Los Angeles City Council Funds Housing With Mansion Tax

The Los Angeles City Council approved a plan to bolster affordable housing efforts and homelessness programs with “mansion tax” money.

The council gave the green light Tuesday to spend nearly $425 million collected from Measure ULA, known as the mansion tax, on affordable housing and homelessness programs, the Los Angeles Times reported.

The spending plan for the 2025-26 fiscal year is the largest yet under Measure ULA. It calls for more than $100 million to be set aside for homelessness prevention programs, including income support for at-risk tenants and eviction defense. More than $288 million was dedicated for spending on the production and preservation of affordable housing.

The tax has collected more than $702 million in the two years since voters passed Measure ULA. The spending plan is bigger than all other years combined.

Measure ULA taxes property sales above $5 million, which has drawn criticism from the real estate industry. A recent report from the University of California, Los Angeles found that the tax has slowed sales and stifled development, especially in the commercial sector. Proponents of the measure say it provides critical financing to affordable housing and homelessness prevention programs after the state and county have cut funds.

“Don’t believe the hate from big-money real estate or their lies appearing all over the media,” Joe Donlin, director of United to House LA, said in a statement to the newspaper. “Measure ULA is doing the steady work to create stable homes and good jobs for Angelenos.”

The vote came days after the California legislature and Gov. Gavin Newsom signed a major overhaul of the California Environmental Quality Act. The legislation exempts most urban infill residential developments from CEQA oversight, cutting red tape that has tied up projects in recent years as developers work to help state and local governments meet their housing goals.

Under its Regional Housing Needs Assessment, the city of Los Angeles must open 456,643 housing units by 2029; 184,721 of those units must be affordable to low- and very low-income households. In Los Angeles County, low-income for one person is defined as making a maximum of $84,850 annually, and very low-income residents make less than $50,000.

— Chris Malone Méndez