tv [untitled] July 31, 2012 3:00pm-3:30pm PDT
next speaker. >> my name is eugene gordon, jr., and from the position of colonialism, now and imperialists nation, the u.s. a, articles are needed to begin the capital currency class, which 2012 now surrounds planet earth, sovereign nations with military bases, protecting its interests where government, federal, state, local, financial issues, which now consumes time and it natures planet earth -- and nature's planet earth. this has not ended this beautified education of finance capital into a major's materials
science, a means of production costs, basic needs. witness the radiation of fascism, to come together, capital currency, class rank divide, speculation, gaining. supervisor mar: thank you. next speaker, please. >> ♪ you are the tax man yeah, you are the tax man and you are looking, watching you, relax, man, because you are
the tax man yeah, you are the tax man, and we are going to phase out you ♪ supervisor mar: thank you. next speaker. >> i became a business owner when i was 16 years old. i applied for my business license, and i feel like this is a huge step forward for san francisco because, i mean, as it is, we are the only city in america that charges in please come i mean employees -- employers per employee on their taxes, and i feel it definitely needs to change because it hinders businesses as well as african americans from being
employed because i would not have a job if it were not for african american businesses, my mother, specifically, and i just want to congratulate you all. supervisor campos: is there any other member of the public who would like to speak? seeing none, we will go ahead and close this. items 45 and 46. if not, the hearing has been closed. supervisor avalos: >> i just want to congratulate the mayor and the controller for their great work, reaching out to the business community and really
crafting a measure that i think is fair. it will hold up to the test of time. i am very excited that we have a measure that is actually going to be exempting small businesses that have gross receipts below $1 million. to me, that is significant. it is about how we will be creating the kind of tax structure that we have made here and there with exemptions we have made to small businesses. this is something we can make wholesale at the same time bringing revenue in at the high- end in a progressive way. i think it meets the values of san francisco, and i am eager for this measure. i also want to talk to you about the consensus to come to get around this measure. we had the dissolution of the redevelopment agency earlier this year, and we have as a response the housing trust fund moving forward that is related
to this new business tax measure, the gross receipts tax, and if we did not have, if it was business as usual here in san francisco, we perhaps would have gridlock that would not be able to get to the next step in terms of how we are able to meet our obligations and looking at our obligations about supporting communities and supporting small businesses, and we move that aside. i think it is significant to talk about today, and i am excited that we are on the verge of creating a new system for our business tax. that was made through a great deal of dialogue. the consensus around here, i work with a coalition, a group of community and labor organizations, on the other side that the mayor has worked with and president david chiu has warred with. they have had a great deal of consensus building on this measure as well. i just want to urge you,
colleagues, to have your support to move this forward to the ballot. lastly, i wanted to mention the press conference. yesterday, we went to veritable vegetables. it is a woman-owned company that is wholesalers for organic produce in the bay area, and they have been around for quite a long time, hiring local residents. what the owners said yesterday is that we are happy to pay our taxes, and we get something for our taxes, and i think it is important to not fail to recognize the we're paying for many of the things that government is really about. we have a public infrastructure for muni in transit. that we a public safety and schools. that we have parks, that we're able to mitigate challenges with
the divide between rich and poor. how we are going to respond. this is very important, and the people at veritable vegetables were eager to talk about that yesterday after the press conference, so i am excited that we're moving forward to raise this revenue in these challenges. supervisor campos: president chiu? president chiu: thank you, chair campos. i am glad we're able to come together on this ballot. i have probably done this more than in my first term, and i very much want to thank everyone for coming together, from progressive labor and community groups, for all of the segments of leadership within
the business community. numerous kudos, i know, have already gone to our controller and our city economist, but i also want to thank the city attorney for her work in drafting several versions of this legislation. we hopefully in november will be able to put into place a fair and more equitable business tax system that taxes measures of revenue and profit rather than work force and labor. knowledge that with this measure we are filling what we know in our local economy we need. the goal of tax reform is to assure that we lay the groundwork of thousands of jobs. 750 jobs per year. back on top of the fact that we are also going to be bringing in more revenues for our city, so this is a win-win-win.
