The City Council took up a resolution to endorse Measure T last night, September 17. The vote was Butt, Thurmond and McLaughlin voting yes; Bates, Marquez and Sandhu abstaining and Rogers voting no.

Rogers voted no because he wanted to add a policy that we reimburse any business the first $250,000 of taxes paid from any new tax, and we reimburse new businesses for any taxes they pay. His motion to amend died for lack of a second, probably because his suggestion was last-minute and difficult to understand,

Click here for full information about Measure T.

Bates, Marquez and Sandhu, part of the Chevron Five, have signaled their strategy on Measure T going into the election. In previous candidates’ forums as well as during discussion of the endorsement, they typically raise questions about it in public while stating they are neutral, and it should be decided by the people.

The principle objection raised by Bates, Marquez and Sandhu is that Measure T will adversely impact small businesses and discourage them from locating in Richmond. Interestingly enough, Bates, Marquez, Viramontes and Lopez all supported Measure T when it was on the ballot two years ago, but that was before they became so cozy with Chevron.

In fact, there has been no evidence that any small business in Richmond will be significantly affected by Measure T.

First of all. Measure T only affects manufacturing businesses, which constitute only 1%of Richmond businesses. Measure T defines a manufacturing business as:

“Manufacturing” means the activity of converting or conditioning tangible personal property by changing the form, composition, or quality of character of some existing material or materials, including natural resources, by procedures commonly regarded by the average person as manufacturing, compounding, processing or assembling, into a material or materials with a different form or use. Manufacturing includes any process of refining or processing hydrocarbons, petroleum or crude oil to produce products for use as fuels, lubricants, solvents, plastics, or other intermediate or final products. ”Materials used in manufacturing” means any and all materials used by a business engaged in manufacturing any part of which becomes a part of a product produced by the manufacturing business. With respect to any business which refines, distills, or otherwise manufacturers any product using hydrocarbons, petroleum or crude oil of any type, materials used in manufacturing includes all such materials used in such manufacturing process. For any taxable period, materials used in manufacturing does not include any materials acquired, stored or transported which are not actually subjected to the manufacturing process during the taxable period.

Opponents of Measure T have tried to represent that it will affect businesses such as restaurants and grocery stores, which is not accurate. The Individuals who have filed official arguments against Measure T (Click here) include:

• A Chevron lobbyist
• A scrap metal processor
• An insurance broker
• A hardware store owner
• Two bakers, one with sales of $12,000,000 and the other with sales of $250,000.
• A metal caster that uses 400 tons of metal a year

Four of the seven are not involved in a manufacturing business, but they are cozy with Chevron and the Chamber of Commerce – a Chevron surrogate. The businesses of the other three, which include bakeries with sales ranging from $250,000 to $12 million annually, would not be significantly affected. Neither would the metal casting company.

If you want to calculate the impact of Measure T on any manufacturing business, Click here for a spreadsheet. All you have to enter are the cost of raw materials and the number of employees. An individual business will have this information readily available.

If you are not involved in a business, but want to do an estimate, information can typically be found on line free at sites like http://www.manta.com.  

• For example, the cost of ingredients for a bakery is typically 15% - 30% of the total wholesale costs (http://www.researchwikis.com/Bakery_Products_Market_Research). It would be even less for a retail operation.
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• For the bakery with sales of $12 million and 135 employees, assuming a raw material cost of 22.5%, the net difference would be $84.50 a year – totally negligible.

• For the bakery with $250,000 in annual sales and three employees, there would be no increase in taxes.

• For the metal casting company which uses 400 tons a year of aluminum and bronze and has 20 employees, the raw material cost might be about $880,000. The net increase in taxes would be $862 a year – about $2.36 a day.

I invite any Richmond business that can prove it will be adversely affected by Measure T to contact me.