San Francisco Homeowners Lose $260B in Value
hoover.org
hoover.org
I'm not a SF resident, and have no particular loyalty to it (or any particular interest in defending its municipal policies). But the author (and publication at large) seem to be interested primarily in gleeful portrayals of SF's collapse, with factuality as a distant concern.
[1]: https://news.ycombinator.com/item?id=35857223
[2]: https://www.businessinsider.com/san-francisco-poop-patrol-em...
So it seems to me that the "pooper scoopers" combined salary+benefits of $184k really is, in fact, extraordinarily high.
(No comment on the rest of the article.)
[1] https://www.businessinsider.com/weath-maps-cities-san-franci...
[2] https://www.census.gov/content/dam/Census/library/publicatio... (I took the nationwide ratio of "$71k median household income" to "$56k median individual full-time year-round worker income" and estimated that the same ratio also applied to SF.)
> There are tens of thousands of mothers, fathers, brothers, sisters, sons, and daughters of San Francisco drug addicts who likely feel the same way as Berlinn [mother of an addict who disagrees with SF drug policies]. They should be heard, and new policies should be implemented to get drug use off the streets, provide support for those struggling with addiction, and return functionality to a city that lost its bearings so many years ago.
I mean as a frustrated hippie idealist SF native hypocrite I think I totally agree... but thats just like, you know, your opinion man?
Given this difference, it seems like it would be misleading not to quote total compensation.
We can have a conversation about pensions and retirement funding if you'd like, but that isn't mentioned anywhere in the article. Instead, the article moves to imply that city employees are lining their pockets, when they aren't.
This isn't how pensions or civil retirement plans work. Contributions during an individual's career result in predictable and proportional fractional payouts after retirement or leaving the civil system.
Again: the implication is that civil servants are somehow making out like bandits here, when 71k take-home is well below the average SF salary[1].
Edit: And to tie a knot around it: no tech job I'm aware of includes the "market" value of their insurance plan or matching schemes in their TC numbers. These would be closer analogues for what's happening here.
[1]: https://www.ziprecruiter.com/Salaries/-in-San-Francisco,CA
I see. So why shouldn’t it be considered a part of total compensation?
The rest of the benefits not being included in TC I agree with.
You're right that pension benefits can be reasonably included in a TC calculation; I'd still argue that the article's framing is meant to imply that TC here reflects a larger take-home than it actually does, as well as malfeasance on SF's part (rather than ordinary and boring funding obligations).
This makes comparing a pension to equity, or even a 401(k), problematic in respects. A pension is an annuity, and should be calculated as such.
Most people have to save for their retirement, and hope to have enough money to pay for healthcare and living expenses until their final days.
City employees have no such need and don't suffer such uncertainty.
They can retire at 65 and, no matter how long they live, never have to worry about healthcare or living costs.
For a public employer like the SF, both are at least partially just migrated spreadsheet cells. Neither is directly realizable by the employee, and quoting them in a take-home number only serves to imply otherwise.
Edit: I've realized I've conflated TC and take-home with my second comment in this sub-thread (but not the original comment). You can consider things like pension funding part of TC in a meaningful sense; the larger point about the article's editorialization still stands (since pension funding doesn't change annual take-home numbers).
I'm not aware of any ordinary scenario in which estimated insurance or pension funding obligations are included in compensation figures.
They either do some specific % 401(k) match, or they don't. In either case, the % is known and you factor it in as part of your total compensation when you compare employers.
For most private employers, the % they will contribute to your pension is zero or a single digit percentage.
Neither is directly realizable by the employee
If any of those funds are being used to fill prior unfunded obligations then they will not be realized by the employee after retirement, but by other civil service retirees. It's typical that the employer will post a single defined percent of salary toward the pension fund for all employees, not a varying percent depending on the expected funding status of each individual employee. This means that if a pension plan isn't fully funded the employer needs to increase this percent for every employee even though the top-up funds are really only going to backstop the pensions of previously hired employees. Yet this top-up percent will be calculated as part of the total "compensation" for the more newly hired employees.
At least I am assuming this is how it works given how the pension works at my employer.
At least for the next few years they're unlikely to pay less than is necessary per employee (and in fact pay much more than is necessary). In my job the employer contribution to the pension is about 14% (with the employee contribution about 7% - 9% depending on pension tier), which is making up for a period of time in the late 90s when the contribution was low single digits (IIRC). We're unlikely to see those underfundingly low contribution rates anytime soon.
