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Technology firms are the economic engine of the Bay Area. But so are real estate and restaurants, which would be asked to pay more taxes under a plan pushed by technology companies and investors.

San Francisco’s tax plan is due to be overhauled, and one way to do it is to institute a gross receipts tax instead of a payroll tax. Tech firms and investors like Ron Conway, a Silicon Valley billionaire, like that plan because tech firms spend much more on payroll than they do on sales of products, according to the San Francisco Examiner.

Tech firms pushed a gross receipts tax “hard” during a meeting at City Hall with Mayor Ed Lee and Board of Supervisors President David Chiu, according to reports.

San Francisco-based companies currently pay a 1.5 percent tax on their payrolls, the newspaper reported. Twitter, however, convinced city leaders to write laws allowing for a special payroll tax exemption zone, and Zynga also convinced the city to write an exception on taxation of stock option compensation.

If the payroll tax is replaced with a gross receipts tax, retail, restaurants and real estate would pay almost double the tax currently paid, the newspaper reported. They’d pay 26 percent of the total tax revenue, compared to 16 percent now, the newspaper reported.

The payroll tax currently brings in $400 million a year, the newspaper reported.

“The tech companies don’t seem to be team players,” small-business advocate Scott Hauge told the newspaper.

Any final language on taxation issues will be fleshed out by June, when city leaders would have to make moves to place a change in the tax structure before voters in November.

Copyright NBC Owned Television Stations

Article source: http://www.nbcbayarea.com/news/local/SF-Tech-Firms-Want-Retail-Real-Estate-To-Bear-Tax-Burden-149547085.html

It was time, said Bruce Brugmann, founder, editor and publisher of the San Francisco Bay Guardian, “to turn things over to the next generation.”

The passing of the torch occurred Tuesday, when the independent weekly, started in 1962, said it is being acquired by the San Francisco Examiner, and that Brugmann and his wife, Co-Publisher Jean Dibble, were relinquishing their roles.

“It’s not an easy thing to do, but it made sense economically, and it made sense to Jean and me,” said Brugmann. “It’s the best way to keep the Guardian intact, and hopefully keep it alive for another generation.”

While the Guardian, which has a weekly circulation of 70,000, has stuck to its mission of “printing the news and raising hell,” it’s had a tougher time paying its bills.

“It’s been hard for us,” said Brugmann, who acknowledged the paper has been losing money, despite a multimillion-dollar antitrust settlement in January 2011 with rival SF Weekly, which was found to have been deliberately selling ads below cost to undercut the Bay Guardian.

Tough time for papers

“Publishing is hard now, advertising is not easy. Not everyone is interested in buying newspapers in this country.”

But the Examiner, which itself changed ownership just four months ago, was interested in the Bay Guardian. “Bruce and Jean built a great franchise, we recognize the value they built,” said Todd Vogt, the Examiner’s president and publisher. “And we’re believers in print.”

Vogt, who last week denied reports of an imminent sale, would not disclose financial details of the transaction (neither did Brugmann), which is set to close next month. He said the two papers would remain editorially separate and the Bay Guardian’s reporting staff of 30 would be untouched. Tim Redmond, a 30-year veteran of the paper, is taking over as editor and publisher.

“We have no intention of changing the editorial voice of the Guardian. If anything, a refreshed progressive voice is needed in the city,” Vogt said.

Both Brugmann and Vogt pointed to cost savings – the Bay Guardian will be printed on the Examiner’s presses, and its staff moved into the Examiner’s offices at 71 Stevenson St. – and to “synergies,” particularly around advertising.

Vogt said the two ad staffs will be kept separate, but “where there are opportunities to cross-sell, we will. I can see working together on advertorials and event sponsorships and so forth. There’s big potential, especially in the arts and entertainment community.”

