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- May 29, 2012by Eli Zigas, Food Systems and Urban Agriculture Program Manager
Seven city agencies spent nearly a million dollars supporting urban agriculture projects in San Francisco in 2010-2011. Yet there is no single staff person responsible for coordinating that funding, nor any overarching goals for how the money is used. Urban agriculture legislation introduced on April 24 by Supervisor David Chiu, however, would change that.
The proposed ordinance, which implements a number of the recommendations in SPUR’s recent report Public Harvest, would:
- Set goals, with outcomes and timelines, such as: an audit of city-owned buildings to identify rooftops suitable for urban agriculture; five new resource centers for compost, mulch and tools; a streamlined application process; a reduction in community garden waiting lists to no more than one year wait time; 10 new urban agriculture projects on public land where residents show desire for the projects;
- Create an urban agriculture program that would coordinate the efforts of city agencies, engage with community groups to reach the goals of the legislation and generally support city gardening and farming; and
- Require the mayor and city administrator to publish an evaluation of existing efforts and a strategic plan for the new urban agriculture program by the end of 2012. Importantly, this evaluation and planning process explicitly calls for SPUR’s top recommendation, which was for the mayor and city administrator to decide whether a city agency or a nonprofit partially funded by the city will serve as the main institutional support for urban agriculture.
Those provisions combined aim to reduce the duplication of effort among agencies by creating a one-stop shop that would: provide a streamlined application process for starting projects on public land; serve as an information clearinghouse for the public and for agencies; and offer technical assistance to city gardens and farms. The legislation’s annual reporting requirement would also increase accountability by shining detailed attention on the city’s progress toward reaching the goals, as well as by providing an accounting of how agencies spent their funding. And, by requiring a strategic plan and having staff assigned to coordinate among agencies, the new urban agriculture program could ensure that existing funding is used more efficiently.
The legislation, however, wouldn’t be a cure-all. Even if the law is passed, successful implementation will require buy-in from the mayor’s office and individual agencies, which would ultimately decide how much priority and staff time they put toward improving existing programs. The legislation sets targets for new sites on public land, but the specific locations and the money to start the projects must still be found. And, for residents on community-garden waiting lists, the bill provides no immediate relief. Instead, the legislation builds the institutional capacity within the city to provide more land, resources and support in the coming years.
Though it won’t solve any challenges overnight, the legislation is a crucial step forward. SPUR supports the legislation and we will be tracking its progress through the Board of Supervisors.
- May 21, 2012By Corey Marshall, Good Government Policy Director
As the deadline rapidly approaches to submit measures for the November ballot, the City and County of San Francisco is moving ahead aggressively with its effort to reform the city’s business tax. While the city has made significant progress in recent weeks, there are some signs that the complexity and commitment to reform are being further complicated by increasing calls for a tax that would not just replace revenue from the existing payroll tax but bring the city additional funds.
City Controller Ben Rosenfield and Chief Economist Ted Egan have for the last few months been hard at work designing a replacement for San Francisco’s payroll tax. The controller’s office originally modeled two different proposals to replace the city’s current payroll tax: a modified payroll tax that would lower rates and broaden the base of payers, and a gross receipts tax based on rate schedules defined by industry. In the last month, however, that process has narrowed to focus solely on a gross receipts tax proposal. (Read the controller’s latest report on that effort.)
Gross receipts taxes are widespread in California, but they all have one important thing in common: They are extremely complicated. The tax must address dozens of different industries, as well as companies’ differing abilities to pay — and their varying ability to move to other places to conduct business. All this means there are many more levers than with a simple payroll tax. (San Francisco’s existing payroll tax is a straight 1.5 percent of all payrolls over $250,000 per year.)
But with a multitude of levers also comes significantly more flexibility. For example, the controller’s current proposed structure consists of six separate schedules. These schedules group companies that have comparable ratios between payroll (an expense) and gross receipts (how much money a company makes). For example, a real estate management firm may have few employees and high gross receipts from rent and other fees paid by tenants. Conversely, a restaurant might have a large number of employees and lower overall receipts. These two very different operating models are treated identically under the city’s existing payroll tax, but a gross receipts tax would provide different schedules for types of companies with different cost structures.
Another goal of the controller’s effort is to attempt to make the tax structure progressive in order to encourage job growth in small businesses and start-ups. Within these schedules there are a number of different rates (see sample schedule below) so that companies generating more revenue within each category would pay marginally higher rates. Likewise, start-up businesses that are not yet generating revenue — but may have significant payroll as they build products or services — would have more breathing room than they do in the current structure.
While the process to date has been one of the most inclusive in memory — with dozens of industry meetings and numerous iterations — the devil will ultimately be in the details for any proposal submitted to voters. There will be many winners and losers in any transition to a new tax (see below), which means achieving some form of consensus could determine a measure’s success or failure.
