Twitter Tax Deal Causes Liberal Freak Out in Progressive San Francisco
- Posted on April 3, 2011 at 7:03pm by
Scott Baker
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SAN FRANCISCO (AP) — In the shadow of San Francisco’s stately City Hall, sidewalks abound with transients, drugs and crime. Into this neighborhood, one of the world’s hottest social media companies has promised to stride, offering urban rebirth in exchange for a tax break.
Tax incentives to bring businesses to blighted streets are not unusual. But this is San Francisco. And Twitter. The mayor supports the plan, but progressive politicians — and now the city’s largest public employee union — call the proposal a poorly crafted giveaway to the rich.
The conflict comes at a time when the city’s high tech economy teems with energy not seen since before the first Internet bubble burst more than a decade ago.
At issue is the city’s payroll tax. San Francisco is the only city in California to levy its business tax based on how much companies pay workers, rather than how much money they take in.
Since Twitter emerged as a side project of a San Francisco podcasting company in 2006, the business has grown from a handful of employees to a few hundred. With investors pouring money into Twitter, the company expects to grow to more than 3,000.
To do that, Twitter needs a lot more space. One option would be to flee to a sprawling suburban campus in Silicon Valley, where adding more employees would not mean adding to the tax bill.
AP
For a company that expects to add thousands of new of employees in the next few years, the savings would add up quickly.
“This is the moment we have been waiting for,” Lee said of the proposed deal. “The transformative nature of an anchor tenant like Twitter will revitalize this community.”
Yet in San Francisco, where an overall economy largely untouched by the recession has kept real estate prices among the highest in the country, some low-income residents worry that revitalization will just lead to higher rents. And city employees facing layoffs and contract concessions thanks to a massive budget shortfall resent what they see as a giveaway to venture capitalists and a bailout for landlords.
“Who are the (Twitter) investors?” Supervisor John Avalos told The San Francisco Examiner. “Probably some of the wealthiest people in this country. And we are giving them more wealth.”
Last Tuesday, members of a neighborhood group protested outside Twitter’s current headquarters, about a mile from the proposed new offices.
They accused Twitter of not living up to its pledge to be a good neighbor. They complained neither the city nor the company have considered the low-income residents who would be adversely impacted by rising rents spurred by the prosperity Twitter could bring.
“The residents are feeling that if they’re not going to benefit from this revitalization that the city is pushing for, it really doesn’t make sense for these companies to stay in San Francisco,” said Angelica Cabande, director of South of Market Community Action Network.
Twitter declined to comment on the tax-break fracas.
As a result of the controversy, a lawmaker on the Board of Supervisors’ progressive wing, Ross Mirkarimi, has proposed an alternative measure he says will fix an underlying legal flaw that has led to anxiety among hot tech companies looking to grow.
San Francisco’s payroll tax is unusual enough, but one provision makes it even more unique. The city in 2004 added language to the tax code to make clear that tax collectors considered stock options a part of employees’ compensation and hence taxable as part of the payroll.
For tech startups, stock options are one of the most common ways to hold onto employees, especially when a lack of funds doesn’t allow them to offer competitive salaries. When lucky companies reach a point where they can make their initial public offering of stock, those options can turn into a major windfall for workers.
But for companies in San Francisco, that windfall sticks employers with a huge tax increase right at the time they’ve issued the stock in an effort to expand. Mirkarimi’s proposal would place a two-year moratorium on taxing any company’s stock options to ease the fears not just of Twitter, but other San Francisco-based startups like social gaming leader Zynga and consumer review website Yelp.
“You don’t want to write law in a way that only helps one company or one neighborhood in one part of the city,” Mirkarimi said.
The Board of Supervisors is scheduled to vote Tuesday on the Twitter package, and Mirkarimi predicts it will pass even without his vote. If that happens, Service Employees International Union Local 1021, the public employees union, may seek a ballot measure that could delay the deal until voters weigh in.
City economic officials paint any failure of the deal not as a loss to Twitter but as a loss for the neighborhood, where more than half of the available commercial real estate sits vacant. While Twitter is the big fish the city is seeking to catch, any businesses within the geographic zone defined by the legislation would get a similar tax break.
“The benefit we want, which is jobs in this area, is not happening without some incentive,” said Jennifer Matz, director of the city’s Office of Economic and Workforce Development. Without such incentives, she said, the neighborhood has not seen improvement for a generation. “It resisted the last dot-com boom.”
