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“A group of essential workers from Los Angeles claim McDonald’s is exploiting corporate tax loopholes by failing to pay nearly $30 million in property taxes annually that would help fund schools and a range of essential services, including public hospitals and affordable housing.”

“Jannette Verbera, a special education assistant with the Los Angeles Unified School District and an SEIU member, said schools were already struggling before the COVID-19 pandemic hit. ‘There weren’t enough special education assistants to help our children,’ she said in a statement. ‘We lacked proper equipment and I had to buy basic things like wipes for students.’”

A contingent of essential workers – including nurses, janitors, security guards, school employees and fast-food workers – called out McDonald’s in California for avoiding $30 million every year in local taxes. These are investments that should be going towards schools and local communities, especially now, but are being siphoned off by one of the most profitable companies in the country.


Orange County Register: Essential workers assail McDonald’s in rally supporting Prop. 15

They claim McDonald's has avoided paying nearly $30 million a year in property taxes

Kevin Smith


A group of essential workers from Los Angeles claim McDonald’s is exploiting corporate tax loopholes by failing to pay nearly $30 million in property taxes annually that would help fund schools and a range of essential services, including public hospitals and affordable housing.

The contingent – including nurses, janitors, security guards, school employees and fast-food workers — made its way to a McDonald’s on South La Brea Avenue on Monday to admonish the company for taking advantage of California’s “broken property tax law” and to rally support for Proposition 15.

Representatives with McDonald’s could not be reached for comment Monday.

Prop. 15

The November ballot measure is designed to close tax loopholes for large property holders and spend the resulting revenues on local governments and schools. California, the workers say, would reclaim up to $12 billion each year from wealthy corporations like McDonald’s.

That would be accomplished by amending the state’s constitution to require certain commercial and industrial properties worth more than $3 million to be taxed based on their market value. Agricultural property would be exempt. The change from the purchase price to market value would be phased in beginning in fiscal 2022.

Supporters say Prop. 15 would also cut taxes for small businesses while protecting homeowners and renters. Opponents claim it amounts to a $12.5 billion property tax increase that would boost prices for food, gas, utilities, daycare and health care.

Standing atop the flatbed of a semi tractor-tractor trailer, workers at Monday’s rally implored Southern Californians to hold McDonald’s accountable and to vote yes on Prop. 15.

“The black, brown and immigrant communities have borne the brunt of this pandemic,” said Robert Branch, a security guard and member of SEIU United Service Workers West. “We need investment in public programs that ensure our health and safety — not cuts.”

A wide discrepancy in tax assessments

Drawing on data from the fast-food giant’s SEC filings and various reports, the workers note that McDonald’s built many of its California restaurants in the 1960s and 70s. Under Prop. 13, which was passed in 1978, they allege those locations are typically taxed on prices that are decades old.

An SEIU analysis estimates a typical McDonald’s store is taxed on a value of less than $2 million, although McDonald’s restaurants in California routinely sell for $4 million or more.

Data from the Los Angeles County Office of the Assessor website show, for example, that a McDonald’s at 6904 La Tijera Blvd. was assessed at $8 a square foot, while a Goodwill thrift shop across the street was assessed at $73 a square foot.

Another McDonald’s at 2810 S. Figueroa was assessed at $7 a square foot, county records show, while the motorcycle shop behind it was assessed at $52, and the office building next door was valued at $137 a square foot.

The workers contend McDonald’s makes most of its money charging rent to the franchisees who run 95% of the company’s U.S. stores. The company took in $7 billion in rent from its franchisees in 2018, according to an SEC filing.

Those workers have enlisted the support of Fight for $15, a political movement that’s seeking to boost the nation’s federal wage to $15 an hour. They say McDonald’s in California would pay about $30 million more a year in property taxes under Prop. 15. That equates to $150 million over the next five years.

Schools are in need

Jannette Verbera, a special education assistant with the Los Angeles Unified School District and an SEIU member, said schools were already struggling before the COVID-19 pandemic hit.

“There weren’t enough special education assistants to help our children,” she said in a statement. “We lacked proper equipment and I had to buy basic things like wipes for students.”

Making McDonald’s and other big corporations pay their fair share, she said, means additional funding for distance learning, for the safe reopening of schools and for “quality education for all beyond the pandemic.”

