My business partners and I opened our NoPa restaurant, Che Fico, in 2018. From the start, we included a 4% surcharge to cover the additional costs we faced under the city’s mandated health care coverage plan, which requires restaurants to contribute to a city fund for employees.
San Francisco, CA
Opinion | Restaurateur: New law aimed at transparency will hit SF restaurants hardest
When Che Fico reopened post-pandemic, we were driven by a mission to rectify long-standing industry injustices that disproportionately favored a select few—primarily servers and bartenders—at the expense of other workers who didn’t receive tips and worked long hours in substandard conditions. We instituted a 10% surcharge, increased pay across the board and introduced new benefits, such as a 401(k) plan with a 4% match and profit sharing.
It was not easy. We had to adjust our shared tip pool several times to ensure everyone was included and that it was fair to our entire staff. We also increased hourly wages to compensate for potential tip losses. This model epitomized free-market capitalism, where ownership collaborated with labor to find common ground and consumers had the choice to support a business that resonated with their values. Our menu was always clear that the charge would be added to the final bill.
Now a new law known as the “junk fee” bill, taking effect July 1, aims to reshape California’s dining industry by banning restaurants from adding surcharges or service fees to their bills. Instead they’d have to raise menu prices, baking the surcharge in.
While this may initially appear to benefit consumers, it will disproportionately harm small businesses—the latest move in a pattern of well-meaning yet detrimental policy decisions targeting the restaurant industry. It also obscures the challenge of operating in San Francisco, where voters and officials have repeatedly approved costly additional mandates that operators elsewhere do not face.
We can all agree that hidden fees are frustrating. Nothing is worse than booking a hotel room at an advertised price, enjoying your stay and upon checkout, finding your bill laden with resort charges, Wi-Fi charges, valet parking and other surprise fees and taxes. I fully understand the frustration. I am a consumer myself. But the vast majority of restaurants don’t operate this way. If they charge surcharges or service fees, they post it on menus and let guests know when they book a reservation.
Transparency is the goal, and this is one way for operators to show customers all the things they are paying for, beyond the cost of food. Guests have thousands of restaurants to choose from, especially in San Francisco. They can simply decide a certain restaurant isn’t worth the fee. And no restaurateur who believes in good service and repeat business wants to leave a bad taste in a customer’s mouth upon dropping the check.
But the new law focuses more on appearances than on the operational realities of managing a restaurant in one of the nation’s most expensive urban environments.
Gavin Newsom enacted San Francisco’s Health Care Security Ordinance during his tenure as San Francisco mayor. As governor, he continues to influence policy in ways that strain local enterprises. The health ordinance has been one of the most damaging things to happen to San Francisco small businesses and can be directly linked to the beginning of the surcharge trend here. One of the most pervasive problems with that legislation is that it punishes businesses for growing and hiring more workers, adding a cost of several dollars per hour per employee for businesses with 20 or more workers. But rather than use his post as governor to propose a smart, statewide reform of the health ordinance, this new junk fee bill will throw out all surcharges regardless of their purpose or how they are communicated to consumers.
Advocates of eliminating service charges argue that doing so protects consumers, but that fails to consider the pressure San Francisco restaurants face—challenges beyond typical market fluctuations. They contend with some of the highest insurance premiums in the country, soaring utility rates from providers like Pacific Gas & Electric and a labor market characterized by escalating wages and staffing shortages. Consider:
Labor costs are rising: San Francisco’s minimum wage rose from $10.74 per hour in 2014 to $18.67 in 2024—a 74% increase approved by voters and the Board of Supervisors. Such spikes put a significant burden on labor-intensive sectors like the restaurant industry.
Inflation is increasing utility bills and the cost of goods: The pandemic further intensified supply chain disruptions, pushing the costs of ingredients up by about 15% in San Francisco. Officials have approved numerous rate increases for PG&E, leading to a 60-77% increase in commercial rates in the last decade, even as PG&E rakes in billions in profits.
Rent and property costs are soaring: The city’s commercial real estate market has also surged, with rents increasing by about a third since 2014. Rent or mortgage payments are the third-highest expense for many restaurants, after labor and cost of goods.
Surcharges have enabled small businesses to manage these rising costs without shocking customers with drastic or frequent price increases and allowed them to convey these external cost pressures. Removing them could lead to a sudden spike in dining costs, further deterring customers and pushing restaurants toward insolvency.
The irony is stark. Policymakers, comfortably dining at San Francisco’s top restaurants, seem oblivious to the adverse effects of their decisions on those serving them. By eliminating the option to communicate cost pressures through surcharges, the law does not support consumers. This will lead to decreased consumer spending, fewer shifts for waitstaff, reduced orders for suppliers and lower tax revenue from a once-thriving industry.
The “junk fee” law misunderstands basic economic principles: Thin operating margins and insufficient profits can lead businesses to close, which affects the entire community—workers, suppliers, service providers and local artisans. In my own restaurants, our surcharge has allowed us to improve pay across the board, offer a 401(k) with a 4% match and create profit-sharing. If Newsom’s intention is to dismantle these programs, then he is certainly being effective.
