S.F. Overpaid CEO Act fails, a big setback for unions at City Hall

A union-backed San Francisco ballot measure that would have raised taxes on big businesses to bolster funding for cash-strapped city services has failed.

Proposition D, known by its supporters as the Overpaid CEO Act, was rejected by 53.6% of voters as of the latest tally Monday. The gap between yes and no votes narrowed slightly after election day, but the measure no longer has a path to succeed, even though more ballots are left to count.

Prop D would have raised a city tax on large companies with CEOs who earn more than 100 times the median pay of their workers. The measure would have also adjusted the way the tax is calculated so it was based on the compensation of all the affected businesses' employees, not just those in San Francisco.

The defeat is a major loss for unions representing city staff who championed Prop D, hoping to bring more revenue to City Hall to alleviate massive deficits worsened by federal funding cuts from the Trump Administration. The measure was estimated to generate as much as $300 million per year - about half the size of the city's current budget shortfall.

But opponents of Prop D, including Mayor Daniel Lurie and the Chamber of Commerce, warned that it could backfire by causing grocery stores, pharmacies and other big companies to either raise prices or further reduce their presence in San Francisco. Those arguments were strengthened by a report from the city's chief economist that said Prop D could, over 20 years, leave San Francisco with 944 fewer jobs on average and cut gross domestic product by $206 million.

Big businesses and wealthy donors opposed to the measure raised about $6.6 million to defeat it, while supporters pulled in about half that amount.

"The election result demonstrates that a strong majority of voters are willing to support policies that strengthen San Francisco's future," Rodney Fong, the chamber's CEO, said in a statement. "We have defeated Prop D thanks to voters who have watched the city recover and are not interested in gambling on the progress we've made."

Fong thanked Lurie for "leading the charge" against the measure.

Scott Mann, a spokesperson for the Yes on D campaign, said in a statement Monday that Lurie had sided with "billionaires and corporations who received massive tax cuts from the Trump administration" instead of promoting the "best interest" of the city. Now, San Francisco still faces ongoing budget shortfalls without a clear way to fix them, Mann said.

"The cuts that follow will fall hardest on the people who can least afford it - the patients who depend on our public hospitals, the families who rely on city services and the workers who make this city run," Mann said. "But working families haven't given up on San Francisco and we will continue to fight every day to protect the city we love and all who call it home."

The chamber put forward a competing measure, Proposition C, that would have made more modest changes to the same tax targeted by Prop D and expanded tax relief to more small businesses. Lurie also came out against Prop C, calling the dueling tax fight evidence of a "broken system" that benefited only political insiders.

Prop C failed as well, with about 65.9% of the vote as of Monday.

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This story was originally published June 8, 2026 at 7:04 PM.