How I’m voting on San Francisco ballot measures

San Francisco June 2018 Election

On June 5, San Franciscans vote on nine local and regional ballot measures. In this post, I analyze each measure and provide rationale for each of my choices:

YES: A, D, G, RM3

NO: B, C, E, F, H, I

A preliminary note is that my default vote for ballot measures is “no.” I spent several hours researching these, and only feel comfortable making my choices after that investment. Whenever possible, I believe in giving legislators — who have significant investigatory resources — the power to make the best legislation, and similarly giving agencies the power to enact those laws. I voted against F and H specifically on these grounds.

For a nonpartisan overview, I recommend bythebay.cool, from the same creators as ballot.fyi on the 2016 California propositions. I don’t fully agree with their summaries, the site provides a thorough and engaging overview of these complicated bills. The official voter information pamphlet also has good information, as do Ballotpedia and other voter guides I cite at the bottom of this article.

Prop A: Revenue Bonds for Power Facilities Excluding Fossil Fuels and Nuclear Energy Charter Amendment

Prop A enables the San Francisco Public Utilities Commission to fund clean power projects in the same way they currently fund water and sewer projects: bonds approved by the Mayor and two thirds of the Board of Supervisors. This is not an unfunded liability (like California Prop 68), as these projects recoup their investment with utility fees. I would have preferred nuclear energy not be excluded, but San Francisco isn’t about to build a nuclear power plant anyway, so this clause just preempts attacks.

Prop B: Restriction on Board and Commission Members Seeking Office Charter Amendment

This measure assumes that board and commission members are regularly corrupted by their campaigns for elected office, an assumption proponents have not even attempted to prove. I attended an event from a local democratic club to hear from proponents and opponents of each ballot prop, and the Prop B proponent was asked for an instance where this had been problematic. They were unable to produce an example.

Another set of candidates for public office makes official decisions that affect their election chances, yet are excluded from this measure: incumbent officeholders. The official opponents’ argument in the voter pamphlet comes off as conspiracy-minded in raising this, but this measure would clearly expand the incumbency advantage. It’s noteworthy that the Supervisors who approved this for the ballot are largely the same ones who voted to oust London Breed as Acting Mayor after Mayor Lee’s death, enabling competitor Mark Leno to sue for her to remove the Acting Mayor title from campaign materials. If Prop B were to pass, incumbents would be free to describe themselves as a current elected official, while other candidates would require the “former” commissioner/board member designation.

This would discourage aspiring politicians from seeking seats on commissions and boards, which provide relevant government knowledge. In turn, it would favor candidates from the private sector and incumbents, ultimately stifling electoral competition and the quality of our elected officials.

Props C and D: Commercial Rent Taxes for Childcare and Early Education [C] and Housing and Homelessness Services [D]

Propositions C and D are competing to increase the tax on commercial rents, currently set at around 0.3 percent for most businesses with gross receipts of at least $1 million. Prop C would levy an additional tax of 1 percent on warehouses and 3.5 percent on other commercial space; the estimated $146 million would fund childcare and early education (85 percent) and general city purposes (15 percent). Prop D would levy an additional tax of 1.7 percent tax; the estimated $70 million would fund general city services ($1.5 to 3 million per year), subsidized housing (55 percent of the remainder), and homelessness (45 percent of the remainder).

It is unfortunate that the city has pit childcare against housing: both are critically important, and the tax base for both is worth tapping. But I favor D for two reasons: it’s more measured in its tax increase; and housing and homelessness are more dire needs which can’t easily be addressed by other policies.

Increasing any tax by an order of magnitude is risky. Prop D increasing it by nearly sixfold is audacious; Prop C’s twelvefold increase is simply irresponsible. If a lower increase works out, we can always increase it over time. But building out a childcare infrastructure based on commercial rents — which are volatile — makes it very hard to turn back if it causes negative consequences. These could include businesses leaving San Francisco or buying out their landlords to avoid the tax. A previous instance of Supervisors Kim and Peskin introducing a Proposition C serves as a lesson: 2016 Prop C raised the inclusionary housing rate to 25 percent, at which point housing production fell sharply. In 2017, the Board had to unbreak this by reducing the rate to 18 percent, as recommended by an economic feasibility study.