Norges Bank, the sovereign wealth fund of Norway, exploited loopholes to avoid $12.4 million every year in local taxes

According to a new report from the San Francisco Chronicle, Norges Bank – the sovereign wealth fund of Norway – makes $12.4 million every year by exploiting California’s tax loopholes. The analysis shows that, by avoiding majority change of ownership on just two buildings in San Francisco, the foreign bank is able to avoid $12.4 million every year in local taxes that should be going towards schools and essential local services at a time when needed most.

San Francisco Chronicle: Prop. 13 revise: Prop. 15 would be biggest change to California property taxes in 4 decades

Roland Li and Joe Garofoli


Norges Bank, Norway’s sovereign wealth fund, caught a break when it bought a minority ownership stake in two San Francisco buildings four years ago.

Norges paid $453 million for 44% ownership of 100 First St. and 303 Second St. It was an example of soaring San Francisco real estate values: Six years earlier, the office buildings had sold for a combined $429 million, but now Norges valued them at $1.15 billion.

But unlike typical sales, the properties’ tax bill did not rise in a similar way, because of the rules set by California’s Proposition 13. Under the initiative that voters approved in 1978, property taxes can rise no more than 2% each year unless more than half of ownership is sold or new construction occurs.

Those protections would be removed for commercial properties if voters pass Proposition 15 on the November ballot. The initiative would reassess commercial and industrial properties in California at least every three years instead of whenever they are sold. It would be the most sweeping change to the state’s property tax code in over four decades.

The measure could more than double the annual tax bill for the two Norges buildings, to a combined $12.4 million, based on the 2016 deal. Norges did not respond to a request for comment.

Statewide, the measure would increase property taxes by an estimated $8 billion to $12.5 billion annually, according to the nonpartisan state Legislative Analyst’s Office. Under Prop. 15, 60% of the new revenue would go to cities and counties, and the rest to school districts.

Owners with less than $3 million in total property would be exempt from the initiative — an attempt by its supporters to shield smaller owners from higher taxes. The ballot measure would not affect residential properties or agricultural land. It would begin to take effect in 2022 and be phased in over the next three years.

In San Francisco, a number of large office buildings leased by companies including Twitter, Uber and Facebook could see major tax increases, following previous ownership sales of less than 50% that, like the Norges deal, were not subject to tax increases. Buildings that have not been sold in decades could also see substantial tax increases to match the current market.

“Massive corporations — many of which are foreign and out-of-state — are robbing our communities of resources for teachers, personal protective equipment for nurses and equipment for firefighters on the front lines,” said Tyler Law, an adviser for the Prop. 15 campaign. “By avoiding their fair share, they have forced Californians to shoulder more of the burden. Prop. 15 closes property tax loopholes exploited by the richest corporations so that we can invest here in California while also giving small businesses a tax break.”

In the Bay Area, Prop. 15 would bring in an additional $733 million annually for San Francisco’s schools and government, $652 million for Alameda County and $770 million for San Mateo County, according to an analysis in February by the University of Southern California’s Dornsife Program for Environmental and Regional Equity.


Some No on 15 ads say the measure’s proponents have said that “homeowners are next” to lose Prop. 13 protections. However, there is nothing in Prop. 15 that affects homeowners’ property tax rates.

Prop. 15 supporters say the money the initiative would raise is desperately needed because the pandemic forced California’s schools and local governments to slash their budgets. The California Teachers Association’s political action committee has contributed nearly $12 million for the measure, and the initiative is backed by other large public-employee unions. Supporters have raised a total of $42 million.

Chan Zuckerberg Initiative, the philanthropic organization backed by Facebook CEO Mark Zuckerberg and his wife, San Francisco doctor Priscilla Chan, donated $7.1 million to the Yes on 15 campaign, calling the measure a way to meet local “urgent needs” such as funding public hospitals and schools.

Gov. Gavin Newsom endorsed the initiative, saying it is a “fair, phased-in and long-overdue reform” that will support public safety programs and schools. Other backers include San Francisco Mayor London Breed, Oakland Mayor Libby Schaaf, and Democratic presidential nominee Joe Biden and his running mate, California Sen. Kamala Harris.


