-- counseling to taxpayers aren't -- and also after the fact. that is because we have more pairs and those that are paying and more complex tax. the measure and mission are increased administrative costs in the formula that you see in the legislation. those costs had no more of an increment of to% of the tax collected. our conversations is a phase i and their implementation. it seemed to indicate that the costs will be between $3 million to $6 million would be the current working estimates. that is envisioned in the former was and the net revenue numbers we're talking about. that is a high-level summary.

while the gross receipts tax is certainly more complex and challenging for the city to administer and taxpayers to pay, it:-#dd is the norm in californ. many other governments have grown used to collecting this tax and often taxpayers are paying this tax in other places. that provides some comfort that there are places to go when questions come up. because others are dealing with these legally and administratively that we do not have with the payroll tax. the rules are developed by dess and applied to us. iwe're t that way. >> ískrwe have exhausted the presentation. on the transfer tax item, why do we go to that quickly so we can

take public comment? -- don't we go to that quickly so we can take public comment? >> good afternoon, again, supervisors. we have done an analysis on the impact of the transfer taxes that are before you. as -- the cityóz9kñ charges a tx on real property equal to a percentage of its sales price. pmñit is a progressive tax which increases with the value sold. there are two measures that would place an increase on the tax.

one is sponsored by supervisor, raising the rates between 2,000,025 million. the other would raise the tax rates by a smaller amount. but this is a general tax and any proceeds would go into the general fund. this is an outline of the proposed rate increases. this would increase the tax from about 2% 2.95% 4 1 million to 5 million and from 5 to 10 and 2.4 to 2.7 for $10 million and above. this would increase from 1.75 to 2.25. in terms of the economic impact, this is a tax that falls on the seller of the house or

property. what it effectively as it gets -- is it gets passed on to the buyer. the reason for that is the virus cannot avoid that process -- the buyers cannot avoid that process. these are fairly defined sub- markets. the impacts of that are higher housing prices for residential properties which leads to higher wages and a higher commercial real estate price which leads to high commercial red. this is where the negative economic impact on the private sector comes from in increasing the transfer tax. as with the gross receipts tax, the increase in revenue is positive and the fact is a result of the interplay of the negative and positive factors. our estimate of the proposals is their economic impact is virtually identical in the context of an economy the size of the city which is $100

billion. 150 jobs will be lost, upset -- offset vw24&h(ublic sector jobs. we are modeling these as a float to the general fund, not as if it was modeled to any particular use. a subsequent policy decision directs these to housing or any other purpose, that could change the economic impact. this is a proportional increase of city government. the essential net economic impact of this is about 140 jobs in both cases. i would be happy to take any questions. supervisor chu: why don't go to the budget analyst report? no, at.

-- no report. i have a number of speaker cards before me. gordon mar, and gabriel holland. >> please line up on the right side of the room. >> and another speaker. if you heard your name call, please line up against the wall. that is the preference of our cleric. -- clerk. first speaker, please come on up. >> good afternoon. i am the owner of world motors in san francisco and i have the

honor of san francisco mercedes- benz with me. the average car dealership has a 2% return on sales. i am here today to urge the committee and mayor's office to understand the impact of an increase to of tax burden. agribusinesses -- our business is one of eight car dealers left. there is eight of us left. we provide the city and county of san francisco with nearly $9 million in sales tax revenue and employ more than 1500 people. more than 80% of the jobs are considered blue-collar and are in the parts repair or technician side. our coalitionrs7 need to change to gross receipts tax and appreciate the hard work that has gone into that but we urge you not to increase the tax burden so we can compete with our auto dealers in the region. we're proud to sell cars that provide good paying jobs in san francisco and urge the committee

to ensure that our tax burden does not increase. >> i am the owner of mercedes- benz in san francisco. mark -- smart car as well. on this issue we are family businesses. we have been around for 50 years and just celebrated2 anniversary. harbison said!@

last three years is how to run a business efficiently or what we think efficiently. and my father and i take pride on how --6úçaç having a tenured staff. the first thing that happens when we're looking at how to run this business with an operating margin of less than 2% over the last three or four years, if you look at our financial statement, these blue-collar jobs tend to be the first ones to go away. we tend to reduce staff which we learn to do very well in the last three or four years. that is something that hits close to home. these are blue collar workers, people i have worked with. i have been with the bus -- business for 20 years and these are people that i do not want to -- i want them to keep working. thank you for your time and thank you for getting to understand our business. supervisor kim: thank you.

kraska afternoon, everyone. i am an insurance broker. i am sure 800 small businesses in san francisco, including some of the auto dealerships and i have lost some of the auto dealerships because they could not afford to do business in san francisco, or they have gone out of business. i want to thank the comptroller's office and think the economists but also you supervisors, understanding the stakeholders and all the people involved in trying to make this equitable. some of the numbers i see is my business can live with. i am concerned about people like the automobile dealers like mercedes and audi. because of the gross receipts. their margins are very little. it is either 1% or 2%. we really need to look at that gross receipts and make it equitable so there will stay here.

