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Cupertino mayor claims Apple shirking civic responsibilities
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May 5, 2016, 12:42 PM
 
Cupertino Mayor Barry Chang claims that he was once forcibly escorted out of Apple's headquarters and "surrounded" by a security team when he apparently dropped by spontaneously to seek a meeting about traffic congestion in the city three years ago, when he was a councilman. Now mayor of the city, Chang is getting a lot of heat -- including a recall effort from citizens -- over his seeming inability to fund the upgrade of the city's aging infrastructure, and in particular deal with the growing traffic problem.

Chang and some others believe the answer to the funding issues lies with extorting more money from the various tech companies that exist in the area, with the largest by far being Apple. Among Chang's proposals have been a resolution that would ask Apple for a $100 million gift to the city -- which only needed a single 'yes' vote in the city council to be adopted, but did not receive one -- and he is planning a new initiative that would propose a "business employer tax" that would charge any business in the city with more than 100 employees a $1,000 per head surcharge.

Chang has complained that "Apple is not willing to pay a dime. They're making profit, and they should share the responsibility for our city, but they won't. They abuse us," and claims that his proposals have been stymied because "Apple is such a big company here. The council members don't want to offend them. Apple talks to them, and they won't vote against Apple. This is the fact," but in making his statements neglected to mention that in fact, Apple pays at least $9.2 million to the city in taxes each year (that specific figure is from 2012-2013, the most recent filing publicly available), which makes up 18 percent of the city's entire budget.

Cupertino, with a population of 60,000, also has the hard drive maker Seagate Technology and photo app maker Polarr based there, along with a handful of other tech companies, but Apple is by far the largest, and is building a new second campus -- dubbed by many as "the spaceship" -- that will cost the company more than $5 billion and house some 12,000-15,000 workers, as well as generate yet more city taxes. While Chang's claim that the company's cultural importance as America's leading technology company intimidates city council members may have some merit, the citizens of the town apparently do not agree with the idea that Apple isn't paying its fair share.

A group called Cupertino Citizens for Sensible Growth has launched a recall effort against the mayor, saying he has "failed to fulfill his fiduciary duty to Cupertino citizens," and other groups have protested his ideas at city council meetings. Residents are frustrated by the increasing traffic and noise in the small town, and want either better and updated transit systems and roads, or for the city to slow the pace of development. Chang remains convinced that higher taxes on the wealthy and major employers in the area is the best solution for raising revenues.



"This American politics. This so-called democracy," he said, sneering at the efforts to recall him and the general unpopularity of his proposals. Members of the public have expressed their displeasure with Chang by crumpling up meeting agendas and throwing them at the council. "They ball up the paper and throw it, and they say 'You're making all the wrong decisions'," he said, "[But] I'm not going to back down."

"Raising taxes is not popular, but I'm not afraid," Chang added. "We are the center of technology, and our public transit system is old and embarrassing -- and the politicians have no backbone. They get scared." In addition to being the mayor, Chang is currently running for a seat on the California state assembly. "You're helping create the problems, so you have to help solve the problem," he said of Apple. "Look at the system we have here: the rich people get more richer and the poor cannot survive. Where's the fairness? Nowhere."

Chang has attempted to organize protests outside Apple over what he sees as the company underfunding the city it relies on. Thus far -- because of Apple's "pretty good image," he says -- he has been unable to get anyone to join him in the idea.
     
prl99
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May 5, 2016, 01:10 PM
 
This is the same as the EU. Apple is documented as paying a ton of taxes yet the mayor wants even more. Maybe it's time to look at the way he's spending the money he gets and see if there's a better way to spend it instead of simply "extorting" money from Apple, which is always the easy way out of problems.
     
DrSkywalker
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May 5, 2016, 01:14 PM
 
Increasing taxes and going after corporations is a very easy tonic sought by dim-witted politicians who lack creativity and insight.
     
Inkling
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May 5, 2016, 01:45 PM
 
Quote: "In fact, Apple pays at least $9.2 million to the city in taxes each year." Numbers will make clear exactly what's happening. The company's net profit last year was $53.4 billion. Note that's profit not income. Dealing with so many zeros isn't easy, but as best I can tell that means that Apple is paying 0.02% of its profits to the city that provides the resources for its global headquarters and a host of services, including schools, highways and police protection, for its employees. That's comparable to a company that made a $1 million profit last year paying but $200 in local taxes. What's startling about those figures is just how little Apple pays Cupertino. No wonder, the city is hurting for money. No wonder its traffic flow is a mess. No wonder the mayor wants change. What is difficult to explain is why anyone defends Apple's MacScrooge attitude toward its community.
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David Esrati
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May 5, 2016, 01:58 PM
 
In Ohio- in the midst of the rust belt, local municipalities charge an income tax and that's been the main way to survive state cuts (thanks John Kasich).
It puts communities in bidding wars to attract employers- but, with a 2.25% local income tax, on top of the State and Federal income taxes- one major employer, CareSource (a private health insurer that works entirely with federal dollars that are targeted to the poor) kicks back a ton in income tax- esp since the CEO makes $3.2 mil.
Without their growth fueled by Obama Care- Dayton would be in the same boat as Detroit. In fact- the whole strategy now for "economic development" is "Meds, Eds and Feds" all of which don't pay property taxes.
This Mayor isn't too far off-
And Apple should be ashamed. They can afford to help Cupertino out. Quality of life is an important part of a city's vitality and viability.
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bobolicious
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May 5, 2016, 02:27 PM
 
...perhaps there's an app for that... ie telecommuting...?

Even with electric vehicles, is an increasing expectation of mobility at least partially at cause for traffic woes, not to mention the 'quality of life' in the air shared by all...?
     
Mike Wuerthele
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May 5, 2016, 02:53 PM
 
Apple is paying what's required by law. If the politicians want more, then they should fix the laws.

Easy as that.
     
DiabloConQueso
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May 5, 2016, 04:18 PM
 
Note that this has nothing to do with "offshore tax avoidance" or anything of the sort.

This doesn't even have anything to do with California state taxes, either.

This is completely about municipal taxes (like property taxes, garbage collection taxes, waste water taxes, et al). Apple pays the precise amount of municipal taxes that the municipality demands they pay down to the cent, and no more or less. If this dipstick mayor thinks Apple is paying too little in municipal taxes, it's because his dipstick municipal taxation office approved it.
     
coffeetime
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May 5, 2016, 05:16 PM
 
Isn't Apple is going to build mono-rail train system for employees for the new campus? That will help reduce the traffic.
     
hdfonts
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May 10, 2016, 10:13 AM
 
Rule of thumb: You don't just "drop" by Apple to just chat about the traffic. With all of the intellectual property at Apple's Cupertino campus, EXPECT to be surrounded by security guards and escorted off the property whether you're the mayor or not. Phone ahead.
     
Steve Wilkinson
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May 10, 2016, 11:12 AM
 
He's probably pretty sure that after building the 'spaceship' they won't relocate to Texas. Shakedown time.
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Steve Wilkinson
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May 10, 2016, 11:16 AM
 
Originally Posted by Mike Wuerthele View Post
Apple is paying what's required by law. If the politicians want more, then they should fix the laws.
Easy as that.
Except they won't because they've been bought off by corporate interests and lobbying.

So, it's easier to just try and pick some popular companies in the public eye and try extortion tactics.
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