Report: Twitter CEO Jack Dorsey Wants to Leave San Francisco Despite Receiving Tax Breaks to Stay

A recent report states that as San Francisco nears a vote limiting new office space construction, tech firms such as Twitter may abandon the city despite receiving tax breaks to operate in the city.

A recent report from BuzzFeed News alleges that nine years after Twitter was given a controversial tax break to operate in San Francisco, the social media firm is expanding outside of the city. CEO Jack Dorsey stated on an earnings call: “Our concentration in San Francisco is not serving us any longer and we will strive to be a far more distributed workforce. We have to build a company that’s not entirely dependent on San Francisco.”

San Francisco Supervisor Aaron Peskin, who has regularly criticized the tech industry, commented on the statement from Dorsey saying: “Sounds like something Jack would say. Apparently, the only thing serving Twitter anymore is Donald Trump.”

BuzzFeed News reports:

As the city’s politics lurch leftward — unlike when the tax passed, Peskin’s faction now controls of the Board of Supervisors and the city will vote on a proposition limiting new office space construction in March — Twitter, which took tens of millions in tax incentives throughout the decade, is planning to spread its workforce across the globe. In recent years, the centrist policies championed by former mayors like Ed Lee have given way to an anti-corporate wave, including the election of a democratic socialist to the board in 2019, mirroring a change in the national Democratic party.

After the tax break expired as planned last May, there was little appetite in San Francisco to renew it. San Francisco voters also approved a ballot measure in 2018 that required companies with more than $50 million in annual revenue to pay an additional tax to help people who are homeless. Dorsey opposed the measure, saying it treated companies like Dorsey’s company Square unfairly compared to ones like Salesforce, whose CEO Marc Benioff backed it, and Square later sued the city over its tax bill.

Critics of Twitter’s tax break saw Dorsey’s comments on Thursday as a validation of their skepticism. “I’m not surprised to hear that they’re not really prioritizing their presence in San Francisco,” David Campos, a former San Francisco supervisor who voted against the tax break when he was on the board in 2011, told BuzzFeed News. “I’m not surprised that they essentially benefited from a very generous tax policy by city government, only to turn around and say San Francisco is not a priority for us. Unfortunately, it’s what many of us suspected.”

San Francisco’s Chief Economist, Ted Egan, stated that Dorsey’s comments about the expansion of Twitter outside of San Francisco were concerning: “It reinforces the fact that the city’s had a challenge in keeping large companies in the city as they grow,” Egan stated. He added that due to skyrocketing property costs in San Francisco, the move is not entirely surprising: “It’s not unexpected that a major tech company would choose to have a distributed workforce or grow globally, particularly when the cost of living differences between San Francisco and many other places are continuing to widen.”

Twitter has not entirely abandoned the city though, the company told BuzzFeed News in a statement: “San Francisco will be where the majority of our employees will be based for the foreseeable future. There’s incredible talent around the world and we have to be able to work in a way that supports them as employees regardless of where they live, especially when they want to build careers in their own communities.”