Prop. 15 proponents say 92% of the new taxes will be paid by 10% of the commercial and industrial property owners, citing a study by Blue Sky Consulting, whose co-founder Tim Gage served as director of the California Department of Finance under former Gov. Gray Davis.

A study by Beacon Economics, commissioned by the Silicon Valley Community Foundation, said that “it seems unlikely that small-business owners would be hurt by Prop. 15.” Most rents are determined by local market factors, according to the report.

“If thousands of renters routinely had their rents increase each time properties were reassessed, evidence would be seen,” the report’s authors said. “Ultimately, this analysis shows that rents are determined by what the market is willing to pay.”

“She’s been paid by campaigns funded by commercial property owners fighting the tax increase … Huffman’s Sacramento-based firm, AC Public Affairs, has been paid $590,000 so far by the No on Prop. 15 campaign”

“Black communities in California suffer most from the lack of funding for schools and community colleges, which are typically gateways for people to have career paths and livable wages and good jobs” – Anthony Thigpenn, Founder and President of California Calls

CalMatters: California NAACP president aids corporate prop campaigns — collects $1.2 million and counting

Alice Huffman, who is both a professional campaign consultant and long-time NAACP leader, was especially sought after this year as political campaigns respond to the national reckoning over race.

Laurel Rosenhall


Read through the voter handbook for California’s November election, and a name pops up over and over again: Alice Huffman. As leader of the California NAACP, Huffman has weighed in with positions that critics say run counter to the historic civil rights organization’s mission to advance racial equality in education, housing and criminal justice.

Should voters raise commercial property taxes to pour billions of dollars into schools? Should they make it easier for cities to pass rent control ordinances? Should California outlaw the use of cash bail?

No, no and no, Huffman argues in the ballot handbook, where she is repeatedly identified as president of the California State Conference of the NAACP (National Association for the Advancement of Colored People).

What the guide doesn’t tell voters is that Huffman’s political consulting firm has been paid more than $1.2 million so far this year by ballot measure campaigns that she or the California NAACP has endorsed. She’s been paid by campaigns funded by commercial property owners fighting the tax increase, corporate landlords opposed to expanding rent control and bail bondsmen who want to keep the cash bail system.

Huffman’s dual roles as both a paid campaign consultant and leader of a vaunted civil rights group amount to an unusual — but legal — arrangement. Though she has held both positions for many years, Huffman was especially sought after this year, as political campaigns respond to the national reckoning over race and frame many of their messages with themes of justice and equity. The small firm Huffman runs with her sister is being paid by five ballot measure campaigns this year, public records show — more than it has taken on in previous elections. Many of them are funded by corporate interests at war with labor unions.

While it’s common for political campaigns to hire strategists to help them communicate with specific constituencies, those consultants usually do not come with a brand as well-known as the NAACP is for its work fighting discrimination over the last century. Huffman’s approach — making money from the campaigns that also wind up with an NAACP seal of approval — is stirring controversy in some Black communities. Critics say it appears the endorsement of the renowned civil rights organization is essentially up for sale.

“I feel like it’s a conflict of interest and I think it’s misleading to the public,” said Carroll Fife, an officer of the Oakland chapter of the NAACP who disagrees with the state organization on several ballot measure endorsements. “It’s unfortunate. Politics is gross.”


Huffman declined to be interviewed for this article, as did other members of the California NAACP executive board.

In the ballot handbook, Huffman argues the measures would hurt low-income Californians because commercial property owners would pass their higher costs onto consumers and small-business tenants, and expanded rent control could shrink the supply of affordable housing. Huffman’s Sacramento-based firm, AC Public Affairs, has been paid $590,000 so far by the No on Prop. 15 campaign and $280,000 by the No on Prop. 21 campaign, public records show.

“She has the right to make money as we all do,” said Anthony Thigpenn, a community organizer in Los Angeles who heads the California Calls advocacy group and supports Prop. 15. “But when it’s something that’s using a community-based organization’s brand, and particularly when it’s taking positions… that are not in the interest of the communities that organization has advocated for and championed, that is disappointing and sad.”

Thigpenn said he believes increasing commercial property taxes with the so-called “split-roll” approach in Prop. 15 is a matter of racial justice.

