The measure, known as the Local Taxpayer Protection Act, has qualified for the November ballot with backing from the Howard Jarvis Taxpayers Association, the group long associated with Proposition 13. If approved by voters, it would restrict local real estate transfer taxes and raise the voter-approval threshold for new local taxes from a simple majority to two-thirds.

Supporters of local housing funding say the measure is gaining momentum in part because of backlash against several high-profile city transfer taxes that were adopted with the goal of generating money for affordable housing but have produced unintended consequences.

In Los Angeles, Santa Monica and San Francisco, voters approved higher real estate transfer taxes aimed largely at expensive property sales. Those measures were often described as “mansion taxes,” but critics say the costs have fallen heavily on commercial and multi-family property transactions — the kinds of deals that can affect future housing production.

Real estate transfer taxes are charged when property changes hands, typically as a percentage of the sale price. Counties and general law cities in California are limited to a 0.11% transfer tax. Some charter cities, however, have adopted much higher rates.

Los Angeles’ Measure ULA applies to property sales above $5 million. Critics say the structure creates a sharp cutoff: a property sold for just under the threshold avoids the tax, while a larger apartment building above the line can face a major added cost. An affordable eight-unit apartment building, for example, could owe more than $200,000 in transfer taxes, while a luxury home sold for $4.9 million would owe nothing under ULA.

Housing advocates argue that the measure has slowed sales and discouraged new apartment development. A UCLA analysis cited by critics found that Measure ULA may be costing Los Angeles city and county governments more in lost property tax revenue than it is producing through the transfer tax. Unlike transfer taxes, which are collected only when a property is sold, property taxes generate revenue every year for cities, counties, schools, fire districts and other public agencies.

Santa Monica’s Measure GS has faced similar criticism. The measure charges $56 per $1,000 on sales of $8 million or more, one of the highest rates in California. In the year after it took effect, residential sales above that amount reportedly dropped by half, while commercial sales fell from 18 to five. Revenue came in at less than half of projections.

San Francisco’s Proposition I, which imposes rates of up to 6% on the largest property transactions, has also been blamed for reducing sales and slowing housing activity. City leaders there are now pursuing a proposal to cut the tax in half.

The November ballot measure would address those local taxes by limiting transfer taxes statewide to 0.11%. But opponents say it goes much further by making it far harder for local governments to raise new revenue for basic services and housing programs.

That provision could have broad consequences for cities, counties and special districts throughout California. In fast-growing and infrastructure-stressed regions such as the Inland Empire, local governments often rely on voter-approved revenue measures to help pay for transportation improvements, fire protection, schools, housing programs and other needs.

Housing advocates are urging state leaders to negotiate a compromise before the June 25 deadline, when proponents could still withdraw the measure from the ballot. They argue that lawmakers can correct what they view as poorly designed transfer taxes in a few cities without imposing sweeping new limits on local governments statewide.

The debate places state leaders in a difficult position: balancing concerns over taxes that may be discouraging housing development with the need to preserve local funding tools at a time when California remains under pressure to build more homes and maintain essential public services.

Original source: CalMatters

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The proposal, backed by the Service Employees International Union Healthcare Workers West, would impose a one-time, 5% tax on individuals whose net worth exceeds $1 billion and who were living in the state as of Jan. 1, 2026. The goal is to generate $100 billion in revenue, which would largely be used to offset federal funding cuts to healthcare for low-income people.

“California’s health is at stake,” said Liz Perlman, executive director of a chapter of the American Federation of State, County and Municipal Employees, a major labor union. “Hospitals are closing and people will die. Why? So billionaires can get another tax cut that they don’t need.”

The California Secretary of State still has to verify the signatures and officially place the measure on the ballot. Backers say they collected more than 1.5 million signatures, well over the roughly 875,000 they needed. California allows ballot initiative campaigns to pay people per signature they gather. The cost of gathering petition signatures can vary widely, but it typically runs around $15 for each signature.

If the measure goes before voters in November, it could prompt one of the costliest ballot fights ever and will draw national attention as a litmus test for voter attitudes on raising taxes on the rich. An effort to oppose the tax has already raised millions and led to proposals designed to nullify the tax. Meanwhile, Vermont Sen. Bernie Sanders has campaigned in support of the idea.

