amend the administrative code to provide an exception for permanent residents to the prohibition on short-term residential rental under certain condition to establish procedures and an application fee for a short-term residential rental registry for tracking in compliance and to amend the planning code to clarify that short-term residential rentals shall not change a unit's type as re deckv and making the requisite finding. >> thank you. president chiu. >> thank you, mr. chair. colleagues, i know we he had a very lengthy discussion on this topic two weeks that go so let me very briefly say thank you. i want to thank you for your consideration of our legislation to regulate short-term rentals. and i very much appreciate all the work that all of you have done to tackle a very complicated and complex policy issue and to find a balanced solution to both allow people to afford to live in their homes and to stop hotel conversions. after two years of process that ha included multiple planning and land use hearings on top of countless stakeholder meeting, we are ready to take action and we need to take action.

the status quo is simply not working and with that, colleagues, i ask for your support. >> thank you. supervisor yee. >> thank you. colleagues, i think the conversations that we have had in the last few weeks have focused on the concerns that i have heard from my district and that i continue to have with this legislation. as president chiu said, this is a complex issue and i don't believe in the one size fits all approach that this legislation takes in legalizing short-term rentals. we have zoning laws that allow certain use he in specific areas for very good reasons. whether we are talking about formula retail controls or our recent discussions about pinball machines and video game arcades, and planning -- the planning commission and the board of supervisors have always considered the

individual needs and characters of neighborhoods. i cannot support this legislation in this current form because it does not provide that nuance and thoughtful approach that i think is needed. i also think that we have -- we are missing a great opportunity by not collecting back taxes owed by these platforms. therefore, colleagues, i will not be able to support this legislation today. >> thank you. supervisor avalos. >> thank you. i actually, just based on discourse about this legislation that's continued over the past week, i don't think that we approved the exact piece of ordinance that is going to be right for the city. yesterday there was an op-ed that was written by dianne feinstein, senator feinstein, the great senator from the

great state of california. and she has been one who ha worked on this board of supervisors and was mayor for nine years on top of nine years on the board of supervisors, and i think what she has to say relates to all the amendments we tried to put in place last week for this legislation. and i'd like to take another bite at the apple to see if we can get an ordinance that more closely resembles what would be best for san francisco and its many neighborhoods as well as what's best for making distinctions between residential property and hotel property, as well as trying to limit the length of stays that often, if there are longer length of stays in our residential -- residential units, that could undermine rent control, could undermine the amount of property that's available for renters. renters are desperately under attack in this city, and if we're seeing that our rental

stock is being eroded by legislation like this because we haven't closed some of the loopholes that are in it, then we know that many, many san franciscans will continue to suffer and to leave this city. and we're seeing the great divided wealth in san francisco widen right before our eyes all over again. and, so, i would like to go back to proposing a 90-day cap to short-term rentals for both hosted and unhosted rentals. this was an amendment that i had put forward last week and i know the city attorney has drafted that already so can make that available. it was shared last week so i think it's easily at their disposal to be able to provide for us. but when i proposed that as an amendment to the ordinance. ~ but i want to propose it a an amendment to the ordinance. >> is there a second to? supervisor campos. >> thank you. >> supervisor campos. >> thank you.

i have another amendment that i'd like to make. i don't know if it's appropriate for me to speak to that amendment now or if we want to stick to speaking to the amendment by supervisor avalos. >> i think as we did last time, let's take all the amendments in case there are others and then we'll take them one by one. >> thank you very much, mr. chair. and, again, i want to thank all my colleagues for all the time and energy that has gone into this and all the members of the public from all sides of the issue that have gone before the board to speak about this. last time two weeks ago i introduced an amendment that would simply require the companies that in this line of work to do what every business in san francisco has to do, which is to pay back all the taxes that they owe the city and county of san francisco. i'm not going to repeat the arguments that i made, but i do want to note what was said by senator dianne feinstein in an

