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San Francisco elections a sounding board for tech backlash

Voters in the nation’s technology capital will have a say on Tuesday as they decide on two measures that reflect growing public concern about ridehailing and vaping products.

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SAN FRANCISCO—The public’s backlash against tech companies is playing out at the ballot box.

Voters in San Francisco will have a say on Tuesday as they decide on two measures that reflect the growing public concern about emerging markets like ridehailing and vaping.

This election cycle will be the latest in a series of showdowns in which local officials have flexed their political muscles to take on tech companies, many of which have long called San Francisco home. Some of the city’s most highly valued startups have raised the alarm over the past year about city efforts like levying taxes on employee stock options or imposing fees to fund programs on housing affordability and homelessness.

“There’s a lot at stake because the anti-tech wave keeps building upon itself,” said venture capitalist Bradley Tusk of Tusk Ventures, who advises startups facing regulatory challenges and who helped Uber navigate a fight with city regulators in New York.

San Francisco’s Proposition D, billed by supporters as a traffic-mitigation strategy, takes aim at ridehailing apps by proposing a tax of up to 3.25% per ride on trips in the city where Uber and Lyft both got their starts. It would also apply to autonomously driven fares if those eventually are offered.

City officials projected the measure could raise at least $30 million a year to fund improvements in transit, cycling and pedestrian programs.

The local Board of Supervisors placed the initiative on the ballot, citing a recent city study that highlighted ridehailing as a factor in growing congestion. Opponents of the measure, led by the Republican Party of San Francisco, said Proposition D would do nothing to ease traffic conditions.

After initially opposing the proposal, Uber and Lyft agreed to support the campaign for Proposition D following negotiations with San Francisco Supervisor Aaron Peskin, who had initially threatened even costlier legislation that would have taxed the companies’ gross receipts.

Another ballot measure, Proposition C, was funded by San Francisco-based e-cigarette giant Juul as an effort to override the city’s passage of legislation that banned teen use of vaping products. Juul’s measure proposed a far lighter regulation of the e-cigarette market, fueling outrage among many city leaders.

Amid a growing public outcry about vaping-related deaths nationwide, the company announced in late September it was ending financial support of the Proposition C campaign, but the measure remains on the ballot.

Turnout is usually low for off-year elections, and there are no statewide or national contests at stake.

But this year the city’s balance of power on the narrowly divided 11-member Board of Supervisors could shift toward the progressive bloc, which has been a thorn in the side of big tech companies and could gain the edge with a win on Tuesday. Supervisor Vallie Brown, an ally of moderate Mayor London Breed, is locked in a tight race for re-election.

“What’s a mystery is why the tech companies … don’t give everyone the morning off and ask that they please vote,” Tusk said. “Right now, all of the politics are anti-tech because that’s who votes for the Board of Supervisors, especially in the primaries. Their views would change if the electoral base changed.”

Featured image via heyengel/iStock/Getty Images Plus

  • alec.jpg
    Written by Alexander Davis
    Alexander “Alec” Davis is the editor-in-chief of PitchBook News, based in San Francisco. A native of Southern California, he has been a financial journalist since the mid-1990s. Alec previously was an editor at The Wall Street Journal and was a founding editor of MarketWatch. He holds a bachelor’s degree in history and journalism from the University of Colorado, Boulder, and a master’s degree in international politics from American University.
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