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Comment by csomar | Hacker News Reader

Google and Facebook are in the SF Bay Area and not in SF City. Also, Zuckerberg gets a $1 salary. Unless this law targets full compensation (stocks included), it's not going to touch him. FB is too big to accept a 0.1% or 0.6% gross tax. This law is targeting smaller companies (think Stripe and similar).

San Jose is an alternative for the CEO/Headquarters. There could be a minor office in the city where tech workers prefer to live, or they could commute down instead of up. Imo, SF City is overplaying their hand here and might be in a bit of a shock for the reality of how business works. The last bubble and good times might have distorted their understanding.

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Yes, it includes stock options, property, etc. Basically all compensation.

Source: https://calmatters.org/california-divide/2020/11/san-francis...

Is Facebook still giving Zuck bonuses or new stock issues? Isn't Zuckerberg's wealth composed entirely of stock that he already owns? So how is this going to affect Facebook?

His income in 2020 was listed at $23M, all under "other income", mostly for the costs Facebook paid for his personal security and personal air travel on the corporate jet.

But he wasn't the highest paid exec. Sheryl Sandberg was, at $30M. Probably still not high enough to trigger the tax.

The law says any company operating in SF, which would include FB and Google, who have offices there.

Also the law says all compensation, including stocks and bonuses. So Zuck would definitely qualify.

Thanks for the clarification. But any company operating in SF is a bit crazy. So if a bank has a branch/office in SF, then it's liable for this tax? For all their gross income or just for the income generated within city boundaries?

The law says just money they make in the city. But it's kind of vague and I'm sure there will be a lot of debate between the companies and the city about how much they are making in the city.

The medium size businesses that only operate in SF will be screwed the worst.

I foresee some real estate companies that have office buildings just next to SF municipal border are going to make a nice profit.

The law says any company operating in SF, which would include FB and Google, who have offices there.

Very interesting, but, does that mean that execs who don't personally work in SF are subject to the tax? Ie, will Citibank's Michael Corbat, working out of Citigroup's New York offices, need to pay the tax because Citibank has bank branches in SF?

I'm not a lawyer or accountant, but my layman's reading of the law says it is a tax on gross receipts for the company in San Francisco, not the CEO directly. But applies if anyone who works for the company makes more than 100x the median.

I'm really not sure how they plan to enforce this at all.

BTW, Stripe has already left San Francisco for South San Francisco (which is a different city).

That was fast. Unless this tax targets all of the bay area, the moving cost is not really much and your workers could still commute with a WFH option. Imo, San Jose is in prime position to build a real city with the possible exodus from SF.

> San Jose is in prime position to build a real city

San Jose is already 25% bigger than SF. It's the third largest city in California after Los Angeles and San Diego.

Population essentially doesn't matter - people are talking about density here. For example, Phoenix is essentially an enormous suburb with giant malls, and you never hear of despite its population numbers. Boston is a small city with rich urban life that occupies an outsize role in the American psyche.

The suburbs in San Jose are more developed than the city itself, where there isn't much action. That's what attract people to SF.

SJ is big by population but it's essentially a tiny downtown and a huge spread of suburban single-family homes and strip malls. And (before the covid mess) the traffic was already not great. So if we ever get back to in-person office working, and after Google sets up their new office in SJ and others will consider doing the same it probably is going to suck big time. But if it will be "mostly remote" setup then SJ has plenty of space and opportunity to accommodate more business.

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