The eventual success or failure of business tax reform in San Francisco is only partially dependent on the structure of the proposal itself. The other side of this coin has to do with revenue. By design, all proposals to date have taken a “revenue neutral” approach; they attempt to simply replace revenue from the payroll tax and not generate additional funds for the city. However, that original intent is increasingly in doubt as the June deadlines for the ballot approach. Supervisor John Avalos, officials from Service Employees International Union 1021 and others have indicated their desire for any changes to the tax to generate additional funds. Whether or not those hopes are eventually included in the mayor’s tax reform proposal, it is increasingly likely that a separate measure to increase revenues could also be on the ballot in November. Could the controller’s measure include some additional revenue in order to neutralize these efforts?
The final stretch of negotiations will be critical to the success of the city’s business tax reform efforts. With the multitude of different moving pieces — both within the negotiations over rates and financial impacts, and apart from the negotiations around new revenues — this is still a fragile coalition. We hope a balance can be struck that will allow for the city to successfully transition to the gross receipts tax currently on the table. It would allow for greater stability over time, more equity and built-in incentives for new companies and industries to grow and thrive in San Francisco. But we must be mindful of the delicate balancing act required to get there.Tags: good government
- May 18, 2012By Egon Terplan, Regional Planning Director
After more than six years of planning, and six months after the release of a draft environmental impact report, we now have a clearer picture of what bus rapid transit on Van Ness Avenue might look like. This past Tuesday, the San Francisco Municipal Transportation Agency (SFMTA) unanimously approved a combination of two out of the four designs under consideration.
Bus rapid transit (BRT) is similar to light rail in efficiency, but it uses buses instead of trains on tracks, which makes for lower costs and greater flexibility. Systems typically feature three ingredients:
· Dedicated lanes, usually in the center of the street
· Unique branding to make buses highly visible
· All-door boarding and proof-of-payment systems, often with payment required to be in the station area
The proposal for BRT on Van Ness would include all of these elements at nine dedicated stations between Mission and Lombard streets (see map below). Outside of these special stations, the Van Ness/Mission bus would function as it does today, mixing with cars in the far right lane of traffic.
The current draft environmental impact report / environmental impact statement included four alternatives for bus rapid transit on Van Ness (including a “no build” option that would keep bus service the way it is today). The version that passed the SFMTA board combined options 3 and 4 from the draft into a blended solution with a dedicated center lane and right-side boarding.
SPUR argued in a recent letter to the boards of SFMTA and San Francisco County Transportation Authority (SFCTA) that the blended alternative has four main benefits:
· It demonstrates the biggest travel-time reduction, reliability improvements and ridership increases
· It uses existing vehicles with right-side boarding
· It maintains as much of the existing median as possible
· It creates a new urban design amenity on Van Ness by breaking up the street with a more inviting design
The same day that the SFMTA approved the proposal, the San Francisco County Transportation Authority pushed the same decision back for one month. But this a minor lag for the long-delayed project. Meanwhile, momentum for bus rapid transit is growing throughout the Bay Area — in the East Bay, South Bay and on Geary Boulevard.
We are excited to see the Van Ness project take its next step and hope for strong support from the SFCTA next month, as well full certification of the final environmental review this fall. We recognize that transit projects of this scale take time, but we look forward to riding the bus when it (finally) opens in 2017.Tags: transportation
- May 17, 2012By Laura Tam, Sustainable Development Policy Director
Have you been to Hetch Hetchy Reservoir in Yosemite? Everyone who drinks water or takes a shower in San Francisco should go. It is spectacular: a miles-long placid blue lake nested within towering granite cliffs, from which waterfalls cascade. To visit the waterfalls or Yosemite’s northern backcountry, you walk across O’Shaughnessy Dam. It marks the first catchment in a 160-mile long water system that brings high quality, superb-tasting water to 2.6 million residents of the Bay Area every day.
Standing upon it will give you the chance to appreciate the sublimity of both nature and human achievement. O’Shaughnessy Dam and the waterworks that connect it to the Bay Area are a marvel of engineering. The water shunted through them — about 218 million gallons a day — arrives in most city taps by gravity alone. This is also a place imbued with history: San Francisco’s congressional delegation won the right to build the dam in 1913, to secure a reliable source of water in the wake of the 1906 earthquake. This effort was famously and vociferously fought by John Muir and was the subject of a national debate for years; the loss later galvanized the Sierra Club to successfully oppose large dams in Dinosaur National Monument and Grand Canyon National Park.
It would be almost impossible to build a new dam there today. (In fact partially because it is so difficult and destructive to build large dams, we are running out of new supplies of water in California.) But tearing O’Shaughnessy Dam down now in order to restore Hetch Hetchy Valley would be a disaster.
If their signature-gathering campaign is successful, a small group of environmental advocates, led by Restore Hetch Hetchy, will give you the opportunity this November to vote on a measure that would require the San Francisco Public Utilities Commission (SFPUC) to develop a plan to drain Hetch Hetchy Reservoir. The proposed ballot measure calls for the creation of a task force that would spend $8 million to develop a long-term plan for improving water quality and reliability, remediating environmental damages caused by the water supply system, and identifying new water and renewable energy supplies so that Hetch Hetchy Valley could be returned to the National Park Service.
