Q: Is this the first Green Benefit District (GBD) to be formed?
A: Yes and no. The GBD model is based on San Francisco’s existing Community Benefit District (CBD) model in regards to formation and administration. CBDs are special assessment districts, authorized pursuant to state and local law, that allow individual property owners to vote to assess their own property in exchange for control over how assessment revenues are spent within their neighborhood. In other cities, these districts are often called Business Improvement Districts (BIDs).
The proposed GBD for Dogpatch and Northwest Potrero Hill is a variation on the CBD model, in that the assessments would be spent exclusively on the maintenance and improvement of green spaces and the public realm in the District, and it is the first of its kind in the State of California. The City and County of San Francisco (CCSF) legislation enabling the formation of GBDs can be found here.
Q: How are the assessment rates calculated?
A: Utilizing information gathered from the GBD Survey and from the numerous public workshops held, the Formation Committee determined what services the Dogpatch and Northwest Potrero Hill neighbors would like the GBD to provide, and what these property owners would be willing to pay, broadly, for such enhanced services.
Determining the exact package of enhanced services and the ultimate cost of these services was not only a public outreach and survey process, but also a technical budgeting process, for which the formation committee engaged the services and leadership of Build Public. Build Public in collaboration with MJM Management Group generated professional cost estimates for different packages of services. MJM is the premier public space management company in San Francisco, providing public space maintenance services to the Union Square BID and the Yerba Buena CBD among others. They bring over 20 years of experience to the service design and budgeting process.
The assessment rate in the Dogpatch & NW Potrero Hill GBD varies by land use type. Commercial, Residential and Industrial parcels are assessed based on their total building square footage, while Greenspace parcels and Vacant/Parking Lots are assessed based on their total lot square footage.
For a more detailed explanation of the methodology used to calculate assessment rates, see Section VII of the Management Plan and Section G: Apportionment Method of the Engineer’s Report.
Q: Will the existence of the GBD mean that the City will carry out less maintenance than it does now?
A: No. The City currently provides a baseline of services to the Dogpatch and Northwest Potrero Hill neighborhoods, based upon annual City & County of SF (CCSF) budget allocations. By adopting the GBD Management Plan, the CCSF Board of Supervisors will confirm and guarantee a baseline level of service equivalent to that being provided in similar areas of the city. Throughout the duration of the GBD, these services will be maintained consistently with other similar areas of the city. The services, activities, and improvements funded by the Dogpatch & NWPH GBD annual assessments are in addition to those already provided by the CCSF agencies. The GBD owners’ nonprofit corporation will work in close partnership with the CCSF agencies to ensure that the GBD’s greening goals are met in an efficient and fair manner and that GBD services do not duplicate or replace Baseline City Services and agency responsibilities. The GBD will ensure that Baseline City Services are maintained at current levels, but are redeployed in ways that complement and leverage the GBD’s resources. The GBD owners’ non-profit corporation will advocate for the neighborhood’s needs at City Hall and work to ensure that CCSF agencies meet their established agency and departmental goals. The GBD will also leverage outside public and private investment in new Public Realm areas because its requests for outside capital investment will be backed by the GBD’s ability to provide reliable and professional maintenance services.
Q: What is the projected annual first year budget for the GBD?
A: The proposed first year budget is $514,852. Of this amount, $492,859 will be covered by assessments paid by property owners based on special benefits of the GBD. The GBD will be responsible for raising the remaining balance ($21,993) through outside funding sources, including grants, donations, and volunteer hours.
The funding is allocated to proportionally to each zone, with zone-specific use priorities (Zone 1: Dogpatch. Zone 2: NW Potrero Hill):
For more information on how the budget was calculated, see Section VI of the GBD Management Plan.
Q: Can the budget be changed?
