San Francisco pension reform threatened by health law battle 

click to enlarge A proposal to change the way San Francisco businesses meet San Francisco's health care law could be in jeopardy due to the conflict over pension reform. (Getty Images file photo) - A PROPOSAL TO CHANGE THE WAY SAN FRANCISCO BUSINESSES MEET SAN FRANCISCO'S HEALTH CARE LAW COULD BE IN JEOPARDY DUE TO THE CONFLICT OVER PENSION REFORM. (GETTY IMAGES FILE PHOTO)
  • A proposal to change the way San Francisco businesses meet San Francisco's health care law could be in jeopardy due to the conflict over pension reform. (Getty Images file photo)
  • A proposal to change the way San Francisco businesses meet San Francisco's health care law could be in jeopardy due to the conflict over pension reform. (Getty Images file photo)

Business leaders are threatening to withdraw their support for several November ballot measures — including Mayor Ed Lee’s pension-reform measure — because of a rift over a proposed change to The City’s health care program. 

Business advocates are riled up over Supervisor David Campos’ proposal to change the way hundreds of businesses meet the mandate of The City’s universal health care law because they say it will result in a $50 million hit on businesses and cost jobs.

The proposal is straining the relations between the business community and the San Francisco Labor Council, which is strongly backing Campos’ legislation. Steve Falk, president of the San Francisco Chamber of Commerce, said he has asked labor leaders to stop pushing Campos’ proposal or suffer the consequences. Business organizations are threatening not to actively back or donate to November ballot-measure campaigns such as a sales-tax increase, a street-repair bond, and the union-supported pension reform proposition.

Falk said business organizations are not currently cutting any campaign checks until the issue is resolved.

Falk sits with the Labor Council’s president Tim Paulson on the political committee for Proposition C, the pension measure crafted by Mayor Ed Lee with labor leaders and the Board of Supervisors. The measure is dueling against Public Defender Jeff Adachi’s Proposition D measure.

Prop. C is being billed by Lee and others as the “consensus” measure, but a falling-out between business and labor could undermine that sales pitch.

“I can’t be a co-chair of anything with Tim Paulson … if the council is supporting a surprise measure that will cost business $50 million a year,” Falk said.

Falk is meeting with the Labor Council representatives today to talk about a compromise. Campos’ legislation, which goes before a Board of Supervisors committee next week, would change the rules regulating medical reimbursement accounts, which is one way hundreds of businesses meet San Francisco’s mandate that employers must spend a minimum amount on workers’ health costs. In 2010, 80 percent of the money put into these accounts, or $50.1 million, was put back into the businesses and not spent on worker health. Campos wants to prevent that by requiring that the funds remain accumulating in the accounts.

“You can’t ask the business community to fund tax increases, to fund bond measures at the same time you’re asking them to fund this $50 million impact, especially for something we don’t believe will impact health care at all,” said Rob Black, executive director of the Golden Gate Restaurant Association.

Paulson reaffirmed the Labor Council’s support of Campos’ legislation Thursday.

“There are businesses not putting any money into health care which is what the law is intended to do,” Paulson said.

jsabatini@sfexaminer.com

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