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Comments (113)
Its Gonna Getcha
Posted on April 3, 2011 at 9:46pmThis premise about “financial equality” keeps magically repeating itself. There’s no way to base a financial structure in this country based on equality. Every single person being happy every single moment is insanity. Not even for a split second. Ever. Ever
Report Post »ReallyAUnionGuy
Posted on April 3, 2011 at 9:40pmSo if they don’t do it I m sure there are some other communities that can use the jobs.
PS Hey BLAZERS, can you help out some union guys that are trying to do the right thing. Sign up to follow the blog at http://www.firefightersforfreedom.blogspot or go to http://www.firefightersforfreedom.com and click on blog. The more support that shows the louder our voice becomes.
Report Post »Thanks, and see ya at a TAX day rally.
raggle
Posted on April 3, 2011 at 10:30pmI like it.
Report Post »wisehiney
Posted on April 3, 2011 at 9:34pmHey Twitter! If y’all move out here to NC, we will give you incentives, highly educated employees, great hospitality, but you will have to miss all of the fun when San Andreas cracks.
Report Post »ConsiderThis
Posted on April 3, 2011 at 9:19pmI can‘t think of anything quite as stupid as penalizing business’s for adding jobs!!!
If Twitter does get this deal and winds up improving the neighborhood forcing the poor to move on then maybe the Progressives can provide accommodation for these unfortunate folks in the higher end neighborhoods where I doubt you can find any of the lower class today.
Something tells me that right now the good Progressives of SF have these folks right where there want them!
Report Post »Derfel Cadarn
Posted on April 3, 2011 at 9:31pmUsing this logic GE must have eliminated unemployment nation wide to have paid no tax on $15,000,000,000.00 in profits.
Report Post »dcwu
Posted on April 3, 2011 at 9:19pmHalf a loaf is better than none dummies.
Report Post »marine249
Posted on April 3, 2011 at 11:31pmhalf a loaf of what? b.s. maybe
Report Post »dcwu
Posted on April 4, 2011 at 12:02am@Marine
Report Post »Half of some tax dollars for SF vs. no tax dollars.
SF is so hot to strip the rich of everything that they will drive the rich out of SF and get nothing.
dcwu
Posted on April 3, 2011 at 9:18pmSan Francisco Tax Policy: You have. We Take. FU.
Report Post »misteryuck
Posted on April 3, 2011 at 9:17pmThey (elitists stateists) feel that they must spread the wealth around. Hmmmmm….
Report Post »Now, where have I heard that before?
RightPolitically
Posted on April 3, 2011 at 9:16pmCommie SFO is a lost cause……along with Chicago, Detroit and so on, all by the way, BASTIONS OF LIBERALISM!
Report Post »malaglot
Posted on April 3, 2011 at 9:15pmOnly a liveral would believe that government not confiscating as much from a business as they otherwise might is the same as a “giveaway”. To believe that means to believe that all money belongs to the state and we are only allowed to use it in the amounts and for the reasons the state deems fit.
Report Post »angelcat
Posted on April 3, 2011 at 9:12pmSo these progressive nitwits would cut off their noses to spite their faces. This would provide jobs and revitalize the area but(HORRORS), it would give a company a break. That just can’t happen.
Report Post »tomae23
Posted on April 3, 2011 at 9:11pmI think it’s a great idea SF has put forward…tax tax tax…when they go broke independents and conservatives can move back to the ‘city by the bay.’
Report Post »SingerGuy
Posted on April 3, 2011 at 8:59pmThe Utah Economic Commission announced last summer that Twitter was abandoning California and moving to Salt Lake City. I don‘t know what caused them to change their mind but I’ll bet this dust-up causes them to rethink that move. Utah certainly has the high tech talent pool to support them coming out here, and I don’t think anyone will picket them for doing so. Plus, we have skiing!
Report Post »bclassic
Posted on April 3, 2011 at 8:52pmWho is John Galt?
Report Post »YouShallNotPass
Posted on April 3, 2011 at 9:03pmsomeone who would never consider doing business in SF, ever
Report Post »NOTYERHUCKLEBERRY
Posted on April 3, 2011 at 9:40pmMy thoughts, exactly!
Report Post »thermonator
Posted on April 3, 2011 at 8:46pmThese people crack me up. If they want a low rent district, why don’t they move to a low pay district, like Detroit for example.