i know there are automobile dealers that have made huge investments like the infinity store. we'reylju encouraging try to get auto world back in san francisco. equitably, they're not going to come here and invest. or they may leave here because it may not be profitable for them to be here. i am asking the board of supervisors and the economists and everyone to look at that particular stakeholder in the city that brings us a substantial amount of revenue that we cannot afford to lose. i want to thank all the parties for being sensitive to small businesses. thank you. supervisor campos: thank you. i have a few more cards. -- supervisor kim:, i have a few morchu: thank you, i have a few

more cards. >> i am the director of jobs with justice and here as part of the progress of revenue coalition which is a -- includes a broad range of labor groups that are working together to support good public sector jobs. in 2010, our coalition was involved in a campaign to pass proposition n, a transfer tax. it mitigated the budget deficit. we have been working on new revenue strategies including the tax measure campaign and the city college parcel tax and we support the housing trust fund effort. we will be speaking to --

there's a clear and urgent need for additional revenue, to restore the painful budget cuts and fee increases that have happened over the last 10 years. om that better than we do. in april, ted egan came and did a presentation on the different business tax proposals that were being considered and we fully supportui%by framework shifting from payroll tax to gross receipts tax. we are disappointed to find that the proposal is being considered -- the proposals being considered did not address the city's need for new revenue. we actively worked with supervisor avalos to create an alternative business tax measure and we thank supervisor kim, mar, olague, and campos to sponsor it. we look forward to supervisor

chu also been on board. we support amending the fee structure to add an annual adjustment based on the consumer price index. supervisor chu: thank you. next speaker. >> i am the secretary treasurer of opiu local #3. i was encouraged by the controller and the report talking about the two initiatives and how close they are. the idea of switching from a payroll to a gross receipts is something that we obviously need. we need some stability within our economic system. we need to make sure that we're creating jobs through the tax system and we need to spread the tax base. -- tax burden on all of us. that is good policy and we

support that. supervisor avalos's initiative is more progressive in terms of taking care and try to protect the small businesses and bringingp0wz in more revenue bd on the license fee. i was heartened that the complaints that have been heard recently from the business community do not have to do with the license fee so the fact that we're getting our revenue mostly from the license fee of with those who have $25 million or more in gross receipts is very encouraging and i think the way to go. we really think this is good policy. we also understand we're very close with this deal that we want to work together to make sure that we create a policy in san francisco that create p and provides a brod based for achieving that kind of tax revenue that we need. thank you.

>> i will be reading a statement from one of my members. her name is from a cut garcia. i am a student in san francisco state university and part of students with [inaudible] i am a single mother with two daughters. for as long as i carol burke, my parents have always worked to provide for our family, even if that meant working two jobs over 20 hours a day and graveyard shift. i have been able to see how much they struggle to provide the best possible for my sisters and i. year after year, they paid taxes, sometimes even thousands of dollars. we have always been a low-income family. my heart -- mother needs a heart transplant. it is not fair that my parents

have to pay more taxes than some of the workers in san%éjañ frano and businesses that do not pay taxes. the business tax measure put forth by supervisors of fallows, kim, campos, and a lot gate is a clear example of what is needed to raise the revenue for san francisco. itq:g- is targeted at the highet growth companies that do business here in the city. there should not be a fear of losing businesses that pay little or no taxes. there should be more concerned on keeping families in sf. i come from a small community, from district 10 and i am proud to say that the small business act i would like to support. and seeing small businesses thrive on community support brings the heart of the city. the city has numerous support when it comes to mom-and-pop stores and not to hear a flinn

script on paying taxes is kind of disheartening. i hope the tax is the best we can come up with. supervisor chu: thank you. >> thank you for hearing me. i am city college student and also a member of students making a change. it is an estimate that many businesses for the past 10 years have not been paying their share of taxes. i am urging you guys to support the business tax measure put forth and it seems like it is the best measure for recuperating lost revenue. the difference between the amounts would be significant and it would be helpful if they did

their fair share. it is on these businesses that can afford it. thank you. supervisor chu: thank you. next speaker. >> good afternoon, supervisors. i work with coleman advocates for children and youth and i am here on behalf of colon members and the progress of voting coalition. three weeks ago, the supervisors in this chamber saw the need for clear revenue to fund vital city services. we have for the line over and over again, it is not just about cuts but we have to bring in more revenue as well. it is time to walk the walk. time to make sure that we're not just cutting but increasing our pot as well. the two business tax measures before you are one and the same. how much are we willing to hold some of the wealthiest businesses in san francisco accountable? the exception lies and if we're willing to stand together to ensure that downtown pairs -- pays its fair share.

