago in our city but just a few years ago, in the Great Recession coming out of it when i first came into office in city hall, with doubledigit unemployment in San Francisco here locally and hundreds of millions of dollars a Vital Public Service dollars were cut in the budget. I do not want to go back to those times. I would venture this war does not want to go back to those times either. During budget deliberations your committee a controller controller emphasize it is to statistically we are extending the longest but not of Economic Growth as a city right now and dangerously close to having to the next recession just from a time lapse perspective. Next economic junk turn whether we like it or not is going to come in i come up for one, will not support and dont want to see our board supporting policies that would push us in that direction. This policy has a two potential to do that. Second, as i mentioned before my belief in scapegoating one specific industry one specific group of san franciscans. To me, its unamerican and its on san franciscan. Housing prices have today which we can speak on for volumes is not a black or not a result of this industry. Its due to lack of planning the of those that can be forged at least able to do everything in our power to remedy the situation i do want to stand by and let someone dialogue and pit one group of people against another here in San Francisco. Third, from the history perspective what we dont over the past two years inside of city hall. Just a couple of years ago and consensus fashion, the board of supervisors and the mayor came together to reform our citys outdated payroll tax and switch it to a gross receipts tax across the board. At the time we were the only major city in california to appear all tax. It was proven it was limiting job growth and new Employment Opportunities. Over 70 of the voters of San Francisco can together to approve this change. In just four short years later, were seeking to overturn that mandate. The idea for my perspective reinstituting a payroll tax it just simply the wrong direction. We know it will kill jobs and force companies to leave the city of San Francisco. I simply dont understand why were going to be advancing policies that will hurt our city and not make it better. In addition, just before this committee convened earlier today, our Comptrollers Office and the office city chief economist released the report that would this legislation would cost 1000 jobs. The city of San Francisco and actually make housing less affordable. Again, thirdparty analysis as this will make housing less affordable in San Francisco. To me, this is more about politics than policy and seeking to further scapegoat a group of san franciscans i believe should embrace your innocent. Were better than this. I believe we should be focusing our efforts on existing measures on about and for that reason i will be supporting this measure today and if my colleagues the authors, dont do it themselves i would love to entertain a motion to table this item because i dont think this should see the light of day anymore in our secured with that, turnover two supervisor mar. They determine farrell. Im glad that supervisor peskin is here. The other coauthor supervisor david campos im not sure these hundred join us as well. Ive never been associate with donald trump or calls unamerican before in my life. I will just say that when we hear from the Public Comments will you will hear from many communities that are not feeling the benefits of the fiveyear tech boom from our cities from Small Businesses to residence, seniors and disabled people and many hardworking san franciscans that are feeling the fear of losing their communities. Ive never been called divisive as well and i know that the grassroot campaign we are building is about uniting communities and neighborhoods across the city could i will just say with supervisor peskin and campos and many of the committee Coalition Representatives from your jobs for justice San Francisco, ace, lines of California Community empowerment as the rising follows grassroots organizations within, coalition on homelessness and others, we are about Building Community. Many of his call San Francisco home because of the we cherish the vitality and ingenuity and creativity and diversity of our communities in the five years of the tech boom, though, have strained the affordability of living in the city for Small Business among four artists, for tenants, residence for small homeowners even. I think its increasingly difficult for many working families seniors and disabled people to remain in their homes and the fears i can i have the fears, to, being pushed out of San Francisco into another city because its so unaffordable and i think theres a clear connection with the five years of the tech boom and the various tax breaks and benefits given to this one sector. I think, this is reasonable legislation that would make tech corporations and these are billiondollar corporations and focus on the big tech corporations to pay their fair share in taxes so we can better keep residence in their neighborhoods Small Businesses running and ensure everyone who call San Francisco home can afford to live here not just a 1 with a. 1 , for example. This measure we call the homelessness and Housing Impact tech tax. It assesses 1. 