While the research on childcare’s long-term benefits is shaky, the reality is that many parents need it to participate in the labor force. New studies show that much of the gender wage gap is explained by childbearing, suggesting that improving access to childcare can improve gender equity.

But government does not need to fund childcare programs directly to ensure access; even Denmark does not provide free childcare. Instead we can follow Canada and many European nations in enacting a child cash benefit, which would also assist parents who care for children themselves, or have a family member (e.g. grandparent or older sibling) do so. I’ve written on how transforming the US Child Tax Credit into a universal child benefit would significantly reduce child poverty, and San Francisco would make an ideal launchpad. With the $124 million that Prop C would direct to childcare, San Francisco could send families $3,100 checks for each of the 40,000 children under five years old. Even the cheapest childcare is more expensive than that, but the funds could be focused on low-income families and combined with existing childcare subsidies (on which the City spends $100 million, and which often have years-long waitlists). Studies show that child benefits have significant long-term impacts, and cash would allow low-income families to participate in the normal childcare market as higher earners do.

Meanwhile, San Francisco’s housing shortage is a crisis. Prop D’s $67 million for affordable housing and homelessness could also fund a cash transfer, say of $670 for each household with income below $50,000. We even have a mechanism for this: San Francisco is one of two cities to have a local version of the Earned Income Tax Credit, one of the country’s most effective antipoverty tools. Ours is called the Working Families Credit, and its funding has dried up to about $150,000 per year. I’ve written on ways to expand it here, and Prop C/D funding levels would make it monumental in its generosity.

If we’re going to spend money on in-kind benefits, there’s a good case for housing over something like childcare. For one, subsidized housing projects can infuse socioeconomic diversity into areas in a way that normal market forces might not. In some cases, subsidized housing can also get approved more quickly and easily than market-rate housing (though this can go the other way, too), increasing the total housing stock and reducing rents. And since homelessness programs are often partially about healthcare (mental health and addiction), their funding cannot be replaced by cash transfers.

While Prop C’s tax is unnecessarily aggressive and funds services already provided by a functioning market, Prop D provides badly needed funding for housing-related projects, and does so with a responsible revenue stream. It deserves the sole “yes” vote of the two.

Prop E: Ban on the Sale of Flavored Tobacco

As I wrote about California Prop 67 on the November 2016 ballot, which banned plastic bags:

Banning products should be a last resort reserved for products that severely harm users and/or others. Machine guns and heroin fall in this category; plastic bags do not.

Flavored tobacco is clearly more damaging than plastic bags, and in particular the marketing of flavored tobacco to children and communities of color is reprehensible. But prohibition has serious costs: our failed drug war has incarcerated hundreds of thousands of people — largely of color — not to mention the deaths and waste of public funds. Banning flavored tobacco could well generate a black market for it, and while those illicit transactions might not lead to murder, they could still put sellers in jail, doing more damage to the communities the measure aims to help.

Prohibition is not the only tool in our arsenal. Alongside 2016’s Prop 67, California voted on two taxes: Prop 56 (an additional $2 tobacco tax) and Prop 65 (turning the paper bag fee into a tax). I voted for both. We could similarly increase the tax on flavored tobacco, and divert the funds to addiction treatment in recognition that it is not a crime. If predatory marketing is a concern, San Francisco could further regulate flavored tobacco advertisements. These are the strategies we’re applying to cannabis, and they represent the right approach for flavored tobacco too. It may be the right time for action, but it’s not the time to turn back the clock on prohibition just as we’re learning from our mistakes.

Prop F: City-Funded Legal Representation for Tenants Facing Eviction

Legislation is always more flexible than ballot measures, and it doesn’t require overloading citizens with complicated topics. Many actions require or are easier with ballot measures, especially new taxes, but Prop F is not in that camp. Its funding comes from the General Fund, and two Supervisors — Sheehy and President Breed — introduced similar legislation in November 2017. Their bill also improves upon the measure by excluding evictions due to domestic abuse, and including more overall detail.