Examiner is also free

The Examiner, owned by the Hearst Corp. until it bought The Chronicle in 2000, is a free, six-day-a-week paper with a weekday circulation of 75,000 to 190,000 and 255,000 on Sunday. In November, a consortium, SF Newspaper Co. LLC, co-owned by Vogt and other newspaper executives, purchased the Examiner from Clarity Media Group, owned by conservative billionaire businessman Philip Anschutz.

Under Vogt and Editor in Chief Stephen Buel, formerly an editor and part owner of the East Bay Express, the Examiner’s editorial stance has shifted away from its rightist bent under Anschutz. In business terms, Vogt has had to deal with the same financial issues confronting other daily papers.

“It’s been a challenge,” he said. “But our ad numbers have increased, and I really think there’s opportunity for local advertising growth.” An initial round of layoffs occurred soon after Vogt’s group acquired the Examiner, but none involved the reporting staff, he said.

One condition of the acquisition is that Brugmann stays involved with the Bay Guardian “and guides me a little in terms of the politics of the city,” Vogt said. “In my entire experience, nothing compares with politics in this city.”

Brugmann will no doubt be happy to oblige. “I’ll be helping out in any way I can,” he said. “I’ve already threatened to go over to City Hall more often.”

He’ll also be devoting more time to his Bruce Blog on the Bay Guardian’s website, as well as some outside writing. And he’s working with former Chronicle staffer Dick Rogers and others on setting up a brick-and-mortar Northern California journalism museum – a work in progress you can see at norcalmediamuseum.com.

History of journalism

“If someone doesn’t do this, much of the history of journalism in the Bay Area will be lost,” he said. “And I still have a lot of energy.”

Coincidentally, Brugmann’s old working haunt, the 27,000-square-foot Bay Guardian building on Potrero Hill, was sold this week for about $6.5 million to San Francisco real estate firm Union Property Capital. That’s close to a $2 million profit for Brugmann, who paid $4.7 million for the building in 2002, according to the San Francisco Business Times, which first reported the sale.

Brugmann wouldn’t confirm the numbers, but at least he and his wife have the beginnings of a nice little nest egg as they move on to the next stage of their careers, right?

“We also have some debts to deal with,” he replied. “That’s the problem nowadays with this business.”

Andrew S. Ross is a San Francisco Chronicle columnist. Blogging at www.sfgate.com/columns/ bottomline. Facebook page: sfg.ly/doACKM. Tweeting: @andrewsross. bottomline@sfchronicle.com

This article appeared on page D – 1 of the San Francisco Chronicle

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/04/25/BUMS1O8UOE.DTL&type=business

I’ve recently learned that real estate brokers in San Francisco have reached a consensus on a topic that entrepreneurs and investors can’t seem to agree on: that we are in the midst of a technology bubble.

Technologists have been debating the existence of such a bubble for over a year now, but they just can’t seem to agree. Some argue that companies like Twitter, Facebook and LinkedIn, are overvalued with multi-billion dollar valuations. Others say that technology companies are actually undervalued.

Real estate brokers in San Francisco have seen the evidence of a new dot-com style bubble: Rents are shooting up as the demand for apartments grows. As a newcomer to San Francisco, I can attest to how frantic the search for apartments has become in the area, and to the often audacious pricing of rental properties.

An article published on Thursday in The San Francisco Examiner notes that Bay Area renters are now seeing rent hikes that are eerily similar to those during the dot-com bubble that occurred a little more than a decade ago. RealFacts, a real estate analysis firm, told the Examiner that a new wave of San Francisco residents who work for technology giants and start-ups seemed to be responsible for the rise in apartment rental costs.

“I think a lot of new dot-com employees, specifically those who work for companies like Apple, Google and Twitter, are now moving into the city and can afford to pay much higher rents,” said Sally Kuchar, editor of the real estate blog Curbed San Francisco, told me in a phone interview. ”As a result, San Francisco rental rates have risen by 6 percent between 2010 and 2011.”