Hopefully, before the law takes effect, state leaders will have a dose of common sense and will revise the legislation to preserve the rich diversity of San Francisco’s dining scene. Otherwise, they will simply be compounding the issues that began with the initial health ordinance, without acknowledging the benefits workers and restaurant patrons receive surcharges are clearly spelled out.
David Nayfeld is the co-owner of Back Home Hospitality, which includes Che Fico. Find him at @davidnayfeld on X and Instagram.
One of San Francisco’s busiest freeways remained shut down Saturday, creating major traffic delays and dampening business for some local restaurants and shops.
All eastbound lanes of Interstate 80 just before the Bay Bridge are closed as crews work around the clock to rehabilitate the roadway. The 55-hour shutdown, which began on Friday night, is scheduled to last until Monday morning in time for the commute.
The closure has forced drivers onto detour routes, leading to heavy congestion for those trying to reach the East Bay, including Oakland and Berkeley.
The impact is being felt beyond the roadways.
At MoMo’s, a restaurant across from Oracle Park, staff found business noticeably slower.
“A little bit more mellow than usual. We usually see a little bit more foot traffic, a little bit more people on Saturdays,” said Daniel Bermudez, executive chef at MoMo’s.
Bermudez believes the freeway closure may be discouraging visitors from coming into the city this weekend, despite favorable weather.
“The weather is beautiful today. It’s nice and sunny. So we have plenty of tables outside,” he said.
With the San Francisco Giants playing an away game, the restaurant had hoped fans would still gather to watch, but turnout during game time remained light.
“This is kind of like our off-season Saturday. A lot slower than our baseball weekend,” said Casandra Alarcon, general manager at MoMo’s.
Other small businesses in the Mission Bay and South of Market neighborhoods reported similar trends, saying most of their customers are regulars who live nearby rather than visitors.
“A little bit slower for sure. Before, we had tourists come and walk to the baseball park,” said Ajaree Safron, manager at Brickhouse Cafe & Bar.
Caltrans has shut down eastbound lanes between 17th and 4th streets to repave the 71-year-old roadway. The goal is to extend the life of the Bayshore Freeway by another decade.
City and transportation officials said the timing of the closure was intentional, noting fewer major events scheduled in San Francisco this weekend, aside from the Cherry Blossom Festival.
Westbound lanes remain open, and officials said traffic heading into San Francisco from the East Bay has not been significantly affected.
“Getting into the city, it wasn’t too bad. Regular [traffic], what we expect on a Saturday morning,” said visitor Andrea Inouye.
While the closure has posed challenges for businesses, some workers said they are taking it in stride.
“Hopefully, it’s not for too long and we get past it, and get back to our normal routine,” Bermudez said.
Despite early concerns about widespread gridlock, transportation officials said the region has avoided the worst-case scenario. Traffic remains heavy in areas near detours, but the anticipated “carmageddon” has not materialized, in part because many drivers chose to avoid the area or take public transit.
Bay Area High School baseball fans are treated to a rare opportunity Saturday (April 18) with three games at Oracle Park, home of the San Francisco Giants, including the famed Bruce-Mahoney clash between West Catholic Athletic League rivals St. Ignatius and Sacred Heart Cathedral.
The first pitch of the 20th annual Dante Benedetti Baseball Classic starts at 11 a.m. and pits two more San Francisco private schools as University (9-7), winners of four straight, taking on Riordan (5-11).
That will be followed by the Bruce-Mahoney game at 2:30 between St. Ignatius (12-5, 4-2 WCAL) and the Irish (7-10, 1-5) and finished off with a North Coast Section clash between North Bay’s Marin Catholic (9-7) against Acalanes (7-6-1).
The Benedetti Classic, founded by Dante’s Boys Foundation board member Tom Lounibos and Giants president Larry Baer, benefits the DBF which honors the spirit of Benedetti who for nearly 40 years owned San Francisco’s Mr. Baseball nickname for his kindness and generosity to baseball-playing youth in the area.
Among their philanthropic efforts are glove and baseball equipment drives, field renovations and contributions to scholarships and sponsorships.
After starting the season 0-4 — three of those losses were by one run — University, under head coach Andrew Suvunnachuen, has found its way, winning the last four, all in Bay Counties League play, by a combined 51-6 count over Lick-Wilmerding (16-1 and 11-3) and San Domenico (13-2 and 11-0).
Senior catcher and pitcher Jett Messenger leads the way with a .447 average, while getting on base at a .638 rate. He also leads the team with 20 stolen bases. Junior third baseman Tate Gebhart is hitting .419, while Leo Felder and Behbart share the RBI lead with 15 each.
Junior Matthew Foley is 3-2 on the mound with a 2.38 ERA and 25 strikeouts in 17.2 innings.
