Voter’s Edge California
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MapLight
League of Women Voters of California Education Fund
November 6, 2018 — Elección General de California
Local

City of Oakland
Measure X - Majority Approval Required

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Resultados electorales

Se aprueba

105,301 votos si (69.48%)

46,256 votos no (30.52%)

100% de distritos activos (275/275).

Shall the Measure graduating the real estate transfer tax as follows: 1% up to $300,000; 1.5% over $300,000+2,000,000; 1.75% over $2,000,000+5,000,000; and 2.5% over $5,000,000; a lower rate for low-moderate income first-time homebuyers; and reducing the tax up to 1/3 for seismic retrofit or solar energy work costs incurred by low-moderate income homebuyers; raising approximately $9,000,000 annually until repealed, be adopted?

¿Qué es esta propuesta?

Información básica sobre la iniciativa de ley — Información oficial sobre esta iniciativa

Análisis del analista legislativo / Proposal

 

The Oakland Municipal Code currently imposes a tax on the transfer of real property in Oakland. Currently, the tax rate is a flat 1.5% of the value of the amount of consideration (generally the sales price) paid for the property. This rate is the same regardless of the amount of the consideration.

 

This measure would establish four tax rates ranging from 1% to 2.5%. For transfers with consideration of $300,000 or less, the tax rate would be 1%; for transfers with consideration above $300,000 and up to $2 million, the tax rate would be 1.5%; for transfers with consideration above $2 million and up to $5 million, the tax rate would be 1.75%; and for transfers with consideration more than $5 million, the tax rate would be 2.5%.

 

The City currently reduces the 1.5% real estate transfer tax to 1.25% for qualified low and moderate income first-time homebuyers. As part of the new graduated rate system, this measure would reduce the tax rate for low and moderate income first-time homebuyers by one-half of a percentage point below the applicable rate. For example, a sale of a home to a low and moderate income first-time homebuyer for $500,000 would generate a transfer tax of $5,000, at a tax rate of 1.0% (.5% below the 1.5% rate for a transfer at this price.) The tax rate reduction for low and moderate income first-time homebuyers would apply only to property transfers for $2 million or less.

 

The City currently imposes the real estate transfer tax on the full value of the amount paid for the property without any reduction for seismic retrofit or solar energy work. This measure would reduce the tax by up to one-third (1/3) for seismic retrofit work or the installation of a solar energy system costs if the work is completed within one year of the transfer. Only transfers for $2 million or less to low and moderate income homebuyers would be eligible for the reduction. The tax reduction would be refunded to homebuyers for the costs they incur for qualified seismic retrofit or solar energy installation work. The measure defines the type of work that qualifies as “seismic retrofit” and work to “install a solar energy system.” The measure would allow the City Council to adopt rules to implement the seismic retrofit and solar energy refund.

 

The Oakland City Council placed this measure on the ballot. A “yes” vote supports the passage of the amendment to the Oakland Municipal Code; and 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.

 

 

 

Efectos fiscales

Barbara J Parker City Attorney

 

Real estate taxes are a volatile revenue source and estimates based on prior years’ activity may not be predictive of future revenues.

When applying the proposed transfer tax rates to the past six years’ real estate transactions, the City estimates revenue potentially increasing between $1.7 million and $17 million per year.

The City anticipates approximately $181,000 in annual staffing costs for tax administration and collection.


Beginning in January 2024, and no more than once every five years thereafter, City Council may increase the $300,000 threshold between the first and second tax rate tiers, and the $2,000,000 threshold between the second and third tax rate tiers by an amount equal to or less than the increase to the Consumer Price Index, with thresholds capped at $500,000 and $3,500,000.

 

Disclaimer

 

The Office of the City Auditor has not audited and, as such, has not validated the City of Oakland Finance Department’s financial and statistical analysis that supports this measure. References to this data in our independent analysis represent the best data available at this time.

 

Published Arguments — Arguments for and against the ballot measure

Argumento A FAVOR

 

by more equitably funding government services. Measure X will make Oakland’s tax on real estate sales more progressive!

 

Progressive taxation, a hallmark of a just and fair society, addresses wealth disparity Oakland’s current Real Estate Transfer Tax (RETT) rate is a flat 1.5% of the value of the transferred property, whether it is worth $200,000 or $20,000,000. Cities in California have lower RETTs than many cities nationally. Currently, San Francisco is the only city in California with a progressive, tiered RETT. It’s time for Oakland to have one as well.

