Of the five San Francisco ballot propositions up for a vote on November 6, only Proposition C has escalated into a citywide spectacle starring Mayor London Breed (who has come out against C) and tech titan Marc Benioff, who is not only pro-C but this week very publicly announced a $2.5 million donation to the campaign. Benioff subsequently got into a Twitter spat with Twitter CEO Jack Dorsey, who is also against C.
Benioff and Breed had respectful words about agreeing to disagree, but Benioff also told this to the Chronicle: “At the end of the day, it’s going to be — are you for the homeless or not for the homeless? For me, it’s binary,” he said. “I’m for the homeless.”
That kind of polarizing view is pretty harsh. Prop C opponents like Breed, along with state Senators Scott Weiner and David Chiu, as well as the city Chamber of Commerce are not literally against the homeless. That’s not what this debate should be about. It has to be about the following: If we agree to spend more money, what’s the best way to spend it? And does Prop C let city government spend it that way?
There are a lot of questions involved, so let’s do this in FAQ form.
How much does San Francisco spend on homelessness at the moment?
The Department of Homelessness and Supportive Housing’s 2018-19 budget is $284 million.This does not include money that other departments, such as Public Works (with its $374 million budget) and Public Health ($2.37 billion), spend on health care and street cleanups. The true figure, according to the city’s budget analyst, is $380 million.
How many people are homeless in San Francisco?
The city’s latest biennial count, from 2017, is 7,499, of which 4,353 were unsheltered. The figures have held steady, more or less, since 2013.
Remind me, what’s San Francisco’s budget?
It’s around $11 billion. The city’s biggest budget ever.
Where is this new homeless money going to come from?
An extra tax on SF’s wealthiest corporations like Benioff’s Salesforce — roughly 2.5% of the 13,000 businesses that pay the gross receipts tax. It could bring in $250 million to $300 million. All of that would go to homelessness services and housing.
If a billionaire businessman like Benioff is OK spending more money — which will come from higher city taxes on rich companies like his — it’s got to be a good idea, right?
Opponents have raised two major concerns. The first is the higher taxes will drive companies and jobs out of the city. The city’s budget analyst has sprinkled a little cold water on that argument, saying annual job losses would be roughly 725 to 875, about 0.1% of city jobs. The impact could even be mitigated by big bosses like Benioff, the city’s largest private employer, deciding to stay put. Add another factor: If the extra spending and services get more people off the streets, it could improve conditions for the tourism and business community, which is very worried about the current state of the streets. Fair to say that the jobs argument is far less important to unpack than the other major concern.
Which is … ?
Will Prop C’s $300 million be money well spent? You don’t have to look back too far into city history to find blatant, corrupt waste of taxpayer money that was collected with good intentions. Hundreds of millions of dollars of it. Let’s put criminal intent aside; we’re not saying that city officials and contractors providing services are going to steal the money. But a system that is so tangled and complex — encompassing five city departments, 15 databases, and 75 different organizations — might be worth fixing first, especially when a lot of the organizations due to receive the Prop C money have been working for years without making a dent in the problem. That’s the argument Breed and others are making.
Yet another argument is that it’s bad tax policy to craft specialty taxes for specific budget items, larding a system with permanent earmarks. The urban-planning think tank SPUR recommended no votes on two propositions on the June ballot for exactly this reason.
But SPUR is holding its nose this time in its voter guide: “These concerns are overshadowed by San Francisco’s homelessness challenge, which has reached visible crisis proportions. In a city with a thriving economy and a budget exceeding $11 billion, there are too many people who remain in need.”
No one has yet analyzed whether a reduction in homelessness in San Francisco could have a positive fiscal return. The controller’s Prop C report did, however, nod to studies that show a benefit from reducing emergency medical use.
With thousands fewer people on the streets, the city’s spending on emergency health care would likely go down. Perhaps street cleaning too? And would foot traffic in certain areas increase and boost business?
So how will money be spent under Prop C?
It would be divided into four major areas:
• At least 50% of the money must help people find affordable housing, with sizable amounts earmarked for homeless youth and families. This can take many forms. The money can go to build new housing or preserve existing units, such as in SRO buildings. Up to 12% of this can take the form of rental subsidies. Why so much for permanent housing instead of temporary shelters? A growing body of evidence says it’s the best way to reduce the problem.
• At least 25% would go to the Department of Public Health for mental health services for homeless people “severely impaired by behavioral health issues.”
• Up to 10% would go to shelters, navigation centers, and other facilities like portable showers.
• Up to 15% would help prevent homelessness with rental or utility subsidies, eviction defense, and other financial assistance.
Some opponents say Prop C doesn’t have a plan, which seems odd. Do they want an item-by-item accounting before it even gets off the ground?
What about oversight? The city has turned bond money for libraries and parks into big improvements, and apparently that’s been money well spent. Shouldn’t we be able to do this for homelessness?
When the city budget analyst issued a 2016 audit of SF’s homeless services, one main theme was a lack of coordination and oversight. Deciding where money should flow was happening “on an ad-hoc and reactionary basis.” That’s why Mayor Ed Lee created the Department of Homelessness and Supportive Housing, whose chief is well aware of the problem.
Whenever you have hundreds of millions of dollars sloshing around, there will be waste, fraud, and abuse. The goal is to minimize it. There would also be money spent on new ideas. Perhaps the city will take a cue from Seattle and build homeless villages using microhouses, an idea that homelessness activist and two-time mayoral candidate Amy Farah Weiss has been stumping for. (Talk about having a plan: Weiss has as many details as you’d like to hear, and told us as much when she sat down with The Frisc last month.)
Prop C establishes an oversight committee of nine people to recommend how to spend the funds, to monitor the spending, and reassess the situation on the ground every three years. Four members would be mayoral appointees, four would be appointed by the Board of Supervisors, and one by the city controller. (There are many other conditions too, with seats earmarked for people who have experienced homelessness, who have mental health expertise, and so forth.) It’s hard to say if this will be enough oversight.
This is money for the homeless. Why does so much of it go for housing?
That’s actually how SF does it now. A big part of the effort is keeping people from becoming homeless again.
If Prop C wins big against the wishes of Mayor Breed, could it affect her chances of re-election next year?
Tough to say. If by some fantastically positive outcome, the encampments are gone, vulnerable people are housed, and the dirty needles and poop are nowhere to be found, voters may not remember the brouhaha over Prop C and give the mayor credit. Indeed, Breed herself may trumpet these things as accomplishments of her administration.
On the other hand, if Prop C fails and the situation we see every day is nowhere near better, or even not a lot better, expect Breed to be attacked for opposing hundreds of millions of potential dollars to fight homelessness in San Francisco.