Democratic Gov. Gavin Newsom and Silicon Valley tech moguls are adamantly opposed. They warn it will drive California’s wealthiest residents out of the state. Nearly half of California’s personal income tax revenue comes from the top 1% of earners. Some have already purchased properties out of state in case it passes.

“After playing with matches since October the SEIU has succeeded in lighting a ‘Tax the Rich’ wildfire by getting enough signatures,” said David Lesperance, a tax consultant who’s advised some of his wealthy clients who left California because of the proposal. “The many billionaire targets of their efforts have already responded by executing fire escape plans by relocating to other states.”

Brian Brokaw, a longtime Newsom adviser who is leading a political committee opposing the tax, said the measure was poorly constructed and would deal a huge blow to the state’s budget.

“Enacting a so-called wealth tax in just one state wouldn’t target a small group — it would impact all 40 million Californians,” he said in a statement. “This proposal trades a short-term revenue bump for long-term losses.”

At least 25 billionaires listed among Forbes magazine’s 2025 rankings of the world’s 500 wealthiest people either lived in California or had some significant ties to the state, based on a review by The Associated Press. But determining whether they were full-time residents or just frequent visitors could turn into a matter of dispute, since many of them own property elsewhere.

The big tax and spending cuts law President Donald Trump signed last year will cut more than $1 trillion nationwide over a decade from Medicaid and federal food assistance.

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In a closed-door discussion this week, representatives for Assembly Speaker Robert Rivas (D-Hollister) met with the leaders behind the Californians for Safer Communities Coalition, the group led by local district attorneys that has spent the last six months campaigning for voter support to reform Proposition 47, which voters passed in 2014.

Two people with knowledge of the meeting said legislative leaders are moving forward with a hard-ball approach that would make voters choose between the two efforts — and could splinter support for the ballot measure.

Unless the ballot measure is withdrawn, the Democratic leadership plans to add an “inoperability clause” to its legislation that would revoke the new laws if voters pass the statewide proposition in November, according to the sources and a letter Republicans sent to legislative leaders.

The Republican lawmakers in the letter condemned those changes, saying they would “do grave damage” to the bipartisan progress made on retail theft. Lawmakers are advancing a bipartisan 12-bill legislative package that would address the issues of retail theft and focus on protecting the safety of workers and store owners, without harsher penalties for some offenders.

The proposed ballot initiative takes a different approach that would revise Proposition 47 to make possession of fentanyl into a felony, and repeat offenders who steal for the third time — regardless of the value of the product stolen — could serve up to three years in state prison. A spokesperson for the ballot measure campaign declined to comment about the meeting.

“The Speaker has done more in eight months than anyone has done in eight years to push the conversation forward and I think everyone in the room acknowledges that,” said Daniel Conway, vice president of government relations for the California Grocers Assn., who was present during the discussions this week. “And that is why there is a bona fide effort to see what can be done.”

Both the proposed legislation and ballot measure focus on the need to address retail theft. But over the last several months, disagreements have been mounting over the best path forward. Gov. Gavin Newsom made it clear that he does not want proposed reforms to Proposition 47 on the November ballot, saying effective changes can be made through the legislative process instead. But law enforcement groups and conservative prosecutors say the only way to enact substantive changes is by bringing it back to the voters.

California voters approved Proposition 47 in 2014 to reclassify some felony drug and theft offenses as misdemeanors and to raise, from $400 to $950, the amount for which theft can be prosecuted as a felony.

The political jockeying and the change leaders plan to make to the legislation could potentially lead to splintering within the ballot measure coalition, which has had the backing of law enforcement groups and funding from major retailers.

The Grocer’s Assn., which represents over 6,000 food stores and grocery suppliers, is still supportive of both the ballot measure and legislation.

Rachel Michelin, president of the California Retailers Assn., told The Times that she supports the legislative package and thinks it does more for retailers than the ballot initiative. But she is frustrated at the politics being played on all sides.

“I am just trying to provide resources to retailers and law enforcement to keep our customers safe,” she said. “Unfortunately, I don’t know whether the proponents of the initiative are going to budge. My fear is we lose all of these things in the package if they move forward to initiative. That would be detrimental.”

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