This ballot measure is so problematic that SPUR has taken early action to oppose it.
SPUR wholeheartedly agrees that planning for water quality and reliability is important. In fact, this is so obviously a good idea that the SFPUC and other end users of Hetch Hetchy water have been doing it for years. In 2007, in approving the environmental impact report for the Water System Improvement Program — an investment of more than $4 billion to shore up the seismic reliability of the Hetch Hetchy water system — the SFPUC gave itself, and its wholesale customers on the peninsula, ten years to develop a plan that would identify reliable alternative sources of water to meet the region’s future growth in demand, rather than diverting more water from the Tuolumne River. The SFPUC and other Hetch Hetchy users are currently implementing plans to meet this demand through recycled water, groundwater and conservation. (Read SPUR’s analysis of this plan.) So the idea of planning for new water supplies need not be on the ballot.
In terms of quality, Hetch Hetchy water is so pristine that it is one of only a handful of water supplies in the country that doesn’t need to be filtered, a process that is expensive and energy intensive. The SFPUC tests its quality more than 100,000 times a year to ensure that it exceeds all safe drinking water standards.
The main problem with the measure is that in spite of appearing to be about studying best options or planning for future water supplies, it has pre-determined the solution: draining Hetch Hetchy Reservoir.
The idea of punching a hole in or removing the dam and allowing the valley to be restored to its pre-development conditions has been around since the late 1980s. Over the last 35 years, the idea has been studied by the Environmental Defense Fund, the U.S. Bureau of Reclamation, the National Park Service, UC Davis, and several state agencies. Some of these studies determined that the idea of draining the reservoir was technically feasible but incredibly costly.
In 2006, the California State Department of Water Resources (DWR) and Department of Parks and Recreation evaluated the cost estimates of multiple feasibility studies conducted between 1988 and 2005. DWR’s meta-study found a range of costs from $3 billion to $10 billion for restoration and replacement of water and power sources. Restore Hetch Hetchy and the Environmental Defense Fund’s own studies support a lower cost estimate, ranging from $1 billion to $2 billion. DWR also found that the planning studies necessary to refine the costs and benefits of restoration would cost $65 million alone.
Even if we could obtain the several billion dollars necessary to carry out this endeavor (neither private nor public sources have yet been identified) some of the tasks involved may not even be possible. Here are just some of the hurdles we would need to cross:
• Identify water supplies to meet about 18 percent of the region’s water demand in dry years (which occur about 20 percent of the time)
• Permit and build 40 to 90 megawatts of renewable power to supply almost all municipal demand in San Francisco
• Build and operate a water-filtration plant, because water stored further downstream than Hetch Hetchy will have to be filtered
• Engineer and design a series of expensive and complicated infrastructure projects to re-engineer major components of the regional water system, then get those changes through the environmental review process
• Somehow convince senior water-right holders like the Modesto and Turlock Irrigation Districts on the Tuolumne River to let us store our drinking water in their reservoirs
• Also convince them it would be a good idea to raise the heights of their dams so we can enlarge these reservoirs with our extra water, flooding anew many miles of the Tuolumne River and acres of currently dry land.
Yes, the plan to drain Hetch Hetchy involves causing new ecological damage. We would be trading flooded acres in one place for flooded acres in another.
At SPUR, we have done a lot of work on climate change adaptation. From this work, we have concluded that it is not wise to reduce water storage facilities considering the realities of a growing population and climate change. A bigger population will increase demand, meanwhile climate change could significantly reduce supply through drought and hydrological cycle changes. Hetch Hetchy, unlike other water storage facilities in California, is relatively buffered from near-term climate change because of its high elevation. And it is the largest single source of water supply for the Bay Area. In the future, we will certainly need diverse supplies to rely on in a prolonged drought, but we will also need Hetch Hetchy more than ever.
Loss of the reservoir would decrease the Bay Area’s water and energy security, requiring new water storage (possibly in reservoirs not owned by San Francisco) and the development of new water and energy supplies. Such new supplies are not guaranteed to have the low greenhouse gas emissions profile that Hetch Hetchy water and power do — and they could worsen climate change while increasing our vulnerability to it.
So visit Hetch Hetchy. Stand on O’Shaughnessy Dam and feel the cool updraft. Appreciate what nature created and what the city built there long ago. Dams, including this one, don’t last forever, and perhaps in a few generations the conversation about a different future for the Hetch Hetchy Valley may be worthwhile. Then, we’ll need to weigh our options for other new large water supplies, all of which will have enormous environmental tradeoffs: think of building a desalination plant, fighting with Los Angeles over the Sacramento Delta, building a peripheral canal or siting new large dams in presently undammed Sierra mountains and foothills.
