Monday, January 25, 2016

UPDATE: Child Care Requirements for San Francisco Office and Residential Projects

BOMA San Francisco Members

UPDATE - January 25, 2016

This ordinance was passed by the San Francisco Board of Supervisors on January 12th. The measure is currently awaiting action from Mayor Ed Lee.

Original Post - December 14, 2015

A measure by Supervisor Norman Yee would increase the child care requirements for certain commercial and residential projects. The legislative digest is below. The funds generated from this impact fee may only be used to fund capital child care facilities.

Please email if you have any questions or concerns.

Bottom Line for CRE Developments

Currently new downtown commercial developments are charged a $1 per gross square foot in lieu fee. If this legislation passes, the fee would increase to $1.57 per gross square foot. Also, the requirement would extend to commercial projects citywide and apply to new projects and existing buildings proposing the net addition of 25k (it was 50k) or more gross square feet of office or hotel space.

The big changes are for residential developments.

Quick Read

Ordinance amending the Planning Code to increase the Child Care In Lieu Fee for office and hotel development projects of up to $1.57 per gross square foot and apply the Fee to projects of 25,000 or more gross square feet; to impose a tiered Child Care Fee for residential development projects of up to $1.83 per gross square feet; to allow developers the option to provide onsite Small Family Daycare Homes in lieu of the fee; affirming the Planning Department’s determination under the California Environmental Quality Act; and making findings of consistency with the General Plan, and the eight priority policies of Planning Code, Section 101.1.

Existing Law

The Planning Code requires that office and hotel development projects of 50,000 or more gross square feet must meet certain Child Care Requirements, including the option to pay $1.00 per gross square feet. The Planning Code does not have a citywide requirement on residential development to meet Child Care requirements, but some Area Plans have community impact fees that include a fee for child care.

Amendments to Current Law

The Proposed Legislation will require that office and hotel development projects of 25,000 or more gross square feet meet certain Child Care Requirements and increases the in lieu fee to $1.57 per gross square feet. The Proposed Legislation will impose a new Child Care Fee for residential projects of $1.83 for projects containing 10 or more units and 50% of that amount or $0.91 for projects of up to 9 units. The Proposed Legislation provides for an option to provide on-site day care facilities and receive a full or partial waiver of the Fee. The Proposed Legislation also includes an option for a project sponsor who is already providing On- or Off-site Units under the Inclusionary Housing Ordinance to receive a full or partial waiver of the Fee if they designate one or more of those units as Designated Childcare Units that will be rented to a household operating a Small Family Daycare Home as defined in State law for at least 10 years. Background Information San Francisco conducted a Citywide Nexus Study dated March 2014 prepared by the consultant AECOM. The fee amounts in the Proposed Ordinance are based on the results of that analysis.

Wednesday, January 20, 2016

We Need Your Feedback: All-Gender Toilet Facilities

Supervisor David Campos has requested BOMA San Francisco and business community feedback regarding a proposal to expand the number of all gender (unisex) single occupancy restrooms in San Francisco. This is at trend taking place nationwide in order to increase bathroom accessibility for all. Indeed, similar ordinances have already been passed in municipalities across the United States.


This legislation would mandate that businesses and places of public accommodation (click here and scroll to #7) designate via signage single-user toilet facilities that are available to the public or employees.

Some BOMA members would be required to update their signage if they have places of public accommodation that only have single user toilet facilities.

San Francisco 2015 Gross Receipts Tax and Payroll Expense Tax - Important Information for BOMA Members

BOMA San Francisco Members:

Please take a moment to review this important message regarding San Francisco's Gross Receipts Tax and Payroll Expense Tax.

2015 Return is Live - Due by February 29, 2016

The 2015 Gross Receipts Tax and Payroll Expense Tax Year Online Return is now live at

To enter the Online Return you will need:
  • Seven digit Business Account Number
  • Last four digits of your business tax identification number (Federal EIN or SSN
  • Eight digit alphanumeric Online PIN (same as prior year)
Please note the following:
  • Payroll Expense Tax and Gross Receipts Tax returns are due by February 29, 2016. 
  • Online forms must therefore be transmitted before midnight on February 29, 2016. 
  • Payments must be received or postmarked on or before February 29, 2016. 
  • Penalties, interest, and fees will be imposed after February 29, 2016. 
  • Your total tax obligation will be summarized and displayed at the end of the filing.
  • You may review and update your business information through Account Update prior to starting this filing.
The San Francisco Office of the Treasurer and Tax Collector will send out filing notices the week of January 11 that will include the Business Account Number, Online PIN, and other information to assist BOMA members and other taxpayers with filing their Return.

In response to taxpayer feedback, the Office of the Treasurer has added additional help features, including instructions embedded on each page, as well as links to technical advisories. We have also simplified the process to access the residential landlord filing and the Online EZ filing for small businesses. They believe these changes will provide a more streamlined filing experience for taxpayers.

Free Seminar - Gross Receipts Tax Seminar

Thursday, February 11
3 PM- 4:30 PM
SF Public Library
100 Larkin St,
San Francisco, CA
Koret Auditorium

The seminar will focus on the online form, minor changes that have been made to the form, and the ease of use and access.

San Francisco Business Tax Reform Annual Report 2015

Key Information 
  • Two of the largest sectors in the city, Professional and Financial Services, along with Real Estate, paid nearly 50% of all gross receipts taxes in 2014. 
  • Accordingly, since the gross receipts tax and business registration fee collections were smaller than expected, the payroll expense tax rate for 2015 will be larger than the baseline: 1.162% as opposed to 1.125%: a difference of 4%.
    • Given that small variance, and the uncertainty regarding the gross receipts tax based on only one year of data, in our opinion it is too soon to project if the payroll expense tax will be fully phased-out by 2018
  • Audits and other compliance efforts in the coming years will provide more insight into revenue trends seen with the initial filing data.
Please click here to review the report.
  • In November, 2012, San Francisco voters approved Proposition E, which imposed a new gross receipts tax on businesses, began the process of replacing the City's payroll expense tax, and raised and restructured the City's business registration fee. 
  • The gross receipts tax is designed to phase in, with gradually rising rates, over a 5 year period ending in 2018. Based on the amount of gross receipts tax collections each year, the payroll expense tax rate in the subsequent year is reduced, through a formula, to ensure the two taxes together are revenue-neutral to the City. 
  • In August, 2015, based on the results of the 2014 filing, the Controller's Office calculated the payroll expense tax rate for 2015 to be 1.162%, down from 1.350% in 2014. 
  • Proposition E also requires the City Controller, Chief Economist, and Treasurer to annually report on the fiscal and economic impacts of the new tax system, how these compare to expectations, and any implementation challenges and recommendations. 
  • This report for 2015 is the first of these annual joint reports.