Report Post »WHITE LOTUS2x
Posted on April 3, 2011 at 8:42pmIf the progressive politicians and SEIU dont want this deal it must be good for the economy. They dont want to see lower taxes for buisness suceed proving the progressives wrong. Lotus.
Report Post »Berbel73
Posted on April 3, 2011 at 8:41pm“Who are the (Twitter) investors?” Supervisor John Avalos told The San Francisco Examiner. “Probably some of the wealthiest people in this country. And we are giving them more wealth.”
Report Post »This is a perfect example of the progressive mindset. No the creators and owners of Twitter didn’t earn their wealth it was given to them by the progressives. Their arrogance is both astounding and appalling.
RoyHowell
Posted on April 3, 2011 at 8:40pmIt’s about CONTROL & POWER! Liberals and Elitist in their truthful mind want 100% control because they think they are above the minions and that THEY should have the POWER to make all the decisions. I mean, that’s fair right? Only the smartest should have control and power? RIGHT? RIGHT? or actually – LEFT.
It’s time to remove the word “Re-Election”. It needs to be abolished. We need men and women who will “serve” one term and then just go home, back to their regular lives. Put an end to the phrases:
“If you want to get re-elected I can help.”
“If you do this for me I can help you get re-elected.”
“We need to do this deal to get re-elected.”
“Re-election is coming up and I’ll stand with you if you stand with me on this.”
Get it? The price of Re-election is too damn high! Banish this word!
The price of “re-election” is too high!
Another word I’d like to get rid of is “fair”. There is no such thing. But that’s for another discussion.
Report Post »raggle
Posted on April 3, 2011 at 8:39pmEasy decision, relocate. Bring prosperity to a community that deserves it.
Report Post »Stoic one
Posted on April 3, 2011 at 9:08pmHow about simply a community that wants? apparently San Fran does not.
Report Post »RepubliCorp
Posted on April 3, 2011 at 9:17pmagree!
Report Post »Pioneer_Spirit
Posted on April 4, 2011 at 2:03amNote to “the City by the Bay,” CAT was courted by three maybe four states to relocate. What are the odds makers placing on the number of cities and or states courting Twitter? I am curious. ( didn’t Governor Rick Perry / Texas attract away from California 150 plus companies? )
Report Post »BetterDays
Posted on April 3, 2011 at 8:39pmMy seriously leftist brother in law is a states attorney based out of Sin Francisco, his office is probably trying to figure out how to sue Twitter so they can’t move and must pay three times the taxes on every employee. I just sit and wonder in dumbfounded astonishment at the insipid trype that emanates from the mouths of the far left.
Report Post »If they weren’t so racist and violent I would consider them un news worthy.
If at all possible be at peace with all men. Be quick to forgive, render not evil for evil, but do good to those that hurt you, for in so doing you heap coals on their heads.
beckwill
Posted on April 3, 2011 at 9:40pmWell said and true, even if it hurts.
Report Post »CaptainSpaulding
Posted on April 3, 2011 at 8:28pmSpread the misery equally in San Fran. (laugh)
Report Post »brntout
Posted on April 3, 2011 at 8:40pmAnd the tender loins (lions) prevail home of the fruits nuts and flakes where even the weather is……
Report Post »jefferson1743
Posted on April 3, 2011 at 8:28pmWhy not twitter GE doesn’t pay taxes why should twitter.
Report Post »1TrueOne55
Posted on April 4, 2011 at 2:01amWell then maybe GE should buy Twitter and then it could pay the taxes…
Report Post »brntout
Posted on April 3, 2011 at 8:20pmwhoops only had to know a union was invlved and stopped reading
Report Post »mrclean
Posted on April 3, 2011 at 8:20pmYet another opportunity for SEIU to flex it’s muscles and bully the locals right into the poor house.
Report Post »vennoye
Posted on April 4, 2011 at 12:04amThe only reason that liberals are SO in favor of taxing people is so that they can give politically motivated rewards to their friends. If tax policy is fair for everyone, they won’t have any political muscle (or graft)!!! It’s all about POWER.
Report Post »jds7171
Posted on April 3, 2011 at 8:18pmWow, the liberals are complaining about prosperity. That is a new one for me. I am just shocked. Its like a woman breaking off an engagement to a guy because he is wealthy.
Report Post »Liberals you are stupid.