Fortunately, that time has not yet come, so this November, vote “no” on the “Water Sustainability and Environmental Restoration Planning Act of 2012.” Let’s keep Hetch Hetchy around for the forseeable future.Tags: sustainable development
- May 9, 2012By Jennifer Warburg
In recent months, Sacramento, Los Angeles and San Diego each passed their first Sustainable Communities Strategy (SCS) in response to Senate Bill 375, the 2008 state bill requiring each region in California to create a coordinated land use and transportation plan to reduce per capita greenhouse gas emissions from driving.
We in the Bay Area have the advantage of being the last among the big regions to pass an SCS. What can we learn from the other regions about the implementation of SB 375 and the prospects for better regional planning statewide?
Last month, SPUR explored this question in a panel discussion with four of the state’s leading advocates for effective strategies: Ken Kirkey from the Association of Bay Area Governments, Eliot Rose from the Center for Resource Efficient Communities, Amanda Eaken from the Natural Resources Defense Council and Stuart Cohen from TransForm. Given each area’s distinct circumstances and politics, it is difficult to generalize about their SCS process, but several broad lessons stood out.
The San Diego Association of Governments (SANDAG) was the first regional agency in California to adopt an SCS, and the results were watched closely by the state’s other metropolitan areas. SANDAG has the advantage of being a region that includes a single county, as opposed to SCAG’s six, SACOG’s six and the Bay Area’s nine. The SANDAG SCS passed in October 2011, and the region has looked likely to meet the Air Resources Board’s green house gas emission reduction targets early, thanks in part to the overall decrease in regional activity accompanying the economic recession. But the SANDAG SCS has received ambivalent reception, with many observers questioning whether the plan went far enough. As Eliot Rose wrote, “complying with SB 375 is a different thing than actually using the opportunities that the bill presents to produce substantive changes in the way our communities look and the way that we get around, and SANDAG’s RTP illustrates this gap.”
SANDAG has devoted a commendable investment to transit, a proportion comparable with Los Angeles at 47 percent, but the San Diego region is still directing substantial new development to areas where transit is likely to remain limited. According to Rose, only 53 percent of the region’s growth is slated to occur in Smart Growth Opportunity Areas, with the rest scattered in suburbs and unincorporated areas, even after the 2035 horizon when the region is unbound by general plan assumptions.
The SANDAG plan is currently held up in litigation, and its perceived shortcomings have prompted a wider conversation about whether more aggressive standards should be adopted in order to hold regional entities to their policy commitments.
In Southern California, the Southern California Association of Governments (SCAG) focused throughout its SCS process on overcoming the apprehension that measures to reduce greenhouse gas emissions are bad for the economy. Organizers gathered compelling data from expert studies demonstrating the market demand for transit, multifamily housing and walkable communities. Most promising were the voter surveys commissioned by SCAG which showed a population that embraces smart land use planning and wants to live in communities with many transportation options.
By mounting an extensive outreach campaign across the region, the largest and most heavily populated in the state, SCAG leaders were able to bring about a major shift in funding priorities. $246 billion, nearly half the plan’s total revenue will be spent on public transportation, including the ambitious 30/10 Plan to build 12 key transit expansion projects in Los Angeles in the next ten years. The plan quadrupled regional spending on bike and pedestrian infrastructure, but the final figure still represents just 1 percent of the SCS budget, falling far short of the 14 percent of funds voters said they would like to see spent on active transit.
The SCAG SCS was passed unanimously on April 4, and the broad support it was able to garner represents progress for the region. But voters are notably ready to see even more commitment to smart land use and public transportation investment.
Sacramento’s regional planning entity, the Sacramento Area Council of Governments (SACOG), passed its SCS just a few weeks ago on April 26. The plan focused on local rezoning around identified transit priority areas, defined as areas within a half-mile of high quality transit: a rail stop or a bus corridor that provides or will provide at least 15-minute frequency service during peak hours by the year 2035. But the Sacramento delta region lagged behind the other regions in their prioritization of transit, allocating only 32 percent of their overall budget, compared with SCAG’s and SANDAG’s 47 percent and MTC/ABAG’s projected 67 percent. Sacramento also plans to spend significantly more on highways than the other regions.
SACOG has earned praise, however, for allocating nearly 8 percent of its overall budget for improvements to bike and pedestrian infrastructure, far exceeding the other regions whose investments in active transportation remain a meager 1 percent. And Sacramento makes important steps in concentrating new growth within already built up areas, managing to grow by 39 percent, but increase its urbanized footprint by only 7 percent.
As the Bay Area's own SCS is finalized over the next year, our task is to continue to set a high bar—to keep shifting our investments towards more sustainable modes and high performing transport projects that are cost effective and support multiple regional goals such as reducing driving and expanding the economy. The other metropolitan regions are looking to ABAG and MTC’s Project Performance Assessment Process for improved economic, social and environmental goals with which to measure the merit of projects in the next SCS process.
