Next Steps for Supporting Small Business
Over the last three years, we’ve undergone significant efforts to improve how we support opening and operating a small business in San Francisco.
- We opened our new Permit Center, which brings all of the permitting agencies for small businesses (as well as for housing construction and special events) into one space to make it easier for our small business owners.
- We passed Prop H at the ballot, which set the foundation for cutting permitting time for many of our small businesses to under 30 days.
- We followed that with the Small Business Recovery Act, which extended many of those principles and provisions.
Each of these steps was made with the goal of changing how we as a City support and foster small businesses. Our business owners shouldn’t be spending their time navigating complex bureaucracies — they should be out building their business, hiring workers, and contributing to vibrant commercial corridors.
The good news is that we are seeing success from these reforms. For example:
- All Good Pizza in the Bayview, which was a food truck in a parking lot, is now in the process of getting permits to build a brick and motor store at the location. The owner Kristin Houk’s began the process pre-Prop H, and her plans were stuck in various departments. Post Prop H, her plans have moved faster due to concurrent review, and technical support from the small business permit specialists.
But there is more to do. That’s why we are launching a new effort that builds on Prop H and the Small Business Recovery Act, which will:
- Allow for more flexible uses for small businesses that want to open two kinds of services in one location;
- Remove bureaucratic barriers that cause delays and expose businesses to appeals;
- Eliminate restrictions that prevent us from filling vacant storefronts;
- Re-evaluate limits that prevent restaurants and bars from opening.
This will require legislation at the Board of Supervisors and support from all of our neighborhoods. People want us to fill empty storefronts faster and help grow our local economy.
Residents have overwhelming supported our small businesses and asked us to get rid of unnecessary bureaucratic barriers that make it hard to work with the City. That’s what we have been doing as we’ve implemented Prop H, and it’s we are doing with this new legislation.
Reforms: Prop H & Small Business Recovery Act
I authored the Save Our Small Business Act (Prop H) in 2020 and the voters approved it overwhelmingly. Prop H:
- Required to City to shorten the permitting process for small businesses to 30 days in many areas
- Relaxed zoning restrictions
- Allowed businesses to provide a more diverse mix of services without having to go through a lengthy permitting process
We followed Prop H by passing the Small Business Recovery Act in 2021, which extended these Prop H streamlining measures to more neighborhoods and created more flexibility for businesses to allow them to easily diversify their revenue and create a more resilient business.
Since Prop H began in January 2021, over 3,500 projects have benefitted from the program, which allows more small business projects to be processed over-the-counter and within a shorter timeframe.
Prop H made many improvements to the small business permitting process. Fewer projects are having to go through a Conditional Use Authorization process, which requires a hearing at the Planning Commission, which could take months to schedule. Business permits are getting approved more quickly. This is key: Small businesses are paying rent as they wait for permits, even if they aren’t open, so each day counts. Here’s an example of one improvement:
Before Prop H, if a business wanted to change uses like from a clothing store to a café, even if both types of businesses were permitted in a neighborhood, the change would still require, at a minimum, 30-day noticing period, be subject to appeal from a single neighbor, and it could not get their Planning Department approvals over the counter.
Today, nearly two thirds of businesses that are changing from one business type to another can receive their approval from the Planning Department within one day over the counter.
Next Steps in Our Streamlining Work
All of this is good progress, but we know there is more to do. Our small businesses need more flexibility and fewer barriers so they can get the doors of their business open.
That’s why I’m proposing legislation to build on the progress we have made through the Prop H and the Small Business Recovery Act. Key changes include:
- Permitting Flexible Retail in more parts of the City. Currently, only half of the City can benefit from Flexible Retail, where businesses can operate two types of businesses concurrently, such as having retail and a coffee shop together, and switch between six different uses without having to go back before the City for additional permit approvals.
- Allowing more businesses to open without going through the months long Conditional Use Authorization process by principally permitting more uses throughout the City, and reducing the ability for appeals to cause even longer delays.
- Removing restrictions against non-retail professional services on the ground floor, such as architectural or accounting offices, to provide more options in filling vacant commercial ground floor spaces.
- Re-evaluating limits on the number of restaurants or bars in certain commercial corridors.
So many restrictions have been put in place over the years, and this is contributing to empty storefronts in our neighborhoods. To just understand what we are undertaking here, the legislation we are pursuing will require over 100 changes to the Planning Code. Amending the legislation is incredibly complicated — you can only imagine what that means for a small business owner trying to figure out how to get through this process.
This is a challenging time for our small business owners. The global pandemic and shifts in consumer behavior have really changed the landscape and made it more difficult to survive. The City should not be a barrier to small business — we should be helping to foster it.
Key to all of these reforms is our Permit Center, which fully opened in July 2021 and is located at 49 South Van Ness. It houses all the relevant permitting Departments for small businesses, construction, and special events in one location to make it as easy as possible for our residents and business owners to work with the City. This includes 23 distinct service areas through the Planning Department, Department of Building Inspection, Department of Public Health, Department of Public Works, and others.
Since the start of this year, the Permit Center has served an average of 191 customers per day and provides on average 531 services daily.
Even with these improvements, we know that pulling permits can be complicated, especially for business owners who might be immigrants or going through this process for the first time. Our small business owners shouldn’t be required to hire someone else, like a permit expediter, to undergo this process. We are trying to make the process as easy and navigable as possible.
That’s why the Office of Small Business has Small Business Permit Specialists who are ready to support entrepreneurs through every step of the permitting process. Since this program was launched a year ago, these permit specialists have worked on over 870 cases, which includes guiding people through multi-agency processes at the Permit Center and following up to help them complete the process in the following days.
Who we are trying to help: New Thai Restaurant hed verythai
When Naruephone Wannajaro (who goes by Billie) came to San Francisco from Thailand, she knew she wanted to open up a restaurant, but she did not understand the process due to her limited English.
Prior to coming to San Francisco Billie and her partner owned four restaurants in Bangkok. During the pandemic their restaurants were shut down. That is when she and her partner decided to come to the United States. Before coming to San Francisco Billie went to New York, and Texas. She chose San Francisco because it is a very “foodie” city.
To navigate the process, Billie went to the Office of Small Business where she was supported by Small Business Case Managers and Permit Specialists. Billie is the recipient of First Year Free, and an expedited Permit from Prop H.
Thai restaurant, hed verythai, has been open for two months and is doing well.