A: In a given year, the GBD Board of Directors may determine that a redeployment of funds to a different spending category may be appropriate to accomplish a specific goal of the GBD. To do so, a vote of the Board of Directors is required to alter the percent of assessments allocated to a given budget category. This redeployment may not exceed a 10% change in the total budget for each fiscal year. For example, if after the first fiscal year, the GBD Board of Directors reallocates 5% of the Capital Improvements budget to the Maintenance budget, and after the second fiscal year, reallocates an additional 7% of the Capital Improvements budget to the Maintenance budget, resulting in a cumulative 12% redeployment of funds over two fiscal years, this would be allowed because in neither fiscal year did the redeployment of funds exceed a 10% change in the total budget.
Q: What if the assessments collected in a given year are not spent?
A: The funds will roll over to the following year. The Management Plan outlines an annual spending plan that must be followed by the Dogpatch & NWPH GBD. If, at the end of a fiscal year, all monies budgeted for a category of services, activities, and improvements have not been spent in a spending category, or the 10% contingency was not used that year, that amount may roll over to the following year. The GBD must spend these additional funds within the following fiscal year.
Q: How will the assessments be collected?
A: Each property owner in the GBD pays an assessment based on a formula calculated on objective parcel criteria, collected twice a year on the same schedule as property tax bill collection (due Nov 1 and Feb 1). The GBD assessment will appear as a separate line item on annual property tax bills and will be collected and enforced by the San Francisco Treasurer and Tax Collector. The Treasurer and Tax Collector will transfer the assessment payments to the owners’ non-profit corporation that manages the GBD. If the City subsequently finds that assessment funds have been spent in ways inconsistent with the Management Plan, the City can withhold future funds.
Q: Will an individual have a right to not pay the tax?
A: The GBD model is identical to the CBD model in regards to assessment collection – if an individual’s property is located within the boundaries of the GBD, he or she is required to pay the assessment, and like any other special assessment it is not optional. Please refer to the GBD Boundary Maps to see if your property falls within Zone 1 or Zone 2 of the GBD.
Q: Can landlords pass their assessments through to tenants?
A: With the exception of general obligation bonds approved by 50% of voters and with express language allowing a pass-through, the San Francisco Rent Ordinance prohibits owners of rent-controlled rental units from passing through the increased cost of special assessments to tenants in rent-controlled units. Owners of rent controlled units do have the right under the San Francisco Rent Ordinance to file a Operating & Maintenance Petition requesting right to pass-through a portion of general operating costs for their buildings (including garbage, water, etc.), but not solely for increased costs associated special assessments. General tax increases may be considered as one of several cost factors. The petition must be approved by the Rent Board approval, and even if approved, low-income or fixed-income tenants may obtain a hardship exemption from the Rent Board from any pass-through approved by the Rent Board. For unregulated (post-1979) residential units and commercial buildings, the right of the landlord to pass through new assessments will depend on the terms of each individual lease and the state of the overall rental market.
Q: Will the GBD include all of District 10?
A: No. The Dogpatch & NWPH GBD is comprised of two distinct zones: (1) the Dogpatch Neighborhood and (2) Northwest Potrero Hill. The area between these two zones is not included in the proposed GBD. Survey work, a maintenance and capital plan, and budget were completed for the Greater Potrero Hill area. Residents and owners in this area may choose to contract for future service with the GBD, or wait until the GBD renewal process begins in 2025 and propose an expansion of the GBD boundaries as part of that process.
Zone I – Boundary Description
- Mariposa Street from Iowa Street to Illinois Street (South side only)
- Illinois Street from Mariposa Street to Cesar Chavez Street (West side only)
- Cesar Chavez Street from Illinois Street to Pennsylvania Street (North side only)
- Pennsylvania Street from Cesar Chavez Street to 22nd Street (East Side Only)
- 22nd Street from Pennsylvania to Iowa Street (North Side Only)
- Iowa Street from 22nd Street to Mariposa Street (East Side Only)
Zone II – Boundary Description
- 16th Street from Potrero Avenue to Kansas Street (South side only, and completely encompassing parcel 3958-006)
- Kansas Street from the northeast corner of parcel 3958-006 traveling south along the eastern perimeter of the parcel for 100 feet, then traveling west along the southern perimeter of the parcel for 100 feet, then traveling south to the southeast corner of parcel 4029-022
- 19th Street from southeast corner of parcel 4029-022 to Potrero Avenue (North side only)
- Potrero Avenue from 19th Street to 16th Street (East side only)
Q: Will the special election be part of the general election in November?