- April 25, 2012By Egon Terplan, Regional Planning Director
Earlier this spring, high-speed rail in California took two very significant steps. First Bay Area leaders announced a plan to electrify Caltrain, which would make it possible for Caltrain and high-speed rail to share the same tracks between San Jose and San Francisco. Second the California High-Speed Rail Authority released an updated business plan that cuts the cost of the train system by a third.
The new business plan (download the official summary here) still assumes an electrified train system that will travel between San Francisco and Los Angeles in 2 hours and 40 minutes (at 220 m.p.h.) and will operate without any ongoing subsidy.
There are four key changes in this updated business plan:
1. It lowers the cost of the high-speed rail system by $30 billion to $68.4 billion by adopting a “blended” approach. This focuses investment on upgrading existing regional and commuter rail systems, not building an entirely new statewide system. The blended approach is realistic and allows for the system to be built incrementally. In the 2011 business plan, the blended approach was estimated to cost $78 billion. It is now estimated to be $68.4 billion. The savings are primarily due to updated assumptions about inflation and faster construction time. This approach has greater political support in adjacent communities (namely on the Peninsula) and has successful precedents around the world, including France’s popular TGV.
2. While starting construction in the Central Valley, it includes early investments in the Bay Area and Los Angeles (the “bookends” of the system). This includes the decision to help fund the electrification of Caltrain with a $700 million statewide investment in addition to $800 million in local and regional funds to help electrify Caltrain by 2020. Electrifying Caltrain will speed service (since electric trains can stop and start faster than diesel ones) and will reduce emissions by 90 percent. The new business plan also includes investment in upgrading the rail systems in the Los Angeles area. Overall, $3.5 billion will go into the urban systems over the next eight years.
3. It proposes that the initial operating segment will connect from the Central Valley to Southern California.The 2011 business plan proposed that the initial construction section would run from Madera (south of Merced) to Bakersfield. This business plan assumes that the system will begin with passenger service from Merced to a station in the San Fernando Valley. To connect from the Central Valley to Southern California requires investment in building passenger rail tracks over the Tehachapi Mountains to connect Bakersfield and Palmdale. This business plan assumes that this segment will have sufficient ridership and revenue to exceed its cost and will be self-sustaining without need for operating subsidy.
4. It makes high-speed trains part of an integrated statewide transportation system in California, where each investment has immediate benefits to its respective region. While the initial construction and operating segments will be to the south, the California High-Speed Rail Authority is proposing improvements to the existing regional rail system between the Central Valley and the Bay Area, namely the Altamont Commuter Express from Stockton to San Jose and Amtrak’s San Joaquin line from the East Bay to Stockton or Sacramento via Contra Costa County.
While we commend Bay Area leaders and the California High-Speed Rail Authority for taking these important steps to move the project forward, SPUR remains concerned that high-speed rail’s initial operating segment runs from the Central Valley to Southern California and will not connect to the Bay Area. We are also concerned that there is not yet funding to extend Caltrain’s service from the current San Francisco station at 4th and King to the new Transbay Transit Center in downtown. This raises a few questions:
· When will be there be a one-seat ride from San Francisco to Los Angeles?
· If there is funding to upgrade the Altamont Commuter Express over the Altamont Pass, does this mean a rider from San Francisco would take Caltrain to San Jose and then ACE to Stockton before connecting to the trunk line to Los Angeles?
· Does this mean that we should rethink Dumbarton Rail as an electrified service that could bring upgrades and electrified ACE trains to meet up with Caltrain on the Peninsula?
· What will it take to fully fund high-speed service over the Pacheco Pass south of San Jose?
The new plan puts the onus on the Bay Area as a region — and SPUR as a civic voice — to find the money to both bring Caltrain and high-speed service to San Francisco’s key transit hub and connect that service to the initial high-speed operating segment in the Central Valley.
Despite our concerns about the initial focus on the connection to Southern California, we at SPUR (like the mayors of California’s major cities) remain strong supporters of high-speed rail. The blended approach takes a pragmatic tack — without sacrificing true high-speed service.
- April 24, 2012By Corey Marshall, Good Government Policy Director
For the last decade, businesses in San Francisco have been adamant that the city’s payroll tax is holding back job growth. First, companies must pay the tax when they reach $250,000 in payroll, which discourages new hiring. Second, they must pay it when employees exercise their stock options — a strong incentive for any company considering an IPO to leave the city. SPUR, along with much of the business community, has argued that we should restructure the city’s tax system to remove these disincentives to hiring. Following payroll tax exemptions in 2011 for stock compensation and for businesses locating in the Mid-Market neighborhood, the call for payroll tax reform has sounded again. The city is finally responding, but will this effort lead to real reform?
