San Francisco County Municipal Code § 960.4 Credit

(a) The first person or combined group to both enter into a binding agreement to lease all or a portion of each Qualified Building and require at least 100 employees to occupy that Qualified Building shall be allowed a credit against that person or combined group’s Gross Receipts Tax (including any tax on administrative office business activities under Section 953.8). Any other person or combined group that meets these requirements for such Qualified Building shall not be entitled to the credit, even if their lease is for a different portion of the Qualified Building. The credit shall be an annual credit commencing in the tax year following the tax year in which the person or combined group entered into the lease of all or a portion of the Qualified Building and first required at least 100 employees to occupy the Qualified Building, and continuing for the lesser of 15 years or until the end of the tax year in which the person or combined group’s original lease term without extensions expires (the “Credit Term”); provided, however, that the person or combined group may only take the credit for each tax year during the Credit Term in which the person or combined group continues to lease the Qualified Building and continues to require at least 100 employees to occupy the Qualified Building. The person or combined group must take the credit for each tax year on an original Gross Receipts Tax return filed with the Tax Collector. The credit shall equal the lesser of: (1) the Gross Receipts Tax liability of the person or combined group for that tax year; and (2) $4,000,000. (b) For purposes of this Section 960.4, “Qualified Building” means a building located within the City that meets all of the following requirements: (1) The building contains at least 450,000 gross square feet, exclusive of any space provided under subsection (b)(7); (2) Construction began on the building between November 5, 2024 and November 4, 2029, inclusive; (3) Construction of the building incorporated at least 50% of the remains of the exterior walls of a prior structure (measured by the state of the structure when its owner of record on November 5, 2024 acquired it) that was at least 100 years old on November 5, 2024; (4) Construction on the building created at least 500 construction jobs over the course of construction; (5) At least $500,000,000 (not including the cost of the land or financing costs) was expended for the development and construction of the building; (6) Except as provided in subsection (b)(7), the building is used exclusively for non-residential purposes; (7) The building is part of a project that provided (prior to issuance of the building’s first temporary certificate of occupancy) at least 50,000 gross square feet of publicly accessible open space or affordable housing, or that designated building space to be leased to or occupied by any organization that: (A) serves the community, including but not limited to an organization dedicated to educating youth, childcare, the arts, or serving low-income, unemployed, or unhoused persons; or (B) is tax exempt under Internal Revenue Code Section 501(c)(3). The requirement in this subsection (b)(7) may be satisfied with space that is not within or adjacent to the Qualified Building. (c) The Planning Department shall, by January 1, 2025, establish procedures for developers and other persons to obtain certification that a building is a Qualified Building under subsection (b). To be eligible for the credit, the person or combined group claiming the credit must submit a copy of that certification with the person or combined group’s Gross Receipts Tax return. (d) In no event shall the credit under this Section 960.4 reduce a person or combined group’s Gross Receipts Tax liability to less than $0 for any tax year. The credit under this Section shall not be refundable and may not be carried forward to a subsequent year. (Added by Proposition M, 11/5/2024, Eff. 12/20/2024)