i think for everyone in the city, and, colleagues, i would ask today for unanimous support. supervisor campos: supervisor mar? supervisor mar: thank you. when we were outside on the steps, members of congress and others, but connie ford, representing the council, and many labor organizations, with children and seniors, it made it clear that there is a strong going to be working on this jobs initiative for november. i also want to say that things to supervisor avalos, chiu, and others to bring this together -- thanks to them. this will bring about the revitalization of our neighborhoods, and it is over 10 years of work that went into this, but i think to pass it in november, we will need a grass-
roots coalition to make sure we have this revenue, so thanks so much to supervisor avalos, president chiu, and mayor lee. let's pass this in november. president chiu: supervisor chu? supervisor chu: i know this is something that was talked about for years. i was one of the doubters that we could put something together this major for business reform on the ballot, and going to the press conference today and seeing labor and the chamber of commerce and the small businesses and various members of the board of supervisors was really inspiring for me actually, and i am just happy to see we are able to come to conclusion on this issue, that it was not as divisive i thought it would be, but i know a lot of work went in to make that happen. anytime there is a coalition that is this broad, there is a
tremendous amount of effort that goes into making it happen. i want to thank all of the parties involved, and i want to thank the mayor's office, our board president, and supervisor avalos. the mayor asked today who this will benefit, and i think it will benefit every san franciscan. we talk about how we are lightening the load for some of our small businesses. we are lightening the load for some of the businesses that want to grow, but at the end of the day, we are also talking about a greater investment in our city, and that could go towards schools or parks, public safety efforts. i just think in general, this is a win for the entire city, and i look forward to supporting this on the november ballot with the recreation and parks bond. this will be a better place for everyone. the last thing, this is in companionship with the housing
trust fund. $13 million of this gross receipts tax will go towards affordable housing. that means less people on our streets and in substandard housing. all of that is an incredibly important investment. all along with recapturing the redevelopment tax element that we put together in a housing trust fund that is also moving forward to the voters, so again, i am excited and proud to support this, and i just want to thank the leadership and all of the members of the coalition who made this happen. president chiu: supervisor cohen -- olague? supervisor olague: i want to add my support to this. they are coming together to really hold the bar at a certain level, and to the mayor's office for coming in meeting us
half way, and the business community also for being able to work toward something that was agreeable to all, so i'd think this really is a win-win. we managed to achieve it here through this measure and also threw the housing trust fund. it was a similar process where we had two very opposite groups coming together to meet, to try to get to a place where we can all come to some agreement, and at the end, i think it is better for the city, so i am just happy to be supportive of those. president chiu: supervisor campos? supervisor campos: thank you very much, mr. president. before i speak, i want to take this opportunity to ask the chair, if i may, for the budget analysts, if they can talk about a report that they conducted for
me. as i indicated at the last meeting that we had, this is one of the most important decisions that we are making, perhaps the most important decision that we have made since i have been elected to the board talking abg our tax structure, and i was surprised that no analysis had been requested of the budget and lead this latest -- the budget and the legislative analyst. i think it is important to hear from mr. rose briefly on the work that they have done in the last few days and just some of the key points in their report. again, i want to thank mr. rose and his staff for very expeditiously getting that, and i think his work is something that is very important information to add to the record, but also to this discussion, so if i may, if i
can ask harvey rose? president chiu: mr. rose? >> president chiu, supervisor campos, supervisors. in the first paragraph, we say that businesses pay an annual fee ranging from a minimum of $25 to a maximum of $500 based on the amount of their annual payroll, and that is shown in table 1 of page 5 of our detailed report. beginning in 15-16, the annual fee would increase by $65, for $25 to $90. that is an increase over 200% for all businesses except for some, where the fee would increase by $50, from $25 to 7 $5, and that is an increase of 200%. secondly, we point out that
small businesses with an annual payroll of $250,000 or less pay an annual registration fee of $63 to 4 cents on average under the current registration fee. if the ordinance is approved by the board of supervisors, submitting it to the electorate, all businesses with annual gross receipts of $1 million or less would pay an annual registration fee of $145.76 on average, an increase of 129.4%. we also point out that the business registration fee revenues would make up a larger share of the total business tax revenues, including both the annual business registration fees and the annual gross receipts taxes under the proposed ordinance that will be submitted to the voters. the revenues will increase by about $28.50 million, from 8.7 million in 2012-2013.