A: No, the voting process for the GBD is a special ballot election independent of the general election, and is conducted by the Board of Elections. The GBD ballot process is currently expected to begin in June of 2015, culminating in a Board of Supervisors determination in July 2015.
Q: Will all of District 10 vote in the special election?
A: No, only property owners within the proposed district boundaries will vote on the GBD.
Q: Will the GBD detract from existing community volunteerism?
A: Absolutely not. The GBD will not replace the volunteer efforts that make our parks and gardens great, but rather it will make that work easier and more productive by ensuring funding for the long term maintenance and care of these spaces.
Q: How are the Board of Directors selected?
A: By-laws will be written by the GBD Formation Committee (the “Interim Board”) stating requirements for the permanent Board of Directors’ composition, responsibilities, and election process. The Board of Directors and the owners’ non-profit corporation will be subject to standard non-profit rules of governance, including ethical rules governing disclosure of conflicts of interest and prohibitions against self-dealing.
Board Member Elections:
- Requests for nominations shall be posted in the local paper and on the GBD website, and shall be emailed to all email lists registered with the GBD.
- Nominations for Board of Directors positions will be accepted in person at a scheduled Interim Board meeting, which shall be noticed on the GBD’s website at least three weeks in advance of the meeting.
- Ballots will be mailed to property owners and must be mailed back within 3 weeks, or submitted in person at a scheduled Board meeting, which shall be noticed on the GBD’s website at least three weeks in advance of the meeting.
- A “Good Governance Committee” selected by the Interim Board will count ballots and be witnessed by at least one non-Board member.
- Final results will be announced at the next scheduled Interim Board meeting.
Board of Directors Composition:
- 10-14 members
- Geographic distribution reflecting the budget ratio between zones: 80% from Zone 1 and 20% from Zone 2
- 60% property owners, at least half of which must hold primary residence within the GBD
- 40% non-property owners, half of which should be green space advocates with substantial experience, and 2 of which should represent residential and commercial tenants
For more information about the governance of the GBD, see Appendix A of the Management Plan.
Q: Are there term limits on the GBD Board of Directors?
A: Yes. Board Members would be appointed for a maximum term of 3 years. Initially, Board member terms will vary from 1 to 3 years to allow for staggered terms to prevent wholesale change of the Board.
Q: Will there be complete transparency as far as where the money came from, where the money went and how much money is in the bank?
A: Yes. If successfully formed, the GBD will be a 501(c)(3) corporation subject to the same reporting, accounting and public transparency requirements that apply to any other tax-exempt corporation. Furthermore, all CBDs in San Francisco are required to submit annual performance reports to the Mayor’s Office of Economic and Workforce Development (OEWD), including a transparent accounting of all income and expenses, and our proposed GBD would do the same. These are reviewed by OEWD and also presented to the Board of Supervisors in a public hearing. Accountability, transparency, and local control are foundational goals of the GBD, and they have shaped and continue to shape the formation of this first ever Green Benefit District.
Q: What is the term of a GBD?
A: Assessments would be collected for 10 years (Nov 1, 2015 – Oct 30, 2025) if the proposed GBD is formed by the Board of Supervisors, following the GBD formation process described below. Expenditure of those collected assessments can continue for up to 6 months after the end of the assessment collection period (through April 30, 2026), at which point the GBD terminates if not renewed through a new GBD formation process.
Q: What legislation has enabled the creation of GBDs?