BonnieBlueFlag
Posted on April 3, 2011 at 11:51pmWhat you don‘t understand is that they don’t want to clean up the homeless/ drug addict problem the article first mentions- they love it. Wherever there are drug addicts in the streets there *AREN’T* clean-cut nuclear families. They despise the type of Norman Rockwell America that made this country great. They would rather see orgies and dead junkies in the street. This is their illness.
Report Post »Boss J
Posted on April 4, 2011 at 1:51amPerfect view into the liberal mindset.
Report Post »We all have to be equal, even if that means we all have to live in poverty!
I would love to bring some of the libs favorite Democrats back to life and watch the old zombies beat the snot out of these fools. The Republicans are now the 1950′s Democratic party and the Democrats are just friggin insane!
hersey10
Posted on April 3, 2011 at 8:12pmAdd this to the pile of proof Liberals hate tax cuts , tax relief , tax incentives etc .
Report Post »Revere1
Posted on April 3, 2011 at 8:17pmLiberals haven’t a clue about tax policy. They think it’s their means of imposing “equality” of which they dictate the terms: http://www.battlefield315.com/2011/02/liberal-taxes-explained.html Basically, the idea of a company not being taxed to death is a tragedy in their eyes.
Report Post »GIDEON612
Posted on April 3, 2011 at 8:30pmThey not only do not know about tax codes, they don’t know what to think. The media has not told them what to think or how to respond yet. Those details will be in the main stream media after the gossip column.
Report Post »restorehope
Posted on April 3, 2011 at 8:33pmOnly in San Francisco can you hear people complain that a successful company shouldn’t be allowed to move to a poorer neighborhood because it might raise the standards of that neighborhood.
Oh, yes, that’s right……we all have to be equal. How unfair to those poorer people to actually have their neighborhood improved! Sounds like those San Fran progressives are being politically incorrect to me.
Report Post »joe conservative
Posted on April 3, 2011 at 8:49pmGreat comment hersey10, that sums it up. Rich liberals hate rich people, it’s just too funny. Look at Michael Moore, worth $50 million, yet hates the wealthy. The hypocrisy is astonishing with these people. http://www.youtube.com/watch?v=11eYGdOVnvc
Report Post »A Doctors Labor Is Not My Right
Posted on April 3, 2011 at 8:55pm““Who are the (Twitter) investors?” Supervisor John Avalos told The San Francisco Examiner. “Probably some of the wealthiest people in this country. And we are giving them more wealth.””
John Avalos is somehow unaware (?) that taxes actually take wealth from those that create it, and therefore lowering taxes IS NOT GIVING THEM ANYTHING, but simply taking less of what already belongs to them.
And yes, tax money belongs to the person who created the wealth to begin with (the individual tax payer), which why taxes are to be used for the immediate benefit of each individual in the same way.
Run from San Francisco, Twitter – they will destroy your business!
Report Post »cheezwhiz
Posted on April 3, 2011 at 9:01pmFacebook didn’t take the bait, they’ll be out of SF and in to Menlo Park…good for FB
Report Post »Showtime
Posted on April 3, 2011 at 9:06pmLiberals hate anything that makes good fiscal sense.
Report Post »A Doctors Labor Is Not My Right
Posted on April 3, 2011 at 9:19pm“The mayor supports the plan, but progressive politicians — and now the city’s largest public employee union — call the proposal a poorly crafted giveaway to the rich.”
All tax money belongs to the person who created it; Lower taxes are not a giveaway.
Set a flat state tax, and people will pay taxes according to the amount of wealth they actually create. And then after that wealth is taxed, you can’t take any more of it and call it another tax – because the definition of a tax is not merely “government taking money from someone”.
Report Post »Anti_Spock
Posted on April 3, 2011 at 9:20pmMessage to San Francisco: You’re killing companies with your taxes, forcing shady deals. Sounds like obamacare exemptions. Liberals just don’t get it!
Report Post »taxed
Posted on April 3, 2011 at 9:21pmOh how funny.
Like I always say, show me a lib and I’ll show you a hypocrite…
http://conservativepoliticalforum.com/index.php?topic=2416.0
Report Post »cheezwhiz
Posted on April 3, 2011 at 9:21pm“The benefit we want, which is jobs in this area, is not happening without some incentive,” said Jennifer Matz, director of the city’s Office of Economic and Workforce Development. Without such incentives, she said, the neighborhood has not seen improvement for a generation. “It resisted the last dot-com boom.”