the measure shows the willingness to not just talk the talk but walk the walk. once on the ballot, san francisco voters have shown as they did with the transfer tax they're ready for big business to begin to pay their fair share. thank you. supervisor chu: thank you. next speaker. kathy burke. if you have not heard your name called, please line up against the wall and we will call you as you come up. >> good afternoon, everybody. i am with south of market committee action network and i am here to read a statement from the co-owner of jp's restaurant. this restaurant has been in the south of market since 1994. they used to be called new philippine as restaurant. we did a lot of hearings

throughout the city. we also have catered for elected officials for their events. there is a lot of businesses that have been displaced. the rent keeps going up and the seals keep going down. eyeless lost my business. that is why i support the proceeds supervisor avalos has proposed. it would help me and the low- income businesses. we need the low-income businesses to stay in the city. we're tired of being displaced. i urge you to consider the gross receipts tax that were proposed will save us. while some people see so much downtown, we see some of what is. thank you. supervisor chu: thank you.

next speaker. >> good afternoon. i'm with the council of community housing organizations. with the progress of revenue coalition and have been talking to many of you about the housing trust fund we have been working on. one of the things when we began working on the housing trust fund was acknowledging a need for new revenue, not just new revenue for housing but for all including new city services. the housing side alone, we have experienced an incredible loss of $50 million in redevelopment this year. a loss of 40% in federal funding, much of the cdbg funding that goes to housing but to related city services. not only that, but our members are also involved with small f', helping small businesses prosper and advance. we need a revenue proposal that takes care of small businesses and spreads the share of the tax

burden across all income levels. we hope that you will work toward one measure that is progressive and adds a substantial amount of revenue as needed as we face budget cuts year in and year out. thank you very much. supervisor chu: good afternoon -- > > good afternoon. just to punctuate, we have been working hard on the trust fund -- on the fund and appreciate that many members of the board have sponsored the measure and it looks like it comes to the board next tuesday with very favorable prognosis. we also recognize how closely related is to the conversations around revenue. so we wanted to come here to show our support for this process in the same spirit that i think the housing trust fund has become a big tent measure

that will hopefully go to the november ballot with a lot of popular support. we encourage the big tent revenue measure that would be on the ballot as a companion piece. which would be a great outcome for all this, not just housing. thank you. >> hello to the board. i am a part-time faculty member at city college and a member of ast 2121 and i would like to support the abolition initiative because it feels strange to be living in one of the wealthiest cities in the country went public education is being decimated and i have to pay twice as much to ride the bus and now that i did two years ago. we have needed to recover the yearly loss of the $25 million in revenue since 2001 due to the city's settlement of a lawsuit brought by the big corporations, not the small corporations.

our schools and public services need as much revenue replaced as we can get. $40 million is a lot better than $14 million. thank you. >> good afternoon. debbie lerman. i want to appreciate the vision for tax reformik&÷n that stabils and increases revenue coming into the city and is consistent with progressive principles that will equitably distribute the burden across the business community including protecting small businesses and insurance the most profitable businesses will pay their fair share. we hope that this board will pass on something that we can all endorse and work together on. in particular, we would like to see a measure that maximizes revenue that is available for city services, affordable housing, and many other unmet needs the city faces.

a few weeks ago through our recent budget process, this committee struggled until 5:00 a.m. with a list of annett needs and many of them had to be dropped off the list. it is obvious we do have after many years of painful budget cuts and shortfalls, many things we need to restore. one example of that is the nonprofit cost of doing business increase and we're extremely thankful to the mayor and this committee for putting forward a 1% budget increase from each of you. i remind this committee the cpi is to% so although this committee did incur will work, we still have a situation in our sector where nonprofits took a 1% budget cut across the board and there's no c.p.i., no increase in the second year of the budget. that is one example of how our services are still gradually eroding and it highlights the need for a proposal that maximizes revenue.

this is a great opportunity to restore funding will last 10 years ago in the business lawsuit. we see it as revenue neutral to 10 years ago and we hope this committee will take full of vintage of that and thank you for your work on it. supervisor chu: thank you next speaker -- thank you, next speaker. >> i amsàu -- we're here to urge you to support the avalos measure or legislation. as we know, our community, especially in the south of market has had its fair share of cuts for services and we feel that big corporations÷÷ócs needo parent their fair share. we have seen small businesses close down because they cannot survive in the economy right now. therefore, they're urging you to please support this measure and we hope to see that through this committee.

supervisor chu: are -- if there are other members of the public who would like to speak, please let against the wall. this will be the final speaker otherwise. >> i am the san francisco political coordinator for seiu 1021 to speak in favor of supervisor avalos's -- both revenue measures. because they are progressive and the underlying principles are ones that we support. we do want to also indicate we're willing to look at some kind of compromise as long as there is an escalator for more. after looking at pulling some of our leadership, there is no objections to something like that but it is a little disappointing to us to go below

$40 million precisely because of the lawsuit and the cuts we have sustained. we believe it should be revenue positive and we support supervisor avalos's initial measure of $40 million but we're willing to a little that number as long as there is an escalator. thank you for everyone's work, supervisor kim, supervisor chu. we have been working on this for so many years and i would love to c.s. get to one measure -- c.s. get to one measure that we can all embrace. thank you for your work. supervisor chu: thank you. are there other members of the public who wish to comment on items one through 14? seeing none, public comment is