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KCBS Cover Story: Healthy SF Law Creating Enforcement Battle Lines

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DougSovern20100908_KCBS_0208r Doug Sovern
Doug began his career as a copy boy at the New York Times, and then...
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CBS SF Bay (con't)

Affordable Care Act Updates: CBSSanFrancisco.com/ACA

Health News & Information: CBSSanFrancisco.com/Health

SAN FRANCISCO (KCBS) – Sour grapes are growing between San Francisco City Hall and restaurateurs over what critics say is a confusing and badly written law.

Healthy San Francisco is a first-of-its-kind law requiring most businesses in the City to contribute a certain amount towards their workers’ healthcare; either by paying for their insurance, reimbursing their medical expenses, or paying into a special City fund that lets the workers go to a public clinic.

“The law is very difficult to understand and follow, with little support from the City,” suggested Brad Levy, chef and owner of Firefly, a popular restaurant in San Francisco’s Noe Valley neighborhood.

Restaurants seem to be finding the new law onerous. The Golden Gate Restaurant Association fought it in court, and lost. About 5% of the City’s restaurants subsequently added surcharges to their menus, telling customers they must pay extra to cover the cost of complying with the law.

Initially, Levy resisted the surcharge approach. Ultimately, though, he added it and ultimately found his restaurant on a list of 93 that took in more than they spent on workers’ health care. That list was released by the Office of Labor Standards Enforcement.

Download: SF Restaurants Which Collected More Healthcare Fees Than Paid Out (.xls)

“It implied that restaurants were pocketing this money, if it didn’t outright say that,” lamented Levy.

“I felt ripped off and lied to,” responded one outraged San Francisco diner.

The City Attorney’s office eventually cleared Firefly of any wrongdoing. But, tough enforcement was expected to continue.

“There is no dispute and no confusion with respect to what a restaurant’s responsibilities are when it advertises to its customers a surcharge,” explained City Attorney Dennis Herrera. “If you say we’re going to use that to pay for Health San Francisco, you need to do it.”

Of course, not all restaurants had added surcharges to begin with. Some took a different approach when the law went into effect.

“We don’t have any surcharge,” explained Gerald Hirigoyen, owner of Piperade. “I had to raise my prices, so that’s what I did.”

“It’s a tough thing to do, for us. It is difficult to pay but at the end of the day, I feel good about myself,” he said.

Wednesday: In Part 2 of Doug Sovern’s KCBS Cover Story series, he’ll report on how and why Firefly was taken off the list of violating restaurants; plus what the law’s authors have to say. Airing at 6:20 a.m., 8:30 a.m., 12:20 p.m., 4:20 p.m. and 9:20 p.m. on 740 AM & 106.9 FM.

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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