City Controller Ben Rosenfield and Chief Economist Ted Egan have for the last three months been hard at work designing a replacement for San Francisco’s payroll tax. That tax is currently 1.5 percent of total payroll for every company with at least $250,000 in payroll. This means most businesses pay nothing, because they're too small to qualify. The city has also had difficulty collecting from entities that don’t clearly have “payroll,” including some partnerships, sole proprietors and financial vehicles. As a result, only 7,500 of the city’s 80,000 registered businesses pay the tax. One of the goals of the reform effort is to reduce rates on growing companies by asking all companies to pay something.
San Francisco is the only city in California to levy a tax on payroll; most other cities have some form of gross receipts tax. For all of the complaints about the city’s payroll tax, though, at least it’s simple.
Rosenfield and Egan have developed alternatives and conducted dozens of industry workshops to explore their implications. All proposals at this stage are designed to be revenue neutral (meaning they would create the same amount of revenue as the current payroll tax), but they would broaden the base of payers. In other words, the city isn’t looking for more money, but it is trying to increase the percentage of businesses that contribute.
To make the San Francisco ballot in November, proposed measures must be submitted to the Board of Supervisors by the first week in June. As of this writing, the controller’s office is on schedule to send a final proposal to the mayor and board president by the first week in May. There are currently two distinct proposals: a new gross receipts tax and a revised payroll tax. Below we summarize the main features of each. (You can also download the latest presentation from the controller’s office.)
Option 1: Gross Receipts Tax
Gross receipts taxes are based on a company’s total earnings, as opposed to a percentage of a company’s payroll. Most major cities in California have a gross receipts tax, and no other cities have a payroll tax.
· Uses industry-based rate schedules. Separates the business tax base into six groups, based on industry sectors. This structure mirrors that used in many other California cities but simplifies the structure with fewer schedules.
· Sets progressive rates. Transitions tax rates to a structure in which rates increase as earnings increase. Companies pay a higher rate as they earn more. Conversely, companies pay a lower rate if they earn less.
· Sets marginal rates. Creates tiers of rates that apply only to the range of gross receipts, rather than the entire amount of gross receipts, similar to personal income taxes. For example, a company in schedule 1 would pay 0.1 percent tax on gross receipts from $1 million to $2.5 million and 0.2 percent on all gross receipts from $2.5 million to $25 million.
· Broadens the tax base. Increases the number of businesses paying the payroll tax to 33,500 from only 7,500 in 2010.
Option 2: Revised Payroll Tax
The revised payroll tax proposal retains the current business tax structure but lowers rates in all categories and significantly increases the cost of business licenses.
· Increases business license fees. Retains payroll tax but increases business license fees at all levels. In the current system these fees range from $25 to $500 based on payroll. New rates would range from $150 to $10,000.
· Lowers overall payroll tax rates. As a result of higher license fees and a greater number of payers, payroll tax rates would actually be reduced at all levels. Rates would progressively increase with payroll but top out at 1.2 percent for those with the biggest payrolls.
· Uses progressive rates.Transitions the current 1.5 percent tax rate to a structure in which companies pay a higher rate as they earn more. Conversely, companies pay a lower rate if they earn less.
· Creates special real estate license fees. New rates would be assigned by type of facility. Residential buildings of more than four units would pay per unit, commercial real estate would pay per square foot of space, and commercial parking with more than 100 spaces would pay a flat rate per facility.
· Creates incentives for new businesses. Includes a one-year payroll tax holiday for all new businesses.
· Encourages growing businesses. Multi-year stock option smoothing and a $100,000 annual deduction for all businesses could help businesses grow and thrive.
· Broadens the tax base. Increases the number of businesses paying the payroll tax to 33,000 payers from 7,500.
All of this begs a very important question: What is the best way to transition a tax system that generates $400 million per year? Very carefully. The city is considering a multi-year transition that phases in the new structure in a way that ensures that the city doesn’t lose revenue — or collect too much. Details are not yet finalized, but it could look something like this:
Business Tax Phasing Plan
Old Payroll Tax Rate
New Tax Rate
Of course, there is always a third option: do nothing. It is still unclear whether a consensus will be achieved in support of a new structure.
Further complicating the process are separate proposals from the Board of Supervisors, including a small business payroll tax exemption introduced by supervisors David Campos and Mark Farrell, and a persistent push to generate new revenues from Supervisor John Avalos and others.
Depending on which path the eventual tax reform proposal takes on its way to the ballot, there are a number of possible outcomes. The mayor could simply choose to put a payroll tax reform package on the ballot by his own signature, in which case the board would have no influence over the content. But what happens if a proposal is carried by the board? Will there be adjustments to specific rate categories? Integration of one or more proposals from the Board of Supervisors? Perhaps even a proposal that generates additional revenue? Of course the more layers of complexity, the lower the chance that the proposal will make it to the ballot.
SPUR has mixed feelings about these proposals. We do not want to drive away firms headquartered in San Francisco, which is a real risk of the gross receipts option. On the other hand, we believe the payroll tax is probably worse. Our hope is that the city can fine-tune the gross receipts option so that it succeeds in building the tax base while keeping San Francisco a viable location for many different kinds of firms.
