In the News
In the News
San Jose: Proposed Ballot Measure Ties Business Tax to Revenue
SAN JOSE -- Of the Bay Area's major cities, San Jose stands alone in not taxing its large businesses based on their earnings. But the local professor who led a successful 2012 ballot measure to raise the city's minimum wage is fixing to change that in the coming year.
Advocates argue the city's high-tech giants that helped give Silicon Valley its name aren't paying their "fair share" of taxes to help patch up pot holes, hire more police officers and clean up city parks.
A new initiative being eyed for the November 2016 ballot would do just that, according to its authors.
More Details Emerge About San Jose Business Tax Proposal
Backers of a proposed San Jose "gross receipts tax" on businesses are ramping up their organizational efforts and public outreach.
The newly launched website of San Joseans for a World-Class City, a group formed last week that supports the revenue-based business tax, gives specifics about the initiative they hope to put on the Nov. 2016 ballot.
The initiative is the brainchild of Scott Myers-Lipton, a San Jose State Universitysociology professor who helped lead the successful campaign to raise San Jose's minimum wage in 2012.
San Jose's current business tax is an annual flat fee of $150 plus an additional $18 for every worker after the eighth employee. The tax is capped at $25,000.
Under the proposed gross receipts tax, companies would be taxed at $600 or $1,200 for every $1 million in annual revenue, according to San Joseans' website. The lower rate would apply to businesses in "low profit margin" industries, though details on which industries this includes are not provided. Businesses with less than $1 million in revenue would be exempt from the tax.
Another Step Up Idea Turned to Action!
Step Up Silicon Valley is happy to announce the successful incubation of our 2015 advocacy project known today as “San Joseans for a World-Class City.” This campaign seeks to offer living wage jobs to local hires through the modernization of the San Jose Business Tax.
Step Up incubates systems change initiatives that begin as community-based ideas to become community-owned and operated projects. The San Joseans for a World-Class City coalition today includes public/government stakeholders, non-profits, and faith-based institutions. Step Up supports the campaign as a coalition member, alongside Next Door Solutions to Domestic Violence, The Stride Center, and Justice for Immigrants – Diocese of San Jose.
As a systems change incubator, Step Up offers a platform for community members to turn ideas into action. Our three accomplishments towards successfully incubating this project include:
Convening diverse community stakeholders to generate innovative solutions to poverty in Silicon Valley,
Raising funds for polling,
Polling to engage community members, the results of which indicate community interest in the campaign, and
Building a coalition.
In February 2015, Step Up Silicon Valley invited Professor Myers-Lipton to present and lead a discussion on his latest publication, Ending Extreme Inequality. The kickoff event was the first of the year’s Learning & Development Series, held at the Leavey School of Business at Santa Clara University and facilitated by Professor William A. Sundstrom of SCU. Discussion on an Economic Bill of Rights garnered the interest of over 30 community members in attendance. Step Up convened a follow-up meeting on April 20, 2015 to create a campaign based on the first two rights – the right to a job and living wage – through public works.
Since its inception, the infrastructure public works campaign has developed into “San Joseans for a World-Class City.” Step Up participated in the initial phases with Professor Myers-Lipton. Throughout the summer of 2015, we conducted an initial assessment to gain community-based input on the project and later engaged in polling in November 2015 to gauge the community will to support and move the project forward. The results of the polling show an overwhelming amount of support for a gross receipts tax as a means of funding police, living wage jobs, and repaving our streets.
This project will move forward in 2016 under the leadership of Professor Scott Myers-Lipton of San Jose State University. For more information on our incubation process and the background of the advocacy campaign, read more here (http://stepupsv.org/step-up-initiatives/retoolingthesanjosebusinesstax/).
San Jose Councilmen Ask for Analysis of Business Tax Measure
SAN JOSE -- Before a proposed ballot measure to alter the city's business tax moves forward, two San Jose City Council members are calling for giving it a much closer look.
Councilmen Donald Rocha and Raul Peralez will ask the council's Rules Committee on Wednesday to approve a study that compares the proposed measure with the current tax, analyzes how the new tax would impact businesses, estimates changes in city revenue under the tax and looks at which businesses are exempt. The councilmen also want the city attorney to glance over the initiative to ensure that it doesn't "give rise to any legal concerns."
A citywide tax measure filed last week and angling for the 2016 ballot has already drawn opposition from the local business community. And while the city can do nothing to alter the initiative once it qualifies, some San Jose leaders want at least an impartial analysis of the proposal before November’s election.
In a memo submitted to Wednesday’s Rules and Open Government Committee, council members Don Rocha and Raul Peralez urge the city to examine how the measure would affect businesses and how it compares to the existing tax. The city attorney, they added, should review the language to see whether it raises any legal concerns.