 

Measure X replaces Oakland’s flat RETT with rates varying based on the value of the sale. It also doubles (.5%) the existing rate reduction for first-time low & moderate income homebuyers. It lowers taxes (down to 1%) on sales of $300,000 or less, makes no change to the 1.5% rate for most sales, and raises taxes on expensive property sales (1.75% for over $2 million and 2.5% for over $5 million). And low and moderate income buyers also would be eligible for a partial refund for seismic retrofit and/or solar energy installation expenses.

 

Had this progressive tax structure been in effect since 2012, Oakland would have brought in an additional $9,000,000 per year on average for vital City services. The new revenue generated by this measure would come from people buying and selling the most expensive properties – people in the upper income levels, larger businesses, and big time investors, who can afford to share more of the weight of funding our city services.

 

This is a great opportunity to better fund the important city services we all want and need. Please join us in voting YES on Measure X.

 

/Ed Gerber

 

Oakland Budget Advisory Commissioner

 

s/Dan Kalb

 

Oakland City Councilmember

 

s/Zac Unger

 

Oakland Firefighter/Paramedic, IAFF Local 55

 

s/George Cummings

 

Senior Minister, Imani Community Church

s/Libby Schaaf
Mayor of Oakland

Argumento EN CONTRA

 

NO! NO! NO! We don't want a new tax every election. We don't want to make Oakland's cost of housing and rents EVEN MORE UNAFFORDABLE. We don't want the City to pit one set of taxpayers against another. We DO want austerity for our government bureaucracy.

 

Council members will have you believe that the austerity mandated by voter-approved Proposition 13 has 'starved' our City government. And that this tax increase is necessary to offset what Prop 13 robs us in city services. But this is NOT TRUE. Oakland's bureaucrats have been diverting our taxes into bureaucratic expansion resulting in soaring unfunded pension liabilities. The previous City Auditor admonished Oakland to reduce the City Employees' unfunded pension liabilities. Instead, unfunded pension liabilities ballooned to $1.9 billion and growing. And the City continues to expand its bureaucracy -- The new OakDOT bureaucracy nightmare diverts taxes from Capital Improvement Projects to staff with breathtakingly generous compensation. This is why we get 'pothole blitzes' rather than well-paved streets that the City Charter requires.

 

Some voters may be tempted to,support this as A TAX ON SOMEONE ELSE. But MAKE NO MISTAKE, this tax increases the cost of buildings, which will be passed along to residents and small businesses through HIGHER RENTAL RATES.

 

City Council members will make you believe we do not pay our fair share compared to other states or Bay Area cities. Oakland's transfer fee is already ONE OF THE MOST expensive fees compared to other cities in the Bay Area. A city with serious affordability issue SHOULD NOT BE ADDING TO THE COST OF HOUSING AND BUSINESS.

 

No amount of new taxes will solve the City bureaucracy's lust to reward itself. Don't allow the City to continue increasing the cost of housing and doing business. Demand austerity and Vote NO!

 

Marcus Crawley. Concerned Taxpayer

 

Dan B. Walden, Executive Director

 

Alameda County Taxpayers Association

 

Refutación al argumento A FAVOR

 

Rebuttal to Arguments in Favor of Tax

The advocates make this tax SOUND GOOD. Some taxes are necessary, but this tax will make Oakland WORSE.

This tax is a General Tax that will be placed in the General Purpose Fund to be spent on ANYTHING. Oakland's ongoing scheme is to raise taxes for an admirable purpose and spend most of the funds on bureaucracy expansion.

·       In 2016 Oakland voters approved Measure KK principally to repave streets. Instead, the City delivered a 'pothole blitz', promises of a modest repaving program next year and pretty website pictures of a resurfaced street.

·       For years the City has diverted Measure KK funds & Measure DD funds to a Public Arts projects. However, most of the Arts funds are spent on bureaucracy and only a pittance on artists.

·       The voters have approved Alameda County sales taxes to repave streets. Oakland spends most of its share of this sales tax on bureaucracy and street maintenance, not repaving.

