The approval comes after the Citizens Advisory Committee for the Central Market-Tenderloin Area, which oversees the agreements, had voted to reject all but one of them earlier this month. However, at the time, committee members said the vote was more symbolic than anything. Committee members said they wanted to make a point that they expected more measurable requirements and substance in the agreements, and for the companies to take the process more seriously.
Kelly incorporated many of the committee’s recommendations in negotiating the benefit agreements. Companies need to satisfy 80 percent of what’s agreed upon in the deals to obtain the tax break, which is an exemption from the 1.5 percent payroll tax on new hires.
“These agreements represent over $600,000 in cash investment, thousands of volunteer hours and specific commitments to the Tenderloin and central Market,” said Bill Barnes, an aide to Kelly, in a statement. “While the city administrator respects the citizens advisory committee, following its recommendation would mean companies stay in the area and the community organizations lose real benefits.”
Kelly remains in negotiations with Spotify over its agreement, which may be approved by the Jan. 31 deadline.
Last year, 14 mid-Market companies received a combined $1.9 million tax break. Only those with payrolls in excess of $1 million must enter into a community benefit agreement.