Bay Area should reject FASTER for FAIRER plan
Organizations representing the Bay Area’s largest businesses are proposing “FASTER,” a regressive tax scheme to pay for much needed transit investments. Their proposal would raise sales taxes, now roughly 10% in most of the Bay Area, by another full percent.
We appreciate their recognition of the growing need to improve Bay Area transit, but what is proposed will harm tax-burdened poor and working families rather than those most able to pay. We propose “FAIRER” — a progressive plan that would enable employers to contribute a small fraction of the cost of doing business to fund transportation needs fueled by rapid job growth.
Most people in the Bay Area are aware of the twin crises in housing and transportation. But behind these two is another: the inequitable distribution of income and wealth. The Bay Area is home to more than 100 billionaires. Four companies with a major presence here are valued at over a trillion dollars, and many midsize companies have amassed significant wealth as well. Despite this economic success, too many workers must live in their cars because they can’t afford to rent, let alone buy, a home. Even moderate-income workers are bearing the brunt of these crises, commuting great distances just to be able to house their families.
Bay Area employers have benefited from our communities’ historic investment in infrastructure, education, culture and our quality of life. However, our inability to match private sector employment growth with public investment threatens both economic growth and our collective quality of life.
We must create a transit system that allows people to get to work or school without a car. In addition to supporting workers, effective transit will significantly reduce Bay Area greenhouse gas emissions. But we must take inequity into account. Rather than impose a new burden on workers, large employers must pay their fair share of the external costs imposed by rapid job growth.
FAIRER taxes can take numerous forms. Mountain View voters recently approved a progressive “head tax” with 71% support — companies pay per employee with larger companies paying at a higher rate. The tricounty Portland metro area has a functional transit system with high ridership — funded not with sales tax but instead with a simple 0.77% payroll tax paid by employers. Other cities tax gross receipts.
Because cities cannot bond against fees and donations FAIRER taxes should meet two criteria: 1) They should fall on those most able to pay; 2) They should be annual taxes, rather than one-time fees or voluntary donations from major employers. The huge capital investments needed to keep pace with growing transportation needs require bond sales, which in turn depend upon continuing sources of revenue.
The sponsors of FASTER argue that taxing employers would hurt our economy. We disagree. Failure to enact a FAIRER tax plan to address the impacts of growth will in fact stifle growth. Employers (startups as well as large firms) will have difficulty attracting and retaining employees if the region continues to suffer with unbearable traffic and residential displacement that causes workers to live farther away with no efficient way to get to work.
We urge business, ABAG/ MTC and state leaders to reject FASTER. Let’s instead work to develop a FAIRER plan for our transportation future and relieve the pressures these crises impose on struggling families.