Mayor London Breed speaks with a homeless man during a walking tour of the South of Market district. (Kevin N. Hume/S.F. Examiner)

Breed comes out against homeless tax measure Proposition C

Calling the flight of corporations and jobs “inevitable,” Mayor London Breed announced Friday she is opposing Proposition C on the November ballot that would raise $300 million annually for homeless services by taxing San Francisco’s largest businesses.

Breed’s announcement comes just days before early voting in the election begins Tuesday and is timed with other statements of opposition from Assemblymember David Chiu and state Sen. Scott Wiener, also issued Friday.

Breed argued that the measure lacks accountability and that it “could make our homelessness problem worse.”

“The City needs to audit the $300+ million we are already spending on homelessness,” Breed said in the statement. “Before we double the tax bill overnight, San Franciscans deserve accountability for the money they are already paying.”

The .5 percent gross receipts tax would apply to businesses with more than $50 million in gross receipts, about 300 to 400 businesses largely in the tech and financial services sectors.

Jennifer Friedenbach, executive director of the Coalition on Homelessness, who led the effort to place the measure on the ballot, said, “We’re confident we will win without her. We’re disappointed she’s not standing with us.”

Friedenbach said that for Breed’s talk about addressing the homeless crisis to become a reality more funding is needed. “By opposing this measure, she’s basically arguing for the status quo,” Friedenbach said.

Breed said that the tax would “decidedly harm our local economy” and warned of “the inevitable flight of headquarter companies—and jobs—from San Francisco.”

Analysis by the City Controller’s Office, released Sept. 24, said that the tax would have a minimal impact on the economy and would cost The City about 875 jobs over the next two decades. The report could not determine if it would cause businesses to locate elsewhere.

Supervisor Hillary Ronen, a supporter of Prop. C, said the revenue was needed to address the homeless issue “to make lives better for everyone in San Francisco” and noted how the companies who would be taxed have recently received a corporate income tax reduction.

“How exactly is the mayor planning on fixing the problem on the street without more revenue?” Ronen said.

Ronen also said opponents pointing to economic impacts “contrary to the facts is irresponsible and really disappointing.”

The San Francisco Chamber of Commerce is leading the campaign against Proposition C.

Supervisor Sandra Fewer said, “I disagree with their position especially when the Chief Economist for San Francisco states that Prop. C will have a negligible impact on our economy and the benefits could be cleaner streets and a more attractive city.”

While the most recent homeless count said 69 percent were living in San Francisco when they became homeless, Breed said increasing spending in San Francisco “could put us in the untenable and expensive position of funding services for residents from other counties.” She said a more regional strategy was needed.

The opposition by Breed, along with Chiu and Wiener, goes against the position taken by their political ally YIMBY Action, a pro-development advocacy group.

“YIMBY Action is a strong ‘YES’ for Proposition C,” said Laura Foote, executive director of YIMBY Action, in an email to the Examiner. “We strongly disagree with them on Prop C. Like all hard problems, reasonable people disagree on the correct solutions.”

Friedenbach previously told the San Francisco Examiner that “we are very confident this is going to make a very dramatic impact on the visibility of homelessness on the streets.”

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