What's the matter with Silicon Valley?

This image was removed due to legal reasons.

How do the mayors of the Bay Area’s three largest cities prevent a tech boom from obliterating the region as we know it? For starters, they sit down and talk to each other.


On February 6th, KQED hosted a roundtable discussion featuring Mayor Libby Schaaf of Oakland, Mayor Ed Lee of San Francisco and Mayor Sam Liccardo of San Jose. The conversation, moderated by KQED’s Thuy Vu and Scott Shafer, touched on city-specific topics, such as San Francisco’s real estate boom and San Jose’s ongoing lawsuit with Major League Baseball. But issues of mutual concern were also raised: transportation, housing and, of course, technology.

Here are some of the highlights.

Tech behaving badly:

Vu: Mayor [Lee], some of your biggest campaign donors are powerful players in the tech sector, and some residents in the city are questioning whether they can trust you to represent their interests…What do you say to them?

Lee: I would say, “Watch what I do, and make sure you hold me accountable.” Because I’ve always been held accountable as a public official. I quite frankly enjoy that challenge. You also have Mr. Marc Benioff donating $5 million to our middle grades and our public schools, without any strings or control—so that we can better the middle grades. This morning, we celebrated a $75 million donation from Mark Zuckerberg and Priscilla Chan to our general hospital.

Vu: Do you think tech companies can do more? And then I’d like to open this to all of you: do you think tech companies have an obligation, now that they’re going through a pretty flush time, to do more to help the various issues in your cities?

Schaaf: I think you know what our answer is going to be to that: absolutely.

Shafer: Are you disappointed that they don’t?

Schaaf: Absolutely, and I think it’s an educational opportunity to bring them along and to demonstrate to them how it enhances their bottom line and creates a better corporate brand for them. And the issue of diversity in tech—that is a huge one. I was just having an interesting conversation this morning with some tech representatives. And I was pretty disappointed at the response, because I think that the companies really need to respond to the disparities—how their workforces do not look like our cities.

Liccardo: I think the good news is, I think a lot of folks in tech are getting it. And some folks in tech have gotten it for a long time. I mean, Santa Clara County and San Jose, led by the Silicon Valley leadership group, our tech companies formed the first housing trust in the country. Which has been responsible for ensuring that thousands of people get access to affordable housing, raising money directly through philanthropy, and also leveraging that. They are now about to embark on an effort on homelessness. I think tech is stepping up…we need to do more to encourage that and facilitate that and, in some cases, get out of the way.

Schaaf: I agree, and we have an opportunity to kind of give them a roadmap. I think the intent is there.


What to do about Airbnb:

Vu: I also want to talk to you about tech, Mayor Lee. About San Francisco’s relationship with tech companies fueling the economy…Airbnb for example, owes the city $25 million in back taxes. Why have you not been aggressive in going after that?

Lee: Well first of all, I don’t know if it’s $25 million, that’s what some speculators have said…We know there are some taxes owed. I’ve taken a strong position, so has the board of supervisors, and everyone else I spoke to: “Pay your taxes, whatever they owe, and get into a system where you don’t owe it.” Having said that, there’s still delicate discussions going on about not changing neighborhood character going forward. They’ve agreed to pay all of their taxes going forward, and it’s a very popular system.

Shafer: But three years ago … you sent someone to the treasurer to urge him to not collect the back taxes. That was three, three-and-a-half years ago, the money still has not been collected.

Lee: I don’t know where you got that, Scott.

Shafer: The chief technology officer of the city didn’t go and…

Lee: No, I don’t think that ever happened.

[Ed. — the San Francisco Examiner reported that Mayor Lee's technology chief, Jay Nath, urged the city treasurer to  use "discretion" and "pause adoption" in asking Airbnb to pay back taxes in a 2012 meeting.]

Tech’s community responsibility:

Shafer: If you look at companies like Wal-Mart, they have been blacklisted from big cities like San Francisco and probably Oakland, because they don’t pay decent wages and benefits. And yet, you’ve got a company like Uber, Lyft—they pay no benefits, they pay no health care to their employees. There’s lawsuits over that right now. Why aren’t those companies being really urged…to extend the same kinds of benefits to those folks?