editorial. it is not pretty typical that senator feinstein and i find our self-on the same page, and i think that when you have a coalition that is opposing a piece of legislation like this one that is as broad as the coalition that has been working on this, a coalition that includes tenants, that includes landlords, that includes the labor community, that includes planners, that includes so many different businesses, i think that we have a responsibility to pay attention to what they're saying and to really take note. it's not often that you have dianne feinstein on one side of an issue agreeing with someone like chris daily, but that's precisely what's happening in this issue. as senator feinstein noted in her editorial, in her view this legislation is a short-sighted action that would destroy the

integrity of zoning throughout san francisco. this is not only former member of the board of supervisors or a president of the board of supervisors, but a former mayor of san francisco saying that. and on the issue of back taxes, i want to just note what i said last time. on april 3rd, 2012, the city's tax collector issued a memo stating that a website company who receive rent and connection with an occupancy transaction is an operator that is responsible for collecting the transit occupancy tax associated with that rental and for remiting it to the city. we have heard testimony from air bnb that they owe approximately 25 million in unpaid transit occupancy tax he. senator feinstein further stated in her editorial that this common sense amendment to collect back taxes was rejected

by the board of supervisors and i quote, we must protect the integrity of san francisco and ensure that taxes that are due are paid in full. end quote. i agree with senator feinstein and still find it unbelievable that we rejected this amendment the last time around. these companies have violated our tax code by failing to pay the taxes for the past 2-1/2 years. there has been much discussion about this issue in the last few days. recently, actually, a member of this board, supervisor cohen at a forum last week indicated that she wanted to do something about the back taxes as reported in 48 hills. in response to the question as to whether she was going to do something about the collection of back taxes, supervisor cohen responded, and i quote, "heck yes." supervisor cohen, i want to give you today an opportunity

to do something about the comments and the statement that you gave at this forum. and, so, with that i would like to reintroduce my amendment to make the operative date of this legislation 30 days after the treasurer tax collector certifies all outstanding transient occupancy taxes have been paid. let's make the statement that there aren't two sets of rules in san francisco. just like any business in san francisco, air bnb must adhere to our tax laws. before a law that legitimatizes a company's presently illegal activities is past, we must demand at a very minimum that the company pay its fair share and pay the 25 million in taxes owed to the tax payers of the city and county of san francisco. so, i make that motion -- that amendment, and i will distribute copies of the

amendment which you should have already from the last time, but we'll make sure that you have extra copies. >> so, is there a second -- seconded by supervisor avalos. thank you. supervisor wiener. >> thank you, mr. chairman. i voted against both of these amendments last week and i'll be voting against both of them again today. i think that either one frankly is just not the right way to proceed with this legislation. i have enormous respect for senator feinstein and she is absolutely one of the best elected officials we've had in san francisco. but you can't always agree on everything. i think it's really important, and these two amendments actually raise an important issue. i know and we've seen from some of the opponents, it's all about air bnb, all about this large company. and, so, it becomes very easy to vilify when you're talking

about a highly valued growing company. it's not just about air bnb. this is about real live residents of san francisco, real live people who are residents of this city who are our neighbors who rely on home sharing, whether it's to make ends meet, put a new roof on their house, to put their kids through college. a lot of people are struggling in this city and i know it's tempting to say everyone who is involved is a landlord doing evictions, that's not true. some are, but most are not. i know he it's easy to say everyone is abusing the system, that is simply not the case. there are a lot of people in this city who are relying on whether it's renting out that extra room or whatever the case may be to make ends meet. and, so, when you talk about, well, if we don't limit

everyone, even someone who has an extra room in their home that they want to rent out for more than 90 days, we're going to limit everyone to 90 days and if you don't do that you're rezoning the city and you are somehow helping this large corporation. what we're doing is allowing people to actually make ends meet who need this income. and by putting this restriction in place, we are harming real live san franciscans, and i think we have to keep that in mind. this is not just about corporations. it's about residents of our city. i also want to -- in terms of the tax argument, and we had a long discussion about this last week and given that it's being raised again, i want to reiterate what i said last week. we know that with or without this legislation, this legislation proceeds without this amendment. our treasurer tax collector had the authority a year ago, six

