Now Disney gets a nice tax break

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There's an element of Disney buying Lucasfilm that hasn't made the news yet: The giant SoCal outfit is now inheriting Lucas's nifty annual tax break, cheating San Francisco out of property taxes worth about $60 million. See, part of what Disney gets is that shiny Lucas building in the Presidio -- a private office complex built in a national park. And since it's on federal land, not San Francisco land, Lucas doesn't pay the city property taxes.

Nice to know the rest of us working stiffs are helping Disney out.

Oh, and $4 billion for the entire Lucas empire? Disney got it cheap.

Comments

And provides no services to it whatsoever- other than Muni- how is the City being cheated. The Presidio has its own police force, fire department, etc. It's like saying that the City is entitled to property taxes for land in San Mateo.

Posted by D. Native on Oct. 31, 2012 @ 2:45 pm

I love the Lucas Campus in the Presidio. It is one of the nicest places to walk around. Beautiful landscaping, statues honoring Bernard Maybeck, Philo Farnsworth and Yoda. A great viewing spot for the Palace of Fine Arts.

So yeah, I can't go into the buildings but I can't go into 95% of the buildings in the Presidio.

I see that Tim is seething because San Francisco isn't getting tax revenues from land that it doesn't own but that's his problem. The place is great and a benefit to SF.

I know what's coming...if there was a fire there then the SFPD would have to help put it out. Got it. The campus is a great deal for San Francisco anyway.

Posted by Troll on Oct. 31, 2012 @ 3:03 pm

SFFD took over fire and ambulance coverage in the Presidio a couple years ago, but the National Parks Service and the Presidio Trust have to pay a lot of money for it. If the businesses in the Presidio had to pay property taxes, I'd bet National Parks and the Presidio Trust would want some of that money back.

Posted by The Commish on Oct. 31, 2012 @ 3:49 pm

Even though Lucas is on federal property, I believe the city (county) is able to assess a property tax on the buildings and improvements as a "possessory interest."

In the words of a Santa Clara law professor:

"Thus, publicly held federal or state lands often generate these non-fee possessory interests which California has taxed since 1859."

http://digitalcommons.law.scu.edu/cgi/viewcontent.cgi?article=2229&conte...

http://law.onecle.com/california/taxation/107.html

The SFBG has done a lot of long-term damage to progressive thinking with its tax reporting and tax positions. A city income tax? Really? Any half-decent bookkeeper can prepare income tax returns so that even the most profitable are able to report LOSSES in SF (or CA or the US) while boatloads of profits are allocated to Cayman and Hong Kong and Singapore, which are low or no-tax jurisdictions. It's so simple it's laugable when anyone supports a business income tax or profits tax in lieu of far, far superior tax systems.

Even if the government hired thousands of tax auditors to "reallocate" income and expenses so that profits were more fairly reported in SF (or CA or the US), they would never win many cases when pitted against the much better trained and savvy tax lawyers, accountants, and economists. And the litigation costs would run into the billions just trying to win a handful of cases against an army of much better trained and prepared tax lawyers.

And bond taxes the Guardian also supports like Prop B, where bond interest is mostly paid to the 1%ers, often tax-free? Yeah, those are great taxes too. NOT.

I'll make it simple for you since tax policy seems to be one of those subjects The Bay Guardian ALWAYS gets wrong. Only support gross receipt taxes with graduated tax rates (exempting small businesses and allowing tax credits for any "tax on tax" issues), especially supporting high graduated taxes on gross rents less direct costs for maintenance and repair expenses.

These are two of the fairest taxes, the easist to audit, virtually impossible for taxpayers to avoid (even with their million-dollar paid tax advisors), and bring in the most revenue with the least distortion to the underlying economy since the tax base is so broad and the tax rates are so low compared to "income tax rates." Thus, when companies ship jobs overseas but continue to sell their products and services into the lucrative US, CA and SF markets, they pay tax on their sales here. And US companies don't pay tax on shipments outside the US, thus helping to bring jobs and employment back to the US.

Posted by Guest on Oct. 31, 2012 @ 3:38 pm

Not least because it is regressive - the tax gets passed on directly to the consumer so it causes inflation and hits the poor, who spend most of the money here, while the rich spend it elsewhere.

Property tax is undesirable too though, I'd agree, but at lest Prop 13 prevents the worst execesses of that.

But SF benefits directly from the Presidio - they cannot reasonably be expected to be able to apply taxes to federal land. it's best to think of the Presidio of not being in SF at all. And if there were a way into the Presidio that didn't involve going thru SF, it wouldn't be deemed to be Sf at all.

