Tech ti­tans clash over new busi­ness tax to help home­less

Nelson Mail - - World -

A ‘‘home­less tax’’ that will hit some of the big­gest tech­nol­ogy com­pa­nies and raise US$300 mil­lion (NZ$444m) to help those sleep­ing on the streets has caused deep di­vi­sions within Sil­i­con Val­ley.

San Fran­cisco has one of the worst prob­lems with home­less­ness in the US. Res­i­dents face men­tally ill peo­ple shout­ing on the streets, ad­dicts openly in­ject­ing heroin, piles of ex­cre­ment be­tween parked cars and rows of home­less peo­ple sleep­ing in tents.

Such hu­man suf­fer­ing jars against a city that has en­joyed a tech-fu­elled boom in wealth, with 70 bil­lion­aires, and an aver­age house price of US$1.6m.

Sup­port­ers of the tax said that it would raise US$75m a year for men­tal health ser­vices and add 1000 beds in home­less shel­ters.

Vot­ers ap­proved the mea­sure, much to the dis­ap­point­ment of the tech com­pa­nies and ven­ture cap­i­tal­ists based in San Fran­cisco who had poured thou­sands of dol­lars into fight­ing the tax. They in­clude Twit­ter, Visa, the pay­ment pro­cess­ing plat­form Stripe and Lyft, the taxi com­pany.

The tax, called Propo­si­tion C, will raise an es­ti­mated US$300m a year for ser­vices that will help the 7500 peo­ple a night who sleep on the streets of the city, pop­u­la­tion 885,000, boost­ing spend­ing on home­less­ness by 80 per cent. The levy av­er­ages 0.5 per cent of the gross re­ceipts of busi­nesses with rev­enues of more than US$50m.

Tech com­pany chiefs have ar­gued that San Fran­cisco al­ready spends more per head on home­less­ness than other ci­ties. Mark Pin­cus, co-founder of Zynga, the mo­bile games de­vel­oper, who is worth US$1.5 bil­lion, called it ‘‘the dumb­est, least thought-out prop ever’’. Jack Dorsey, Twit­ter’s chief ex­ec­u­tive who is worth an es­ti­mated US$5.4b, had donated US$125,000 to fight­ing the tax and made a veiled threat that an­other of his busi­nesses, the pay­ment pro­cess­ing com­pany Square, would leave the city if the tax were passed.

‘‘We’re happy to pay our taxes. We just want to be treated fairly with re­spect to our peer com­pa­nies,’’ he wrote on Twit­ter. ‘‘Oth­er­wise we don’t know how to prac­ti­cally grow in the city. That’s heart­break­ing for us as we love SF [San Fran­cisco] and want to con­tinue to help build it.’’

Marc Be­nioff, chief ex­ec­u­tive of the cloud-based soft­ware com­pany Sales­force, has been a sup­porter of Propo­si­tion C, putting mil­lions of his own money into sup­port­ing the cam­paign.

He has clashed with Dorsey on

‘‘We’re happy to pay our taxes. We just want to be treated fairly with re­spect to our peer com­pa­nies.’’

Jack Dorsey, Twit­ter chief ex­ec­u­tive

Twit­ter, point­ing out that the so­cial me­dia plat­form has re­ceived tax breaks from the city since 2011, and added: ‘‘Ex­actly how much have his com­pa­nies & per­son­ally given back to our city, our home­less pro­grammes, pub­lic hos­pi­tals, & pub­lic schools?’’

Af­ter the vote, Be­nioff said: ‘‘Let the city come to­gether in love for those who need it most!’’

How­ever, the mea­sure passed by 60 per cent, less than the two-thirds ma­jor­ity needed to guar­an­tee its adop­tion, leav­ing it open to a le­gal chal­lenge.


Stormy Ni­c­hole Day, left, sits on a side­walk on Haight St with Nord (last name not given) and his dog Hobo while in­ter­viewed about be­ing home­less in San Fran­cisco.


A San Fran­cisco city worker tells a home­less man that the area next to him is about to be power washed and points to an area where he might want to move.

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