San Bruno council directs staff to pursue business-license overhaul, consider rescinding 1977 height limit and send fireworks to voters

San Bruno's City Council on June 23 moved its most consequential fiscal choices for 2026 toward the voters. After staff briefings and public comment, the council directed staff to prepare a variable gross-receipts business license tax (a tiered model) for placement on the November ballot, voted to place a measure rescinding Ordinance 1284 (the 1977 height-and-density voter-approval rule) on the ballot, and agreed to let San Bruno voters decide whether the city should continue allowing sale and use of "safe and sane" fireworks.

Council members emphasized that the business-license overhaul is intended to fix what staff described as a regressive local structure in which larger firms pay a lower effective share. HDL's study manager Ian Davis presented two models: a simple flat gross-receipts rate (roughly $1 per $1,000 in gross receipts, estimated to raise about $3.7 million annually) and a tiered model that targets higher rates at certain business types and could raise substantially more. After questions about competitiveness and administration, the council asked staff to work with HDL to refine a tiered (variable) model for formal ballot language. Assistant City Manager framed the business-license option as a simple-majority measure, while the commercial parcel tax alternative would require a two-thirds vote.

On land-use policy, Planning and Community Development staff summarized how state housing laws in recent years (accessory dwelling unit rules, state density-bonus provisions and SB 79 near transit stations) have eroded parts of Ordinance 1284, allowing some housing projects to exceed local limits without a voter referendum. Staff said the ordinance currently blocks some commercial and revenue-generating projects while state law often lets affordable housing projects proceed. The council voted to ask staff to return with a ballot measure to rescind (or modify) 1284 so voters can decide whether to restore local discretion over non-housing development.

On fireworks, staff reminded the council that San Bruno's safe-and-sane program was approved by voters in 2005 and implemented by ordinance in 2008. Staff noted a 2024 cap on permittee cost-recovery and said the number of permittees has fallen in recent years. During public comment, veterans groups, sports leagues and nonprofit vendors warned a ban would eliminate important local fundraising; other speakers urged allowing voters to reconsider the policy for public-safety and animal-welfare reasons. The council directed staff to prepare ballot language enabling voters to decide whether the city should continue permitting safe-and-sane fireworks.

The council adopted its FY 2026-27 operating budget and capital improvement program in the regular meeting that followed. Staff presented a citywide spending plan of about $329 million across funds and a general fund operating plan of $75.2 million. To balance the general fund, staff identified $2.45 million in reductions, including the removal of eight vacant positions and periodic reallocations to special funds. Staff also warned of approximately $20 million of state-imposed revenue risk tied to vehicle-license-fee formulas, the state's tax-share adjustments, excess ERAF and new constraints on the card-room taxes. Public-works projects in the CIP include an estimated $6.6 million for paving, sidewalk trip-hazard mitigation, Bel Air/Lions Field planning and $3.7 million earmarked for a senior-center renovation.

What happens next: staff will return with refined ballot language and timelines in July; county ballot deadlines make decisions time-sensitive. The council also requested additional follow-up work on the business-license model, further polling and outreach on revenue items, and a staff report about community-benefit funds and equipment-replacement reserves.

Quotes: Council members spoke broadly in favor of placing options before voters. "We should put something on the ballot," Councilmember Hamilton said in the study session about 1284. HDL's Ian Davis summarized options: "A flat gross receipts tax is simple and easy to understand; a tiered model raises more revenue but is more complex." Assistant to the city manager Brian Adams cautioned that even with a sale ban, the city would continue enforcement of illegal fireworks and debris cleanup.

The council's next steps include staff returning in July with specific ballot questions and cost estimates; the final deadline to submit measures to the county is early August.