San Francisco is once again going through epic changes.  True to its rising Phoenix, the City has survived conflagration and political sea changes.  Hopefully, it will survive the current Board of Supervisors.  Each day brings news of another scatty proposal.  As we at the Libertarian Party of San Francisco have repeatedly noted, each proposal when turned into legislation, 1) brings consequences, which then require more legislation, and 2) should remind us of Lucy telling Peanuts this time she will hold the football still (the iconic symbol of trusting souls by the late great cartoonist Charles M. Schulz).  

These two proposals illustrate the chain-reaction effect:

 o  Hotel tax increase of 1% over the current 14% to help address homelessness.  If a hotel room rate is $300 without tax, with tax it will cost $345.  High lodging costs might discourage some visitors if not from staying in the City altogether, surely from staying at hotels.  So, looks like an additional fix might be needed to prevent vacant hotels rooms.

o  Just in case visitors might be thinking of staying at Airbnb instead of paying higher prices for hotel rooms, there is a proposal to hike Airbnb taxes too.  Some folks might just decide to lodge in Daly City.  So, will the “solution” be to tack an additional fee to the BART fare?

To illustrate the Lucy effect, one need only mention “affordable housing requirement.”

o  In 2012, voters approved the Housing Trust which would solve the challenge of high housing costs by requiring that developers subsidize 12% of the housing units they build.  Problems solved, right?

o  In June 2014, the Board of Supervisors approved for the November ballot a non-binding resolution establishing a goal of 33% affordable housing in areas of the City where significant new housing is added.  Sources of revenue were supposed to be found.  But…

o  In October 2015, referring to the Treasure Island housing project, Supervisor Jane Kim said, “Now 40 is the new 30.  The project is entitled and there is an agreement set by both parties.  I want to study it and see what’s possible.” Island Housing Project. Meanwhile in San Francisco…

o  On the June 2016 ballot, we will see a proposal indicating that project sponsors shall construct 25% of all units constructed on the project site as affordable housing units.  If the project sponsor elects to build affordable housing off-site, the affordable housing percentage goes up to 33%.  Soon 50 will be the new 33?

We would all like the City to be "affordable."  However proliferating legislation with the resulting bureaucracy, and subsidized housing characterized by moving targets are bound to raise costs.  Bureaucrats cost money – tax money, and the market will automatically raise the price of anything to account for uncertainty.