Posted by Guest on Nov. 01, 2012 @ 12:17 am

All taxes get passed onto consumers to the extent that the market will bear, after that, they begin to eat into profit. You just don't like taxes.

Posted by marcos on Nov. 01, 2012 @ 8:50 pm

paying more if taxes go up. If profits fall then businesses get closed down, putting people out of work. The rest then have to pay more tax.

There's no free lunch, Marcos. We always pay in the end.

Posted by Guest on Nov. 02, 2012 @ 12:31 am

The point is that both LucasFilm, and now Disney, are taking advantage of a loophole. They get the convenience of being in San Francisco (albeit on federal land) and don't have to pay any property taxes to the city. Unless all of their employees also live, eat and commute exclusively within Presidio boundaries, they are still using San Francisco infrastructure (roads, MUNI, schools, police and fire) in their daily lives.

The Presidio is beautiful but it's not an isolated bubble. Apparently, it's only isolated from taxes.

Posted by S. Bloomberg on Oct. 31, 2012 @ 3:38 pm

to enter and use the City and its roads etc.? What about people that work in the City for non-profits and they commute from out fo the City- no taxes and the workers are using the City Roads etc?

Posted by D. Native on Nov. 01, 2012 @ 4:01 am

They wanted to charge drivers for coming downtown. But then they realized that as many people commute from SF into the valley, and any tit-for-tat, beggar-thy-neighbor policies like would likely backfire.

Posted by Guest on Nov. 01, 2012 @ 4:14 am

And San Francisco gets the convenience of having LucasFilm/Disney JOBS!

Posted by Guest on Nov. 01, 2012 @ 9:11 am

>"Unless all of their employees also live, eat and commute exclusively within Presidio boundaries"

Well if they live in San Francisco then the city is getting real estate taxes on the living quarters that they pay for. Not sure how their eating is a drain on the city economy. In fact, the local groceries and restaurants might actually appreciate it.

Not sure what the problem is. At some point Tim and the other Progressives will have to grow up and realize that they can't tax every penny that successful people have.

Posted by Troll on Oct. 31, 2012 @ 4:21 pm

$60,000,000.00 huh? If the city wound up getting it, it'd spend most of it on relief for the panhandlers,,,hence that many more bums, more poop on the sidewalk and feces clogged Muni escalators.

Posted by Guest on Nov. 01, 2012 @ 8:29 am

Grew up in the south bay, we have a nice big campus that has many companies, they don't pay any property taxes. Presidio and Moffett Field are federal land.

Posted by Garrett on Nov. 01, 2012 @ 11:20 am

Actually, I'm unhappy that anyone got to build a commercial office complex in a national park. Try that in Yosemite and see people howl. The Democrats (Re. Pelosi) turned this particular park into a real-estate venture.

As for city services: I believe the Presidio uses municipal water and sewer. I believe that cars entering and leaving use city streets. If there were a fire, the SFFD would absolutely respond. It's not an isolated island.

Posted by tim on Nov. 01, 2012 @ 3:03 pm

That is on the edge of a major city and it used to be a damn army base. Did you really expect Congress to fully fund a national park on prime real estate and expect nothing from it? Honestly I think the trust has done a great job of getting a good mix of businesses and non profits in there. Makes it much more of a destination than if it were all natural space. It is a pretty neat urban park. Plus the goal is for it to be able to fully support itself, those not using any tax dollars. What a deal.

And really Tim, two minutes with google and I discovered that the Presidio actual supplies about 2/3 of its own water from within the Presdio. When supplies start to run low,it BUYS water from the City. Not donated, it BUYS it. Then best of all, it has it's own water treatment plant. Nice job of reporting. As for the city roads, I truly doubt that the wear and tear imposed on the city by residents and businesses in the Presidio is all that much,especially when you consider most people driving through the City to get there probably live in the City and thus pay taxes etc. the other easy access comes from Marin and you don't even need to touch city roads to get onto the Presidio from there.

Looks like someone else already took care of the whole issue with the fire department. Really batting a thousand tonight Tim.

Posted by Guest on Nov. 01, 2012 @ 8:00 pm

Please. Tim has no knowledge or interest in reporting whatsoever. Several commenters have done the work to show that the Presidio pays its own way when it uses city services (fire, water, etc..). Meanwhile private companies like Lucas have given us some of the most beautiful open public space anywhere. And jobs for San Franciscans and benefits to local businesses. And heaven forbid some young kids might get excited about the technology being developed there. Why...they might grow up to be people who don't need any handouts! What then?

