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Opposing Arguments Promise Bitter Transfer Tax Battle

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By Jorge Casuso

August 10, 2022 -- The arguments for and against two rival transfer tax measures on the November ballot offer a clear glimpse of what promises to be a hotly contested battle.

The top signatories -- Mayor Sue Himmelrich and Councilmember Phil Brock -- have already sparred over the measures during bitter debates on the dais that have turned personal.

As a result, the arguments against the measures, posted on the City's website this week, provide stark visions -- and blunt accusations -- that will be used to sway voters over the next three months.

Himmelrich -- whose proposed tax of $53 per $1,000 on properties valued at $8 million or more made the ballot with voter signatures -- comes out swinging at Brock's far more modest measure placed on the November 8 ballot by the Council.

Brock's measure, the opposing argument alleges, "originated because wealthy real estate interests are afraid they cannot win an honest Yes/No election vote" on Himmelrich's measure and are trying to "undermine" it.

"Even if both measures get a majority vote, only the measure with more votes becomes law," the opposing argument notes.

"What is (the Mayor's) Measure and why are real estate moguls and developers so concerned?" the argument asks, before pivoting to a list of reasons to back Himmelrich's measure.

The approximately $50 million a year raised by the measure will help "assist lower income rent burdened" Santa Monica seniors and families, produce "a fair share" of affordable housing and help fund local public schools.

The argument then pivots back to the "wealthy real estate interests (that) may make huge campaign contributions" to convince voters Brock's measure is better.

The argument is co-signed by Michael Soloff, co-chair of Santa Monicans for Reenters' Rights (SMRR); School Board president Maria Leon-Vazquez, former Mayor and SMRR co-foounder Dennis Zane, and Democratic Club President John Katz.

Brock's argument against Himmelrich's transfer tax measure -- which is "too flawed for Santa Monica" -- makes no mention of his own transfer tax but alludes to its benefits.

The Mayor's tax, which "could make it the highest" property transfer tax in California, fails to fund "important programs and services" Brock's measure would pay for by charging a transfer tax of $25 for every $1,000 above $8 million.

The $12 million to $25 million raised by the tax -- which would only be applied to the amount above the threshold and exempts single family homes -- would help fund programs to address such priorities as "public safety, homelessness or the restoration of critical services like the reopening of libraries and after-school programs for our kids."

Unlike Brock's measure, which sunsets in ten years with a possible five-year extension, Himmelrich's tax, the argument notes, "will never end."

The Mayor's measure will also "hurt local churches and charitable organizations by forcing them to pay hundreds of thousands in new taxes instead of using funds for programs providing assistance to those in need."

And the funds raised by Himmelrich's measure will bankroll "costly government-built housing" that benefits "those developers who get these lucrative government contracts."

In addition, the Mayor's measure "will create a brand-new bureaucracy with no public oversight, costing Millions of Tax Dollars in new City employee salaries and benefits," the opposing argument says.

"It is not surprising that (Himmelrich's measure) is seriously flawed," the argument concludes, since "it was drafted by the Mayor, her husband (Soloff), and others -- instead of engaging with the community and with other members of the City Council."

The opposing argument was co-signed by Marc L. Verville, vice chair of the City's Audit Subcommittee; former Recreation & Parks Commission chair Neil Carrey; Patricia M. Crane, chair of Northeast Neighbors, and Housing Commissioner D. Peter Borresen.

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