GBDs are authorized by the state Property and Business Improvement District Law of 1994 (California Streets and Highways Code §§36600 et seq., or the “1994 Act”) as augmented by Article 15A of the San Francisco’s Business and Tax Regulations Code. The 1994 Act authorizes cities, counties, and cities and counties to create assessment districts and levy proportionate assessments on real property and/or businesses for specified periods of time, to provide services, improvements and activities that specially benefit each assessed property and/or business. In San Francisco, proposed assessees submit petitions to the Board of Supervisors requesting that the Board commence a process of public hearing and voting by proposed assessees. The petitions and the votes are weighted according to each property owner’s proportional share of the total proposed assessment. In the absence of a majority protest, the Board of Supervisors may form the district and levy the assessments. The 1994 Act and Article 15A allow the Board of Supervisors to contract with an owners’ non-profit corporation to manage the district; and includes provisions on operations, reporting, renewal, and disestablishment. The addition of Article 15A to the CCSF Business and Tax Regulations Code created a procedural vehicle for neighborhoods to establish GBDs. A GBD provides a stable funding source for services, activities and improvements within its boundaries. GBD services, improvements and activities may include, but are not limited to, enhancements to ecological, water and energy systems, pedestrian and bicycle amenities, and Recreational Improvements. Article 15A also includes a provision for utilization of assessment funds to purchase or participate in the purchase of real property to serve as Public Realm areas, where the GBD can provide landscaping, improvements and/or maintenance. As defined in Article 15A, Public Realm areas are outdoor spaces open to the public, including parks, parklets, sidewalks, unimproved areas, landscaped areas, plazas, and gardens. A GBD may be managed by an owners’ non-profit corporation. If managed by an owners’ non-profit corporation, Article 15A requires that both property owners who pay GBD assessments and stakeholders who do not own or have an ownership interest in property located in the GBD, including residents, businesses, and neighborhood organizations, be adequately represented on the Board of Directors of the owners’ non-profit corporation.
Q: Is there a process for GBD disestablishment?
A. Yes. Each year the Dogpatch & NWPH GBD is in existence, there will be a 30-day period during which property owners will have the opportunity to request disestablishment of the GBD. The 30-day period shall commence on the anniversary date of the establishment of the GBD. If within that 30-day period, a written petition is submitted by the owners of real property who pay 50% or more of the assessments levied, the Board of Supervisors shall convene a hearing on whether to disestablish the GBD. A majority of the Board of Supervisors (six members) may initiate disestablishment at any time based on misappropriation of funds, malfeasance, or violation of law in connection with the management of the GBD. A supermajority (8 or more members) of the Board of Supervisors may initiate disestablishment proceedings for any reason, except where there are any outstanding bonds, financing, leases, or other similar obligations of the City payable from or secured by assessments levied within GBD.
Q: Are public realm improvements really needed in these neighborhoods?
A: Yes. Northwest Potrero Hill has long been troubled by dangerous and unsanitary activities. Needles, garbage, human waste, and thefts are common issues for the neighborhood, especially in open space areas that are not monitored and cared for. Any open space area that is not cared for or is isolated is an invitation for illegal behavior. Adding lights, landscaping, and positive activity like those outlined in the neighborhood’s Potrero Gateway Loop proposal protects and enhances the local neighborhood.
Dogpatch is a mixed-use neighborhood, but many sections of the neighborhood have industrial warehouses with no sidewalks, street lighting or green space. The proposed capital improvements include adding Permeable Paving where appropriate, waste collection receptacles, working with state and city agencies on safe, sustainable lighting in areas where residential population is increasing, new signage to guide pedestrians and adding a network of recreational green venues to encourage walkability where no sidewalks or community social spots exist to date.
Q: What was the impetus for creating this Green Benefit District?
A: Three core values have informed this neighborhood-driven process:
- Dogpatch and Northwest Potrero Hill’s community-created open spaces, parks, and gardens are centerpieces in the neighborhood, and volunteer efforts at those spaces and at city-owned parks are significant contributors to the quality of life in these communities. Such volunteer efforts, which have greatly added to city-owned spaces, can be supported and further enhanced with visionary and effective management practices, and transparent and steady funding.
- Neighborhood open spaces, parks, and gardens, along with green infrastructure projects such as storm water management, recycled water distribution, air pollution mitigation, and sustainable energy production, are critical to ensuring the long-term ecological sustainability, beauty, public health, and enjoyment of each neighborhood in the GBD.
- Public engagement and transparency in decision making are highly valued in our neighborhood.