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SF rent tax vote still too close to call [Updated]

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Commercial rent tax barely squeaking by while similar measure tanks

A busy street in downtown San Francisco. Photo by Ben Bryant/Shutterstock

Update: On Friday morning, the Department of Elections’ most recent figures showed that Proposition C’s lead was down to 50.18 percent, or 78,509 among 156,459 votes cast. That’s a margin of only 559 votes, almost as close a race as the still hotly contested mayoral election.

Additional counting did little to change Proposition D’s prospects, and it still appears well and truly sunk. While there might technically be enough uncounted ballots to give Proposition D a simple majority victory in the end—however statistically unlikely it would be—because of the arcana of San Francisco’s budget rules the measure needs to pass by a two-thirds majority.

If neither proposition passes, SF’s commercial rent tax will remain as-is: 0.285 percent for “gross receipts between zero and $5 million” and 0.3 percent for gross receipts above $5 million. A 0.325 percent rate will kick in for $25 million-plus properties in 2021.

San Francisco’s mayoral race is still too close to call Thursday morning, but it’s not the only nail-biter in election land.

As of Wednesday night, San Francisco’s Proposition C held a slim lead in counted ballots, with the Department of Elections reporting 50.31 percent in support, a margin of only 934 votes as of this morning.

Proposition C would level new taxes on some commercial rents and put the money toward education and childcare services.

According to the election summary:

This measure would impose a new gross receipts tax of one percent on the amounts a business receives from the lease of warehouse space in the city and 3.5 percent on the amounts a business receives from the lease of other commercial spaces in the City.

[...] 85 percent of the revenues the city collects from this additional tax would fund child care and education for children from newborns through age five whose parents earn 85 percent or less of the SMI [State Median Income], child care and education for children from newborns through age three whose parents earn 200 percent or less of the AMI [Area Median Income...and] increased compensation for people who provide child care and education for children.

Board of Supervisors members Norman Yee and Jane Kim proposed the measure, citing the exodus of families with children from the city and arguing that funding for childcare will help keep some in place.

The U.S. Census estimates that in 2016, only 11.6 percent of SF residents were age 19 or younger; in 2010 it was 15.2 percent. The census doesn’t furnish a corresponding national estimate of those 19 or younger, although the population of those 18 and younger is roughly 22.8 percent nationwide.

Photo by GagliardiImages/Shutterstock

Proposition C was competing against Proposition D, a similar commercial tax backed by a majority of the Board of Supervisors (including mayoral candidate London Breed) and put the money toward “homeless services, housing for extremely low- to middle-income households and, other public purposes.”

If both propositions passed, only the prop with the most votes would have gone into effect. But Proposition D tanked with only 44.59 percent in favor, well short of the two-thirds majority it needed.

On Wednesday night, the San Francisco Chronicle reported that the Department of Elections estimates some 90,000 ballots still uncounted, more than enough to tip Proposition C one way or the other.

Proposition D, on the other hand, is statistically unlikely to get the votes it needs despite the large number of uncounted ballots, although technically anything is possible.