A pension is an annuity, and should be calculated like annuities when determining the benefit received on a per-employee basis.
It doesn't count in annual take-home. The original article implies (through singling out) that these "poop patrol" employees are somehow being disproportionately enriched, when the reality is that their take-home is ordinary for civil servants in SF (and below the city's average take-home).
Being below the average take-home makes sense, in turn, given that the position is pensioned. But the article makes this staid arrangement sound like graft.
Thank you, this is very important information. I believe that for my job a lot of the money being put into the pension on "my" behalf is to cover unfunded obligations taken out for other people long before I had this job. So these payments aren't for my benefit, but for the average benefit of the entire pension fund.
> In 2018, the city created a pooper scooper team, each member of which received annual compensation of about $211,000 that year.
The implication of a $211K salary sounds too ridiculous to be true. And instead of assuming that it is therefore false, people freak out. If you look up an actual article from the time [1], you'll see that the claim is already not true purely by the numbers:
> workers make more than $184,000 a year in salary and benefits
And if you dig in further you'll see that "and benefits" is a huge caveat:
> Employees of San Francisco's "Poop Patrol" are set to earn $71,760 a year, plus an additional $112,918 in benefits, such as healthcare and retirement savings, the San Francisco Chronicle reported.
That $112K in benefits includes health care benefits (which are mandated for city workers, which is a good thing). And health care—if you've been paying attention—is completely fucked in the US, so any attempt at pricing it is going to sound ridiculous. The workers don't actually see any of that money.
If you take the $72K in salary, you'll see that it is below average for San Francisco:
> On average, a San Francisco resident earns about $96,677 a year, nearly double the median household income in the US.
And "below average" is what you'd probably assume a sanitation worker makes. So a huge amount of outrage over nothing.
Which would personally lead me to flag this story, rather than trust any of the other numbers its quoting.
[1]: https://www.businessinsider.com/san-francisco-poop-patrol-em...
I needed to read this to convince myself that I’m not asking for or expecting outrageous compensation at work.
"As members of the city's "Poop Patrol," workers are entitled to $71,760 a year, plus an additional $112,918 in benefits, such as healthcare and retirement savings, the San Francisco Chronicle reported." (https://www.businessinsider.com/san-francisco-poop-patrol-em...)
Want to reduce that cost further? Nationalize health care and increase social security.
In general, government jobs have even better insurance and retirement benefits than a "regular" job. CALPRS requires retirement contributions in the neighborhood of 30% of salary
Among benefits I think only pensions are averaged across all employees in this way. Even health care insurance varies based on which of the insurance options an individual employee picks. And payroll taxes (social security, at least) cap out somewhere in the low 6 figures.
Budgeting rules may also require that they allocate enough for each employee in case they all have families of 4 or larger when in fact many will have only one or two people in their household.
Even though the amount over the salary was called "mandated benefits," it likely also includes non-benefit costs like payroll taxes.
Even so, budgeting over 100% for non-salary costs per-employee is hard for me to get my head around; a bad pension situation seems like the most plausible expanation (or the original reporting [0] was wrong, they didn't show their work).
[0] https://www.sfchronicle.com/bayarea/matier-ross/article/Bree...
Many tech roles total cost is more than 1.5x-2x their salaries.
What tech roles provide defined benefit pension schemes?
(After many years of running, the bot seems broken. Not sure if I’ll fix it this time.)
Where do i sign up for £170k a year?
> In 2018, the city created a pooper scooper team, each member of which received annual compensation of about $211,000 that year. Given the inflation that has occurred since that time, scooper compensation may be close to $250,000 per year today.
> As members of the city's "Poop Patrol," workers are entitled to $71,760 a year, plus an additional $112,918 in benefits, such as healthcare and retirement savings, the San Francisco Chronicle reported.
> In August, the city announced that five staffers from the San Francisco Department of Public Works would soon roam the Tenderloin neighborhood — where nearly half of the city's homeless population is — in search of waste. The staffers will begin their efforts each afternoon equipped with a steam cleaner for sanitizing the streets
There is a concentrated effort to make CA, and especially SF, fail, as an excuse to regress. And when SF (and NYC, where there's also a similar effort) regress, the rest will follow. Just see what happened with the DA recall: since then, crime has risen, spend on policing has risen, and we jail more people unnecessarily.
