San Francisco Extends 'First Year Free' Program, Saving Businesses Nearly $5 Million

San Francisco Mayor Daniel Lurie has signed legislation to renew the city's "First Year Free" program, a key initiative designed to reduce barriers for new small businesses. The program, which waives initial registration, license, permit, and other first-year fees, will now continue through June 2026. This extension aims to bolster San Francisco's economic recovery and foster a more business-friendly environment for entrepreneurs.

The "First Year Free" program, initially launched in 2021, has already demonstrated significant impact. According to city data, the initiative has supported approximately 10,000 businesses, saving them nearly $5 million in fees since its inception. This financial relief is particularly crucial during a business's formative period when revenue generation is often still in its early stages.

Mayor Lurie emphasized the program's importance in a recent tweet, stating, > "We're making it easier to open a small business in San Francisco. I just signed legislation renewing the First Year Free program, which waives registration, license, permit, and other first-year fees. It’s already helped thousands of businesses—and now it will continue to do so." Supervisor Stephen Sherrill, a lead sponsor of the legislation, also highlighted its benefits, noting that the extension means "lower costs, fewer barriers, and real support for small businesses in every neighborhood."

To qualify for the program, businesses must have $5 million or less in San Francisco gross receipts and operate from a registered commercial location; home-based businesses are not eligible. A provision also requires businesses to repay waived fees if their gross receipts exceed $15 million within three years of operation. The renewal of "First Year Free" is part of a broader strategy by Mayor Lurie's administration, which includes initiatives like PermitSF to streamline permitting processes and efforts to increase the availability of affordable liquor licenses.

City Treasurer José Cisneros underscored the program's seamless integration, explaining that eligibility is automatically determined during the new business registration process. Katy Tang, Director of the Office of Small Business, added that the program saves startups "thousands—even tens of thousands—of dollars in start-up costs during a time when they aren’t yet bringing in revenue." This continued support is seen as vital for maintaining a vibrant small business sector in San Francisco.