Update, 5 p.m. Tuesday: The San Francisco Board of Supervisors has voted unanimously to approve a special downtown tax district meant to support transportation infrastructure projects.
The Transbay Transit Community Facilities District is designed to collect a levy from developers of high-rise projects surrounding the new Transbay Terminal. The funds collected would help pay for the terminal itself and other projects, including extending Caltrain from its current South of Market location to downtown.
The developers agreed to the district and special levy two years ago and got city concessions in return, including permits to exceed the city's building-height limit in the Transbay Terminal neighborhood, centered at First and Mission streets.
But earlier this month, developers said the special levy is excessive and threatened to sue the city. That led to an unsuccessful effort to broker a deal that would modify the tax payment schedule for the developers.
Before Tuesday's vote, Supervisor Scott Wiener called the potential lawsuit "weak" and added, "I don’t think we should be bullied into giving up a huge amount of critical transit money because a group of developers don’t want to fulfill their obligation under this massive upzoning that the city did for these properties.”