This freaking article. Seriously.
The last time the mayor of Cupertino walked into Apple – the largest company in his small Californian town and, it so happens, the most valuable company in the world – he hoped to have a meeting to talk about traffic congestion.
Barry Chang barely made it into the lobby when Apple’s security team surrounded and escorted him off the property.
“They said ‘you cannot come in, you’re not invited’. After that I left and have not gone back,” said an exasperated Chang, who’s been mayor since December 2015 and had approached the computing firm when he was serving on the city council three years ago.
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They claim the region is struggling with aging infrastructure and booming companies whose effective tax rate is often quite low.
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Meanwhile, the mayor of Cupertino plans to keep pushing Apple to contribute more to the town. Apple paid $9.2m in tax revenue to Cupertino in 2012to 2013, which was about 18% of the city’s general fund budget, according to an economic impact report.
This article is ridiculous. The title leads reader to believe that Apple is not paying taxes. Apple, one of a few thousand companies doing business in Cupertino isn’t paying taxes. Then, this victim-playing new mayor says he was escorted out of Apple HQ? Did he setup a meeting in advance? If I walk into Seagate and ask for a meeting with their CEO and say I’m not leaving until they give me one, they’re going to throw me out. Using his awful careless disrespect for the largest company in the world for a sob-story is lazy and just shows how awful this guy is.
Apple is responsible for paying for 18% of the city’s general fund budget in 2012/2013. According to this 2015 report, the general fund is 69% of the city’s expenditures. Apple is paying a lot as a single company. As Tim has stated many times, Apple pays the legally required taxes in every country they operate in. If Cupertino wants to raise more money, they can make it law and do that. More strikingly, Cupertino is a very wealthy city, far wealthier per household than San Francisco which has a 9.5% Sales Tax. Cupertino’s is only 6.5%. I think the first step is going to a 9% sales tax then asking Apple to pay more in taxes.
If you want to know just how strange all of this seems, watch this video from 2011 where Steve Jobs visits the Cupertino City Council to give his overview of a new Apple Campus. Gilbert Wong, Vice Mayor of Cupertino at the time is almost out of his seat with happiness and admiration of Steve. He acts very unprofessional when he speaks for everyone about how happy Cupertino is to have Apple and how excited they are about the new Apple Campus. The measure passes unanimously. Then, there’s the fact that Apple is mentioned 12 times in the 2013-14 Cupertino City Adopted budget and never was that council’s tone negative in that PDF. I saw this:
On June 11, 2013 City Council approved a budget of $2,412,573 for Current Planning. This represents an increase of $1,208,389 over the FY 2012-13 Amended Budget. The increase is attributed to Apple 2 Campus special project ($745,000) and Cost Allocation for city services, such as City Channel, Website, HR, City Manager, Finance, IT, etc. A new category appropriation for contingencies has been added this fiscal year. This category represents a reserve for each department that is equal to 10% of their operating budget, excluding employee compensation and benefits, Capital Outlays and Special Projects.
The City budget increased by 400K for Apple Campus 2 + 350K for other expenditures from 1.2 million to 2.4 million that year simply to build infrastructure to accommodate Apple Campus 2 (and 2-3 other projects). The city basically bent over backwards. Barry Chang, Cupertino’s current mayor wasn’t the mayor then. Looks like there’s a new sheriff in town who is taking his sob-story to the press since the current council (which includes Gilbert Wong as a council member) is stuck in the old way of thinking.
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My personal opinion is that Apple hasn’t done anything wrong. I blame the current mayor for complaining about the decisions his predecessor did to the press and I blame the Guardian for running with this story just because it’s about Apple. The journalist also brought up Apple’s federal and offshore holdings and their effective tax-rate. Why? That has nothing to do with a municipal issue in a small town in California. The mayor needs to schedule a meeting with the right people at Apple, discuss their struggles and work it out because that’s his job. This article never should have been written.
Update: The mayor has commented on the Guardian post – http://www.cupertino.org/index.aspx?page=26&recordid=1535&returnURL=%2findex.aspx