Monday, October 22, 2018

Mayor Breed's crap on Proposition C

London Breed in Sunday's Chronicle:

[Mayor]Breed said the “risk that concerns me the most” is the potential for companies impacted by the tax to move their operations and jobs elsewhere. “We cannot afford to lose even more jobs for middle-class San Franciscans, the jobs in retail, manufacturing and services that are most likely to flee the city under Proposition C,” she said.

Since when have retail and service jobs been "middle-class" jobs? Even that claim is about a non-existent threat. Heather Knight crunched the Proposition C numbers on "the retail sector" earlier this year in the Chronicle:

The Chamber of Commerce is fighting the measure, saying it would jeopardize middle-class jobs. But the tax would apply only to gross receipts above $50 million — the first $50 million wouldn’t be affected. And for the retail sector, which has thin profit margins, it would levy just a 0.175 percent tax. That means a major retail company like Safeway or Whole Foods would pay just $1,750 for every million dollars it makes above $50 million.

The mayor or someone on her staff should also read the Controller's analysis of Proposition C (Homelessness Gross Receipts Tax: Economic Impact Report), which found a worst-case scenario would be "an average loss of 0.1% of all jobs in the city, and 0.1% of city GDP...These impacts are small in the context of the city’s job market and economy, equal to a 0.1% difference on average over 20 years." (emphasis added)

The Controller puts this small tax hike in political perspective:

The proposed tax comes one year after the U.S. Federal Government reduced corporate income taxes on businesses. Among other changes, the top-line rate of corporate income tax was cut from 35% to 21%. While the tax savings to San Francisco businesses are difficult to estimate and apportion to the city, it is likely that the 14% income tax cut would outweigh the proposed 0.5% gross receipts tax increase for the majority of the 300-400 affected businesses.

Yes, indeed. And the tax would only apply to maybe 400 of the 13,000 city businesses that now pay the gross receipts tax. That means the mayor is being stupid, and the Chamber of Commerce is lying about Proposition C.

More from Heather Knight:

“This tax is a tiny fraction of the Trump tax cuts they just received,” said Christin Evans, one of the main proponents of the measure and the owner of three small businesses in the Haight: the Booksmith, the Bindery and the Alembic. “If these companies are struggling to pay $1,750 on a million in sales, I’d be happy to offer them business advice.” Evans said her gross receipts last year were $2 million so she wouldn’t be affected, but said she thinks businesses of all sizes would benefit if the homeless crisis were alleviated in a major way.

Mayor Breed says she's worried that it's not clear the city is even spending the $300 million it now spends every year sensibly. From her KQED interview:

From my perspective, we need to understand what we’re doing now, whether or not we’re making the right investments and, more importantly, what is our long-term plan of action to address these issues.

It's hard to take this late-in-the-game issue seriously from someone who never voiced this concern as a supervisor or as a candidate for mayor. 

Why didn't she and other opponents of Proposition C---like Scott Wiener and David Chiu---ever ask for a complete audit of the city's homeless programs during their long, undistinguished careers in public life in San Francisco?

The answer: because it's bullshit, an apparent attempt to fashion themselves as "moderates" in progressive San Francisco.

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