this is based on the estimates of mr. rosenfield and eagen, and finally, as we point out, the existing exemption from paying the payroll tax by businesses having an annual payroll of $250,000 or less, currently a certain percentage of businesses, 8196 in 2011 to 2012 paid the payroll tax. apparently 16.4% of the businesses or 15,553 of about 95,000 businesses would pay the gross receipts tax based on the controllers estimate. therefore, an estimated 7357 or 89.8% more small businesses which presently are not paying the payroll tax would have to pay the gross receipts tax under the proposed ordinance, and ms.
campbell and i would be happy to respond to any questions. president chiu: supervisor campos? supervisor campos: thank you. mr. rose, i do not get any questions but want to thank you and your staff for looking into this matter. i want to reiterate the importance of this work. it is something that all of us should be proud of that we are able to come together on something as important as this. i have to say that for me, the issue has not been as easy as it has been for some of my colleagues, and i respect their perspectives, but i have to say that for me this has been one of the more difficult decisions i have had to make, and it is not because i do not believe in the benefits of moving away from a payroll tax system to a gross receipts tax system.
to the contrary, i think this is something that needs to be done. but i do have concerns, as i indicated last time, about the way in which we are doing this. i respectfully submit that i do not think is entirely clear, that we are not going to look back in five, 10, 20 years and wonder why we did it exactly this way, and there are a couple of concerns that i want to highlight today. one is a concern that i noted last time, that if you look at where our current revenue structure is under this proposal, where we are bringing in 28.5 million the first year if this measure passes, i do not believe that that brings us to the level that we needed to be in terms of the revenue that was lost a few years back when the city settled a lawsuit and
changed its current structure. but the estimates i have seen, you're talking about at least $30 million in revenue needed for us to come back to that level, and the $28.50 million in the first year certainly falls short of that. the second point that i make is that i do have a concern about the fact that we are mixing the issue of the housing trust fund, the affordable housing trust fund, and the gross receipts. as was noted by supervisor kim, of the $28.50 million that we are talking about for the first year if this measure passes, $13 million of that will go to affordable housing, which is a good thing, but that means that only $15 million will be injected back into the general fund for the general use of the fund, and i do not think that that takes us far enough, and i certainly wish that the number was higher.
