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November 3, 2020 — California General Election
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Local

City of Santa Monica
Measure SM - Majority Approval Required

To learn more about measures, follow the links for each tab in this section. For most screenreaders, you can hit Return or Enter to enter a tab and read the content within.

Election Results

Passing

36,465 votes yes (71.88%)

14,268 votes no (28.12%)

To protect essential services including addressing homelessness, cleaning beaches/parks, public safety/ fire/ emergency response, protections for tenants and seniors, supporting libraries, small business recovery, food for the hungry, and after-school/ mental health services for youth, shall the City of Santa Monica increase the one-time real estate transfer tax paid on each sale of property for $5 million or more by $3.00 per $1,000 of sales price, exempting affordable housing projects, providing $3 million annually for local services?

What is this proposal?

Measure Details — Official information about this measure

Impartial analysis / Proposal

George S. Cardona, Interim City Attorney

The Santa Monica Municipal Code imposes a one-time tax on each transfer of real property in Santa Monica. Currently, the tax rate is $3.00 per $1,000 of consideration (generally the sale price) or property value transferred. This rate is the same regardless of the amount of the consideration.

This measure would increase the tax rate to $6.00 per $1,000 for transfers involving consideration or property value transferred of $5 million or more. For transfers involving less than $5 million in consideration or property value transferred, the existing tax rate of $3.00 per $1,000 would remain unchanged.

The City currently imposes the transfer tax on properties transferred to non-profit corporations and community land trusts that provide affordable housing. This measure would exempt certain affordable housing transfers from the proposed tax rate increase for transfers involving consideration or property value transferred of $5 million or more. Affordable housing transfers that qualify for this exemption would continue to be taxed at the existing tax rate of $3.00 per $1,000 of consideration or property value transferred. The measure defines the requirements for affordable housing transfers to qualify for this exemption.

Currently, the County of Los Angeles administers the City’s existing flat tax rate of $3.00 per $1,000 of consideration or property value transferred. The measure authorizes the County to continue collecting the existing tax rate of $3.00 per $1,000 on all transfers. For transfers involving consideration of $5 million or greater, the measure authorizes the proposed tax of $6.00 per $1,000 to be collected in two equal parts: (1) a County collected portion of $3.00 per $1,000; and (2) a City collected portion of $3.00 per $1,000. For transfers involving consideration or property value transferred of $5 million or greater, the measure requires the recording party or agent to pay the City collected portion before recording a transfer at the County Recorder and requires escrow companies to ensure that the City collected portion is either paid before the recording of the transfer or set aside in escrow for payment to the City at the time of recording.

The measure would allow the City Council or the Director of Finance to establish regulations to implement the tax. If the tax is not paid, the measure authorizes administrative penalties, interest, property liens, and direct assessments. The measure establishes a reconsideration process for deficiencies and a public hearing procedure before a lien or direct assessment is imposed on the property.

The measure authorizes the City Council to amend the Municipal Code sections relating to the tax as long as the amendment does not increase the authorized tax rate.

The City would be permitted to use the tax revenue for any governmental purpose.

The Santa Monica City Council placed this measure on the ballot. A “yes” vote supports the passage of the amendment to the Santa Monica Municipal Code; a “no” vote opposes passage of the amendment. A majority vote (i.e., more than 50% of the votes cast) is required to pass the measure.

Published Arguments — Arguments for and against the ballot measure

Arguments FOR

2020 has been a challenging year, and your vote for Local Revenue Measure SM is part of the solution.

Santa Monica has a legacy of coming together to solve our most challenging problems. We are rising to the unprecedented public health threat of COVID-19, the economic impacts it has created, and the overall stress that people are feeling. Our community is taking sensible public health measures, supporting our local small businesses, and protecting our most vulnerable neighbors.

Measure SM is a vital part of rebuilding our community's strength, and it raises taxes only on corporations and those who sell properties worth $5 million or more.

Renters, people living with homelessness, families struggling with uncertain employment, homebound senior citizens, and those struggling with mental health issues will all benefit from Measure SM.

Vote YES on Local Revenue Measure SM to protect Santa Monica, especially public health and vital public services that so many people rely on:

– Maintain clean beaches and parks

– Protect 911 emergency response services

– Fund economic recovery efforts, including helping businesses to re-open safely

– Restore library programs

– Continue programs and services proven to reduce homelessness

– Support rental assistance programs for local seniors and others to keep them in their homes

– Fund Meals on Wheels and the Westside Food Bank

– Restore after-school programs and mental health services for Santa Monica youth

Every penny raised by Measure SM will be spent here in Santa Monica and cannot be taken by the State of California or the County of Los Angeles.

Measure SM will be applied only to real estate property sales of $5 million or more. Measure SM leverages Santa Monica's high property values to help protect public health and essential public services for all of us.