5 workforce expenditure tax on large tech corporations based in San Francisco. It funds Affordable Housing and Homeless Services. We also are considering a general tax that would not dedicate the funding but for this discussion is a special tax. It also, at this urging of supervisor peskin would reduce fees on Small Businesses because we know that Small Businesses are also bleeding in the city a budget and legislative Analyst Report in 2014 show that in the first tech boom i think we were losing about 500 businesses a year in the 90s, but by 2011 2013 and 2014, we are losing about 4000 Small Businesses each year from the city. So, i think the relief introducing a fee on Small Businesses is one small part to address that bleeding of the Small Business sector as well. About measure would raise 120 potentially over 140 million and i think report you cited many people will speak to some of the data in it but also how we need a broader overreaching or override arching report looking more at the former housing benefits and looking more carefully at the impacts and the benefits of this housing and homelessness impact tax. The ballot measure brings in that 1201 40 million to preserve Affordable Housing and to go towards Homeless Services as well. I think it is about requiring Large Tech Companies to pay their fair share. It also helps address the industrys impact on the rising rent higher cost of living and economic instability that i in many residents and Small Businesses the oh in San Francisco. I also want to say, two, the city has offered as you know supervisor farrell billions of dollars in tax breaks to a handful of successful Tech Companies since 2011. I think eliminating a key source of revenue that would have helped improve our city i think the chronicles coverage from a few years ago the headline was Companies Avoid 34 million in city taxes thanks to the twitter tax break. Theres been a number of other measures our board has passed as well that are that example of eliminating key source of revenue that helps improve our city. I think the tech boom also has priced many longterm residents, many seniors and people with disabilities as well as the merchants out of places to live and make a living. The tens of thousands of new tech employees earn on the average two times that of an average san franciscan and in many ways, its leading to an affordability crisis. I think right now the character of neighborhoods the soul of the city as some call, the beauty in the fabric of our beloved communities is been lost and i think we have to find solutions to address a. I think this is a reasonable one that provides concrete dedicated streams of funding for our affordable prices as well. I want to say, too, mom and pop shops and working families are facing that fear and we will hear from many in the audience and this is a simple measure that would require the Large Tech Companies again to pay their fair share and provide him anyways options for many of the longterm residents to continue to stay and thrive in San Francisco. With that i want to hand it over to supervisor peskin for his comments. Supervisor peskin thank you chairman farrell. The chairmans strong words notwithstanding, i dont think this is about demonizing any person or any organization it i think this is really a conversation that is overdue about San Francisco business tax policy. I was around in the days when San Francisco actually had an alternative tax structure where we had a gross receipts tax and a payroll tax. I was one of the members of the board who had to settle the lawsuit that was brought against the city and county that gave us hundreds of millions of dollars of liability, and as a result of that settlement, we abandoned our gross receipts alternative and ended up with a payroll tax that none of us, whether jim lazarus from the chamber of commerce or progressive supervisor from the board of supervisors like i agree with chair farrell that we the payroll tax was a disincentive to drop growth in San Francisco. In working with the Comptrollers Office in the city attorneys office, we tried to figure out a gross receipt structure which required a lot of research in years of work and ended up with the gross receipts that was passed on the ballot, which unfortunately, by the way, disproportionally impacted many of the Small Businesses as the Registration Fee went up significantly not by 10 , not by 5 , not by 20 , but i 100 the smallest businesses in San Francisco, i know, because when i was off the board of supervisors i was one of them. Whose Business Registration we went from 150 a year and 300 a year and below the gross receipts minimums. Having said that, this is a conversation good time has come. I think everybody in San Francisco in the bay area while we welcome the jobs while we have accommodated big tech in many ways, knows that there are a handful of billiondollar, plus companies that while they brought jobs, have had remarkable impact on the city. This is a conversation and whether we got it perfect, whether theres different ways and as a matter fact ted egan leads us on a potential other path, it is a conversation that i think we should all take very seriously, which is and i say this is somebody who voted with two other members of the board against the regressive sales tax measure that will be on the november ballot. I come from a background that says that the people who are most well off in our society should help pay for the people were the least well off in our society. The aggressive sales tax that we put on the ballot this fortunately impacts the poorest people in our society. The tech tax like this, actually could help deal with some of the ills of society that have been exacerbated in this economic boom. Whether or not this is the right way to do it, this is a conversation that is not going to go away. Mr. Egan says committee, let us look at