Categories: Opinion

Opinion: We need stronger relief measures

By Michael Spike Krouse and Stevon Cook

The economic impact of this global pandemic intensifies more and more everyday. Families are uncertain about what their children will eat since schools closed on March 16, 2020. Bills continue to pile up as many are uncertain about how to pay them, while people who have lost their jobs negotiate to defer April’s rent with their landlords.

As business owners in San Francisco, we join our neighbors in looking to civic leaders as they try to find the best solutions to address the financial challenges brought forth by this crisis while trying to keep one another safe.

The city has taken positive action by putting a moratorium on evictions; however, it is slated to end in two days on March 26, 2020. We are asking the Mayor and Board of Supervisors to extend the moratorium for at least 90 days. The federal government has announced relief for homeowners to avoid default on mortgages in addition to extending the tax deadline to July 15, 2020. Locally, we need to introduce policies that protect small businesses and families until the summer of 2021 if we’re going to be serious about giving our community some runway to bounce back.

Here is what we propose:

Tax Holiday for Small Business

We need to “hit the pause button” on sales tax for small businesses that have less than $2.5M in revenue per year, with a special consideration for large businesses that run low profit margins due to the high cost of doing business. For many small businesses the 8.5% is higher than their profit margin. The city made a good move in delaying (not deferring) the most recent sales tax payment (although many businesses had already paid it). We need to go back to incentivizing businesses to hire. We need to help them stay open. For example a small business that does $100,000 a month in sales pays $8500. However long the mandated shut down lasts, the Sales Tax Holiday would be double that. Closed for 2 months, get a 4 month Tax holiday, That would be $34000 in savings for this small business. This could be 4 months of rent, or 6 weeks of payroll. The city and the state need to also bear some of the loss burden that small businesses were forced to accept.

Universal Basic Income (UBI) for the Service Sector

It is likely a one-time UBI type of payment will be available for individuals that made under $99,000 annually and families that made under $150,000 annually last year. While it would be a great benefit to many – especially our public school families – it does not consider that San Francisco’s cost of living is well above $99,000 a year. There must also be consideration for those who may not have filed taxes, including our undocumented neighbors. Through philanthropic and local government revenue, a commitment to monthly $1000 payments would support an 18-month pilot for San Franciscians that work in the service sector.

Make Broadband Access a Public Utility

Within the last five years, the city has made wifi access free in our public institutions and along major corridors like Market Street and Van Ness Avenue. The San Francisco Unified School District is working diligently to launch online learning for our students and provide access to our existing laptops. However, we recognize the importance of eliminating the digital divide not only for our students but also for out-of-work residents looking for jobs and online professional development opportunities.

We commend the efforts of our local and state elected leaders as they work to create economic relief for San Franciscans. We see our neighbors helping the elders in our community, we recognize the clerks at our grocery stores as heroes, and we appreciate our first responders for carrying the heavy load of keeping us safe. We acknowledge that many people who have lost their jobs are feeling down. This moment hurts and the economic impact of this pandemic will be felt for some time. Our hope is that efforts like the ones we’re suggesting will help alleviate the pressure we’re all feeling, and that you don’t lose hope.

We will all get through this, we always do.

Michael Spike Krouse is the owner of the neighborhood bars Madrone and Pops. Stevon Cook is a candidate for District 5 Supervisor and serves a Commissioner on the Board of Education.

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