All of which is irrelevant to Tim. Rich people are in the Presidio, very close to SF. They should go back where they belong. We don't want their kind around here.

Posted by Troll on Nov. 02, 2012 @ 5:36 am

Here are the details:

http://www.sf-fire.org/index.aspx?page=1061

So Lucas pays the Presidio and the Presidio pays San Francisco.

Not good enough for Tim. If successful people have money, Tim wants to tax it. The fact that they don't even operate in San Francisco is irrelevant.

Posted by Troll on Nov. 01, 2012 @ 5:23 pm

Uh, dude: The Presidio may be a federal enclave, but it is within the official territory of the city and county of San Francisco

And yes, I want to tax the rich. Front-page news.

 

Posted by tim on Nov. 01, 2012 @ 7:32 pm

because there is no land route to the Presidio that doesn't go through SF. But SF has no real authority there, and thank god too, or it would be as big a mess as the rest of the city, rather than a beautiful, successful, self-sustaining park.

Tim being imperial is really quite funny. He starts foaming at the mouth if he sees some untaxed wealth and success.

Posted by Guest on Nov. 02, 2012 @ 12:36 am

Okay Tim. So tenants at the Presidio pay rent, and then the Presidio pays the city for services, like $3.5 million for SFFD services. How much does the SFBG pay the fire department?

And then you want to tax the Presidio businesses again? Is double dipping good enough for you? After all, if they are wealthy perhaps we should charge them 3X over for city services. Disney? We should octo-tax them.

Posted by Troll on Nov. 01, 2012 @ 8:08 pm

We should tax the successful until they learn to shut the fuck up about being taxed.

Posted by marcos on Nov. 01, 2012 @ 8:45 pm

...or they just move to San Bruno in which case we get....nothing?

Posted by Troll on Nov. 01, 2012 @ 9:00 pm

Are you trying to say that the Presidio of San Francisco needs to be competing with San Bruno?

Posted by marcos on Nov. 01, 2012 @ 9:06 pm

Well yes I do. Especially if the business tenant is a huge entertainment conglomerate. Maybe San Bruno isn't the competition, perhaps it is Burbank. But if Disney inherits offices that were constructed with great respect for their setting, with beautiful huge expanses of public space, and they already pay for fire and other city services, then maybe they wouldn't be real happy about having to pay for them a second time just because Tim doesn't like having successful people around.

Posted by Troll on Nov. 01, 2012 @ 9:47 pm

rich people and it still wouldn't be enough for them.

And you're right - rich people and successful businesses are the most mobile of all, and the city needs them more than they need the city. That's why the city folded when Twitter threatened to move corss the county line because of taxes.

Posted by Guest on Nov. 02, 2012 @ 12:33 am

Left out of your mix are the creatives that are as attractive to firms as the location. I'd expect that you'd want to leave this to the magic of the market place to sort out without the brutal hand of the state cutting special deals for the powerful.

Posted by marcos on Nov. 02, 2012 @ 5:11 am

I'm not sure I'm correct about this, but I thought George Lucas was keeping the real estate side of his holdings. That what he was selling was the company and the business dealings, but keeping the real estate side of the deal. The article that makes me think this is listed below with the quote.

So basically George Lucas would continue to get the sweet tax break (if any) and charging rent to Disney-- I think. Again I'm not sure I'm right about that but that seems to be the implication of the quote.

http://www.mercurynews.com/movies-dvd/ci_21891588/disney-lucasfilm-buyin...

"A spokeswoman for Lucas said he will retain ownership of the current Lucasfilm campuses, including the sites in San Francisco and Marin, with the understanding that Lucasfilm will continue operating on the sites."

Posted by jimdavis on Nov. 02, 2012 @ 7:44 pm

I love this new transparency.... reactionary and uneducated journali... ahem.. bloggers can write whatever they want, but a thoughtful, wiley public can also comment about just how silly the original "story" is. The Presidio is sort of an awesome success, and it's open to all.... they keep re-opening buildings that were closed to the public for decades. It's good stuff. Fight a better fight.

Posted by Uncle Fishbits on Dec. 14, 2012 @ 2:39 pm

Yes you. Especially the person who wrote this article. THE ARTICLE YOU LINK TO SAYS $60 OVER THE NEXT 12 YEARS!!!! And that was in 1999! About the only thing they might not pay is a little over a million dollars a year. Out of a 3 billion dollar budget. Tim, your are either an idiot for misinterpreting the article you linked to, or an assh0le for willfully trying to mislead people.

Posted by Guest on Jan. 18, 2013 @ 9:52 pm