francisco. this was an extraordinary an historic vote. but it was symbolic. remember, the new board of supervisors who convenes tomorrow will make the actual decision on who the next mayor will be. >> everybody came down to ed lee with the expectation that it will be done in the most intellectually honest way and in a way that role and order is respected. i think we discussed a few nominations and came down to this one by a common denominator. >> i had a sense of urgency because i did not want to see anyone being acting mayor in the presence of the board of supervisors. that is not the kind of transition i talked about. we need to have a transition --

legislative branch separate from the executive branch of san francisco. that is the best way to do our work. people would not like the situation of having an acting mayor and president of the board of supervisors. >> now the dominoes in this chain of political events were falling day-by-day. the next day, january 8, new board members were sworn in. >> congratulations. [applause] >> and on monday, gavin newsom was finally sworn in as lieutenant governor of california. >> the duties upon which i am about to enter. [applause] >> the very next day, january 11, the new board of supervisors met for the first time, with the

historic first decision of their new term. >> item 3 is a motion to ratify the appointment of a successor mayor due to the occurrence of a vacancy in the offense of a mayor expiring january 8, 2012. >> i am hoping for is, as we look forward to the confirmation of mr. lee, that we will also, leaving behind the kind of tactics that were used last week, that i thought really made the process feel more clumsy than it should have been. >> this is ed lee's day. i have said a lot about my perspective of this man who comes from the community, who is rooted in our community, who has a tremendous breath and death of city experience. colleagues, at this time, i hope and ask that we unanimously vote for ed lee to be our next mayor. >> supervisor campos? president to? supervisor chu?

supervisor colon? supervisor elsbernd? there are 11 ayes. the motion is approved a [applause] . >> colleagues, i am going to move that we recessed the meeting and we conduct the swearing in ceremony of the new mayor in the rotunda of city hall. [applause] >> so ended one of the greatest challenges the board of supervisors has ever faced, resulting in the first interim mayor in san francisco in 32 years. >> we had a real sense of belief when the full board made the final appointment to successor mayor. we thought there were some and gaps in our knowledge about how to appoint a successor mayor. by the time it was actually

done, it seemed almost easy, but it was not, to be honest. we had planned for different types of variables to occur, and none of that actually happened. no conflict of interest laws came into play, no inquiry issues. >> i thought they did a good job, actually, trying to figure out something that had very little precedent in our city's history, something that was very important. >> angela and her staff did an extremely professional job. she was on the hot seat, under a tremendous amount of pressure. i did not see a lot of the back room arm-twisting, hair pulling, chest pounding that was going on, the pressure she was under, but when she walked out into the board chamber, when she walked into the hallway and the reporters were chasing after her, she was precise and professional. >> in the end, there were some questions about the charter of

san francisco. >> our charter spells out a formal process, but lee is pretty silent on that application process. >> this has happened in 32 years, but i think we need some better certainty on how we deal with this decision of succession. >> the charter has worked several times during times of vacancies like this. it certainly worked during aftermath of mayor mosconi and harvey milk. >> so we may be seeing more of these successor issues coming up, certainly something we do not want to legislate. i hope that we can trust people to be grown up about it, but if that is not the case, we can spell that out. >> going through the first time with little knowledge and information was difficult. now that we have got our record of how to do this, i think the next clerk and the city will be much informed with having our process and having our archives to look too.

>> and that is how san francisco government worked out the kinks, twists and turns, bombs in the road, to select its new interim mayor, ed lee. san francisco's first asian- american mayor. >> this has been an unprecedented and historic transition of power here in san francisco. i am so happy the board of supervisors came together to select an outstanding choice along many outstanding candidates to lead us over the next several years. >> over the past several months when this issue has come up, it had been agonizing. the board has been put into a difficult situation. there are a lot of differences of opinion on how to run the city, how to mass make a decision, who should be in place, 11 people to agree on that is a challenging thing. i think we have done the best we can do in the process, considering the difference of opinions. >> the people of san francisco can now choose their mayor, the

direction they want to go. that is why this decision was so appropriate. >> the other big shock is that the moderates seem to have won this round. people thought, progressives have themselves on the board. there is no reason that they will not get together and take a noted leader who is a progressive to be interim mayor, and then stayed there for another term. the great thing about being in term mayor is to get to run as an incumbent. the fact that the progressives could not get together to get somebody into office as interim mayor in their own self-interest was very surprising for a lot of us. >> what happened in the last month in city hall was an incredible show of democracy that was part policy, part politics, and it all came together, and more than anything -- not just from a reporter's perspective, often was this? but there was a public interest as well on what was going on in san francisco government.

