Mountain View voters are set to weigh in on two tax initiatives on the Nov. 6 ballot that, if approved, would bring millions in new revenue to city coffers.
Dubbed the "Google tax," Measure P would update Mountain View's business license tax structure and rate for the first time since 1954, implementing a tiered tax system that would charge a headcount fee tied to the size of the business. (Currently, most companies pay license fees that amount to $34 annually.) Measure Q would establish a tax of up to 9 percent on cannabis sales in Mountain View. Both measures need a simple majority of "yes" votes to pass.
With no organized opposition and clear benefits from these measures, the Voice recommends a yes vote on both P and Q.
The Mountain View City Council voted unanimously in June to place Measure P on the November ballot. While all tax proceeds would go into the city's general fund, officials have said that 80 percent of the total revenue -- estimated at $6 million per year -- would be put toward sorely needed transportation improvements, such as the construction of an underpass at Rengstorff Avenue and upgrades to the downtown transit center. Another 10 percent would be spent on affordable housing.
Under the new system, all businesses earning more than $5,000 per year would pay a per-employee fee. The cost for most business licenses would also increase, as the flat fee for licenses would now cost $75.
The new headcount tax would target the city's biggest employers, not small businesses. A mom-and-pop shop with fewer than 25 workers would pay the $75 fee plus $5 per employee, On the opposite end of the spectrum, Google -- easily the city's largest employer with a workforce of 23,000 -- would pay a fee of $584,195 plus $150 per employee over 5,000, totaling about $3.2 million, according to the city's impartial analysis of Measure P.
The Bay Area's jobs-to-housing imbalance and its impacts -- worsening traffic, astronomical housing costs and strained transportation infrastructure -- have been widely reported. With big tech companies like Google largely behind Silicon Valley's job growth, it makes sense to ask them to help mitigate the effects of that growth. While some may argue Measure P could discourage businesses from growing or setting up shop in Mountain View, with office and retail space in high demand and the allure of Silicon Valley's startup culture it's unlikely the headcount tax would drive employers away in droves. Rather, it would be a greater risk to turn down the opportunity for significant tax revenue that would fund important transportation projects.
Measure Q also would generate new general fund revenue by establishing a tax of up to 9 percent on marijuana shop sales. The initiative has nothing to do with whether marijuana dispensaries should be allowed in city limits; the council, citing broad voter support for legalizing recreational marijuana, on Oct. 2 voted to allow up to four cannabis businesses in Mountain View. Rather, it would implement a tax on cannabis sales when marijuana retailers do set up shop.
The city estimates Measure Q could bring in roughly $1 million every year for general services, including public safety improvements and enforcement of cannabis regulations like buffer zones around schools. The tax would only apply to marijuana retailers' gross receipts and council members have the ability to lower the tax if it became too onerous.
These are both fair business tax measures that would significantly impact few employers while bringing in millions of dollars for the city. Vote yes on measures P and Q.