Proposal to cut small business fees
Thousands of small business owners in San Francisco would not have to pay annual fees for the next fiscal year under new legislation aimed at offering a small dose of relief for businesses ravaged by the coronavirus pandemic.
The legislation, which Supervisor Gordon Mar expects to introduce next Tuesday, would apply to businesses with less than $1 million in gross receipts and cost the city about $5.1 million in lost revenue.
It would waive licensing and registration fees for between 13,000 and 20,000 businesses.
The fees vary from industry to industry and range from about $100 a year to several thousand. On average, the registration and licensing fees combined are over $1,000 a year, according to Mar’s office. The city has already extended the deadline for when the fees are due, but this would waive them altogether for the fiscal year 202021. The types of businesses that would benefit include yoga stu
dios, florists, hair salons and small cafes.
Mar said the businesses that would benefit often have been left out of the other state and federal programs that have provided loans or grants to larger businesses. The savings from the waived fees could help a retailer purchase protective gear needed to reopen or help a cafe pay for additional tables and chairs needed to take advantage of the new shared space program, which allows expanded sidewalk dining, Mar said.
“There is a great concern that many of these businesses might not make it,” Mar said. “This program will give them some financial relief as they navigate the challenges of reopening.”
Given that the city is facing a nearly $2 billion deficit over two years, it might seem counterintuitive to propose something that will cost the city revenue, Mar said, but he said it is a “worthwhile investment.”
“These small businesses are the lifeblood of our neighborhoods,” he said.
Grace Garza, who is a hair stylist at Carla and Co. on Taraval in the Outer Sunset district, said the waiver would save her $105.
“It’s a small amount but when you are not earning anything, waiving that fee would really help,” she said. “That is a phone bill. That is gas twice a month.”
She had been preparing to reopen her businesses this week, but that was delayed because of the recent spike in new coronavirus cases, which prompted the city to push back reopenings for some types of businesses. She doesn’t know when she is going to be able to reopen and still hasn’t received any unemployment from the state.
“We are supposed to open July 14, but I don’t have the heart to reschedule customers right now because it could change again,” she said. “It’s been really tough.”
Jay Chang of the San Francisco Chamber of Commerce said the legislation “is appropriate and exactly where the city should be spending its time and money right now.”
“If you are a small business owner in San Francisco, you feel like you are being constantly nickelanddimed,” he said. “This is one nickel off your back.”
As hundreds of San Francisco businesses start to reopen — or consider reopening — the fee waiver “provides a little signal, a little incentive, to stay in the game and not give up the ghost,” Chang said.