months ago, today, tomorrow, up until the expiration of the statute of limitation if he chooses to go into court and to sue for collection of back taxes. we don't need to authorize him to do that. if he decides that that is the best way to proceed, he has the power to do that. and, so, what this amendment is proposing, this amendment is not about somehow authorizing the collection of back taxes. we already have the power to do that and this legislation won't change that. what this amendment about back taxes says is that unless and until that money, the back taxes he are paid, home sharing in san francisco is illegal period. and although he it's easy to say, well, it if air bnb doesn't pay the back taxes, we're going to hold up air bnb's ability to have legalized short-term rentals? no, what it means is individual

residents of san francisco will not be legally able to do home sharing until those backs taxes are paid and until the years and years of litigation leading up to maybe the payment of the back taxes proceeds. we also know that and we have other litigation that this city is engaged in with expedia, with travel os it, that it is not so clear that air bnb is necessarily the entity that's liable for any back taxes ~. it could be residents of san francisco. so, are we saying that unless the tax collector starts going after residents of san francisco to collect back taxes we're not going to let this legislation go into effect? ~ travelocity we also know if we decide that we're not going to go after individuals in san francisco, we're not going to start doing tenants and elderly homeowners to try to get the backs tackes

we claim they owe if we're going after air bnb. there is going to be a litigation and it could be for years. the expedia travelocity ha been going on for years and year. instead of collecting $11 million right now today for our hotel tax and for the arts and all the other uses we use hotel tax he for, instead of starting to collect that $11 million today, we're going to cut off our nose despite our face and say, we're not going to do any of this, we're going to keep this illegal, we're going to keep it in the dark until we can go for years and years and years of litigation up and down the courts and maybe collect the back taxes. or maybe we'll lose and we won't get any of the taxes. so, this amendment has been portrayed in such a simplistic way. this is just someone owes back taxes, pay it, and what we're doing -- what this is proposing is going to hurt san franciscans, it's going to undermine our hotel tax and we very well may lose.

so, this is not a well advised amendment and i will be voting against it. >> thank you. president chiu. (applause) >> thank you, mr. chair. thank you, colleagues, for your discussion. given that these were topics that we did discuss and debate fully two weeks ag i think my perspective on these issues are clear, but let me just reiterate. first of all on the 90-day cap, we heard from hundreds of residents in san francisco who have told us that if there is a 90-day cap on hosted rentals, in other words, places where they currently live, there are seniors, there are empty nesters who literally to them this cap would be tantamount to an eviction notice. they would not be able to continue to live in san francisco. and i think we need to think very carefully before we move forward in this way. on the issue of taxes there's been a lot of noise in the last couple weeks on this topic. i want to take a moment to reiterate facts. the first fact, i was actually

the first supervisor to say publicly that they we ought to collect all taxes from this activity, including and particularly back tax he. i think, colleague, we all know that all this, our legislation does is it requires for the first time hosting platforms to collect and deliver taxes. likely it's estimated $50 million over the next three years. it's also a fact that our legislation affirms our tax collector's ability to collect all taxes from individuals and hosting platforms, including back taxes. and i want to thank our tax collector for issuing a statement today to reiterate that, to say xi quote, no existing or proposed laws such as this one in any way alters these tax obligations, including the obligation to pay unpaid, i.e., back taxes. ~ and i quote it's a fact that the tax collector has already been using its authority to collect these taxes on short-term rental activity and has made

paying those taxes easier by allowing individuals and platforms to file online. it's also fact that our legislation does nothing to stop the tax collector from pursuing back taxes. the tax collector has full authority to enforce the business and tax code and as all of us know here on the board, the tax collector does not release information on who has paid these taxes because that information is private to ensure compliance. it's both legal and required common practice for tax entities. these are the facts. now, there are many among us, myself included, i believe supervisor cohen is among us, who believe we ought to be collecting back taxes. we genuinely believe that. but we are doing this in ways that are smart and with good policy for our city. for others, though, i think it's convenient for some who oppose this legislation to grand stand on taxes. it's been abundantly clear that this tactic is not actually about getting tax revenue for the city.

