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SF Prop N Guide SJ Measure I

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SF
Prop O
City College Parcel Tax
Ordinance
San Francisco Workforce Education and Reinvestment in Community Success Act

Creates a new parcel tax to raise $45 million per year to support City College of San Francisco.

Vote NO

Jump to SPUR’s Recommendation

What the Measure Would Do

Proposition O would impose a parcel tax on properties in San Francisco to generate approximately $45 million annually to support City College. The amount of tax that a property owner would pay differs based on its size and whether the property has residential or non-residential uses. For example, owners of parcels with single-family homes would pay $150 per year while owners of the largest non-residential parcels in San Francisco (larger than 100,000 square feet) would pay $4,000 per year. The tax, which allows for an inflation adjustment increase of up to 2% per year, would sunset after 20 years. Property owners over the age of 65 would be exempt from the tax if they use their property as their primary residence.

The measure would require that the revenue be allocated evenly across four primary purposes[1]:

  1. Services and programs that support student enrollment, basic needs, retention, job placement and completion of educational goals.
  2. Programs that address basic skills such as proficiency in English and technology and that support students obtaining United States citizenship and earning a high school diploma or equivalent certificate.
  3. Workforce development programs that support job training, experience and placement of students into new or transitional careers and job opportunities.
  4. Programs and services (such as tutoring or counseling) and classes that support the academic and leadership development of historically underrepresented students.

Additionally, 1% of the revenue could be used to cover the costs of tax collection and administration by the city and 0.5% could be used by City College for administrative costs.

Prop. O would deposit the parcel tax revenue into the City of San Francisco’s general fund rather than sending it directly to City College, with oversight responsibility given to the Board of Supervisors, mayor, controller and a new oversight committee. As part of this structure, the measure also requires:

  • City College to submit to the mayor and Board of Supervisors an expenditure plan each year prior to receiving any funds.
  • The city controller to conduct audits of City College’s uses of the funds.
  • Establishment of a new oversight committee charged with producing an annual report regarding fund expenditures.

This parcel tax for City College would be separate from, and in addition to, the current $99 annual parcel tax for City College approved by voters in 2016 and slated to expire in 2032.

The Backstory

Over the past decade, fewer and fewer students have enrolled at City College. For example, in 2011–2012, nearly 50,000 students enrolled in credit-bearing classes; in spring 2022, fewer than 18,000 were enrolled in credit-bearing classes.[2] Some of this decline can be attributed to an accreditation crisis that started in 2013 and was resolved in 2017. Some can be attributed to general trends experienced by most community colleges in California since the start of the COVID-19 pandemic. Declining enrollment has led to declining revenue for City College, creating a structural imbalance where the funds the college receives for the number of students enrolled no longer provide sufficient revenue to support the costs of faculty required for the number of classes the college offers.

In the past two years, the budget picture has become so dire that two oversight agencies have rung alarm bells about City College’s finances. The accreditation agency deemed City College “at risk” in both 2020 and 2021, subjecting the college to enhanced monitoring. Meanwhile, the state-level fiscal watchdog warned last year that City College was on a path to insolvency. City College has also had exceedingly high turnover in its leadership, with nine chancellors in nine years.[3]

In 2021, City College faculty agreed to a one-year pay cut in an effort to help maintain class offerings for students.[4] However, the structural deficit continued, and in May of 2022, the City College Board of Trustees cut 50 full-time faculty positions as well as an additional 120 part-time faculty positions, which will result in students having access to about 300 fewer classes in the fall semester.

In response to these cuts, the faculty union — American Federation of Teachers Local 2121 — gathered signatures to put this measure on the ballot. Though it was not placed on the ballot by the City College Board of Trustees, the board passed a resolution in support of the measure.[5]

As a tax placed on the ballot through signature collection, Prop. O requires a simple majority (50% plus one vote) to pass.

Equity Impacts

City College provides higher education pathways for students who are disproportionately low-income and students of color. According to the Board of Trustees, “approximately 37 percent of students are low-income, and of those, 7,560 students meet the federal poverty guidelines of an income below $19,000, indicating the importance of CCSF as a path out of poverty.”[6] Compared to San Francisco’s general population, a greater proportion of City College’s students are Latinx and a smaller proportion are white.