we take it for granted a law that there is a city government here. this was something that brought people together. you heard people talking about it at the cafes, park playground, people who do not always pay attention. in that $0.10, it was the best thing we could have done for city government, even though it was a little bit messy. it was a lot of fun and an eye opener. it got people interested again.

>> good morning. how are you? wifi working? you're not a way get. we are going to wake you up. i am pleased to open today with a special interview with the mayor of san francisco. please welcome mayor italy -- mayor ed lee.

[applause] >> good morning. thank you for making it out here. you are currently the mayor of san francisco. >> interim mayor. >> and you are running again in november. >> that is right, november 8. >> the mayor's microphone is not on. we have teams of people to fix this. perhaps one of your opponents is backstage even as we speak. >> good morning, everyone. [applause] all right. >> we will start over. you are currently the mayor of san francisco. >> yes, i am. >> and you're running for mayor as well. >> yes, and voting day is

november 8. >> you have to be a san francisco resident to vote for you. >> correct. >> it audience, raise your hand if you're a san francisco resident and a leader and that you are a registered voter. leave your hand if you're going to vote for the mayor. [laughter] that is everybody. amazing. it was unanimous. we also have people watching on tv, but they cannot raise their hand -- well, they could, but it would not be seen. this is my question. i cannot find any evidence that you have ever run for anything before. are you a politician? have you ever run for something? >> no, this is the first time i have run for public office. the last time i ran was in high school. >> personally, i find that to be a huge plus. let's talk about the high school election. i think it is relevant since it was your last. what did you run for? >> senior class president of franklin high school in seattle,

washington, where i grew up. >> did you win? >> yes. >> also, that is good. how did you win? during the campaign, did you go negative? how much did you raise for that campaign? >> [laughs] think my slogan was ed win, not lose. >> keep it simple. i think that is pretty awesome that you have never run for office. it gives you a perfect street. >> i have been working in san francisco government for 22 years. i worked for four different mayors and headed up five different departments of the city. >> some of the work you have done has been hugely positive, which is why we made a priority to invite you here. one of the things we have been focusing on at tech crunch is the problems with the payroll tax system in san francisco from a tech company perspective.

twitter and a lot of these companies are getting larger and threatening to leave the city because the 1.5% payroll tax in this weird stock option tax. talk about the things that you and the board has accomplished. >> certainly, when i came to office, there was already a notice on my desk that twitter had indicated that they were looking for space science out the san francisco because of our tax structure. so we worked quickly would supervisor kim and david chiu to study it the payroll tax structure was job-punishing. we realized that as companies started here, they wanted to grow. the numbers were speaking to us. twitter was sitting there were going to grow from about four hundred employees took maybe 3000 in the next two years. all of that was going to be taxed on them, and they wanted to maybe look at another location without that. >> so it twitter did not want to pay taxes.

>> no, there were willing to pay the taxes, but they did not want to be punished further growth was the distinction we wanted to make it a we work with supervisor kim to do two things. let's create an exemption and place it on one of the areas we want to revitalize, and that is midmarket. we went from 10th street, included parts of the tenderloin, and traded a six- year exemption in which it twitter said, that is attracted -- attractive enough, and they ended up signing a long-term lease. they and the shorenstein properties are getting their buildings ready to be retrofitted for seismic safety. >> this is on new employees with in a special area. >> that is right. >> and they have other employees outside of that area, and they will pay the normal payroll tax on those. >> that is right. if they are located in that area, than those net new