it's all talk. i think it's easy to grand stand on back taxes to score points against this legislation but actually delivering tax revenues for the city means moving forward on clear rules that bring short-term renting activity into regulation and into compliance and, colleague, that is what we must do today. >> thank you. supervisor breed. >> thank you. i just have some comments about the back tax issue. i don't know if a lot of folks are empire fans here, but al ka poem is about to go to jail. ~ capone. not for bootlegging, not for bribery, not for murder, but for tax evasion. that part of history is actually true. he did time in alcatraz, which is a famous landmark in our city. it makes me real aye that the government is really, really good at collecting taxes. say what you want about the government's ability to take on other problems, but the old saying about death and taxes still is true today.

i've spoken with treasurer cisneros and the city attorney's office and i am comfortable that the tax collector has the legal tools it needs to collect these back taxes. the amendment last week to hold this legislation until all back taxes are collected certainly sounded good and was on the surface a very fairpoint. but there are several reasons why i did not support it then and i don't plan to support it now. i will mention the treasurer's office has more than enough legal resource he to collect back taxes. they do that every single day. and mr. cisneros says he does not need it in this legislation. in this particular case, the process of tax collection may involve individual host as well as the companies they use. it could take years to resolve during which time the market would remain effectively unregulated. that would jeopardize both our housing supply and the estimated 11 million in annual taxes this will now generate. individual tax cases are

confidential so it seems a bit questionable to city-wide legislation to the disposition of individual cases. i absolutely want the city to collect every penny it is owed. this money goes to support muni, public housing, our police, and everything else we value. but the process of collection is very clearly the treasurer's responsibility and authority and it's not within the board's authority and so that's why i will not be supporting that particular amendment today. thank you. >> thank you. supervisor cohen. >> thank you very much. good afternoon, everybody. taxes bring everybody together, right? supervisor breed and campos and you all said everything that really was on my mind. and i certainly stand by that, my desire to go after back taxes. that's one thing this government does do a very good job of and that's going back, going after people who don't pay their property taxes or their income taxes or one thing we do need to do a better job

of is going after people and, you know, forgivable loans who take taxpayers' money. that's something else we need to look into. my two priorities have really been straightforward when it comes to this debate. it's been to assure that we prevent wholesale cannibalization of buildings for full-time short-term rentals and then also to develop a framework that allows responsible hosts -- responsible hosts -- an opportunity to use short-term rentals to deal with their very real affordability issues. these are issues whether it's known or not, numbers of uhw said they have short-term rentals. members of local 2 said to me they are part of short-term rental. it's interesting because they find them self-in both pots. yes, some people would interpret that hotel workers may be in jeopardy of losing their jobs. so, it's really not just a cut,

dry, black and whitish you. this is something that is far more complex than i think even david chiu thought about when he was getting involved in this. but really just let me take a moment and be extremely clear about what my position is on this issue when it comes to taxes because it seems some are very confused on where i stand. i sub poderth the requirement that all short-term rental platforms air bnb and others pay their taxeses in full. now, the rhetoric on the issue of $25 million, of potentially back owed tax he is completely devoid of accurate information and is really, let's just call it what it is, politically motivated. now, san francisco has one of the smartest and most aggressive city attorneys ever right now in the city attorney's office and we're fortunate to have this person there. our city attorney was instrumental in getting gay rights, women's rights, and fighting slum lords if their dollar was on the table, our

