SF Democrats oppose Airbnb tax cut—after some try to kill the resolution

The San Francisco Democratic Party endorsed a call for Airbnb to drop its lawsuit over San Francisco business taxes Wednesday night after some of the corporate-aligned members of the party’s central committee tried to delay—and possibly kill—the measure.

The resolution challenged the company’s efforts to recover more than $100 million in tax money on the grounds, Airbnb argues, that the city put it in the wrong tax category.

It calls on the mayor and the supervisors to fight the lawsuit, and for Airbnb to drop it:

WHEREAS, this attack on the City’s fiscal health comes despite Airbnb benefiting from recent corporate tax relief under Proposition M, to which the company contributed over half a million dollars, and while its co-founder and Board member Joe Gebbia promotes austerity at the federal level through affiliations with projects aiming to dismantle public services,

THEREFORE BE IT RESOLVED, that the San Francisco Democratic County Central Committee (DCCC) calls on Mayor Daniel Lurie to publicly oppose Airbnb’s and other corporations’ lawsuits against the City’s business taxes, and to advocate that such companies withdraw their claims in the interest of public good and fiscal stability; and

BE IT FURTHER RESOLVED, that the San Francisco DCCC urges the Mayor, the President and Members of the Board of Supervisors, the City Attorney, the Controller, and the Mayor’s Budget Director to prioritize immediate recovery of withheld tax revenues and avoid budget cuts to core public services by rejecting litigation strategies that benefit wealthy corporate actors at the expense of San Francisco’s working families and communities in need.

Representatives of labor unions packed the room, waiting for hours to urge the members of the Democratic County Central Committee to approve the resolution, which was authored by members Gordon Mar and Connie Chan. Chan is also a supervisor and the chair of the Budget and Appropriations Committee, which is dealing with the city’s budget crisis.

A few members raised a few minor issues—Michela Alioto-Pier asked that Mayor Daniel Lurie’s name be removed so the resolution would only call on “the mayor” to act, and others suggested that the resolution also call on Airbnb to drop its case.

Neither of those was terribly controversial, although Chan asked “what is so sacred” about the mayor’s name that it needed to be dropped.

But it was enough that Vice-Chair Dan Calamuci called for a continuance until the next meeting, in late May. By that time, the mayor will have almost finalized his budget—and the money the city has set aside in case Airbnb succeeds would be unavailable for other crucial services.

“This resolution can’t be continued,” Member John Avalos said. “It will be irrelevant in late May.”

At this point it was close to midnight, and Member Peter Gallotta said that “the labor community has been here all night, this is disrespectful.”

Chan had already made a motion to pass the measure, but Calamuci made a motion to continue, seconded by Trevor Chandler. That appeared to be an effort to kill the resolution—without forcing the members who won with the support of big tech companies to actually vote on it.

Chan opposed that motion, saying that members should vote: “If you want to oppose this and side with Airbnb, then you should do that.”

Chan argued that her motion was already on the floor, but Chair Nancy Tung ruled that the motion to continue took precedence. Chan, who has been in local politics for more than two decades, as a legislative aide and a supervisor, said “this is probably the least democratic process I’ve ever experienced.” She called Tung “unprofessional and undemocratic.”

Ten members who were elected on the billionaire slate voted to (kill) continue the resolution, including Tung, Marjan Philhour, Josh Arce, Lily Ho, Emma Hare, Chandler, Calamuci, Mike Chen, and Eric Kinsbury.

But Rep. Nancy Pelosi, who has an ex-officio seat, voted no through her proxy, and came out in support of the measure. Quickly after that, proxies for state Treasurer Fiona Ma and Controller Malia Cohen followed Pelosi’s lead. Proxies for State Sen. Scott Wiener and Assemblymember Matt Haney abstained.

That left the final vote 14-10 against continuation. A quick amendment, which everyone supported, removed Lurie’s name and added a call for Airbnb to drop the suit.

At that point, the members were forced to take a stand: with labor, or with Airbnb and other corporations trying to get out of paying their fair share of local taxes in a serious budget crisis.

The vote was 30-0.

So now, under pressure from one of the city’s strongest Democratic Party constituencies, organized labor, the part is on record demanding that the mayor (who shall remain unnamed for the purposes of this resolution) and the supes stand up to Big Tech and address the budget crisis not just with cuts but with fair taxes on giant corporations. (Member and Sup. Matt Dorsey pointed out the Airbnb’s market capitalization is $37.5 billion, and that the company’s success started with converting 9,000 housing units that once were entry-level rentals for San Franciscans into illegal hotel rooms. “They didn’t have to file this lawsuit.”

In many cases, the City Attorney’s Office urged the supes to settle these types of cases, to avoid the expense and risk of litigation. The current city attorney, David Chiu, was Airbnb’s best friend when he was on the Board of Supes.

But the supes and the mayor get the final word here—and the ability to take the money earmarked for an Airbnb settlement and use it to save essential services.

That will play out over the next few months.