- April 10, 2012by Eli Zigas, Food Systems and Urban Agriculture Program Manager
Meals cooked from scratch. At least a quarter of the ingredients locally sourced. Fresh produce from the 1.5-acre farm adjacent to the new central kitchen. These are just a few of the goals in a new vision for Oakland’s school food program detailed in a recently released report.
The feasibility study, published by the non-profit Center for Ecoliteracy with the collaboration of the Oakland Unified School District (OUSD), looked at how Oakland’s school food program could be reformed to better serve the district’s goal of supporting the health and academic success of its students. The report found that the current infrastructure for the school meals program is stretched beyond its intended capacity and doesn’t have the space to efficiently produce high-quality, fresh-made food that can be distributed to the district’s 89 schools.
OUSD today serves nearly 30,000 meals a day to it students. With 70 percent of those students qualifying for free and reduced-priced meals, the bulk of the revenue that pays for the program's food, labor and overhead comes from federal and state reimbursements, which total less than $3.50 per meal. Despite the fiscal constraints, OUSD has a goal of improving the food it serves its students by overhauling its kitchen facilities and operations.
Specifically, the feasibility study recommends that OUSD dedicate $27 million for capital upgrades including:
- Redeveloping an existing OUSD property into a 44,000-square-foot commissary that would cook food for schools throughout the district
- Remodeling and upgrade nearly every school’s kitchen to either include the capacity for on-site cooking or reheating of meals from the central kitchen
- Creating a 1.5-acre farm adjacent to the new commissary that would provide ingredients for the meals
In addition to OUSD’s capital needs, the report also recommends increasing the school meal program’s operating budget by an average of $200,000 for the first five years and a long-term increase of 3.5 percent in staffing costs once all the new kitchens are opearational. To fund the capital changes, the report recommends that the district pursue local bond funding or parcel taxes, state and federal grants, philanthropic funding, and traditional bank loans. Funding to cover the increased operating costs for staff and overhead are projected to come from increased numbers of students opting for school meals, as well as greater program efficiency.
The report presents an ambitious vision — relevant not just to Oakland, but also to San Francisco Unified School District (SFUSD). The two school districts serve a similar number of meals per day and both have a similar number of students who qualify for free or reduced meals (more than 60 percent). Though the two districts have substantial differences — San Francisco no longer prepares meals from scratch in its school kitchens, for example — Oakland’s study offers one option for how a Bay Area school district could reform its school meals program. Other options the Oakland report did not explore include improving school meals by using an outside contractor or cooking from scratch in every school.
Whether Oakland embraces the recommendations or another path is to be seen, but the report offers a place to begin a conversation on both sides of the Bay.
- April 9, 2012By Noah Christman, Deland Chan, Vivian Chang and Cindy Wu
The Stockton Street Enhancement Project, spearheaded by Chinatown Community Development Center (CCDC) and SPUR, brought Chinatown and SPUR stakeholders together to discuss ways to preserve the economic and cultural vitality of Stockton Street while offering opportunity areas for improvement through the next decade. The project, made possible by a grant from the National Endowment for the Arts, included a walking tour and two workshops designed to address issues with the highly trafficked corridor.
Stockton Street has evolved over the years to become an example of true urbanization, replete with a strong transit network, multigenerational families living in tightly knit spaces, hundreds of mom-and-pop stores and a bustling streetlife. It has a dense immigrant population and plays an important role as a regional hub for both Asian Americans and tourists from around the world. Its success lies in its strong history of grassroots organizing to protect Chinatown’s affordability, culture and urban form.
Buildings along the corridor are typically mixed-use — with retail on the ground floor and housing above — and between three and four stories in height. In addition to storefronts, there are also many social services and institutions (i.e. health, education, religious and family associations) that line the busy blocks of Stockton Street.
The residential base, small businesses and marketplace feel are assets that should be preserved and enhanced as the neighborhood experiences change from major public projects such as the new Central Subway. Connecting Chinatown to Union Square and SoMa before fusing with the existing T-Third line as it extends to Visitacion Valley and the Bayview, the Central Subway could prove to be an catalyst for change along the Stockton Street corridor, reshaping the street’s usage patterns and drastically changing its character. The community planning process framed by CCDC and SPUR sets the overarching vision of how to preserve and enhance the neighborhood amid these oncoming changes.
With an estimated 20,000 people living in Chinatown’s 30 square blocks, many of whom are crowded into 8-by-10-foot single room occupancy units, Chinatown is the city’s most densely inhabited neighborhood. The average median income of these residents is $18,000 per year, with more than a third of the population being seniors who live on fixed incomes. The neighborhood is made up of 88 percent renters, and only 10 percent of households own private vehicles. Future plans for Stockton Street must take into account the needs of the people who live in Chinatown by focusing on the creation of safe streets, affordable housing, open space, timely and efficient transit and access to social services and educational and religious institutions.