“Black communities in California suffer most from the lack of funding for schools and community colleges, which are typically gateways for people to have career paths and livable wages and good jobs,” he said.

Well-known in Sacramento as a political powerhouse with a career that’s spanned some 50 years, Huffman worked for then-Gov. Jerry Brown in the 1970s. She became close with Willie Brown during the 1980s and 1990s, when he was Assembly speaker and she was a lobbyist for the California Teachers Association. She opened her public affairs firm in 1988, and was elected president of the California NAACP in 1999. Her firm helps political campaigns build coalitions and get their messages out through media, advertising and a newsletter called the “Minority News.” Many of the messages feature Huffman and her role with the NAACP.

Over the years, Huffman’s consulting business and the California NAACP’s endorsements have aligned many times. As she was paid by Indian tribes, pharmaceutical companies and cigarette makers trying to pass or defeat ballot measures in the early 2000s, the California NAACP endorsed those campaigns. The same thing happened in 2018, when Huffman’s firm was paid nearly $900,000 by the campaign fighting a rent control measure, and $90,000 by dialysis companies opposing an initiative that would have increased their cost of doing business.

Both measures failed in 2018 but are back on the ballot this year, and the campaigns trying to defeat them have again hired Huffman. Michael Bustamante, a spokesman for the campaign against the Prop. 21 rent control measure, said Huffman is motivated by what’s best for Black Californians.

“In 2018, she was passionate in her opposition to Prop. 10 because of what it would do to the African American community,” he said, referring to opponents’ argument that more rent control would drive up the cost of housing by discouraging developers from building.

“Over and over again she talked about how homeownership… enables African American families to get a toehold to better their future.”

Bustamante, who is also a spokesperson for the campaign against raising commercial property taxes, said in a statement that “the NAACP took its position in opposition to Prop. 15 based on clear facts that they outlined in their March 2nd report,” which says social justice advocates should be concerned that the measure would increase costs for consumers and doesn’t do enough to protect small businesses.

Campaign finance records show the anti-Prop. 15 campaign made its first payment to Huffman’s firm, of $70,000, on Feb. 25.

The campaign funded by dialysis companies opposing an initiative that would require their clinics to have a doctor on site hired Huffman to educate African American voters “about the dangers of Prop. 23,” said campaign spokesperson Kathy Fairbanks.

“Prop. 23 is particularly dangerous for communities of color because they suffer from kidney disease and need dialysis at higher rates,” she said in a statement. “Prop. 23 would force the shutdown of many clinics, jeopardizing the life-saving dialysis patients need.”

Huffman has told reporters in the past that she only takes on political clients whose campaigns are aligned with the California NAACP’s positions. But it’s not clear how the organization arrives at endorsement decisions. Its website doesn’t explain a procedure and hasn’t posted ballot measure endorsements since the 2016 election. CalMatters contacted its six statewide executive committee members including Huffman; three of them declined interview requests and three did not return messages.

Fife, the Oakland NAACP officer, said her local chapter doesn’t know how the statewide conference decides what to endorse.

“It’s not transparent,” she said.

The president of the San Jose chapter of the NAACP said he had been reprimanded by the state conference for recently writing an op-ed supporting Prop. 15, the split-roll property tax measure. Rev. Jethroe Moore II said he wrote the piece to express his personal opinion, and was surprised to see his affiliation with the San Jose NAACP included when it was published.

“These are my personal beliefs,” he said. “Alice is the president of the statewide NAACP and all the branches understand they have to support the positions that they take. I accept my responsibility for stepping out as an individual person in the community to take my stand as an American citizen.”

Huffman’s been re-elected president of the state conference several times, according to her bio. Delegates from local NAACP chapters vote for state officers every other year, the group’s bylaws state.

The national office of the NAACP did not respond to several requests for comment. In the past, it has criticized state chapters for advocating for energy policies that benefit their corporate donors at the expense of the safety of Black neighborhoods. The New York Times cited Huffman’s signature on a 2018 letter opposing a renewable energy program as part of a trend that led the NAACP national office to publish a report on the “Top 10 Manipulation Tactics of the Fossil Fuel Industry.”

