Newsom and his business allies work to kill proposed revenue measures by any means necessary
That measure would have created a transfer tax on sales of properties over $875,000 and generated approximately $50 million annually for affordable housing (funds that were drastically reduced in Newsom's proposed 2010-11 budget) while cutting in half the current requirements and fees on market-rate developers to create below-market-rate units. The plan would have stimulated both types of housing and created desperately needed construction work — an approach those involved called an elegant solution to several problems.
"To me, this was a win-win, solving two problems that are each a big deal," Metcalf told us. "I don't know what his reasons were for not supporting it. I was surprised."
But Welch said, "It collapsed straight up because the mayor didn't want to support a tax." Although Newsom told the Times it was because there wasn't broad enough consensus yet, "the mayor's reason is whole-cloth bullshit," Welch said, noting the role of the Mayor's Office in brokering the deal. "The mayor walks away from it because everyone wasn't in the room? Well, it's your room, motherfucker. Show some leadership."
Newsom Press Secretary Tony Winnicker refused to discuss these issues by phone, responding to our written inquires by noting that Newsom opposes taxes and thinks the best way to address budget deficits are privatizing city services and pension reform (although he opposes Public Defender Jeff Adachi's initiative, the only pension reform measure on the fall ballot).
"The mayor is opposed to the Board of Supervisors' proposals to increase taxes because they're not needed to balance the budget and they will strangle our still young economic recovery," Winnicker wrote, refusing to answer follow-up questions or support a statement about Chiu's measure that the OEA concludes is not accurate.
Like many political observers of all stripes, those from downtown and progressive circles, Welch criticized Newsom for his lack of engagement with city business and its long-term fiscal outlook, contrasting him with former Mayor Willie Brown, who met regularly with former Board of Supervisors President Tom Ammiano even as the two ran a bitter campaign for mayor against one another in 1999. "They dealt with the city's business like two adults who cared about the city," he said.
Welch acknowledged that there was still work to be done building political support for the transfer tax measure. He and other progressives would have had to win over city employee unions who wouldn't like the budget set-aside aspect, and Erickson and Metcalf would need to placate some of their downtown allies who oppose taxes on ideological grounds. But given how downtown groups are behaving right now, that might not have been an easy sell.
"There are members of the small business community that are averse to any taxes," said Regina Dick-Endrizzi, director of the city's Office of Small Business and staffer to the Small Business Commission, which was withholding a recommendation on the Chiu measure but planned to meet again to consider it July 12 (look for an update on the sfbg.com Politics blog). She said the small business community is having tough times and "they are just not sensitive to keeping city workers employed."
Larger commercial interests are being even more forceful in opposing the revenue measures. While a parade of workers, social service providers, and progressive activists testifying at the July 9 Budget Committee hearing implored supervisors to place all the proposed revenue measures on the ballot, representatives from the Building Owners and Managers Association (BOMA) and San Francisco Chamber of Commerce were the only two speakers urging supervisors to drop the measures and focus instead on creating private sector jobs.