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Brock's Transfer Tax Measure Could Test SMRR's Clout

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By Jorge Casuso

July 11, 2022 -- An upcoming vote on Councilmember Phil Brock's real estate transfer tax measure could be a key test of Santa Monicans for Renters' Rights' (SMMR) political clout.

The tenants' group that has dominated City politics for the better part of four decades has weighed in on Tuesday's City Council agenda item with a letter to the Council and held personal meetings with some of its members.

The group is headed by former Mayor Denny Zane and former Housing Commissioner Michael Soloff, key players in the strategy and funding of the campaign for Mayor Sue Himmelrich's far more ambitious transfer tax.

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"They're putting on the squeeze," said Councilmember Oscar de la Torre, who said he met Sunday with Soloff, Mayor Himmelrich's husband. "They want us to reject Phil's measure and support Sue's.

"There's a full court press," said de la Torre, who ran on a Change slate with Brock in 2020. "This (tax measure) is not only to raise revenues, it's a political strategy."

SMRR -- which only endorsed two of the five winning Council candidates two years ago -- is seeking to gain political traction with Himmelrich's measure, which would provide funding to keep vulnerable tenants in their homes.

The measure, which would impose a tax of $53 on $1,000 on property sales above $8 million -- compared to a $15 tax under Brock's measure -- would raise an estimated $50 million a year to help pay for "homelessness prevention, affordable housing and schools."

While the Council on Tuesday must place Himmelrich's measure on the November 8 ballot after it garnered the required number of voter signatures, Brock's rival measure must be placed on the ballot by the Council.

The Council is expected to take up the measure -- which would raise between $8 and $15 million a year -- on Tuesday, when it discusses a report by staff on its fiscal impacts ("Staff Recommends Placing Brock's Transfer Tax on Ballot, Warns of Shortcomings," July 7, 2022).

Brock says he will ask the Council to make three key amendments that staff would have to incorporate before the Council votes on July 26 on whether to place the measure on the ballot.

Brock wants to include a sunset clause the would eliminate the tax after ten years, and he wants to increase the amount of the tax to $20 per $1,000 for commercial properties that sell for more than $8 million, which he says would raise an additional $2 million a year.

The money would go to pay for City services that were slashed or cut back during the coronavirus shutdown, including restoring library and after-school playground hours and crossing guards at schools and funding public safety initiatives.

"This provides services where they're needed in the city," Brock said. "Right now we're in a crisis. I want to get out of the crisis.

"Will that happen for ever?" he said. "Hell no. We're getting back on our feet."

In addition to adding a sunset clause, which Mayor Himmelrich's measure does not include, and raising the tax amount, Brock wants to ensure partnerships are not exempted from the tax if they split the sales proceeds to skirt the threshold.

Brock believes the votes are there to place his measure on the ballot, in which case, if both rival measures get a majority, the tax measure with the most votes would prevail.

"My understanding was that we were still good," Brock said Sunday. "That could obviously change. As of Friday, my understanding was we still had six votes."

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