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This November, Redwood City voters will decide on Measure BB, a plan to revamp the city’s outdated business license tax. Here’s the breakdown of what it could mean for businesses and the community.
What’s Measure BB
The current tax system charges businesses a flat base rate of $86 plus $57 per employee, regardless of business size. This system disproportionately impacts small businesses, who end up paying more per employee than larger companies. Measure BB aims to fix that by updating the base tax to $90 and adjusting employee taxes based on business size and type—small retailers would pay less, while larger businesses, or especially professional services, would pay more.
The new tax structure is expected to generate $7 million annually for the city’s general fund, helping to maintain services like street repairs, emergency response, and public safety. Think firefighters, police patrols and paramedics.
What’s the Upside
Small businesses would benefit from lower taxes, while the new revenue would help fund essential city services. Affordable housing and childcare providers would be exempt from the tax altogether, offering further community support.
What’s the downside
Large businesses would see a significant tax increase, which could lead to job cuts or even cause some companies to relocate. Commercial landlords might pass their higher taxes onto tenants, potentially raising rents for small businesses. There’s also concern that the city could lose its competitive edge if neighboring cities offer lower taxes.
Bottom Line
Measure BB seems to make Redwood City’s tax system fairer, with larger businesses paying more to support city services. But it comes with risks, especially for large businesses. Voters will need to weigh the benefits of more funding for essential services against the potential economic impact. There is an argument in favor of Measure BB on the ballot, but no argument against Measure BB on the ballot.
50%+1 voter approval is needed to pass this measure.
Here’s the Ballot text:
Shall the measure to maintain local city services, such as: maintaining 911 emergency response/neighborhood police patrols; fixing potholes, repairing streets/sidewalks; maintaining on-duty firefighters/paramedics; and storm drains to prevent flooding; by modernizing the City of Redwood City business license tax base, and per employee rates between $10 and $250, with the highest fee on larger businesses, for general government use, as described in the ordinance, providing approximately $7,000,000 annually, until ended by voters, be adopted?
YES OR NO
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