·       In recent years Oakland has received more tax income than ever. Meanwhile, the unfunded pension liabilities for City staff has continued to soar from $1.6 billion 4 years ago to over $1.9 billion now.

The more discretionary taxes the voters approve for Oakland, the more the City bureaucracy grows and the larger the City debt grows. Already every Oakland's citizen's share is over $4,000 and Oakland's street condition index is tied for the worst in the Bay Area.

This tax is good for the bureaucrats and bad for the rest of us. Vote NO!


Marcus Crawley 8/23M-8/

 

Refutación al argumento EN CONTRA

 

 

FACT: Measure X is sensible, progressive tax policy that helps our community!

 

FACT: Voting YES on Measure X means you support lower taxes for first-time low/moderate income homebuyers, and any low/moderate income homebuyer who pays for seismic retrofit or solar installation on their new home.

 

FACT: Measure X raises taxes only on the most expensive property sales, starting at over $2 million, to help pay for vital government services for our city.

 

FACT: Measure X does NOT raise the tax on homes sold for less than $2 million. Average homebuyers will not see any change in their transfer tax, and some will see a reduction.

 

FACT: Measure X does NOT raise taxes on property sales for nonprofit affordable housing.

 

FACT: This measure increases the one-time tax on fewer than 5% of property buyers while bringing in much-needed revenue to help address our city’s many needs.

 

FACT: Opponents of this progressive tax measure would like to see City services slashed in furtherance of their conservative, anti-tax, government-austerity ideology. They consistently oppose any new taxes, regardless of need and despite the crippling impact of flawed policies like Prop. 13 on the ability of cities to deliver services such as libraries, parks, public safety and more.

 

We ask that you reject rhetoric that suggests that Oakland cannot afford to tax property sales on those who can afford it most in one of the hottest real estate markets in the country. Please join with us in voting YES on X.

 

s/Joshua Simon

 

Oakland Homeowner; Nonprofit Affordable Housing professional

 

s/Kathryn Sterbenc

 

Past Chair, Oakland Library Commission

 

s/Jessamyn Sabbag

 

Executive Director, Oakland Rising

 

past Budget Advisory Commissioner

 

s/Jacqueline Duhart

 

Oakland-based Unitarian Universalist ordained clergy

 

s/LaNiece Jones

 

MGO Democratic Club Past President

 

Leer la legislación propuesta

Legislación propuesta

 

BALLOT MEASURE SUBMITTAL FORM

Official Use Only: Date Stamp

 

BALLOT MEASURE QUESTION

 

Jurisdiction Name:

City of Oakland

Election Date: 11/6/2018

 

Note: The information as it appears within the text box will be printed on the ballot and voter guide. Insert ballot question text here:

 

 

Shall the Measure graduating the real estate transfer tax as follows: 1% up to $300,000; 1.5% over $300,000 - 2,000,000; 1.75% over $2,000,000 ­5,000,000; and 2.5% over $5,000,000; a lower rate for low-moderate income first-time homebuyers; and reducing the tax up to 1/3 for seismic retrofit or solar energy work costs incurred by low-moderate income homebuyers; raising approximately $9,000,000 annually until repealed, be adopted?

 

 

TYPE OF MEASURE

PERCENTAGE NEEDED TO PASS

 

x

Regular Measure        ❑ Parcel Tax

Bond Measure            ❑ Charter Amendment

x

SO% + 1       ❑ 66.6667%          ❑ 2/3

Other:

 

 

 

FULL TEXT OPTION

 

Full x

Text to be printed in the Voter Information Pamphlet:
YES (note: must provide a MS Word file)

NO — Do not print, but it's accessible at:

 

 

 

AUTHORIZED REPRESENTATIVE/CONTACT PERSON

(office use)                                                                          ,--

 

Print Name•

 

 

Phone #:

 

 

 

CONTACT INFORMATION

(public use)

 

Phone #:

(510) 238-3226

Email:

electionservices@oaklandnet. corn

 

Website:

file lloakland.local/users/MyDocs2b/simmo9la/My°/e20Documents/87288%20CMS pdf

 
               

 

 

Rev. 6/27/2018


CITY ATTORNEY’S IMPARTIAL ANALYSIS OF MEASURE ____

The Oakland Municipal Code currently imposes a tax on the transfer of real property in Oakland. Currently, the tax rate is a flat 1.5% of the value of the amount of consideration (generally the sales price) paid for the property. This rate is the same regardless of the amount of the consideration.

