Measure W | californiachoices.org

My vote

Would set the existing general tax on transfers of real property at 2.5% of a property’s value for properties valued $1.6M or higher, and increasing the rate from 2.5% to 3% for properties valued $1.9M or higher and from 3% to 3.5% for properties valued $3.0M or higher, adjusted annually for increases in value; removing January 1, 2029 expiration date; generating an estimated additional $2M - $4M annually, until repealed. Measure W requires a majority vote for passage.

Fiscal Impact: Annually, the measure is estimated to generate an additional $2 to $4 million for $5 to $9 million of total tax revenue.

Next Alameda County Measure: Measure X

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Details

Pro/Con

Pro:

Supporters argue that Measure W will continue and expand our successful programs to rehouse homeless neighbors and provide critical services and support. According to official counts, more than 1,500 formerly homeless neighbors in Berkeley have been rehoused since 2018, and the number of people living unsheltered on our streets has been reduced by an unprecedented 45%.

These heartening results, achieved while homelessness in other communities has surged, demonstrate the success of Berkeley’s state-of-the-art programs, policies, and facilities. They also represent a huge reduction in human suffering, and significant improvements to the use and enjoyment of sidewalks, parks, and commercial areas in every neighborhood. But with almost 500 people still languishing on our streets, and continued impacts to our downtown and shopping districts, there’s still much work to be done. Your YES vote on Measure W allows Berkeley to continue rehousing homeless neighbors and restoring public spaces, for the benefit of all residents.

A YES vote on this measure means you support adjusting property transfer taxes to raise funding for homelessness programs.

Con:

Opponents argue that while Berkeley's efforts to reduce homelessness have shown some success, encampment sweeps and relocation to other parts of the region cannot be overlooked as the main reasons behind a temporary decrease in homelessness.

As Berkeley has increased homeless services, the financial handling of these efforts has been far from perfect. In 2019 the transfer tax fund for homelessness was marred by mismanagement, with funds going to unvetted programs. City reports warned against rushing into long term financial commitments without thorough analysis, and the recommendations of the city’s own homelessness panel of experts were not followed.

There are already eight tax related measures on the ballot. Instead of extending a flawed measure, the city should focus on ensuring existing funds are used effectively and transparently.

A NO vote on this measure means you oppose adjusting property transfer taxes to raise funding for homelessness programs.

In Depth

Currently, the City currently imposes a real property transfer tax when property is transferred for consideration. The tax is measured by the value of consideration at a rate of 1.5% of the consideration for transactions less than or equal to $1.5 million and a rate of 2.5% of the consideration for transactions more than $1.5 million. To ensure that the 2.5% rate applies to the top third of transactions, the City annually adjusts the threshold between the two tax rates to match the value of consideration for the transaction at the 67th percentile of transactions, although the threshold may not fall below $1.5 million. The 2.5% tax rate will expire on January 1, 2029. When voters adopted the 2.5% tax rate, they established a homeless services panel of experts, which makes recommendations on how the City should fund programs to end homelessness. City Council must consider, but need not follow, the panel's recommendations and may spend the revenues for any legitimate municipal purpose.

This measure would amend the tax in several ways. First, the 1.5% tax rate would apply to transactions for which the value of consideration is less than $1.6 million. Second, the 2.5% tax rate would apply to transactions for which the value of consideration is equal to $1.6 million but less than $1.9 million. Third, a new 3% tax rate would apply to transactions for which the value of consideration is equal to $1.9 million but less than $3 million. Fourth, a new 3.5% tax rate would apply to transactions for which the value of consideration is equal to or greater than $3 million. Fifth, the 2.5% tax rate would no longer expire and all tiers would remain in effect until amended or repealed by the voters.

The $1.6 million, $1.9 million, and $3.0 million thresholds correspond to the 67th, 80th, and 95th percentiles of real estate transactions in 2024. These thresholds would be adjusted annually to ensure they remain reflective of the percentiles, but would not be adjusted below $1.6 million, $1.9 million, and $3.0 million.

The measure would become effective January 1, 2027. Until then, the tax rates would remain as they currently are. Annually, the measure is estimated to generate an additional $2 to $4 million for $5 to $9 million of total tax revenue.

Source: City of Berkeley Ballot Measure Documents

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