Report Post »———–
Oh yeah , the great social justice incentives in SF ,
drunk bums peeing on sidewalks, half a dozen drug dealers selling assorted products at every intersection, gum and used condoms on sidewalks sticking to your shoes, smell of pee and poo everytime the fog moves in replacing the fog of pot smoke , ugly trannies yelling obscenities at public who ignore them , pimps cruising around keeping eye on their ‘assests’ , shopping carts loaded with recyclables guarded by homeless dogs, cholos and bangers packing heat looking for cash , wannabe hippies in their 30s protesting the Vietnam war ( yeah they still do that in SF) , calling people driving MBZ “ nazis” …..who wouldn’t like these incentives
cheezwhiz
Posted on April 3, 2011 at 9:41pm@ A Doctors Labor Is Not My Right
Report Post »Actually its not so black and white in this case.
There is that third element , corruption.
http://blogs.sfweekly.com/thesnitch/2011/02/newsom_behind_deal_to_keep_twi.php
Quote
This was happening as Newsom was running his statewide campaign for lieutenant governor. He opened his campaign headquarters at 1355 Market St., receiving discounted rent, which was later reported in campaign finance records as a political contribution from the building owner, Alvin Dworman.
End Quote
The owner of Market Sq building gave money to Newsom’s campaign , Newsom brokered Twitter to lease that building
marine249
Posted on April 3, 2011 at 9:48pmif Twitter is looking for a place to grow.
Report Post »there sure can come to the county I live in.
if the county fathers want tax the he!! out of them.
we will sure as he!! get rid of our fathers.
A Doctors Labor Is Not My Right
Posted on April 4, 2011 at 1:19am@cheezwhiz,
“The owner of Market Sq building gave money to Newsom’s campaign , Newsom brokered Twitter to lease that building”
The link mentioned blackmail – How does that factor in? Were they forcing Twitter to choose a particular building?
At any rate, I don’t like tax deals. Everyone should just pay a flat state tax.
Report Post »GETLIFE
Posted on April 4, 2011 at 3:09amLet’s see, a liberal government suggesting tax cuts (oops, sorry–“incentives”) for some rich people– to create jobs, and improve the economic situation in the area. And the liberal opponents are afraid that success will raise the rents in the area….
Report Post »TAXED, you are right, this is just too funny. Hopefully, Twitter will leave them to their hypocritical bickering and go somewhere else.
GETLIFE
Posted on April 4, 2011 at 3:19amProgressive rallying cry: “Keep our neighborhoods poor! Keep our neighborhoods poor!”
Report Post »(Could this neighborhood be full of minorities?)
Snowleopard {gallery of cat folks}
Posted on April 4, 2011 at 6:00amAlso add to it the fact SEIU is once again raising a stink over the situation.
Report Post »BSdetector
Posted on April 4, 2011 at 7:15am“They complained neither the city nor the company have considered the low-income residents who would be adversely impacted by rising rents spurred by the prosperity Twitter could bring.”
FINALLY, they‘re openly admitting that they don’t want prosperity and would rather have us all live in squalor.
Report Post »jackrorabbit
Posted on April 4, 2011 at 7:54amWhere is the “Rent is too D*** High” party? This should be right up his ally.
Report Post »watchtheotherhand
Posted on April 4, 2011 at 9:59amI say let’s take progressive socialism to its end game. Do away with money completely. Let those who want to work, work and those who don’t want to work stay home. Let those who do work not be able to charge anything for what goods or services they provide as this creates inequality and just proves their greediness. Anyone can have and take whatever they want with in reason whether they work or not or take financial risks or not. That way we can all be fair and equal. Except of course for those who bust their butts and those who don’t. This is why socialism is an EPIC fail !!!! People will not be motivated to take risks, expand, or work hard because the reward just isn’t there because of heavy taxation. Of course some will to some degree as it is just their bent, but on a whole society and the economic engine will slow to a static coast. Socialism is crap will always be crap and will ALWAYS lower everyone‘s standard of living without raising anyone’s standard except the politicians that live like kings compared to the rest of society.
Report Post »Jim in Houston
Posted on April 4, 2011 at 10:27amWhat else would one expect from Sad Fruit Taxco?
Report Post »TEIN
Posted on April 4, 2011 at 10:54amHow much more proof do Libby/Progressive or anyone one else needs?? You want business growth, lower taxes, you want to kill industry, raise taxes. Time for this class envy to end.
Report Post »