Tax breaks offered to Twitter cause a stir


March 23, 2011 7:35:37 PM PDT
What at first looked like a win-win for Twitter and the city of San Francisco is becoming a bit more complicated. The mayor and other city officials are offering the micro blogging company a big tax break, but critics, including some other businesses are objecting.

Karen Hudeburgh does not consider herself an activist, yet the San Francisco grocery store owner came to city hall on Wednesday to speak out against a proposed tax cut for Twitter.

"The more I learn about this proposal, the more unfair it seems to small businesses in the city that run the engine of this city," she said.

There are two Good Life grocery stores in San Francisco and the owners pay $30,000 a year in payroll taxes.

The Board of Supervisors is considering a measure to suspend that 1.5 percent tax for up to six years for Twitter on any new jobs it creates, if the company relocates to a blighted stretch of Market Street. The incentive would also apply to new businesses that set up in the Tenderloin. Supporters believe the deal will transform the neighborhoods

"In order to revitalize the community you need job development -- jobs, jobs, jobs," said.

The Chamber of Commerce likes the idea and says there's overwhelming support from residents.

"Over 70 percent of registered voters we surveyed in February support this legislation for a mid-Market holiday," said.

The majority of speakers at the hearing were opposed, including former San Francisco Supervisor Chris Daly, who showed a video of protests during the 'dot com' boom.

"They talked about jobs 15 years ago. They're talking about jobs now, but really it's about a land grab," he said.

But the city disputes that and says the community will get tangible benefits when Twitter signs the deal.

"It is in the case of Twitter increasing WiFi accessibility, it is community service of their employees," said.

The details of the community benefit agreement have not been spelled out and that's led to a delay in the full board considering the measure.

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