Silicon Valley leaders discuss how federal cuts will hurt region

Santa Clara County officials want their largest city’s support in hiking sales taxes to keep their public hospital system alive against federal cuts. But San Jose leaders have conditions.

Congressman and former San Jose Mayor Sam Liccardo suggested the city could tie its support for the sales tax measure — now known as “Measure A” — to securing more county dollars toward homeless services in San Jose’s interim shelters. While some local and federal leaders from Silicon Valley have rushed to support the tax measure, San Jose Mayor Matt Mahan has signaled doubt on the county’s proposed five-eighths cent increase that’s been fast tracked for the Nov. 4 special election ballot.

Liccardo — speaking to reporters Saturday outside a county town hall meeting that convened virtually all of Silicon Valley’s lawmakers on the impact of H.R. 1— said he didn’t want to speak for anyone in the negotiations because he wasn’t directly privy. But he said he expects homelessness spending to be a focus of San Jose’s support for the ballot measure.

“I know currently the city and county are in negotiations to talk about a spending plan with that legislation,” Liccardo said. “There are county services which are exclusively provided from dollars in the state and federal government that go exclusively to the county. Everything from drug treatment to mental health to case workers. The use of those dollars to help our unhoused in interim shelters is really critical. I know that is part of the discussion.”

Mahan, a centrist mayor with a more conservative political base, has long been at odds with the progressive Board of Supervisors – dismissing the county’s public health care investments while arguing the county doesn’t do enough to help San Jose resolve its homeless population problem.

Mahan was absent from the town hall — hosted by District 2 Supervisor Betty Duong — which tackled the impacts of federal spending cuts under H.R. 1, also known as President Donald Trump’s “big beautiful bill.” County leaders warn the bill’s $1.5 billion in local revenue losses will hobble the public hospital system and other critical social safety net services.

The entire board of supervisors attended the meeting, except for District 5 Supervisor Margaret Abe-Koga. Congressmembers Liccardo and Zoe Lofgren, as well as state Assemblymembers Ash Kalra, Patrick Ahrens and Gail Pellerin and state Sen. Aisha Wahab also attended.

Lofgren signaled her support for the county tax measure, emphasizing how defunding Planned Parenthood and cuts to the Affordable Care Act will drive more people toward being uninsured and relying on the county hospital system.

“I don’t think a sales tax increase is a great choice — I do think it’s a better choice than closing emergency rooms,” she said at the meeting.

Santa Clara County runs two of the region’s three trauma centers and the only regional burn center of its kind in the Bay Area. The county hospital system is Silicon Valley’s largest and most accessible health care provider and the only option for working-class and uninsured patients. One in four of the county’s nearly 2 million residents are Medi-Cal enrollees. Half of county hospital patients pay through Medi-Cal. The rest pay through a mix of other means and Medicare, a separate federal program serving patients 65 and older and patients of all ages with certain disabilities.

Three of the county’s four hospitals are located in San Jose, including the county’s level I and II trauma centers.

Lofgren said more than 300,000 people in her district rely on Medi-Cal.

“So do children and seniors, and they will lose that benefit,” Lofgren said, adding Trump’s bill will end up raising Covered California premiums by about 200%. “All and all, the (bill) is an assault on people who need a little bit of help. All to give tax breaks to the billionaires.”

Other lawmakers took indirect digs at San Jose’s political priorities.

“We need to focus away from sweeping encampments when we don’t have enough housing for everyone and put those resources where they belong,” Kalra said at the meeting. “We have to double down on ensuring that we’re actually following solutions and I think it’s a lazy and immoral solution to crack down on the homeless.”

County leaders say the tax measure would bring in roughly $330 million every year, if approved. But they admit that still wouldn’t be enough to save the hospital system and other county services from additional cuts.

The county has for years avoided using its taxpayer general fund to pay for a majority of hospital expenses, thanks to Medi-Cal reimbursements. Those help pay for a hospital system that now provides half of all Emergency Department visits in Santa Clara County daily — and provides roughly 2,000 surgeries a month.

“(We provide) 750 emergency department visits every day,” County Executive James Williams said at the meeting. “If you call 911 in this county, 50% of all 911 transports come to county hospitals.”

The outcome of the negotiations between San Jose and Santa Clara County could determine how much of the region’s public health care system remains.

Liccardo declined to take a stance on the tax measure pending the outcome of negotiations.

“If it is as I expect it to be, I will be happy to support the measure,” Liccardo said. “But I want to make sure everyone’s had an opportunity to work this out.”