SF Mayor’s Veto of Increased Transportation Sustainability Fee Stands

 Left to right: Thea Selby of the Transit Riders Union, Peter Cohen, Council of Community Housing Organizations, Margaret McCarthy, SFBC, Supervisor John Avalos, Peter Straus, Transit Riders Union, and Calvin Welch, Human Services Network at a presser pushing to override Mayor Lee's veto. Image: Jeremy Pollock.
Left to right: Thea Selby of the Transit Riders Union, Peter Cohen, Council of Community Housing Organizations, Margaret McCarthy, SFBC, Supervisor John Avalos, Peter Straus, Transit Riders Union, and Calvin Welch, Human Services Network at a presser pushing to override Mayor Lee’s veto. Image: Jeremy Pollock.

Supervisor John Avalos, backed by safe streets and transit advocates, and Supervisors David Campos and Jane Kim, made a push today to override Mayor Lee’s veto of a proposed increase in the Transportation Sustainability Fee (TSF) on large commercial developments. But the override only got six votes rather than the eight required.

The proposal would have increased the one-time fee on large commercial projects by $2 from $19.04 to $21.04 per square foot (and that only applies on the portion above 100,000 square feet, if the project is large enough to qualify). It also requires commercial projects in the pipeline that have not received Planning Commission approval to pay half of the difference between the new TSF and the previous fee.

The TSF was a huge step forward, requiring developers to pay a fee for for impacts on transportation infrastructure brought about by the workers and residents they bring to the city. The proposed increase, meanwhile, would have generated an estimated $2.4 million a year along with $30 million in one-time revenue for the SFMTA.

“Mayor Lee’s veto of the TSF ordinance preserves a backroom deal with developers and forces tax payers, Muni riders, and workers to subsidize the increased transportation impacts of big developments,” said Supervisor John Avalos. “The SFMTA will be forced to make up for the gap in revenue through increased fares and fines or further defer much-needed maintenance and capital projects.”

Image via SF Planning presentation [PDF]
Image via SF Planning presentation [PDF]
But, obviously, it wasn’t just the mayor who was opposed to this particular increase, which only passed by a six-to-five vote in the first place. Supervisor Scott Wiener, whose pro-Muni cred is hard to question, voted against the increase and didn’t pull any punches in a response to the override effort:

“The Avalos legislation–vetoed by Mayor Lee–is more about scoring political points than transportation policy or funding. The Avalos legislation produces very little ongoing revenue and undermines the collaborative work that led to the passage last year of the TSF.”

But Wiener didn’t stop there.

“The TSF legislation I authored and that we passed last year is highly impactful. It almost doubles the annual projected yield of transportation impact fees, from $26 million a year to $45 million. This nearly $20 million annual increase will allow us to significantly invest in Muni and street safety projects.

The Avalos legislation stands in stark contrast to the thoughtful, collaborative, and significant TSF legislation we passed last year. The Avalos legislation is minor in terms of the new funding it produces and constitutes bad faith in terms of the five-year legislative process we went through to pass the TSF. Compared to the nearly $20 million in additional funding annually that our TSF legislation will produce, this new legislation provides a mere $2.5 million in new ongoing annual funding.”

But if Avalos is grand standing, he is doing it alongside some potent allies, including the San Francisco Transit Riders Union, the San Francisco Bicycle Coalition and others seen in the photograph from the press event above:

“As SFMTA works on its budget for the 2016-2018 fiscal period, it is painfully clear that the agency lacks both the operating and capital resources it needs, and programs are being deferred because of these shortages,” said Thea Selby, Chair of the San Francisco Transit Riders Union Executive Board. “These proposed boosts to the TSF would help keep Muni needs on track.”

“Now is no time to stick our heads in the sand, in the face of an increasingly congested city,” said Margaret McCarthy, interim executive director of the SF Bicycle Coalition, at the presser. “Now’s the time for investing in a future that leaves our city and our planet better off than how we inherited it.”

But Wiener didn’t hold back.