Edit: ha! While I posted that, someone indeed found that number isn't the real comp. The number is $71k.
its not that complicated
It's interesting to note which jobs get this treatment ("is X doing its job? The problem X supposedly solves isn't getting any better) and which jobs get the opposite treatment ("X is clearly necessary, because without them the problem X solves would be even worse).
Its more obvious with something tangible. If I give you a $100 bill, and then you drop it down a drain, have you lost it? Of course you have.
The same is true for the value of assets though. You had the opportunity to cash it in by selling, you could have secured a loan against the value, you had the status of the wealth of owning a more expensive home. Those things have real implications on your life, and now you don't have them. It doesn't really matter that it's not actual cash.
You also lose at least 5-6% of the value of real estate every time you buy or sell. So given that buying/selling real estate is complicated and expensive, and moving is complicated and expensive, for the vast majority of people, the value of the house going up and down _in the short term_ is mostly irrelevant.
I rent a home there that fluctuates between 7 million and 5 million over the course of the pandemic and I watched a neighbor poor over 100! Million into a house when he thought things were only going up.
That being said most people here don’t ever sell really. You just hold and buy another home someplace else. It’s a funny place.
So the loses are not real until they are realized. That being said I don’t think the city is headed in a positive direction anytime in the next 5 years.
He then extrapolates a median price change on the entire market to calculate the “$260B” change in asset valuations. That is dubious at best for a monthly volume of ~500 sales…
But it is the most impressive home in San Francisco. Right across from the Lyon steps. You can’t miss it. The only one that you have to crane your neck to see all 5+ stories of it.
I'm also not sure how this accounts for changes in income, as in maybe the people leaving are simply more senior than those coming in, amd this could be a normalish situation? E.g., if there's some normal increase in income levels of people staying in the city and then some portion of very well compensated people leaving, there could be an equilibrium.
The missing piece then is the change in income for people that didn't move.
Great for cash buyers...
Look at sales, yes, they have slowed, but demand is still incredibly high. My primary residence is in a rural county north of Truckee/Tahoe - housing prices in the last 7 years have doubled or more (wide area, wide variation), truckee/tahoe way worse.
I don't see the argument even if you extend it beyond the city. Santa Cruz - houses picked up for $1m or more turned into student ghettos pulling in $5-7k/mo in rent. (my other neighborhood).
260b is a load of bs.
The more people move into an area, the more demand there is for that land, so the more its price increases. The only reason you'd expect the price to decrease would be because people don't want to move there anymore because of new areas that are more desirable or something negatively impacts the desirability of the area.
It's also highly dubious that any land in SF can be considered higher value due to the rampant crime issues. I really don't understand how anyone would want to buy a home or live in one where there a daily risk to waking up to a home invasion, your car being pilfered through, literal human shit on your doorstep, etc. All in a place where cost of living is 2-3x higher than nearly every other part of the country. It's laughable.
Also as a little story about how crime infested SF is, a couple years ago my wife accidentally left her key ring in the lock on our front door (which included car keys to a car right out front), where they stayed for the next ~18 hours, right in obvious public view from the street, until we noticed the next morning. And lo and behold the crime was so bad that the keys were right there the next morning and we had a nice laugh about it.
San Francisco has issues, the main one being it has become too popular with a certain set of TC chasers and chasing out any cultural doversity (sorry desi/indian culture isn't one of those). We've lost blues venues, drag venues many others because of the BS TC uber alles from a certain segment of the tech crowd prior to covid. That same group is panties in a bunch to return to office because of whatever. You have one or the other, not both.
And, this will get me down voted, but fuck the indian community TC chasers (biggest part of the comnunity, but there are others) for ruining the bay area. I hear it from friend from SF to Morgan Hill.
The guys I worked with 20 years ago were different. It was about building things and helping others, not stomping on people to make your next move.
1b1b, 750sqft
Lake Tahoe, the ski resort. Ahem.
redfin says I'm down 30% at least
debating whether to cut my losses - with tech companies gone, mass transit on the brink, and the city in a tailspin, I have this nightmare scenario in my head where prices end up 1/10th of what I paid
at the time soma was selling for as much or more than premium neighborhoods. lesson learned. Now those areas have actually appreciated
There's no way to reverse printing 13 trillion dollars in corona stimulus.. the damage has been done.