employees will be exempted. >> do you believe twitter would have left the city had you not come up with a compromise like this? >> yes, it was serious on their part. we met at their offices were there at today. in net -- in addition to meeting the cfo's and ceo's, i asked if i can meet with the employee is separately. they allowed me to do that, i asked what they liked about the city. one of the things they said to me was they enjoy the diversity that the city has, all of its culture and arts, but i really like is dedicated bike lanes. they really want not to have to drive to work. we have been working very hard on that. >> they ask for anything else? >> they asked that our city keep its innovative spirit. i think a lot of the young workers here -- >> anything specific? like, i would like you to promise me the giants will win the world series every year that

your mayor. can you promise that? >> i could do it with a few miracles for the next 15 games. i would love to promise that. we will have to depend upon some miracles to happen, kind of like last year. >> so you cannot promise that. >> i cannot, but i would love to join in on the miracle trip. >> do you have a chief logger position? because i am currently out of work. [laughter] i do not even need to be paid that much. i could be your blogger person. would that be a problem? >> that could be a different position we can create. aid is new media. >> i do not know what you said. i think you said no. i do want to get back to the tax issues, because it is a very serious. i am amazed that with the

disliked for business that i see what some supervisor's in this city, i am amazed you're able to work out a compromise at all, even for six years. was it difficult? >> i do not think it was that difficult. we had to get past the direct blast the rhetoric. people have seen companies to grow big and not contribute. >> and there was a lot of rhetoric. >> yes, and we just appears to through that. the number-one thing we have to do is create jobs. we have to see how we can attract business, make investment to get the appropriately turn so that more jobs are created. i want to make sure that companies start here, stay here, and grow. the way to do that is you sit down and talk with the technology ceo's and cfo's and the workers themselves to find out what it is that makes them want to stay here. you work on those things. whether it is bike lanes or

exemptions, taxes, even learning about the stock options and how that was going to hurt. >> the stock option part of this is a little different. for example, zynga is not in the exclusion area, correct? >> that is right. there on thompson street. >> said it will continue to pay payroll taxes. >> yes. they just moved in, and they could not offer a different move to midmarket, but they're going to grow and are about to turn public. they were explaining to us, this is how we start in growth, and if you're eager to punish us on taxing our stock options as they make us profitable, not only will the investors away, but i think the company will disappear. we had to pay attention to that. that is a story that came out of tech crunch. we realized stock options was

part of the compensation we were taxing. we had to pay attention to how the companies are growing here and make a distinction. we were able to do that was supervisor mirkarimi and supervisor farrell's leadership at the board, to pay attention to that specific idea. the board of supervisors and the mayor's office got together to offer that six-year exemption there and not tax stock options for six years. >> he had the tax exclusion area, which cuts out payroll, the payroll tax for new employees -- is that permit? >> six years. >> and you also have a six-year exemption on this 1.5% stock option tax. >> and that this city-wide. >> and that keeps zynga here. >> them and others that are about to go public. >> you have done everything. there's no more to do. >> no, no, there's plenty more to do. in fact, what we have started as an ongoing competition with

technology companies. that has been exciting to me, because the more i learn about the technology companies, companies that started up here, people who want to disrupt the way we do media and increase the value of their companies, we need to learn about that. the city government is still -- i mean, i have got the privilege of working with our young supervisors who are energetic and want to understand how we grow our companies here and how we make sure we make the decisions at city hall to allow the to stay here and grow. that is the number-one thing here. it is not just ending. in fact, the payroll tax exemption for six years on midmarket was just the beginning of that discussion. what we have promised to deliver is within the next year, to revamp our whole payroll tax and possibly to get rid of the payroll tax. >> i mean, really? the board of supervisors -- i am not going to say their communist, but they're certainly socialist. and they dislike everyone. [laughter] so they talk about twitter.

