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Tech Industry

Techies, taxes and homelessness converge in battle over San Francisco's Prop. C

Salesforce has thrown in nearly $5 million to support a ballot measure that aims to help the homeless. Lyft and Twitter's CEO have contributed $225,000 to defeat it.

Salesforce CEO Marc Benioff is a vocal advocate for Prop. C, which aims to help the city's homeless.

James Martin/CNET

An upcoming San Francisco ballot measure is unexpectedly pitting some tech companies against each other. The topic: homelessness.

Proposition C would tax companies with a total income of more than $50 million yearly and put that money toward helping the homeless population. It would provide the city with funding to house 4,000 people and give 4,500 people mental health and other services, along with a host of other measures.

Salesforce CEO Marc Benioff has been the most vocal advocate of the proposition. He has contributed $1.02 million to the Yes on C campaign, and Salesforce has contributed $4.72 million.

This is a breakdown of all large contributions for Proposition C as of Wednesday. Orange represents those who support the ballot measure, red represents those who oppose it. 

San Francisco Ethics Commission

Democratic heavy hitters like US Rep. Nancy Pelosi and Sen. Dianne Feinstein have joined Benioff in supporting Prop. C, as have musicians and celebrities like Danny Glover, Jewel, Chris Rock and will.i.am.

"At the end of the day it's going to be are you for the homeless or are you against the homeless?" Benioff tweeted earlier this month. "For me, it's binary. I'm for the homeless."

Some notable tech companies and their CEOs aren't happy about the proposition, however.

Who's put in hundreds of thousands of dollars to oppose Prop. C? Ride-hailing company Lyft, Twitter CEO Jack Dorsey, mobile payment companies Stripe and Square, Y-Combinator co-founder Paul Graham and Sequoia Capital partner Michael Moritz.

They say Prop. C doesn't provide enough accountability for how the money will be spent and would put a higher tax burden on those tech companies that aren't as big as Salesforce.

"We're happy to pay our taxes. We just want to be treated fairly with respect to our peer companies, many of whom are 2-10x larger than us," Dorsey tweeted last Friday, speaking in reference to Square. "Otherwise we don't know how to practically grow in the city."

Homelessness is a serious problem in San Francisco. Walking through the city's streets it's hard to ignore. People huddle in doorways and on top of warm steam vents within spitting distance of the headquarters of Twitter, Lyft, Stripe and Square. San Francisco's homeless population is the seventh biggest in the country with 7,500 homeless individuals and 1,200 homeless families. More than 1,000 people are currently on a waitlist for a temporary shelter bed.

In 2012, dozens of major tech companies began to relocate or open new offices in San Francisco. Most were able to negotiate significant tax breaks from the city because lawmakers believed their presence would help revive the blighted downtown area. The city estimates that Twitter, for instance, would save roughly $22 million over a six-year period because of the break.

As more and more tech workers moved into the city since then, home rental prices have shot up, vacancy rates have plummeted and the homeless population has swelled.

Christin Evans has owned a small bookstore called The Booksmith in San Francisco's Haight-Ashbury neighborhood since 2007. For the past 11 years, she's hosted community meetings at the shop and said homelessness is a topic at every single meeting. So she started trying to help. She worked on a program to assist homeless youth in which more than 60 people were housed.

"What we really need is resources," Evans said. "If there is housing, people will absolutely accept it."

Evans is now volunteering for the Yes on C campaign.

Role reversal

San Francisco Mayor London Breed isn't supporting the proposition because she believes increased spending on homelessness without more accountability is "fiscally irresponsible," according to The New York Times

The tech companies that oppose Prop. C say they're just supporting the mayor. For instance, a Lyft spokeswoman said in an emailed comment, "We support Mayor Breed, Senator Wiener, and Assemblymember Chiu in implementing approaches that most effectively address homeless."

Evans and the Yes on C campaign aren't necessarily buying that rationale.

"It really is misleading. Their true motivation is their profits," Evans said. "In the scheme of things, the taxes are a small amount."

Lyft contributed $100,000 to defeat Prop. C. The company's main rival, Uber, said that it's neutral on the proposition and has no plans to engage in the debate. This is a role reversal for the two companies, since Lyft often portrays itself as the nice guy in the ride-hailing world, touting its donations to emergency relief causes and nonprofit organizations like the ACLU.

Several people have taken to Twitter saying they're boycotting Lyft for its position on Prop. C. "Soooo bummed I have to delete @lyft because they are no on #propC which is like being No on #SF. Shame on you @lyft!" said Twitter user A Levs.

The Yes on C campaign has been circulating a petition asking tech workers who support Prop. C to sign it, despite their employers' position.

"Show San Francisco that the tech industry is willing to address this systemic issue with real action, by taxing itself to help the most vulnerable among us," the petition reads. "In the face of the largest corporate tax cuts in recent history, Prop. C's effects on our tech companies would be minimal, but its potential to house the homeless would be vast."

It's only been circulating for two days, the campaign said, but so far hundreds of people have signed it.

The San Francisco mayor's office didn't return request for comment.

First published Oct. 24, 3:55 p.m. PT. 
Update, Oct. 25 at 11:12 a.m.: Adds comment from Lyft spokeswoman.

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