“The new legislation also sends a clear message to community stakeholders that if you participate in a lengthy and controversial legislative process and make concessions–in this case a significant increase in transit impact fees on commercial development and an extension of the fee, for the first time, to residential development–your reward will be passage of the negotiated legislation followed by an immediate breach of that negotiated resolution by increasing the fee even further.”

Actually, Wiener’s logic is similar to the Mayor’s, who said this in his veto letter, from March 11:

“The TSP was developed over many years through an extensive public process, earning broad stakeholder support and creating $1.27 billion in revenue for San Francisco transportation infrastructure over the next 30 years. This process included a multitude of commissions and numerous hearings before the Board of Supervisors. I was proud to have signed the unanimously approved package just four months ago that levied TSF on residential development for the first time ever and increased the fees on commercial development as well. To re-open this issue would undermine the trust of impacted stakeholders and hinder our ability to create consensus in the future.”

Selby, however, wasn’t buying it:

“Mayor Lee rightly deserves credit for supporting the TSF as initially passed, expanding development fees to large residential developments.  However, we should remember the TSF is a fee, not a tax.  It seeks to recover a portion of the true transportation costs imposed on the City by new development—and only a share.  Traditionally, the minimum share recovered by the TIDF which preceded the TSF was at least 25 percent of the costs estimated by a “nexus study.”  The current TSF recovers the lowest percentage of the City’s estimated costs ever imposed by the fee. The proposed amendment, which would raise the fee by $2 per square foot, would only bring the fee close to, but still below, the 25 percent rate previously imposed.”

Either way, getting enough support to override a veto for bicycling and transit is problematic, to say the least, especially with a proposal that passed by a narrow majority in the first place. “Supervisor Avalos and I work well together on a host of transportation issues,” said Wiener, shortly before casting his “no” vote. “We just disagree on this one.”

  • Gary Fisher

    No One comments because all know.

  • murphstahoe

    “The SFMTA will be forced to make up for the gap in revenue through
    increased fares and fines or further defer much-needed maintenance and
    capital projects.”

    Let’s get cracking on those double parking tickets!

  • p_chazz

    The SF Bike Coalition and the Transit Riders Union should know better than to get behind David Compost. This was a transparent example of his tendency to back no-win measures and then point to them to show how responsive he is to the fill-in-the-blanks advocacy group he is trying please, whether it is housing, transportation, ending police violence or whatever.

  • murphstahoe

    If you want a say in how those organizations focus – pay your dues.

  • sebra leaves

    Too many large projects are choosing to build sidewalk parks and
    bulbouts and plant trees and remove parking instead of paying fees that
    go into maintaining and operating the Muni public transit.

    When the city starts collecting transportation fees instead of accepting in lieu fees from large project developers we can start talking about raising fees.

  • edsully

    John “staff banger” Avalos is an idiot.

  • Mountain Viewer

    No bones in that fight. But isn’t Wiener’s reaction also about scoring political points 🙂

  • Elias Levy

    He is rightly pointing out you don’t spend years creating consensus and passing legislation to have some Johnny-come-lately show up a few months later and shit all over your carefully crafted compromise. It teaches folks that compromise is for suckers, so you might as well not participate in the first place and fight tooth and nail.

  • This is assuming that there was a willingness to come to the table in the first place, which it seems in this case there was. I don’t think that holds true everywhere.

  • sojourner_7

    Avalos has become the poster-child for the SF crazies. Makes the city look even worse than Ed Lee can manage.

  • Richard Mlynarik

    “Thoughtful and collaborative” is SF-speak for “Willie Brown’s arm is inserted very deeply and that’s what causes my mouth to move.” (“Reasonable” and “moderate” likewise.)

  • That’s actually John Avalos, not David Campos. But don’t feel bad, people mix them up several times a week.

  • The “consensus” on the original legislation was created behind closed doors with the Mayor and developers. Since the day it was introduced, Avalos and every pro-transit organization in the City (STRU, Bike Coalition, WalkSF, Livable City, SDA, etc.) have said the fees were too low, beginning at the Planning Commission last September, who unanimously endorsed raising the fees. Even Republican Commissioner Antonini supports higher fees!