twitter should give us all of their revenue because we give them the privilege of existing, etc. it is almost that rhetoric. i do not know how you, as a normal human being, what into a meeting in say let's cut through the rhetoric and have a discussion about the economic impact of twitter leaving the city. those people did not seem to understand that. >> and i think we are having much more civil discussions about how businesses start and grow and what our obstacles are to get rid of to allow the growth to happen. the other part of it is that those jobs are coming right to san francisco residence as we speak. twitter, 35% of the jobs they have currently are san francisco resident. and more to come. as we talk about their building and as we work with shorenstein and we realize that they want to go gold platinum on that building for this indication, they're doing the best they can to retrofit the building. the jobs that will be offered in

the building from building maintenance, janitorial work, architecture work, a lot of jobs will be part of that. >> and it is pretty clear. even though they're not paying payroll tax for these supplies, the economic benefits of them -- >> are huge. today, this year alone, we leased out 4.6 million square feet of office space in the city. 1.6 million of that was technology companies using that space. >> can you put that into context? how much office space to tech companies currently have? >> there's 1503 technology companies in the city today, and they employ just south of 28,000 employees. that is a huge, huge market. >> sounds great. thank you very much. >> thank you. [applause] >> i do not live here. if i did, i would definitely vote for you. but i do not.

is there any last thing you want to say to the san francisco residence to convince them that you're not going to, you know, somehow turn on them? >> i have not been a politician. what i like about the city is i like the excitement of the success. i think the technology companies here are part of a huge group of companies that will make its cities successful. no, we are an innovative city, a city of of entrepreneurs. started today, with the startup battlefield that is going on this afternoon, with the hack-a- thon occurred earlier this week in, all part of the ability for technology companies to take advantage of the innovation we have here. what i will keep doing as the mayor, working closely with the board of supervisors is to pay attention and have -- and have constant engaged in dialogue with the companies. because you'll be joining the very stable companies like salsforce, treader , , zynga, as

they want companies to engage with them. as you see all of the company's living into mission bay, you also engage with the biotech, the life sciences, the green at technology companies coming into the city. they also want to be engaged, and all of the new innovations and new entrepreneurs and the spirit of our city. our cities the success will be depended upon our constant engagement with the technology companies, the companies that you represent, small ones. and if you can start here, then you'll grow here, and we want to make sure you stay here. >> that is awesome. >> thank you. [applause] >> i do not know if ever one hurt, but he said our cities successful based on our constant engagement with the technology companies, something along those lines. you speak plainly for politicians, and it warms my heart to hear that. thank you very much.

>> keep reminding us what we have to do. >> i will. i do not have a block, but i am going to tweet at you. how many people now are convinced that either you're going to vote for the mayor or you would if you were a resident of san francisco, raise your hand? lead to more than a unanimous. that is excellent. >> the neat thing, too, is we're not just a city on the west coast. we are an international city. so companies like zynga that are established, they know that they have an opportunity to establish a worldwide headquarters in san francisco. we are an international city. we understand -- just like this week, we're hosting the third senior officials' meetings in preparation for the asian- pacific economic cooperative council meetings that are happening right here in san francisco, because they know we are a gateway to the whole eastern hemisphere. so you're companies that start

here have a great opportunity to become international headquarters. that is what i want to see. i wanted to the global market happen right here in san francisco. >> you sound a little bit like -- i do not want to see the dirty work, republic, but you do not sound like a liberal democrat. and you cannot be mere without being a liberal democrat here. >> every mayor across the country as the pigeon to economics. that is the number-one thing. if we do not have our cities economically sound, we're a bad investment. i cannot afford the city to be a bad investment. >> i am moving back to san francisco just to vote for you. it is going to be amazing. thank you very much. >> thank you. thank you very much. [applause] >> i was just kidding about registering to vote 10 times.

i feel like all of us are starng to see what the problems in this country are. i think plenty of people are opinionated. i don't think there's many forums where you can really express yourself or try to make a difference or anything. i mean...wha'...whatdo... what do i do, ya' know? the only people that i'm able to affect are the people who care about what i have to say. there is something you can do, but i'm sure it wouldn't be, uh...easy.

different man: i get angry about it, but it's like... ya' know, in my own apartment. [laughs]