i also think that to the extent that you can make a connection between affordable housing in gross receipts, to the extent that some of these businesses are taking responsibility for the increase type cost of living in san francisco, i do not know that $13 million in affordable housing fees money goes far enough. we are certainly seeing already that housing prices are going up. in my district, they are going up exponentially, so i do have a real concern about that, but the second overarching concern is that a concern that was highlighted by the report from the budget and legislative analyst, harvey rose. there are different ways in which we can implement a gross receipts system, and the way we have chosen to do it is to make it revenue neutral in that to the extent that additional revenue is brought into the system, we are focusing on the
business registration fees, and as was noted by the budget and legislative analyst, what we are talking about is seeing a very significant increase in business registration fees. my fear is that to the extent that business registration fees are now in larger part of the tax system, which they are, and that is the tool by which we are increasing revenue, i do believe that this is disproportionately impacting small businesses, and the numbers that the budget and legislative analyst noted our numbers that i have concerns about, and quite frankly, i am a little surprised that this whole business commission jumped on board without doing some of this analysis, but this is what we know. we know that an estimated 7357 small businesses or 89.8% more small businesses will have to
pay taxes under this system. again, there will be more of an impact on small businesses. we also know this will be in larger share of the business tax structure that we have. one thing that i have seen, and i am not an economist, but one that i have seen as a district supervisor is when it comes to creating jobs in this city, it is ultimately the small businesses that are doing that, and so i do have a concern about the disproportionate impact that this could have on small businesses, so i do have trepidation. so the choice for me as a supervisor that is being asked to vote on this today is what do we do? i do believe there are legitimate concerns about the way we are doing it. i do not know that this is
necessarily the best approach, but we do have to make a choice, and what i think from my perspective, from my perspective, their right thing to do is on balance to support that today, not because it is perfect, not because it is even where i would necessarily go, but i do think that on balance, it is more of a positive to of than a negative -- more of a positive than negative. i do have a problem as well in coming out against a system that will ultimately inject more revenue into the system, but i do think we have to be very mindful as we go forward in how this is implemented in that we monitor the impact that it has. alternately for me, what really convinced me are the players that are involved. the fact that we have so many community leaders who have been a part of this process, and i especially want to highlight the work of supervisor supervisor
avalos in making sure that these progressive values are a part of what we do. the fact that we have this progressive coalition that has been actively engaged is something that has made a difference for me. the fact that we have labor partners who are also in support of this coming into the business community, i think the fact that the business community has come to the table with such a diverse group, i think it matters. on balance, even though it is not necessarily be ideal, i think this is a good thing for the city and county of san francisco, so with some trepidation, i will be voting yes today. i was accused last week of being a buzz killer, and nobody wants to get in the wake of a kumbaya moment. that is not the intent of my comments. we as an elective family, the
board of supervisors, the mayor are coming together, but i do think it is important for us to be realistic and to be frank about some of the things that we are doing and the fact that with every positive comes a negative, and i do hope that some of the concerns are not proven to be correct. i do hope i am proven wrong on that front, but i think that in the spirit of how this is being worked on and presented, it makes sense for me to support it, and i do hope that if this gets on the ballot that we as a city can come together and pass this measure. thank you. president chiu: supervisor avalos? president chiu: -- supervisor avalos: thank you. i want to thank him for his comments, and i think it is important for us to go forward with our eyes open. there are consequences. i think the city has a commitment though. looking ahead, if we need to
make adjustments to this, we will. this is something i am committed to, and i know the comptroller is as well, and i am sure the mayor's office is as well. i just forgot there are some folks that i wanted to thank, and i wanted to make sure i do that. first of all, supervisors, olague, kim, mar. there was a concern that we needed to have new revenue coming in. that was significant in terms of moving it forward so it would have new revenue. i want to thank as well -- one second coming here. the progressive revenue coalition, the labor council, the chinese progressive association, the council for community housing organization, the american federation of
teachers, coleman advocates, for children and youth, and also in particular, i want to thank- legislative aide for her work, especially helping to facilitate the revenue coalition, and she has been part of that for multiple years, not just this year. connie ford from the labor council, gordon from justice, and christina from coleman advocates. colleagues, thank you so much for your patience, and a look forward to this being on the ballot today. thanks. president chiu: colleagues, any further discussion? with that, why do we not take an roll call vote? clerk calvillo: supervisor avalos, supervisor campos, president chiu, supervisor chu, supervisor cohen, supervisor
elsbernd, supervisor farrell, supervisor kim, supervisor mar, olague. supervisor wiener. there are 11 eyes. president chiu: the motion is unanimously approved. the item is put on the ballot. madam clerk, could you please call items 47 and 48, our special order of 3:00 p.m.? clerk calvillo: i no. 47, a public hearing of persons interested in the proposed resolution confirming a report of delinquent charges for corp. -- four code enforcement cases with delinquent assessments and the fees pursuant to various provisions of the building code. president chiu: i would like to invite of the building inspection for a quick report. if you could step up to the microphone? >> m
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