    At the Land Use committee, Avalos made two previous proposals for larger increases (9/28/15 and 11/3/15) that were still supported by the Planning Department’s Financial Feasibility analysis, but those were rebuffed.

    As Avalos said yesterday, what the Mayor calls a “consensus approach” is really a “concessions approach,” where those with less power are forced to make concessions:

  • For anyone who wants to geek out on this, here is the Planning Department’s analysis of the proposed fee increase. The key analysis was revisiting the “Economic Feasibility Study” of the fee, which looked at 10 prototypical developments and measures how the fee impacts the land value, and whether the project still pencils out. They looked at Avalos’s proposed fee increase combined with the recently passed child care impact fee, and found that all of the office building prototypes still penciled out with room to spare.
    https://www.scribd.com/doc/305759221/Planning-Department-Memo-on-Avalos-TSF-Amendments

  • The last page lists all of the projects in the pipeline that are exempted from the TSF by the deal the Mayor cut on “grandfathering” proposed projects. That includes huge near-term loses for the SFMTA from the Oceanwide Center ($4.9 million) and Uber office building ($1.2 million), which may get Planning Commission approval in the next months.

    The most outrageous part are the massive projects that are years away from breaking ground (Pier 70, MIssion Rock, Flower Mart) that will still be paying the old TIDF. Together those three projects received a $13 million gift from the Mayor and Wiener.

  • murphstahoe

    Meanwhile your man John helped nuke the TIDF for non-profits and gave a huge break to the new hospital on Van Ness…

  • Elias Levy

    Eh? What are you talking about? The proposal was unanimously recommended for approval by the SFMTA. It was unanimously recommended for approval by Planning Commission with a few suggested amendments. It was unanimously approved by the Board of Supervisors with some amendments and cosponsored by Wiener, Breed, and Christensen. In what world is that behind “closed doors”?

    Just because Avalos did not get everything he wanted doesn’t mean it was a giveaway or not reached through consensus.

  • Talk about political theater, that 2012 debate on the non-profit exemption for the TIDF was a frustrating waste of time. Neither side could cite any potential projects that would be affected. The smaller non-profits had no plans for building anything that would have to pay the TIDF. But the MTA and Wiener couldn’t point to any large non-profit projects that would lead to any new revenue. All the large projects (like CMPC’s hospital on Van Ness) were covered by Development Agreements that would pay a higher rate than the TIDF.

    So we had a philosophical debate about transit vs. human services vs. affordable housing, which led to a lot of bad blood that contributed to our in ability to build a strong enough coalition to put the VLF on the ballot in 2014.

  • The Planning Commission’s “few suggested amendments” essentially endorsed Avalos’s initial proposed fee increases, which went well beyond what was vetoed! They recommended raising the fees up to 33% of the nexus, which is way higher than anything Avalos ever proposed.

    The fact the MTA Board signed off on it is one more example of their lack of independence from the Mayor.

    Avalos’s proposal for a a three-tiered fee structure was voted down in the Land Use committee on 9/28/15. Wiener made one small increase to add $1 for large residential and commercial projects. But that still left the commercial fee proportionally much lower than the commercial fee.

    On 11/3/15, Avalos’s proposal to increase the large commercial fee by $4 was voted down 6-5. Then in Peskin’s first meeting on 12/8/15 when he had the votes, he increased it by only $2.

    But the Mayor and Wiener stuck to the basic fee proposal that was developed without any input from transit advocates. And years from now, major donors to the Mayor like Forest City, Kilroy, and the Giants will be saving millions on their billion dollar projects from the grandfathering deal in the TSF.

  • De Blo

    Thank you Mayor Lee. Anything that slows market rate development in this City is a negative. I would suggest the abolition of rent control, which would improve the quality of life for all San Franciscans.

  • De Blo

    Campos is even worse than Avalos. Vote for Safai in District 11 and Arce in District 9 to bring back sanity.

  • p_chazz

    Same difference.

  • RichLL

    Normally yes. But Campos is more overtly racialist in his approach than Avalos.

    So for the SFBC, lobbying Avalos is a better bet. Avalos is less likely to be resistant to SFBC just because SFBC is largely seen as an organization for privileged white people.

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