We will get through this together.

Please join us in voting YES on Measure SM for a strong Santa Monica.

KEVIN MCKEOWN

Mayor, City of Santa Monica

NATALYA ZERNITSKAYA

President, League of Women Voters of Santa Monica

SHARI DAVIS

Chair, Community for Excellent Public Schools (CEPS)

TIM VAN PELT

Emergency Room Nurse, UCLA Santa Monica Hospital

DENNIS ZANE

Co-Founder & Co-Chair, Santa Monicans for Renters' Rights (SMRR)

Arguments AGAINST

Vote NO. An incremental increased transfer tax is a good idea, but that's NOT what this proposal is. It is BADLY written by the current City Council, fails to close loopholes and may have created some.

This should be a progressive tax. Instead it doubles the tax from the first dollar for any transfer valued at over $5million. Preferable would be keeping the tax as is on the first $5million and increasing it on amounts over $5million, perhaps by more than proposed.

There is zero evidence there would be $3million more a year, or where amounts would be used. The affordable housing exception may have a loophole that gets challenged in expensive litigation because of poor drafting.

City Council also failed to fix loopholes that would allow: the sale of stock in companies holding realty; subdividing property where parts sell for less than the whole; very long term ground or other leases such as the proposed Plaza deal; delaying collection indefinitely by triggering the payment of tax based on recording deeds; collecting tax on the greater of value or consideration.

City Council wants to manipulate voters with biased wording like "to protect essential services including [list of services]." Demand straight-forward, fair, and unbiased measures without loopholes coming out of your City Council by voting NO. Next election let's have a better, well written and impartial transfer tax increase measure.

MATT NECO

Attorney & Mediator

STANLEY H. EPSTEIN

Attorney

Replies to Arguments FOR

VOTE NO

If passed, all funds collected will go into the general fund and can be used for any purpose. Not one dollar will be specifically earmarked for the causes itemized by the pro group, which are designed to tug on your heartstrings. Instead, much of the new revenues will likely go to increased compensation of staff (some already overpaid), unnecessary consultants and large vendors. The majority of the money will not stay in or be spent in the City.

Santa Monica Residents, even before the lootings, firing of rubber bullets, lobbing of tear gas and arrest of peaceful Black Lives Matters protesters on May 31, 2020, did you and do you now really believe those in favorof the measure about:

1. Any legacy of coming together to solve challenging problems? When was the last time you felt the Council collaborated on issues that concern you? How did they do on the scooters? On developing the Plaza space most residents don't want? On extravagant buildings?

2. Taking sensible public health measures? How? Having closed Palisades Park for a time? Addressing homelessness and food insecurity? People not wearing face coverings? Gatherings of more than 10 people?

3. What small businesses have you heard feel supported by the City? We haven't seen small business ownersthanking the City, especially after the lootings.

4. Protecting the vulnerable?

We should reject a measure providing for an irrational tax increase structure and perpetuating major loopholes, and thereby ignore the deceptive arguments by the proponents.

MATT NECO

Santa Monica Resident/Renter

STANLEY H. EPSTEIN

Attorney

Replies to Arguments AGAINST

Raise your hand if you DO NOT own a $5 million property. Congratulations! You won't pay this tax.

The opponents' argument is just plain wrong on the substance, and designed to confuse voters. Despite their series of straw-man arguments, even they agree an incremental increase in the transfer tax on luxury propertiesis a good idea, and give you reason to vote for Measure SM.

Measure SM is straightforward. Our entire community will benefit from funds ensuring safe, clean parks and beaches, reduced homelessness, improved mental health services, libraries, youth programs, and other essential services.

Measure SM is specifically limited to individual property sales of $5 million or more and would not impactany property sales under that amount.

Measure SM protects seniors and renters by discouraging "quick flip" property speculation, often leading to evictions.

Measure SM exempts affordable housing projects that Santa Monica sorely needs.

Public school advocates support Measure SM because it benefits children, with safe places to play, after-school programs, and mental health services for youth.

Locally owned small businesses are SUPPORTING Measure SM because it will help revitalize our local economy and ensure public health.

Renters, senior citizens, and advocates for affordable housing, parks, beaches, and libraries support Measure SM.

Now, when our community is working to support each other through crisis, it’s reasonable that real estate corporations – who’ve profited enormously from Santa Monica’s high quality of life – pay their fair share to keep our city strong.

Vote Yes on SM.

KEVIN MCKEOWN

Mayor, City of Santa Monica

NATALYA ZERNITSKAYA

President, League of Women Voters of Santa Monica

SHARI DAVIS

Chair, Community for Excellent Public Schools (CEPS)

TIM VAN PELT

ER Nurse, UCLA Santa Monica

DENNIS ZANE

Co-Founder and Co-Chair, Santa Monicans for Renters' Rights (SMRR)

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