Airport disputes city’s tax claim

With hundreds of thousands of dollars hanging in the balance, San Francisco’s Airport Commission is disputing South San Francisco’s claims to a portion of the revenue brought in by a new long-term parking garage within the city limits.

South San Francisco officials said that lawyers for the two sides will be sitting down to discuss the options for settling the disagreement — options that include going to court.

South San Francisco is claiming that when the garage — located within South City’s borders, but owned by the airport — went from a United Airlines employee parking structure to a long-term parking facility for travelers, it became subject to a citywide 8 percent tax on gross revenues for commercial parking facilities.

In a Nov. 22 letter to South San Francisco officials, Airport Director John Martin said that the commission does not owe any money to the city because the site is owned and operated by the commission and, therefore, the City and County of San Francisco, not Ampco System Parking, which manages the facility.

That distinction, Martin said, makes the garage, a 3,000-space facility offering rates of $12 a day, a noncommercial parking facility not subject to South San Francisco’s commercial parking tax.

In his letter, Martin also rejected South San Francisco’s claim that the commission needs to obtain a conditional-use permit to operate the facility because the commission is a department of San Francisco and subsequently “mutually exempt” — as determined by Government Code — from building and zoning requirements of the municipality where the property is located.

San Francisco owns 26,054 acres — 40.7 square miles, or 9.1 percent — in San Mateo County, making it the largest landowner in the county. When the new parking facility opened in June, airport officials reportedly projected that it would bring in more than $14 million in revenue annually.

South San Francisco received $1.1 million from a citywide parking tax last year, said Finance Director Jim Steele. An 8 percent tax on $14 million would bring in $1.12 million and roughly double what the city receives.

South San Francisco Mayor Joe Fernekes said that the voter-approved parking tax needed to be “equally applied to anyone within the bounds of South San Francisco.”

“I think the next step is the two sides’ attorneys need to sit down and talk,” Fernekes said, noting that options could include going to court to have a judge rule on the discrepancy.

The two sides would likely discuss the relationship between Ampco and the airport and how it falls into South San Francisco’s definition of contract operator and airport operator, Assistant City Manager Marty Van Duyn said.

“We’re not going to waste a lot of effort to beat a dead horse, but if there is some reason to believe otherwise, then we’ll pursue our tax,” he said.

dsmith@examiner.com

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