Lee: They’re for sure being urged…We’re educating these new sudden overnight billionaire leaders; they’re shocked about their wealth. Some of them don’t even understand what that is, and how they can demonstrate how to be a good citizen. It is, as Libby and Sam said: it’s about an education process. And we’re there to make sure that’s welcome and happening.

Liccardo: And I think also, tech leaders don’t want to get involved in funding whatever it is the government does. That’s not very interesting, and that’s not their job. What they want to do is have an impact; they want to see if they can make a “dent in the universe,” as Steve Jobs used to say…I just spent an hour talking to a tech leader this morning who wants to have a big impact on homelessness. But he wants to do it with a very innovative approach to housing. Where there’s that hook that we can get them engaged. They want metrics. But they also want to do it differently. They don’t want the same bureaucratic process.

Vu: they want outside-the-box thinking.

Schaaf: That’s fair. The government has been pretty slow moving in the past, and it needs to speed up. It needs to be as innovative as our business leaders are.


What about the middle class?

Shafer [to Mayor Lee]: Last year, you gave an interview with Time magazine, and you said, and I’m quoting here: “I don’t think we paid any attention to the middle class; I think everybody assumed that the middle class was moving out.” Why did you make that assumption?

Lee: You know, I think it’s a fact. I’ve worked for the city of San Francisco for 23 years before I became mayor and I looked at all the policies when I became mayor, and I asked, what is it that we really haven’t done? And everyone saying, the fact, I think our middle class is moving out. They weren’t believing in the schools. The neighborhoods weren’t strong enough with kids’ programs. And the affordability issue. So I’ve had to put forth a really strong affordability agenda. The comment that I made was really to get ready to have a middle-class agenda for the city.

Vu: But how will you help people now, because a lot of the housing you’re talking about, because we know in the city it takes 4-6 years to accomplish this, get the homes built. How will you help people now who are feeling priced out?

Lee: Well, first of all, it’s not just housing…you also have to give people other reasons to be here. To pause, and say “Hey, there’s other things that we want to have here: good schools, minimum wage that they can really use and help, good transportation system, and a safe city.”

Shafer: Mayor Schaaf, a lot of the people who are getting priced out are coming your way—they’re coming to the East Bay. And for many years, Oakland felt like it was missing out on the boom, but now it’s all around you, people are moving in—is it too much of a good thing? Now your rents and prices are going up.

Schaaf: We are cautiously watching what is going with housing prices, and we’re trying to learn some cautionary tales, with all due respect, from San Francisco. But I’m really proud that we’ve been preparing for this moment. Our city has been doing these area specific plans, and it’s where you really engage in meaningful dialogue with the existing community about where do we want to see growth, and where do we want to see preservation? Where do we want to see changes in use? And so we have completed five area specific plans, which just lays out a road map for where we want dense housing, and we clear the way for the zoning, and we pay for the environmental clearance, and that’s how we can actually build housing quickly.


Yeah, about that housing…

Vu: The median home price in SF is now a million dollars, a million dollars. Rents are at an all-time high. What do you say to people who say they can no longer live in the city.

Lee: Well, we definitely have these challenges when these boom times have happened. And what we didn’t do for many years is…we didn’t build enough housing in the past. And so the pressure is on the current stock. I’ve got a goal to build 30,000 units of new housing…

Vu: That’s 30,000 homes by 2020. That’s your plan. That’s a goal—is it realistic though? From what I’ve read, you’ll have to finish 5,000 homes every year for the next six years to make that happen.

Lee: Last year, we did 4,000, and that was just the start of the effort…it is really a matter of getting the permits out, getting the land under control and the secret is land cost and how to control that.


"I write about the future (Associate Producer at @ThisIsFusion).

I write about the past (publisher of #OGToldMe).

Oakland, CA raised me."

Share This Story

Get our newsletter