As a very recent transplant to San Francisco, I’ve visited dozens of open houses over the past week and already see a frightful pattern. When I show up to see a property there is always a long line of young people, mostly wearing t-shirts adorned with Twitter, Facebook or Google logos, who are standing at the ready with an application, credit report and deposit check in hand. They often bid up the price of an apartment by several hundred dollars too.

Real estate brokers I’ve spoken with note that although the San Francisco market has always been challenging for renters, the current state of affairs is extraordinary.

Ms. Kuchar of Curbed said rents were also rising because more landlords were choosing to turn their properties into short-term rentals using services like AirBnB, a company that lets people rent out their spare bedrooms or homes to travelers.

“A lot of residential property owners are now converting their long-term rentals into vacation rentals; that has also depleted the market,” Ms. Kuchar said. She also said that though high real estate prices make it clear there is a new bubble in Silicon Valley, no one can really predict how long it will take before it pops.

Article source: http://bits.blogs.nytimes.com/2011/08/05/tech-and-the-san-francisco-rental-bubble/

And they think they have problems?

When the Marin County Assessor’s Office released its records for April, at first there seemed to be reason for celebration in Novato. Overall sales of single-family homes were up 33 percent month-over-month, to 36. Industry veterans who remember the nuclear winter of 2008-2009 will recall months like February 2009, when only 10 homes changed hands in Novato. The market was frozen and looking at a long thaw.

It’s good that homes are again selling in Novato. And if we only look back a few months, we’ll see that prices are rising as well. The average property in Novato has gained back more than 20 percent of its value since January.  As long as we remain focused on 2011, the outlook is good; gotta keep those pesky memories of 2006 and 2007 at bay.

In April 2007, the average single-family home sold in Novato fetched a shade above $900,000. In April 2006, the average price was $952,000. Novato real estate has shed 38 percent of its value in five years. There’s no way to sugar-coat that. In fact, as of January local homes had lost 48 percent of their value in less than five years.

These numbers add up to Novato having a serious negative equity issue, in line with that of California as a whole (33 percent). Still, with cities like Miami experiencing a 25 percent rate not of underwater mortgages but of homes in severe mortgage distress, heading for short sale or foreclosure, the local impact is nowhere near being the worst in the country — or even the state. Novato has suffered more than many other Bay Area cities, but our region as a whole has fared pretty well, comparatively.

For plenty of local homeowners, upside-down mortgages are a reality. Enough of them are suffering that the question now should not be “How many underwater mortgages are there in Novato?” but rather “What should you do if your mortgage slips into negative equity territory?”

As an indicator of a struggling market, negative equity ranks with foreclosures and short sales, but it is not necessarily a precursor to them. One reason foreclosures are up, however, is that a significant number of underwater mortgage holders are choosing to walk away from their properties rather than continue making payments.

A Feb. 2, 2010 article in the New York Times suggests that there is a value-to-loan threshold that owners will not cross before walking away from their home. Once their home’s market value falls below 75 percent of the money owed on their loan, they give up and bug out. While these people are arguably acting with sound financial judgment, they’re also ignoring the many legitimate reasons not to walk away — not all of which are based on emotional attachment to a pile of wood, glass and stucco.

Assuming you are not a speculator, landlord or home-flipper, you purchased your home as a place to live. You did so for a variety of reasons — location, convenience, quality of public schools, square footage, yard — plus the unspoken but understood perk of return on investment. Even if you take away that ROI, you still have all of the other components, plus stability, making a good argument for staying in place. Walk away and what’s the first item on your post-home-ownership agenda? Finding a place to rent, hopefully with a comparable amount of room, convenience and access to good schools. And woe to you if you own pets.

The decision to walk away from an underwater mortgage should not be taken lightly – and should not be made for financial considerations only. Staying in a home burdened with a bad loan requires a paradigm shift. If you can afford your payments and can live with the psychic weight of feeling like an economic patsy, why not stick around and make your house a home, even if it doesn’t make short-term financial sense?

Article source: http://novato.patch.com/articles/negative-equity-doesnt-always-have-to-mean-goodbye