Given City College’s recent cuts, students will have a smaller variety of class offerings, curtailing the courses of study available to them. With fewer class offerings, the college will not be able to offer courses during as many times of day, making it more difficult for students who are juggling work and/or family obligations to find options that work with their schedules.

Parcel taxes are considered regressive in that they impose a disproportionate burden on low-income property owners. Prop. O attempts to address this problem by differentiating between residential and non-residential parcels and by making the tax proportionate to square footage, based on the assumption that larger properties are more valuable and tend to have higher-income owners. Prop. O would also provide an exemption for senior households. While this tiered structure may be imperfect, it would be one way to make the parcel tax less regressive given the restrictions on property taxes imposed by California Proposition 13.

Pros

  • Additional funding for City College would expand course offerings and schedules, allowing students to explore new areas of study and providing more flexibility for students juggling work and school. This funding could also help students facing economic hardship stay enrolled by providing additional wraparound support services.
  • The parcel tax’s tiered structure aims to place greater burdens on property owners with greater capacity to pay the tax.

Cons

  • City College is not on sound financial footing. While recent changes may stabilize the financial picture, the past 10 years of City College’s history do not inspire confidence that additional funding will solve the underlying problems the college is facing.
  • This funding structure, which routes the money through the Board of Supervisors and mayor before falling under control of the City College Board of Trustees, will further diffuse responsibility — and accountability — for City College’s financial stability at a time when voters need that accountability to be very clear.
  • Even though this measure includes a tiered structure, the parcel tax will still, in some instances, be regressive by placing the same tax burden on property owners who have varying capacities to handle that burden.
SPUR's Recommendation

In the past 10 years, City College has repeatedly failed to align its budget to its available resources, risking insolvency and loss of accreditation. This approach has put the entire institution on unsteady footing. While additional resources from this parcel tax could provide a financial buffer for City College, the existing parcel tax that was renewed in 2016 was intended to provide a similar buffer and has not proven successful in stabilizing the college’s finances. This history indicates that the problems facing City College are structural, related to the management of the institution, and will not be solved by additional money alone.

Earlier this year, the Board of Trustees made the difficult decision to slash the number of faculty positions and class offerings in an attempt to right the financial ship. This comes at a significant cost to both students and staff at City College. We are hopeful that that decision — and the recent appointment of a new, permanent chancellor — will put City College on a path toward long-term stability. However, it's too soon to know whether that’s the case. Given that, it's also too soon to dedicate a new parcel tax that would invest more funds into the institution. City College’s stability — and reaccreditation — should be more apparent within two years, at which point additional parcel taxes or other funding would be a more sound investment proposal, particularly if it were controlled directly by the community college district and not the Board of Supervisors.

Vote NO on Prop O - City College Parcel Tax
Footnotes

[1] San Francisco Workforce Education and Reinvestment in Community Success Act, ballot measure text, May 12, 2022: https://sfelections.sfgov.org/sites/default/files/Documents/candidates/….

[2] For 2011-2012 figures, see City College of San Francisco Office of Research and Planning, “CCSF Fact Sheet — Annual Head Count,” September 2021, https://www.ccsf.edu/sites/default/files/2022/document/Factsheet-Annual-Headcount.pdf; and For spring 2022 enrollment figures, see Ida Mojadad, “City College Faculty Stage Sleep-In Ahead of Layoff,” San Francisco Standard, May 3, 2022, https://sfstandard.com/education/city-college-faculty-stage-sleep-in-ahead-of-layoff-vote.

[3] Nanette Asimov, “City College of San Francisco Seeks to Move Past Turmoil with New Chancellor,” San Francisco Chronicle, September 23, 2021, https://www.sfchronicle.com/bayarea/article/City-College-of-San-Francisco-seeks-to-move-past-16483274.php.

[4] Nanette Asmiov, “City College of San Francisco Instructors Accept Pay Cuts to Save Classes, Jobs,” San Francisco Chronicle, May 10, 2021, https://www.sfchronicle.com/education/article/City-College-of-San-Francisco-instructors-accept-16166880.php.

[5] City College of San Francisco Board of Trustees, “Resolution in Support of the San Francisco Workforce Education and Reinvestment in Community Success Act,” June 23, 2022, https://go.boarddocs.com/ca/ccsf/Board.nsf/goto?open&id=CFGRXP702485.

[6] See note 5