Racial equity has emerged as a theme in several campaigns on the California ballot this fall, including some that the NAACP has not weighed in on. Prop. 17 would grant voting rights to people who are on parole following a prison sentence. Though it was a priority for the Legislature’s Black caucus — because African Americans make up 26% of the parole population but only 6% of California adults — the NAACP has not publicly endorsed Prop. 17.

On the other hand, the NAACP has endorsed the campaign aiming to maintain the cash bail system that some advocates see as unfair to many people of color. The No on Prop. 25 campaign, funded by the bail bonds industry, is asking voters to overturn a law that would end the use of money in determining who goes free while awaiting trial. It has paid Huffman $45,000 so far this year.

State Sen. Steve Bradford, vice chair of the Black caucus, said he’s surprised both that the California NAACP is opposed to eliminating cash bail, and that it has not taken a position on whether parolees should have the right to vote.

“I would hope that in the next 40 days they would weigh in strongly because the NAACP was founded on securing the right to vote for people of color,” said Bradford, a Los Angeles Democrat who describes himself as a longtime NAACP member.

Bradford said he supports Prop. 25 to eliminate cash bail because “it’s created somewhat of a debtors prison where poor folks are in jail, while rich folks can post bail for more serious crimes and be scot-free until their day in court.”

Though ending the use of money bail has been a goal for progressives, the final version of the California law wound up splintering the left because it leaves a lot of discretion to judges. In the ballot argument against Prop. 25, Huffman argues that the risk analysis that would replace bail in determining if someone has to be locked up before trial amounts to “computer profiling [that] has been shown to discriminate against minorities and people from neighborhoods with higher concentrations of immigrants and low-income residents.”

Huffman has also appeared in ads urging voters to support Prop. 22, a campaign funded by Uber, Lyft and Doordash that seeks an exemption from state labor law allowing them to treat their drivers as independent contractors instead of employees. She was featured in an email Uber sent to its customers titled “Why communities of color support Prop. 22.” And she wrote an op-ed in the Observer, a Black newspaper in Southern California, saying the Legislature failed Black and Brown gig workers by passing the labor law that Prop. 22 seeks to change.

“In the face of such indifference to the economic wellbeing of people of color, the only response is action,” she wrote. “If the politicians won’t stand up for us, we have to stand up for ourselves by passing Prop. 22.”

Huffman’s public affairs firm has been paid $85,000 so far by the Yes on Prop. 22 campaign.

“Alice Huffman is working with the Yes on Prop. 22 campaign to support outreach efforts in communities of color because of the significant impact the loss of app-based rideshare and delivery services will have on Black and Brown Californians,” campaign spokesperson Geoff Vetter said by email.

“As a Black woman, I know well that the Black community is not a monolith.” -- APRIL D. VERRETT, SEIU LOCAL 2015 UNION PRESIDENT

Though Huffman spent much of her career with the teachers union, her consulting work now consists largely of helping corporate campaigns that are fighting against organized labor. Unions are against changing the labor law with Prop. 22, and for raising commercial property taxes with Prop. 15, adding new requirements on dialysis clinics with Prop. 23 and ending cash bail with Prop. 25.

April D. Verrett, president of the SEIU Local 2015 union that represents nursing home workers, said she has never been involved with the NAACP and doesn’t expect all Black voters to see issues the same way.

“As a Black woman, I know well that the Black community is not a monolith,” she said.

Still, in her mind, several questions on the ballot — money for schools, overhauling the bail system, repealing the ban on affirmative action and granting voting rights to parolees — should galvanize voters who want to advance racial justice.

“All of these inequities disproportionately affect people of color,” Verrett said. “Our country seems to want to have a real conversation about race and inequities. This election in California gives us an opportunity to really begin changing things.”

But ballot measures can be confusing, and deciding how to vote on them is difficult for many voters, said Jessica Levinson, a professor at Loyola Law School of Los Angeles.

“Endorsements really matter because you can’t look at a living breathing candidate and assess them,” she said. “So voters use helpers to try to figure out (how to vote) — and a lot of voters just look to a couple of people or organizations that they trust and that is how they make their decision.”

While it’s legal for campaigns to pay for endorsements, Levinson said, voters should be told when that’s the case. Otherwise, she said, “it robs voters of a meaningful ability to assess how they’re going to vote, if these endorsements are just paid for.”

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