Tech CEOs Dorsey and Benioff face-off over San Francisco homeless tax

Saleforce CEO Marc Benioff is pushing for a tax on San Francisco's largest companies to raise money for homeless efforts. Twitter and Square CEO Jack Dorsey is against the tax, and wants to let the city's new mayor, London Breed, come up with alternative plans.

"These tech CEOs, they need to realize if they want to do business in San Francisco and use all of our civic resources, and in some cases have gotten mid-market tax breaks, then they should be more than happy to give a small amount — which is what it is for these companies — to help us focus on our number one issue," Benioff told CNN Business in a phone interview Friday afternoon.

Benioff is spending money to promote ballot Proposition C, which would tax large companies based in the city. The tax would vary, but come out to about 0.5 percent on businesses' gross receipts above $50 million a year.

It would raise up $300 million annually to address homelessness by building more housing, increasing mental health treatment, and adding shelter beds. That is double what the city currently spends a year on the issue.

Salesforce is the largest employer in the city, and Benioff, a San Francisco native, is very active in local issues. He has been a major donor to San Francisco and Oakland public schools, and recently helped raise $37 million for the Heading Home Campaign, which aims to get families with children off the streets.

"I want to help fix the homeless problem in SF and California. I don't believe this (Prop C) is the best way to do it," said Dorsey in a Tweet reply to Benioff on Friday.

Benioff replied by asking for examples of how Dorsey has helped and what donations he's made. Dorsey called the question a "distraction" and said he wants to support Mayor London Breed's efforts.

Mayor Breed has come out against the proposition, citing concerns about oversight and accountability for how the money is used. There are also concerns it could lead to layoffs or cause businesses to relocate, Breed has said. Breed wants to know more about how it will impact the local economy.

"I do not believe doubling what we spend on homelessness without new accountability, when we don't even spend what we have now efficiently, is good government," said Breed in a statement. "I absolutely do agree business can pay more to address our homeless crisis, which is why I will lead the effort to do this the right way as Mayor, and I look forward to continuing to work in partnership with Marc and others do that."

In a statement, a spokesperson for Square said: "Homelessness in San Francisco is a humanitarian crisis. We support Mayor London Breed, Senator Scott Wiener, and Assembly member David Chiu's calls for a consensus response to homelessness," "We are eager to collaborate with City Hall, local organizations, and other businesses on a unified approach to this issue. Prop C is not that approach."

Benioff says he recently got a call from the mayor asking for $8 million to fund a new shelter.

"If she had Prop C, she wouldn't have to call for that money. It would already have been given to her. Seems pretty straightforward to me," said Benioff.

The debate mirrors a similar contentious battle in Seattle this past summer. The city had proposed a new corporate head tax to raise money for homeless service. Amazon led the charge to stop the tax from being passed.

San Francisco's tax could fare better. A local homeless advocate group raised the signatures to get it on to November's ballot. It has support from other large companies like Cisco, as well as Representatives Nancy Pelosi and Jackie Speier. And Benioff is ready to fight for it.

"I didn't realize until this morning that Jack Dorsey was not going to support it," said Benioff. "The question is how much is he giving back to our public hospitals and schools and to our homeless programs. The only way we're going to make our city better is if we tap the incredible wealth that it's generating."

Benioff, who says he talks to Dorsey regularly, has been paying to promote tweets supporting the proposition.

"I'm glad that Jack tweeted that because we need to have a pubic discussion about homelessness and how we're going to solve it."

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