The ease with which we could provide eviction counsel without a ballot measure suffices for me to vote no on it. I also question some of the assumptions behind the motives, which make it that much more important for it to go through legislative channels so they can be fully investigated:

  1. How effective is the program? Sheehy and Breed’s plan is modeled after a 2012 pilot, a report on which found that “tenants are more likely to stay in their homes when provided full-scope representation [compared to limited-scope representation].” But tenants weren’t randomly assigned representation levels, so this could have been due to factors unrelated to the program. While the report estimated cost savings, the authors acknowledged that they were based on questionable assumptions.
  2. Does it affect the housing supply? It’s reasonable to expect the right to counsel to increase the number of eviction-related lawsuits or challenges. Some of these will cost the landlord time and/or money, and these costs can reduce the supply of rentable housing, as potential landlords decide against entering, and existing ones decide to exit the business to avoid these costs (even if they were engaging in wrongful evictions, these costs can be real). All renter protections need to be weighed against higher rents from impact to the housing supply (see my mention of 2016 Prop C in the Props C & D section).
  3. Is it the best use of $5 million+ per year? For example, does it mostly benefit low-income people? How expensive is the program in administrative overhead costs? Even if our sole goal is housing security, how does it compare to something like giving $100 per year to each household with income below $35,000 (e.g., by expanding the Working Families Credit)?

Some of these questions may have been better addressed in the full 32-page report, or in other analyses of similar programs. But I haven’t had time to fully dig into the matter, and that’s kind of the point: it’s a complicated issue that should be investigated by legislators and their staff, adjusting the law before it goes into effect and continually monitored (the ballot measure doesn’t mention evaluation). However noble the goal, mechanisms matter.

Prop G: Unified School District Parcel Tax

San Francisco should be the best city for families with children. Employers are focusing more on parental leave policies, but structural problems around housing affordability and school quality have pushed San Francisco’s share of children 40 percent below the national average (13 percent vs. 23 percent). To the extent that San Francisco teachers are underpaid (their $69,000 median salary is about 85 percent of median earnings, though this gap shrinks when including benefits), we should give them raises.

Parcel taxes are an effective funding source, since they tax apartment buildings the same as a single-family home. This aspect incentivizes density and is progressive since apartment residents tend to have lower incomes (though it’s also regressive to the extent that richer people own more valuable parcels). Prop G is good policy on both sides.

Prop H: Tasers for Police Officers

Prop H would adopt the San Francisco Police Officers Association’s taser use policy rather than that approved by the Police Commission. The research on tasers is unclear: a recent study found that tasers reduced injuries for police but not civilians, and did not reduce firearm use. Another 2009 study funded by the Department of Justice U.S. Department found that under 1 percent of taser uses resulted in significant injuries. Taser policy should therefore be guided by career experts like the Police Commission, who can adapt the policy based on San Francisco’s experience and new research. Should any adjustments be needed, passing this ballot measure would set the policy in stone until another ballot measure can amend it. This is a matter best left to government officials.

Prop I: Local Policy Discouraging the Relocation of Established Sports Teams

My initial reaction to Prop I was to support it, as it seemed to discourage San Francisco expanding our sports presence. I side with the 83 percent of economists who agree that “Providing state and local subsidies to build stadiums for professional sports teams is likely to cost the relevant taxpayers more than any local economic benefits that are generated” and the 86 percent who agree that “local and state governments in the U.S. should eliminate subsidies to professional sports franchises.” In addition to the being a poor use of city funds — and land, which can house people to reduce housing shortages — I believe subsidizing sports has a deeper effect of dividing society and reinforcing zero-sum thinking which rarely matches real-world matters (such as immigration, trade, and housing).

However, Prop I is only a token statement against pursuing other cities’ sports teams. It makes no binding statement on new sports teams, and is written in dramatic language unsuitable for public policy. This is the kind of meaningless ballot measure which demeans the entire notion of direct democracy.

Regional Measure 3: Bay Area “Traffic Relief Plan” Bridge Toll Increase

Improving transit with a bridge toll increase will be progressive, safe, and green. I live near the Bay Bridge, and both see and breathe its extreme congestion each time I leave my apartment (my neighborhood has some of the worst air quality in the city). Drivers are richer than non-drivers, making bridge tolls progressive. With better transit and less bridge driving, our air quality will improve; the region will reduce its reliance on cars and their associated traffic incidents; and we will have greater incentive to build housing near jobs as workers seek to avoid the higher tolls. RM3 is a strong step toward more sustainable transportation.

How did I compare?

More to come for local races (spoiler: I strongly support London Breed for Mayor), state ballot measures, and state primaries.

Written by

Economist. Founder and president of the UBI Center. Studied at MIT and UC Berkeley. YIMBY. Former Google data scientist.

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