city attorney is going to go after and get t. we're not leaving money on the table. that's one thing that dennis herrera does a very good job of and you also heard in the statement from jose cisneros, our treasurer, tax collector, they got the tools that they need to go after this. during this debate we've all agreed that this issue need to be regulated. but changing the effective date of this legislation based on an assumption that has no fact of what may be owed ignores the reality of our current housing crisis. we can't have it both ways. you can't agree that we need to regulate this behavior and then remove its effectiveness. you can't change your position to suit what is politically popular. it is our job as supervisors to investigate the issue, to hear from all sides, and to make policy decisions that are in the best interest for all san franciscans.

now, while i know -- i know that simplifying the issue makes it easy to get votes. it does an incredible disservice to the residents of san francisco. san franciscans deserve better. they dee he serve to know the facts and they deserve to know the truth. so, here they are. we don't actually know how much back taxes are owed. we don't even know if the city has the ability to collect them. we don't have the luxury of waiting to deal with this issue. we need regulation in place right now today so that we can go after the projected $11 million that we know we can go after and get. we he also need to have faith that our city attorney and our tax collector have the ability to review the legal issues and proceed in a way that is best for us here in san francisco. so, to me city attorney herrera and treasurer cisneros have always demonstrated the ability to fight for san francisco and to stand up for us when we need

them. now, san francisco's affordability issues are nuanced and trust and believe they're very complicated. they don't just impact tenants or one area of san francisco. less' get that real clear. we are all impacted by this. this issue has shown me that many san franciscans and many districts including d-10 are struggling, struggling to stay in their homes and their rental units and it's our job as legislators to think about all side of an issue and represent all of san francisco. now, painting this as a tax break instead of taking the time to explain the complicated nature of this issue is insulting and just flat out wrong. >> thank you. supervisor yee. >> thank you. i was going to say, i don't want to take a final vote until we get through these amendments.

if supervisor avalos' amendment doesn't pass then i will offer -- re-offer my amendments. since everybody is talking about the back taxes, and i certainly hope nobody is going to interpret that i'm politically motivated on this issue, yes, i think the treasurer has the tools to collect it, the funding. we've always had resolutions through here. i've been here two years. resolutions after resolution. basically supporting what people are already authorized to do. and for me to support the back tax issue is really to say this board of supervisors agree with collecting back taxes. it's not giving authorization.

it's saying "do it." for me it's really important to make [speaker not understood], make it stronger. that is, for any of the short-term hosting platforms that pay their back taxes, they could continue their services as -- if this legislation passes. so, you don't punish every single company that want to do this in san francisco because they're citizens of san francisco. they pay their back taxes he. if none of these existing short-term hosting platforms want to pay back taxes and they're not allowed to move forward with their business model, then somebody, guess what, these people that were so

creative, there's other people in the wings just as creative. they could start their new businesses with this short-term hosting platform paying the taxes. so, if the author of this amendment can make that tweak, i think it would strengthen it [speaker not understood] whether this is political or not. >> supervisor campos. >> thank you, mr. chair. thank you, supervisor yee. that's actually something that we have consulted with the city attorney. and i don't know if that's possible legally, but i'm certainly open to the extent that the city attorney believes that's possible. >> mr. givner? >> deputy city attorney jon givner. i'm sorry i didn't catch, supervisor yee, how you would amend supervisor campos' proposed amendment. >> i would say if this legislation passes that the companies that can move forward with this legislation are the ones that pay their back taxes.

as soon as a particular company pays the back taxes he, they get to continue to the services. those that do not pay cannot continue the services. >> deputy city attorney jon givner again. so, the current law that business and tax regulations code provides that individual taxpayer information is confidential. so, currently the treasurer could not disclose to even the planning department which is responsible for enforcing this law, which hosting platforms are current and which mayo taxes he. ~ if supervisor campos' amendment passes today, as i mentioned last week, the ordinance would go back to committee and ultimately also back to the planning commission and map it