San Francisco Mayor London Breed on Tuesday will introduce a sweeping proposal for the November poll to reform the town’s complicated patchwork of enterprise taxes and probably unlock round $300 million of {dollars} in revenues which were collected, however stay off-limits and unspent due to ongoing authorized disputes.

The measure largely displays the conclusions of an examination of the city’s business taxes that started final summer season. That overview, reflecting enter from metropolis leaders and the enterprise neighborhood, was supposed to form a poll measure that might simplify and stabilize the tax system, whereas probably bringing in extra money.

However with the town and far of its enterprise neighborhood confronting an unprecedented financial collapse introduced on by the COVID-19 pandemic, Breed’s measure, which might elevate an estimated $300 million for the overall fund over the following two fiscal years, takes on added urgency.

Enterprise taxes are among the biggest revenue sources for San Francisco’s common fund, ordinarily bringing in additional than $1 billion yearly. By October, metropolis officers must discover a solution to shut a $1.7 billion gap within the common fund over the following two fiscal years attributed to the coronavirus disaster.

The mayor’s initiative isn’t supposed to be the top of ongoing deliberations over business-tax reform, neither is there any assure that the model of the measure she’ll introduce Tuesday might be what voters see in November. Somewhat, it is going to assist set the boundaries for what is going to possible be a frantic few months of debate with the Board of Supervisors to create a unified imaginative and prescient of business-tax reform that the town’s elected leaders can uniformly assist forward of the election.

“In a world the place we live with COVID-19 and its affect on our price range, we have now to be inventive and collaborative to do what’s finest for San Francisco,” Breed mentioned in a press release. “I look ahead to persevering with our work with the Board of Supervisors, the enterprise neighborhood, and all those that are centered on assembly the challenges our metropolis is dealing with.”

In an effort to show a good-faith dedication towards the negotiations, Breed will introduce one model her measure with the Board of Supervisors that may be debated and amended earlier than it’s finalized for the poll. Whereas Breed and the board agree on the broad contours of a plan for reform, they haven’t but agreed on how a lot to extend the gross receipts tax charge, which is predicated on an organization’s complete gross revenues, or how shortly to do it.

Each the mayor and the board agree a rise is critical, however Breed is aiming for a smaller, extra gradual enhance to cut back the pressures on companies already decimated by the pandemic. Supervisors wish to elevate charges extra shortly to herald as a lot cash as doable.

As a backup within the occasion discussions with the board fray or disintegrate, Breed can also be signing a second measure immediately onto the poll that might enact a number of reforms that replicate the place she, the enterprise neighborhood and the board are usually aligned. That model is not going to embody the proposed gross receipts tax enhance, which might progressively take impact because the economic system improves.

The board is predicted to submit its personal tax-reform proposal for the poll on Tuesday, which can possible embody the supervisors’ opening gambit across the tempo and measurement of the tax enhance.

“We’re proposing a balanced measure that gives aid to our small companies, leap begins our economic system, and prevents huge cuts to our crucial public providers by asking our most worthwhile firms to pay their fair proportion,” Board President Norman Yee mentioned in a press release. “There might be many discussions as we transfer this proposal forward and we’re dedicated to seeing a robust, unified measure for November’s poll.”

However either side say they’re optimistic {that a} deal will be reached in time to current a harmonized plan for reform in entrance of voters.

“I feel there’s huge settlement that negotiations will proceed and we hope to have a single proposal that everybody can get behind. I consider that’s very doable, that’s my objective for certain,” Supervisor Matt Haney mentioned.

4 components embedded in each variations of Breed’s measures replicate the areas of the broadest settlement between her administration and the board.

One factor of the proposal would unencumber the roughly $300 million in enterprise taxes that the town has collected however can’t be spent barring the result of two court docket circumstances. Professional-business and anti-tax teams have sued the town claiming officers illegally allowed a pair of 2018 poll measures to cross with easy majorities, moderately than two-thirds supermajorities.

Town gained each circumstances on the trial court docket stage, however each are being appealed. Whereas the taxes are nonetheless being collected, Metropolis Controller Ben Rosenfield has mentioned the town can’t spend the cash till the circumstances are absolutely resolved, which can possible take years.

To get round that blockade, Breed’s proposal would enable the town to begin utilizing the cash it’s already collected for homelessness and child-care packages underneath these beforehand authorised poll measures.

If the town loses its court docket circumstances, and people prior taxes are struck down, the town might use the brand new tax, which might change them, to pay for court-order refunds and to proceed funding the kid care and homelessness packages. If the town wins, it might start freely utilizing the 2018 taxes and the brand new taxes can be shelved.

The brand new taxes can be created together with the remainder of the provisions within the mayor’s proposal if the measure will get a easy majority of votes — however they might take impact provided that the town loses the court docket circumstances. There can be no clear standing for anybody to problem the brand new tax for the reason that cash can be deposited into the town’s common fund, and such taxes require solely a simple-majority vote.

Breed’s measure would additionally eliminate payroll tax for many companies, a metropolis objective practically a decade within the making. The measure would additionally develop the variety of enterprise topic to the town’s gross-receipts tax. If the measure passes, companies making $1.5 million or much less in gross receipts can be exempt from the tax.

Dominic Fracassa is a San Francisco Chronicle employees author. E mail: dfracassa@sfchronicle.com Twitter: @dominicfracassa