Aid for stores near Chinatown big dig

San Francisco will give thousands of dollars to Chinatown merchants whose businesses have withered during the construction of the Central Subway — a move that provoked anxiety among city department heads who feared it would open the door to more public handouts.

“And they’re right,” said Supervisor Aaron Peskin, who used assertive tactics to get the funds. During budget negotiations in June, the supervisor froze $225,000 that Mayor Ed Lee had set aside for parking and other services in Chinatown, also with the intent of bringing business to an area ravaged by street work.

The board’s Budget and Finance Committee released that money Thursday after months of political tug-of-war between Peskin and the mayor over how the money would be spent. Separately, the city’s Office of Economic and Workforce Development has pledged $225,000 in “direct business support” for Peskin’s constituents on Stockton Street, in order to get the supervisor to back off.

The supervisor said he doesn’t mind setting what could be an expensive precedent.

“This is an extraordinary circumstance,” he said of the subway project, which cut a massive gulley through several blocks of Chinatown’s bustling Stockton Street corridor. It has already been delayed a year and is now expected to be completed in 2019.

The city is also offering money and other forms of assistance — including consulting services and new signs — to businesses in other districts that are negatively affected when work crews tear up their streets.

One prominent Chinatown businessman complained that the effort isn’t enough.

In a recent letter to the mayor, Pius Lee, who chairs the Chinatown Neighborhood Association, criticized the city’s construction mitigation plan for only helping shop owners on Stockton Street between Jackson and Sacramento streets.

Lee asked that the offer of up to $10,000 in aid be extended to shopss between Sacramento Street and Broadway, which is undergoing a separate — and much less disruptive — street resurfacing project.

Peskin disagreed with the idea.

“I don’t want to set the precedent that every time we resurface a street we’re handing out money,” he said. “We have to draw the line somewhere.”

Pius Lee also said it was unfair for the mayor to ask businesses to submit written evidence of losses since 2013.