San Francisco voters weighed in Tuesday on two competing measures that seek to change the Top Executive Pay Tax, with one of the measures also including a change to the Gross Receipts Tax.

Should both measures pass, the one with the most votes will take effect, according to the propositions’ legal text.

Currently, the measures state that most businesses with San Francisco gross receipts up to $5 million are exempt from the Gross Receipts Tax. And businesses that use more than half of their city payroll for in-house administrative and management services pay an Administrative Office Tax instead of a Gross Receipts Tax.

The Top Executive Pay Tax is a tax some large businesses pay if their highest-paid managerial employee earns more than 100 times the median pay of their San Francisco employees. Businesses that have city gross receipts up to $5 million and are not subject to the Administrative Office Tax are exempt.

Proposition C

Proposition C states it would increase the number of businesses that could be exempt from the Gross Receipts Tax and would stop any further increases to the “Top Executive Pay Tax” after a final rate bump.

The proposed measure says it would raise the Gross Receipts Tax exemption ceiling to $7.5 million. The $7.5 million ceiling would also apply to the Top Executive Pay Tax exemption.

As for changes to the Top Executive Pay Tax, Proposition C states it would implement the 2028 tax rate increase in 2027, but then stop any future increases.

Supporting Proposition C are Rodney Fong, CEO of the San Francisco Chamber of Commerce, and Chris Wright, senior vice president of Advance SF, an organization of companies, which includes Bank of America, OpenAI, Waymo, the SF Giants CEO and others.

Fong and Wright, in their argument for the measure, say giving businesses more tax breaks would help keep more employees on payroll and would give companies the ability to “contribute to city services in a predictable and balanced way.”

Critics of Proposition C, such as the San Francisco Tenants Union, slam the measure as “billionaire-backed” and argue it would kill the Top Executive Pay Tax and would hand out more tax breaks to businesses at a time when the city is in a budget deficit and faces cuts to essential services.

Proposition D

Proposition D also seeks to change the Top Executive Pay Tax, which is collected from some large businesses where the highest-paid managerial employee earns more than 100 times the median compensation paid to other employees.

If approved, the measure would change the calculation of the tax using the compensation of all employees, not just employees based in San Francisco. Top Executive Pay Tax rates would also be increased for San Francisco gross receipts and payroll.

Supporters have billed the measure as a way to counteract federal cuts to Medicaid. A report by the City Controller’s Office said the measure could result in $250 million to $300 million in additional revenue.

“Proposition D is the solution to our budget deficit. It asks large corporations — not small businesses, not working families — to contribute a little more,” supporters said in the city’s official voter guide.

The measure has the backing of most of the Board of Supervisors, along with labor unions and Rep. Nancy Pelosi.

Opponents, including Mayor Daniel Lurie and state Sen. Scott Wiener, have argued Proposition D would negatively impact the city’s recovery following the COVID-19 pandemic. 

“San Francisco is already one of the most expensive cities in the country to live and do business. Adding extreme and unpredictable tax increases risks driving employers away just as we are trying to bring jobs, workers, and foot traffic back downtown,” said Supervisor Matt Dorsey in the city’s voter guide.

Denver will reimburse developers working on reviving the Rossonian Hotel up to $15.5 million in sales and property taxes after the council approved the urban development proposal during its meeting Monday.

The decision comes after Denver Urban Renewal Authority found that the site was “blighted,” meaning there are unsafe living or working conditions and environmental contamination.

DURA recommended the city allow “tax increment financing,” or TIF, to remediate those problems and get the project off the ground.

“This tax increment financing is one of the final pieces that makes the Rossonian possible. Without it, this project does not happen,” said Paul Books, one of the owners of the building. “But with it, we are working through the last remaining steps to break ground this summer.”

The project, in the Five Points neighborhood, is part of the Welton Corridor Urban Redevelopment Plan. The six-parcel property is in the namesake intersection of Welton, 27th and Washington streets.

The building, once called the Baxter Hotel, was a popular event space for jazz performances between the 1930s and 1950s. Performers such as Duke Ellington, Ella Fitzgerald and Billie Holiday took the stage there. It is on the National Register of Historic Buildings. The building has been vacant since the 1990s.

Palisade Partners, who purchased the property in 2017, plan to build 126 hotel rooms, a restaurant and an event space. They will also construct a new 8-story building between the Rossonian and the Hooper building as part of the redevelopment.

“We’ve concluded that the project does require assistance in order for it to be delivered as it has been contemplated,” said Bill Pruter, executive director of DURA.

Tax-increment financing, which is essentially a tax break or subsidy, allows developers to freeze how much is paid in property or sales taxes at a base level for up to 25 years, and then reinvest what would be paid above that back into certain elements of their projects.

For this project, the developers will be able to reinvest up to $15.5 million — which would otherwise go to the city’s bank account — into their project.

The city will reimburse the tax dollars for specific project costs mostly related to rehabilitation of the building. That includes up to $6.7 million on the plumbing and HVAC work in the new building and up to $2.3 million on the visible structure of the Rossonian Hotel.

French Gates, 61, is the ex-wife of Microsoft co-founder Bill Gates. She and her $30 billion net worth, according to Forbes, join an ownership group headlined by majority owner and managing partner Samantha Holloway, as well as investors David Wright, Andy Jassy and longtime Hollywood producer Jerry Bruckheimer.

“As a longtime Seattle resident, it means a lot to me to have the chance to make this investment in our city and its future,” French Gates said in a statement. “I’m a big believer in the power of sports, and after many years of cheering on Seattle from the sidelines, I’m excited to have an even deeper connection to the Seattle sports community.”

French Gates has never previously had an ownership stake in a major professional sports franchise. She will do so at a time when the Kraken ownership group is positioning itself to own an NBA franchise should the NBA return to the Emerald City for the first time since the SuperSonics were relocated to Oklahoma City nearly 20 years ago.

In March, the Kraken ownership group announced the creation of One Roof Sports and Entertainment, which serves as the umbrella brand of the organization to “oversee a growing portfolio of properties and fuel new opportunities.” At the time, Holloway announced that One Roof would pursue an NBA team in Seattle, should the league move forward with expansion.

Holloway also announced in March that the group had entered an agreement to purchase additional equity in Climate Pledge Arena from Oak View Group, and would make the organization the majority owner of the building. OVG has retained a minority stake.

French Gates, who grew up in Dallas and received a bachelor’s degree in computer science and economics, as well as an MBA from Duke, currently heads Pivotal, a group of organizations she founded to accelerate the pace of social progress for women and young people in the United States and around the world.

French Gates previously founded and co-chaired the Gates Foundation, the world’s largest philanthropy.

“I am excited to welcome Melinda to our ownership group,” Holloway said in a statement. “Melinda is an impressive business leader, philanthropist and importantly, a Seattle sports fan. We share many of the same values, including a deep commitment to Seattle and a belief in building organizations that create lasting impact.”