YOUR COLUMN HERE — Measure H increases the real estate transfer tax on higher-value commercial and residential sales, and Measure HH uses the revenue for community-based affordable housing. Bill Bauer's column, "Measure H: tax increase for more development" (Sept. 22, 2014) and the California Association of Realtors/PAC's recent election mailings are misleading. The reasonableness of the tax increase, properties affected, burden at sale, type of affordable housing and beneficiaries, and the impact the housing has on our city need to be addressed.
Tax: The real estate transfer tax is imposed on all residential and commercial sales. The proposed tax increase, from $3 to $9 per thousand dollars, is only on property which exceeds $1 million dollars in value. Other cities with higher land values have a comparable or greater tax than ours, and their higher tax applies to all property sales. For example (Alameda $12), Albany ($11.50), Berkeley ($15), Oakland ($15), Piedmont ($13), Richmond ($7), San Leandro ($6), and San Mateo ($5). As for the tax burden on the property owner, the obligation can be negotiated between the buyer and the seller. With regard to residential sales, most homeowners sell once in their lifetime, so the tax burden often passes to their estate and/or heirs.
Housing: The tax increase is expected to raise between $4 million and $10.2 million per year for affordable housing. Despite that, the amount only partially offsets the loss of RDA affordable housing revenue (some $15 million to $25 million per year), the revenue is significant. As a local tax, the City has discretion over the type of housing it funds and who it is marketed to, as such persons with lower incomes and the underserved. Local financing allows for the preservation and improvement of existing housing rather than to fund new developments.
The City partners with nonprofit housing providers, which in turn leverage federal, state and other funding. Nonprofit housing is 100 percent affordable. Households at or below 60 percent area median income are prioritized. Uniquely, the housing stays affordable for the entire life of the property. Nonprofit projects lack the massing of market-rate housing. The housing has less impact on traffic, very low income families with children, seniors and persons with disabilities are more likely to use public transportation, shared rides and walk to and form work or school.
Measure HH, which accompanies Measure H on the ballot, is advisory and establishes that the increased tax revenue be spent on affordable housing. Skeptics claim there is no guarantee the city will follow through on its word. There are precedents that the city has. After approval of a schools funding advisory, the city has always met or exceeded the ballot requirements. The same is true for affordable housing. Prior to the state's take-back of RDA revenues, local governments were required to spend at least 20 percent of their RDA money on affordable housing. The city committed a greater share, some 25 - 30 percent, on affordable housing.
Finally, please disregard the false statements against Measure H and Measure HH. The tax increase is comparable to other cities, and the housing does not contribute to height, density and traffic. In fact, our locally-financed housing is some of the best housing. I've voted and mailed my ballot. On Nov. 4, please vote "yes" on Measure H and "yes" on Measure HH.
Richard Hilton is a native Santa Monican, a graduate of SMC (1971) and CSUN and is chair of the city's housing commission.