The “Modernization of the Business Tax Ordinance,” which was filed by the same people who successfully campaigned to increase San Jose’s minimum wage in 2012, would swap the city’s per-employee tax with a gross-receipts tax on total business income. Proceeds would go to the city’s general fund.
San Jose Considers Impartial Review of Citywide Tax Measure
San Jose Councilmembers Ask City to Study Impacts of Business Tax Initiative
Just two days after it was filed, the San Jose business tax initiative is already on the agenda of a city meeting.
Councilmembers Don Rocha and Raul Peralez co-signed a Jan. 14 memorequesting the city manager study the potential fiscal, business, and legal ramifications of the initiative, which would replace San Jose's current per-employee business tax with a revenue-based tax ranging from $0.60 to $1.20 per $1,000 in gross receipts.
The recommendation will be voted on Wednesday by the Rules & Open Government Committee, which is made up of mayor Sam Liccardo, vice mayorRose Herrera and councilmembers Chappie Jones, Johnny Khamis and Magdalena Carrasco. A majority vote would be needed to direct the city manager to undertake such a study, or to move it to a council meeting for approval.
San Jose Council Committee Approves Studying Proposed Business Tax
SAN JOSE -- After a lively debate Wednesday, a council committee gave the green light to studying a controversial plan to "modernize" the city's business tax by asking companies to pay taxes based on a percentage of their revenue to fund basic services.
The council's Rules and Open Government Committee approved the study in a 2-1 vote Wednesday, with Councilman Johnny Khamis opposed. Mayor Sam Liccardo and Councilman Chappie Jones were absent. The full City Council is expected to approve the study Feb. 2.
If qualified for the November ballot and approved by a majority of voters, the measure would change the city's tax structure so higher-grossing businesses pay more, and generate an estimated $70 million in additional revenue for the city's general fund, which pays for public safety services, road repairs, parks and other basic services.
"We're just asking businesses to pay their fair share," said San Jose State sociologist Scott Myers-Lipton, the creator of a November ballot measure that would tax businesses based on their gross-receipts, a practice already in place in San Francisco, Fremont and Oakland.
San Jose Police Union Gives $25,000 to Business Tax Initiative
SAN JOSE -- Scott Myers-Lipton, the San Jose State professor behind a ballot measure to tax large businesses based on revenue, came home Thursday to what he calls an “awesome” surprise. A $25,000 check from the San Jose Police Officers’ Association to support his campaign. “We’re thrilled,” Myers-Lipton told IA.
“You need resources to run a campaign so it’s awesome the POA stepped forward.” The hefty donation, which could be the first of several in the next few weeks, is a wake up call to business groups and an unexpected kick in the pants for the city. San Jose hasn’t updated its business tax in 30 years, and the city started polling voters about it after Myers-Lipton launched his campaign. But police union officials say time is running out. Myers-Lipton has about three months to gather 20,000 signatures to put his measure on the November ballot — and if the city doesn’t move on increasing business taxes to pay for basic services, the union will throw full support to Myers-Lipton.
“We hope the business lobby hasn’t come down with a case of amnesia when it comes to them paying their fair share to restore services in San Jose,” said Paul Kelly, the association’s president. “Police officers did their part by taking pay cuts, reducing retirement benefits and eliminating retiree healthcare, it’s time for businesses to step up.” “Although the window is fast closing on reaching a compromise,” he added, “we remain open to working with any entity that wants to improve services in a fair manner for the residents of San Jose.”
SAN JOSE -- One would think that the richest city in America would have better roads.
And more police officers. And more adequate housing for the poor.And yet, San Jose, which has the highest median household income of any major city in the country, at $77,000 a year, and is home to billion-dollar companies such as Cisco and Adobe Systems Incorporated, also has some of the worst roads in the country, a shrinking police department despite a growing population, and, until the city shut it down, one of the largest homeless encampments in the nation.
As companies in this city and in surrounding Santa Clara County, which encompasses Silicon Valley, have raked in billions over the last few years, the city of San Jose has been trying its hardest not to go broke.
Budget Woes in One of America's Wealthiest Cities: If San Jose can’t
afford its basic public services, what city can?
North County City Officials Consider Business Tax Initiative
SAN JOSE -- San Jose isn't the only city considering changes to its business tax.
Officials from Palo Alto, Mountain View, Sunnyvale and Cupertino have been in discussions about jointly introducing a ballot measure that would establish a new employee-based business tax, according to the Mountain View Voice.
Revenue from the tax would go toward local transportation needs, which could include a North County-exclusive mass transit system, according to unnamed advocates cited by the Voice.
Officials have discussed only taxing companies with 100 or more local employees, though that threshold could be raised. Mountain View Councilmember Lenny Siegel told the Voice the logic of the tax is that because large employers contribute the most to the area's traffic woes, they should contribute to easing that issue.