This measure would establish four tax rates ranging from 1% to 2.5%. For transfers with consideration of $300,000 or less, the tax rate would be 1%; for transfers with consideration above $300,000 and up to $2 million, the tax rate would be 1.5%; for transfers with consideration above $2 million and up to $5 million, the tax rate would be 1.75%; and for transfers with consideration more than $5 million, the tax rate would be 2.5%.

The City currently reduces the 1.5% real estate transfer tax to 1.25% for qualified low and moderate income first-time homebuyers. As part of the new graduated rate system, this measure would reduce the tax rate for low and moderate income first-time homebuyers by one-half of a percentage point below the applicable rate. For example, a sale of a home to a low and moderate income first-time homebuyer for $500,000 would generate a transfer tax of $5,000, at a tax rate of 1.0% (.5% below the 1.5% rate for a transfer at this price.) The tax rate reduction for low and moderate income first-time homebuyers would apply only to property transfers for $2 million or less.

The City currently imposes the real estate transfer tax on the full value of the amount paid for the property without any reduction for seismic retrofit or solar energy work. This measure would reduce the tax by up to one-third (1/3) for seismic retrofit work or the installation of a solar energy system costs if the work is completed within one year of the transfer. Only transfers for $2 million or less to low and moderate income homebuyers would be eligible for the reduction. The tax reduction would be refunded to homebuyers for the costs they incur for qualified seismic retrofit or solar energy installation work. The measure defines the type of work that qualifies as “seismic retrofit” and work to “install a solar energy system.” The measure would allow the City Council to adopt rules to implement the seismic retrofit and solar energy refund.

The Oakland City Council placed this measure on the ballot. A “yes” vote supports the passage of the amendment to the Oakland Municipal Code; and 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.

Barbara J. Parker
City Attorney

2458739v1

1


Summary

This Measure, if adopted by majority vote (more than 50%), authorizes the City of Oakland to create a tiered Real Estate Transfer Tax rate by decreasing the tax rate for lower priced real estate transfers and increasing the rate for higher priced ones. The tax would continue to be collected annually to raise unrestricted general purpose fund revenue. It would become effective on January 1, 2019.

The City of Oakland assesses a Real Estate Transfer Tax on all Oakland real estate sold or transferred.

Oakland’s current Real Estate Transfer Tax is 1.5%, regardless of the value of the property being sold or transferred. The proposed graduated tax rates, presented in real estate transfer tiers, are compared to the current rate below.

Real Estate Transfer Tiers

Current Tax Rate

Proposed Measure Tax Rate

$300,000 or less

1.5%

1%

More than $300,000 up to $2,000,000

1.5%

1.5%

More than $2,000,000 up to $5,000,000

1.5%

1.75%

More than $5,000,000

1.5%

2.5%

 

Exemptions / Exceptions

·       Low and moderate income first-time homebuyers would receive a tax rate reduction of 0.5% for real estate transfers valued at $2 million or less.

·       No tax rate increase for non-profit, affordable-housing providers. The maximum rate would be 1.5%, regardless of the value of the property at the time of sale or transfer.

·       Seismic and solar upgrades by low and moderate income homebuyers may be eligible for reimbursements up to one third of the transfer tax paid.

It is unlikely these exemptions would have a significant impact on future tax revenue. Financial Impact

Real estate taxes are a volatile revenue source and estimates based on prior years’ activity may not be predictive of future revenues.

When applying the proposed transfer tax rates to the past six years’ real estate transactions, the City estimates revenue potentially increasing between $1.7 million and $17 million per year.

The City anticipates approximately $181,000 in annual staffing costs for tax administration and collection.


Beginning in January 2024, and no more than once every five years thereafter, City Council may increase the $300,000 threshold between the first and second tax rate tiers, and the $2,000,000 threshold between the second and third tax rate tiers by an amount equal to or less than the increase to the Consumer Price Index, with thresholds capped at $500,000 and $3,500,000.

 

Disclaimer

 

The Office of the City Auditor has not audited and, as such, has not validated the City of Oakland Finance Department’s financial and statistical analysis that supports this measure. References to this data in our independent analysis represent the best data available at this time.

 

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