Stockton Street is also an important cultural and social hub for Asian Americans from many of San Francisco’s immigrant neighborhoods, including Visitacion Valley, SoMa, Outer Mission and Excelsior, who take the 30, 45 and 8X buses that pass through the corridor. Other Asian Americans enclaves in the Sunset, Richmond, East Bay and South Bay depend similarly on Muni and BART as their connection to Chinatown. Regardless of their location, San Francisco’s Chinatown serves as the confluence for the Bay Area’s Asian Americans, with a large proportion of them attending school, worshipping, visiting friends or shopping in the neighborhood.
Through a walking tour and two workshops, one held in Chinatown and one held at the SPUR Urban Center, Chinatown CDC and SPUR implemented a rigorous community engagement process to better understand the needs along Stockton Street. These public discussions brought together a diverse group of stakeholders — including monolingual residents living along the corridor, local merchants, property owners, architects and planners — to talk about potential opportunities for change. Bilingual and bicultural, the workshops were conducted to be participatory and engaging for all groups involved.
At the start of each workshop, SPUR and CCDC staff analyzed the current state of the Stockton Street corridor and shared case studies, both local and international, as possible models for its future, after whichparticipants divided into smaller groups to run through three different brainstorming exercises: 1) current strengths and challenges of Stockton Street, 2) priority areas to focus on for its future and 3) the connection of the future Chinatown Central Subway Station to Stockton Street.
Participants quickly discovered that there is no single solution for Chinatown’s Stockton Street. On the contrary, there are many elements that work well, but have also proven to be challenges for functionality. For example, retail displays encroaching on to the sidewalk may initially seem innocuous and complementary to the street’s character, but when combined with open basement trapdoors, parking meters, unloading trucks and a multitude of newspaper stands these components quickly narrow the navigable sidewalk space.
Participants noted a similar dichotomy with the corridor’s transportation options. While the continuous flow of Muni buses provides near-seamless transit connections, their frequent stops also create traffic congestion. With pedestrians often forced into the street due to sidewalk obstructions, this congestion brings with it very real danger. Compounding this is the lack of open space along Stockton Street, with only Willie “Woo Woo” Wong Playground providing an oasis from the activity of the street.
In the second exercise the workshop groups identified many of the same priorities and solutions for the corridor. Short-term proposals included restricting loading and unloading during peak pedestrian hours, consolidating sidewalk stands and beautifying the street through painting, cleanup and improved lighting. Participants looked to similar streets around the world for ideas, taking inspiration from flexible parking options and sidewalk bulbouts, high-volume bus stops and pedestrian-scale full-spectrum lighting. Long-term ideas posed included eliminating a south-bound travel lane to free up transit and pedestrian flow, creating “flex delivery zones” dependent on the time of day and prioritizing travel lanes through traffic pattern analysis. Also proposed was the idea of “shoplets,” compact retail spaces that take over on-street parking in a similar manner to a parklet.
The final brainstorming exercise focused on the role of Stockton Street as the future terminus for the Central Subway. Participants immediately identified the opportunities in crafting the station as a hub of activity, art, business and culture while suggesting plaza space and rooftop decks as a respite from the street, along with improved signage and wayfinding for visitors. Finally, participants felt that the subway station’s construction could prove to be the impetus for the evolution of the Stockton Street corridor and the grand catalyst for lighting, transportation and façade improvements along its extent.
The feedback from the Chinatown workshop resulted in pragmatic ideas for positive and lasting change for the corridor, while the SPUR workshop, comprised mostly of working professionals, came up with more technical and creative thoughts on possible changes. SPUR and CCDC hope the City of San Francisco will prioritize these ideas in their plans as they pursue opportunities within the corridor.Tags: community planning
- April 6, 2012by Eli Zigas, Food Systems and Urban Agriculture Program Manager
On March 9, 2012, San Francisco issued its first zoning permit for “neighborhood urban agriculture.” The change of use permit, given to Little City Gardens, allows the small urban farming business to grow produce for sale at its three-quarter-acre market garden in the Mission Terrace neighborhood. It is the first permit issued under San Francisco’s pioneering urban agriculture zoning guidelines, which Mayor Lee signed into law in April 2011.
The permit is both a victory for Little City Gardens and the culmination of a multi-year effort to legalize commercial urban farming in residential neighborhoods in San Francisco. The permit, is, at its core, a simple recognition that the previously vacant lot is now being used to grow food according to basic guidelines. Securing the permit, however, was not simple. The process involved:
- four visits to the permitting office
- plan review by the Planning Department, Department of Building Inspection, Public Utilities Commission and Central Permit Bureau
- a $300 fee
- hours of conversation between the applicants and the various agencies about the new zoning law and the practice of urban farming
Little City Gardens has been at the forefront of trying to find a legal path to sell what it grows in the city. Now, having set the precedent of successfully securing a change of use permit, the path ahead for other aspiring urban farmers in San Francisco will be a little smoother.