Julian Davis
By Julian Davis, special to Fog City Journal
March 3, 2009
Hats off to the organizers of Monday’s City Budget Town Hall. Hopefully this gathering will help spark a more adequate response to our city’s current budget crisis. At this point, we are all painfully aware of the city’s predicament and the effects of the economic depression on our fiscal situation. The staggering deficit projections have us reeling and almost incapable of understanding how to cope with the sheer size of the hole we need to fill. How are city leaders responding to the crisis?
Anyone familiar with Naomi Klein’s thesis in Shock Doctrine: The Rise of Disaster Capitalism can perceive a recognizable pattern at play. For years, conservatives have been waiting with bated breath for the opportunity to slash what they consider to be a bloated city budget. Now with the shock of the budget crisis and an economic picture that is worsening by the day, the conservative crowd, lead by Mayor Gavin Newsom, has a pretext to offer us their bitter medicine – across the board cuts to vital services and programs that form the safety net for so many San Franciscans. A previously imperfect system is being drastically scaled back leaving people who are already feeling the impact of hard times with nowhere to turn.
Progressives, who have what appears to be a firm hold on the local legislature, are responding with limited success. In order to preserve vital health and human services, it is obvious that the city will need a massive influx of new revenue. But while there is a general acceptance of the idea that cuts cannot be avoided, consensus on new revenue options is a chimerical ideal dangling tenuously and inadequately before our eyes. A proposed June election to vote on tax measures has been delayed indefinitely as Board of Supervisors President David Chiu nobly attempts to reach agreement with politicians who would rather see the poor exported from San Francisco all together.
We are at least half a billion in the red. Even if all the proposed tax measures passed, most of them requiring a two-thirds vote, we will be lucky if we raise $150 million. That’s at least a 3-to-1 ratio of cuts to new revenue. Even with our hard-fought victories in November, this situation has progressive San Francisco on its heels. What will the post-budget crisis landscape look like for progressives if we accept these numbers? We will be struggling to re-open health clinics, rec centers, homeless shelters, and after-school programs for a population of everyday people that may no longer remain. As progressives, we cannot accept the inevitability of cuts without demanding new revenue. In fact we ought to be taking a much a harder line. Absolutely no cuts without a substantial revenue plan.
Well you won’t find any credible revenue plan coming out of the Mayor’s office right now. For a Democratic mayor of the ostensibly liberal bastion of San Francisco, that is a laughably pathetic posture. Gavin Newsom is traipsing around the state of California running for Governor like a Prozac fueled maniac who is wantonly oblivious to the suffering of his constituents. He paints a picture of a little Shangri-la by the Bay while he waves a cleaver over everything that makes this city great. There is just no serious revenue plan in Room 200. The latest suggestions that have trickled out are either vastly irrelevant or positively insulting. One idea is for parking meters on the Marina Green. Another is to ramp up condo conversions. There is no way condo conversions can yield any significant chunk of change for the city without resulting in mass evictions of low and moderate-income tenants. Try again Gavin. Try harder. The Board of Supervisors should refuse to pass a budget until there is support from the Mayor for new tax revenue.
This is a pivotal time not only in the nation’s history but in our city’s history. What will be the legacy of depression-era San Francisco, this progressive stronghold we call home? Look what’s happening on the federal level. With President Obama, we have the most progressive federal budget in history and a commitment to raise taxes on the wealthy and on carbon emitting industry. In the coming years, the federal government will be taxing more and spending more to stimulate the economy, build infrastructure, create jobs, lower health care costs, improve education, and keep people in their homes. What will we be doing in San Francisco? Will we really be accepting deep cuts to our social infrastructure and putting up with insufficient revenue proposals? Will we be unable to figure out how to tax the rich and provide for our people? This would be a tragic result for a city that has so often lead by example.
The sad truth is that we cannot expect Newsom and the conservative bloc on the Board of Supervisors to come around. Reaching out to Republicans in Congress turned out to be an exercise in futility for President Obama. They dug in their heels, stalled, and offered no solutions. San Francisco’s conservatives are using the shock of the budget crisis and the economic situation to ram through an agenda that progressives have held at bay for almost a decade now. As long as we attempt to reach consensus with these folks, we are in a dangerous holding pattern. By the time we finally vote on a series of revenue measures, that may or may not pass, all the serious cuts will have already been made.