Riordan, under second-year head coach Craig Sargent, was 5-5 in nonleague games but lost six straight in the rugged WCAL, losing two tough games this week to Mitty (3-2 and 7-4). Junior third baseman and pitcher Santiono Williams leads the team in batting average (.371), on-base percentage (.488) and stolen bases (nine). He’s also been the team’s top pitcher at 4-2 with a 2.84 ERA.
The teams have split two previous games in their history, with Riordan winning 2-0 in 2023 and University prevailing 5-0 in 2021.
St. Ignatius, led by ninth-year head coach Brian Pollzzie, has already secured the Bruce-Mahoney trophy with four straight wins — one each in football, girls volleyball, boys basketball and girls basketball — but this rivalry is always spirited.
The Wildcats, who are ranked fourth in the Bay Area by the San Francisco Chronicle, are coming off a tough 3-0 home loss to No. 2 St. Francis on Friday after beating the host Lancers 10-6 on Tuesday.
The team is led by Stanford-bound Archer Horn, who is hitting .486 with four home runs and a .604 on-base percentage. The shortstop and pitcher also has not allowed an earned run in three pitching appearances while registering one save.
Pitching is a team’s strength with a 2.59 ERA, led by a brigade of strong arms including Leo Rhein (2-0, 2.38), Tycco Giometti (2-1, 2.62), Charlie Stecher 1-1, 0.72) and Chase Gordon (1-0, 2.80). The team is missing standout Finn Demuth, out of the season after undergoing Tommy John surgery.
Sacred Heart Cathedral, led by fourth-year head coach Gregg Franceschi, has scored 60 runs on the season and given up 61. The Irish are coming off two losses to eighth-ranked Valley Christian (5-2 and 10-1).
They are led offensively by junior outfielder Brody O’Sullivan (.381) and senior infielder Jacob Vines (.378). Johnny Nepomuceno and Max Nylander are other run-producers. Zach Stallworth (37 strikeouts, 29.2 innings) and Cooper Rogers Lewis (0.25 ERA) have been the team’s top pitchers.
The series has been remarkably close since 2005 with Sacred Heart Cathedral holding a 27-20 edge, though St. Ignatius won both games last season (5-0 and 6-3) after the Irish won 9-7 and 1-0 in 2024.
Marin Catholic hopes to get back to winning after starting the season 9-1, but have since lost six straight, four in Marin County Athletic League play, including 4-2 to Novato on Thursday. Senior outfield Luke Martin is the team’s leading hitter at .478 while senior infielder and pitcher Cooper Mitchell is at .455. Senior infielder Walker Untermann leads the team with 15 RBIs.
Acalanes is at the other end of the spectrum, winners of five of six after a 2-5-1 start. Junior infielder Tyler Winkles, also a highly recruited quarterback in football, leads the team with a .383 average and nine stolen bases. Riley Gates (2-3, 2.49 ERA, 30 strikeouts) is the team’s top pitcher.
The teams have played three times, all since 2022, with Marin Catholic owning a 2-1 lead. Acalanes won last year’s game 8-7.
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Chinatown fatal crash victim ID’d, safety measures proposed
The victim killed in Friday’s Chinatown crash was identified Monday by the medical examiner as Cutberto Zamora-Martinez, 49, of San Joaquin County. At a meeting on Monday, city officials said the cause of the crash is still under investigation.
SAN FRANCISCO – A 76-year-old man has been arrested on suspicion of vehicular manslaughter and speeding following a crash in San Francisco’s Chinatown that killed a man working in the area.
Zhuo Ming Lu, 76, is accused in the March 27 crash that left 49-year-old Cutberto Zamora-Martinez, of San Joaquin County, dead.
Suspect was trying to park
What we know:
Authorities said Lu was attempting to park near Grant Avenue and Jackson Street when his vehicle jumped the sidewalk and crashed into the landmark New Lung Ting Café, also known as the Pork Chop House. The vehicle also struck two pedestrians, including Zamora-Martinez.
Zamora-Martinez died from his injuries.
He had been working in the area, according to a GoFundMe page. A San Francisco Police Department source close to the investigation told KTVU the victims were carpet installers arriving for work.
The fundraising page described Zamora-Martinez as a husband and father who was the sole provider for his family and “a humble man who wanted the best for his family.”
Before his arrest, Lu had been cooperating with investigators. Authorities have not confirmed what caused the crash.
Some residents questioned whether the driver’s age or a possible confusion between the brake and gas pedals may have been factors.
“Maybe if people hit a certain age, you got to get retested for your driver’s license is something I was thinking about,” said Keith Hong, who works next door to the crash site.
Another case involving an elderly driver
Big picture view:
In an unrelated case, Mary Fong Lau, 80, was sentenced to probation after killing a family of four, two parents and their young children. in March 2024. Authorities said Lau struck the victims as they waited at a Muni stop on their way to the zoo.
Lau pleaded no contest to four felony counts of vehicular manslaughter, and a judge accepted the plea. A Superior Court judge cited her age, remorse and lack of criminal history in the sentencing decision.
She was placed on probation for two years, banned from driving for three years and ordered to complete 200 hours of community service.
The Source: San Francisco Police Department, prior reporting
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