Findings. | |
Short Title. | |
Definitions. | |
Imposition of Tax. | |
Exemptions and Exclusions. | |
Small Business Exemption. | |
Filing; Combined Returns. | |
Tax Collector Authorized to Determine Gross Receipts. | |
Construction and Scope of the Early Care and Education Commercial Rents Tax Ordinance. | |
Administration of the Early Care and Education Commercial Rents Tax Ordinance. | |
Deposit of Proceeds. | |
Expenditure of Proceeds. | |
Amendment of Ordinance. | |
Effect of State and Federal Authorization. | |
Severability. | |
Savings Clause. | |
(a) For more than a decade, San Francisco has been a national leader in early care and education (ECE) with the introduction of the Preschool For All program in 2004. This revolutionary program expanded access, defined and measured quality programs, and supported educators to deliver high-quality early education. Ninety-two percent of San Francisco children attend preschool or transitional kindergarten before attending public kindergarten.
(b) Preschool enrollment of three- to five-year-olds in San Francisco rose from 57% in 2005 to 71% in 2013. Citywide school readiness assessments in 2007 and 2009 charted a similar increase, from 72% of four-year-olds in 2007 to 83% in 2009. These accomplishments are due to the targeted and committed investments of the State and the City and the work of First 5 San Francisco and the Office of Early Care and Education.
(c) However, the City cannot claim the same success when it comes to infants and toddlers under the age of four. Despite medical professionals, child development specialists, and scientific researchers uniformly agreeing that the most critical time in brain development is from birth to age three, and that the brain is 90% developed before a child reaches age five, San Francisco has more than 2,400 children on the waitlist for subsidized ECE, and more than 1,600 of these children are under the age of three. When two-thirds of the children on the waitlist, and in these large numbers, are infants and toddlers, the critical and urgent need for targeted investment in infants and toddlers, akin to the level of City support prioritized for our four-year-olds, becomes dramatically evident.
(d) Three out of four families in San Francisco with children under the age of six have both parents working outside the home, making childcare a necessity, not a luxury. But, as of 2017, infant and toddler early education and childcare can cost a staggering $20,000 a year in San Francisco; in comparison, tuition at UC Berkeley costs $13,600 a year. The heavy toll that childcare costs can take on families is undeniable. In a 2016 poll conducted by the Robert Wood Johnson Foundation, Harvard’s T.H. Chan School of Public Health, and National Public Radio, 71% of the over 1,100 parents polled stated that the cost of childcare is a serious problem for their families.
(e) Without affordable and accessible childcare, one significant consequence is the loss of women from the workforce, a serious problem not just for those women, but for society at large. One stark consequence of losing women in our workforce is the difficulties they face when attempting to return to work in the technology sector after having children. Recent research indicates that such women are 79% less likely to be hired and half as likely to be promoted as other employees, and are offered an average of $11,000 less in salary upon trying to re-enter the technology workforce later in life.
(f) Further, as female employees leave the workforce, the lack of gender diversity in fields like technology and venture capital continues apace. A study conducted by the Deloitte University Leadership Center for Inclusion and the National Venture Capital Association, of 2,500 employees at 217 venture capital firms nationwide, found that lack of family assistance and childcare may be hindering women’s success in venture capital. The same study found that gender diversity in leadership results in greater returns, innovation, and success. Fortune 500 firms that aggressively promote women realize 34% higher profits than those that do not.
(g) Our San Francisco families want and need quality ECE for their children, and society as a whole benefits when we invest in them and their families. Rigorous long-term studies have found a return on investment averaging seven dollars for every dollar spent on quality early learning programs. In addition, children in these studies who have been followed into adulthood have benefitted from increased earnings.
(h) The most effective guarantee of quality ECE is workforce compensation. A 2014 UC Berkeley study showed that educator wages are one of the most important predictors of the quality of education children receive. But today, one third of full-time teaching staff in ECE programs use some form of public assistance to make ends meet. In San Francisco, 92% of our early childcare and education workforce are women; 83% are estimated to be women of color.
(i) Children who come to kindergarten without the skills they need often stay behind and struggle in school. Early childhood care and education programs give children a chance to learn, become excited about school, and be better students over their lifetimes. Investing in ECE helps ensure we have highly-trained and skilled educators, gives our babies and children the best possibility to succeed, while providing essential support for struggling working families.
(Added by Proposition C, 6/5/2018, Eff. 7/20/2018, Oper. 1/1/2019)
This Article 21 shall be known as the “Early Care and Education Commercial Rents Tax Ordinance,” and the tax it imposes shall be known as the “Early Care and Education Commercial Rents Tax.”
(Added by Proposition C, 6/5/2018, Eff. 7/20/2018, Oper. 1/1/2019)
(a) Unless otherwise defined in this Article 21, the terms used in this Article shall have the meanings given to them in Articles 6 and 12-A-1 of the Business and Tax Regulations Code, as amended from time to time. All references to Sections of the Planning Code are to the text of those Sections as of June 5, 2018.
(b) For purposes of this Article 21, the following definitions shall apply:
“Area Median Income” or “AMI” means Area Median Income for the San Francisco area, derived from the U.S. Department of Housing and Urban Development, adjusted solely for household size, as described in Administrative Code Section 10.100-81(c).
“Base Amount” means the Controller’s calculation of the amount of City appropriations (not including appropriations from the Fund and exclusive of expenditures funded by private funding, development impact fees, or prior period balances, or funded or mandated by state or federal law) for Baseline Programs for the Baseline Year, as adjusted in the manner provided in subsections (g) and (h) of Section 2112.
“Baseline Programs” means all programs serving children of all ages under six that are allocated funding through OECE.
“Baseline Year” means the Fiscal Year July 1, 2017 through June 30, 2018.
“Commercial Space” means any building or structure, or portion of a building or structure, that is not “residential real estate,” as that term is defined in Section 954.1(c) of Article 12-A-1 of the Business and Tax Regulations Code, as amended from time to time. Notwithstanding the preceding sentence, Commercial Space shall not include any building or structure, or portion of a building or structure, that is used for: (a) Industrial Use as defined in Section 102 of the Planning Code; (b) Arts Activities as defined in Section 102 of the Planning Code; or (c) Retail Sales or Service Activities or Retail Sales or Service Establishments, as defined in Section 303.1(c) of the Planning Code, that are not Formula Retail uses as defined in Section 303.1(b) of the Planning Code.
“Eligible Programs” are described in Section 2112(d)(1) of this Article 21.
“Fiscal Year” means the period starting July 1 and ending on the following June 30.
“Fund” means the Babies and Families First Fund described in Section 2111 of this Article 21.
“OECE” means the City’s Office of Early Care and Education, described in Section 2A.310 of the Administrative Code, or its successor.
“State Median Income” or “SMI” means the state median income, adjusted for family size, calculated by the California Department of Finance under California Education Code Section 8263.1.
“Warehouse Space” means Commercial Space that is used for Commercial Storage, for Volatile Materials Storage, for Wholesale Storage, or as a Storage Yard, as each of these capitalized terms is defined in Section 102 of the Planning Code.
(Added by Proposition C, 6/5/2018, Eff. 7/20/2018, Oper. 1/1/2019; amended by Ord. 235-18, File No. 180753, App. 10/12/2018, Eff. 11/12/2018, Oper. 1/1/2019)
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