Here’s what we’ve got to do:
Enact a Substantial Revenue Plan in Phases
Phase one: We need an election as soon as possible. There is now talk of a July election. A summer election must happen with or without unanimous consent at the Board of Supervisors for every tax measure. Labor and progressives need to gear up every ounce of grass roots machinery they can and seize this moment to pass the tax measures that progressive beacon of hope, John Avalos, is drafting at the Board of Supervisors (sales tax, commercial parcel tax, carbon tax, vehicle impact fee, gross receipts tax, etc…). This includes Labor putting some real pressure on Gubernatorial candidate Newsom to support the tax proposals or suffer the consequences. Hopefully this will raise $150 million in new revenue.
Phase two: come back on the November ballot with a major overhaul of San Francisco’s business tax. Replace the payroll tax with a progressive graduated gross receipts tax, value added tax, or quasi-income tax that brings in an additional $150 million. By the end of the year we could have $300 million in new annual revenue in the budget – Enough that for every dollar we cut, we have at least a dollar in new revenue to add.
Cut from the Top, not the Bottom
Wherever possible, cut administrative and managerial positions and salaries not funding for direct health and human services. $200 million in cuts will still be painful and difficult choices will need to be made but this can be done in a principled and equitable manner. When the economy finally recovers, not only will basic services still more or less be in place, established revenue sources will pick up and allow for an expansion of a progressive vision for the city.
Tap into the Federal Stimulus Money
Our representative in Congress is the Speaker of the House for Christ’s sake. That should put San Francisco first in line for stimulus money. There are myriad ways of tapping into the stimulus funds but here’s one suggestion. Clean energy infrastructure is a major priority for the new President. San Francisco ought to get stimulus funds earmarked for the SFPUC to put solar panels on every school rooftop and every city-owned building in San Francisco. Other clean energy projects should include wind farms and geo-thermal power plants as well as ocean and wave power. We ought to find a way for the SFPUC to sell that renewable energy to city residents and businesses at a discounted rate compared to PG&E. The city makes money while residents and businesses save money.
Imagine that.
The Hunger Site
March 7, 2009 at 11:48 am
Thanks for the details which I missed from the Town Hall, Sue.
I was very happy to have a word with Supervisor John Avalos about saving the Tenderloin Health Clinic and other programs– and found him very attentive and concerned. Supervisor Chiu also impressed me with his statements.
I finally got around to hearing Newsom on KQED– rather pleased that it was not quite the hour-long one-sided promotion it had been in the past (although it came close– Krasny gushing about his past as a businessman and no one asking if the mayor ever finished his program at Delancey Street).
Newsom’s standard song and dance now is to profess his aversion to “regressive” sales taxes. Would they affect the poor as much as he claims (now that this city has become a Gotham of only the wealthy and the destitute)?
The poor and their growing ranks simply do not buy that much stuff. I wish our politicians could talk more about taxing the rich. But why would they? A sales tax spiel and other “tea tempest taxes” are perfect ways of diverting us from what is really needed now: going after the parasitical top 1 % who are taking the lion’s share of the world’s wealth and cleansing their consciences by tossing us shreds of hope via rapidly depreciating “stimulus packages” and clever refinancing plans.
Newsom on KQED; http://tinyurl.com/bj8esz
and in the past: http://tinyurl.com/yfwjxh
Do you think KQED might call on Cindy Sheehan (http://tinyurl.com/5kl2dx) to talk about her program on Green 960 (a great program if anyone has been missing it)?
Check it out folks: http://tinyurl.com/amdxpm
March 4, 2009 at 11:27 pm
Legalizing same sex marriages generates revenue!
March 3, 2009 at 10:23 pm
At the event on Tuesday night, Supervisor John Avalos outlined a number of potential revenue measures for the ballot later this year. Those measures include a half-cent sales tax, a $1,000 parcel tax on downtown commercial buildings, and a local vehicle license fee, if the appropriate legislation gets passed at the state level.
Contrast this to what Mayor Gavin Newsom is proposing and what Speaker Nancy Pelosi has been able to secure for the Bay Area from the stimulus package, and you can see that, apparently, despite the ascendancy of Obama to the presidency, class warfare is being waged by the Bay Area haves against the San Francisco have nots.
Newsom is proposing a $10,000 fee for TIC conversions to condos. Condo conversion has been a constant passion of his, going back to his days as a supervisor when he and Tony Hall together campaigned for Proposition R, HOPE (Homeownership something-or-other), a ballot measure that would have further eroded San Francisco’s only large stock of affordable housing — rent controlled units. He is also proposing that taxi medallions, which are now distributed by the City on a wait-list basis, be put up for auction and sold for hundreds of thousands of dollars apiece in the private market to the highest bidder, therefore ensuring the supremacy of cab companies over independent cab drivers.
And recently Speaker of the House Nancy Pelosi saw fit, in the negotiations to craft a federal stimulus package, to secure $100 million in funds for the rebuild of Doyle Drive because commuters from the North Bay have been so resistant to tolls and/or congestion pricing. That $100 million, distributed to social service agencies in San Francisco (and perhaps in Marin as well), could have made a huge dent in the deficits now faced by departments in San Francisco serving the most vulnerable and least politically powerful populations in San Francisco. Instead, people who can afford the few extra dollars a day that it would cost them to drive into the City (or to move here and forgo the commute entirely) have gotten off the hook for the fuelish [sic] ways once again.
March 3, 2009 at 2:59 pm
Thanks for this Julian. Sorry I missed the Town Hall last night, I had another meeting. Newsom makes me sick. I would vote for the Mayor of Los Angeles before Newsom OR Feinstein, but not be happy about that vote either. Right after Newsom stopped the City for paying for bottled water in City Hall, I saw him on a TV show where he tried to hide his own bottle of water when they came back from commercial and the camera unexpectedly focused on him, and he actually said “Did they see that?” Oh, why wasn’t my VCR recording then?!? It wasn’t a big thing, but speaks to the character of the man, or I mean, lack of character of the man.
March 3, 2009 at 1:47 pm
Good job, Julian … but where’s your quality Luke Thomas-produced mugshot to go along with the piece? You’re a hell of a lot more handsome than that photo!!
March 3, 2009 at 1:03 pm
Julian,
Your best work ever. Definitely the clearest description of our situation. Also, of our potential options. I watched the ‘Class of 2000’ tackle this same tax dilemma in 2001 and they rolled over and gave 85 million back to Downtown. And, in the process removed the kind of tax you’re talking about (later upheld as legal) which would have garnered us another 400 million or so. Gonzalez argued in favor of keeping the tax. Peskin argued against. Both will run for Mayor in 2011.
h.
March 3, 2009 at 12:49 pm
Great article, Julian.
A few other ideas:
1) Real Estate ‘flip’ tax for properties that are bought and sold on speculation;
2) Statewide reform of Prop. 13 for taxing corporations- this would raise massive revenue on the state level (prop. 13 provisions would remain unchanged for individuals);
3) Lobby for stimulus funds to pay for current infrastructure needs such as road repairs that we are unable to afford with the current budget;
4) Having commuters who use Marina Green and GG Park for free parking makes good sense. Our parks and transit infrastructure are being exploited by out of town commuters who work downtown. Make them pay for their parking (or use transit). It’s good for the economy and environment. Fees would be weekday only, from what I understand.
In fact, raising parking fees closer to market rates in other places in SF is a good way to fund transportation improvements and encourage folks to drive less.
5) review city contracts with private agencies (‘Public-Private Partnerships’), as in the case of our golf courses and the zoo. How it is that we privatize profit and socialize liability in these cases? Should be the other way around.
Thanks again, Julian for the great article.
March 3, 2009 at 12:47 pm
Revenue measures will not pass this summer if they require 2/3 vote. Unless the people who support this have a new idea on how to make it happen, then it is a waste of time.
The Mayor said on KQED this morning that in order to pass a tax with 50%+1 under Prop 218, a state of emergency needed to be declared. He felt this dangerous because it would expose the City to lawsuits, however this was not a concern when the Mayor legalized same sex marriage, so I’m sure that with a little pressure, we can prevail and call an emergency what it is.
In the case where a 50%+1 revenue election is not possible, then we need to figure out how to stabilize the functions of city government across the board, being careful to not play constituency against constituency. The City is the largest employer in the City and as such it has a duty to take the President at his word and cut hours not jobs.
Perhaps if we have that state of emergency, then we might be able to break the Police Officers’ Association and undo that giveaway contract.
There is no progressive case to be made that public health is more important than a functioning MUNI or that MUNI is more important than providing for childrens’ services or that keeping the streets well paved for cyclists is more important than providing a criminal defense for the indigent.
We’re all going to have to take a hit on this budget, the problem is simply exacerbated if one progressive constituency sells out others.
The challenge before progressives is for us to keep the hand of Ronald Reagan from reaching back from the grave to finally obliterate much of the public sector, this just at the moment that Reaganism has been discredited politically and economically.
We’ve already proven that we can do less with more, now the challenge is how to do more with less. One broad brush approach is for labor, the Mayor and Supervisors to seek a 4 day work week where employees earn 5 days retirement credit.
The fact that Pelosi is speaker should not put us at the front of the line, rather should give us a direct like to the heights of the federal government to bring San Francisco values to bear on a progressive people-oriented set of policies to cushion people from the effects of the economy as it falls and to chart a course forward once we’ve landed.
-marc