Measure ULA Oversight Committee”Concerned” Over Proposed Changes

Concern and offense were aired Thursday by members of an oversight committee following an attempt earlier this week to jam amendments to LA’s so-called mansion tax onto the June ballot.

Thursday’s vote by the Measure United to House L.A. Citizens Oversight Committee, the group established through the November 2022 ballot measure to monitor use of Measure ULA funds, could offer a look at the uphill battle proposed carveouts to the two-tier property tax could face in the coming months.

Measure ULA, which went into effect in April 2023, applies a 4 percent tax on all real estate deals – commercial or single-family – starting at $5.3 million. The tax bumps up to 5.5 percent on deals of $10.6 million or more.

The 15-member oversight committee agreed on Thursday to send a letter to the city council expressing concern for being excluded from any process to amend Measure ULA, The body also appointed its own ad hoc committee to take a closer look at the exemptions being sought.

“Honestly, it is so offensive that this amendment was proposed [to the] city council without even once coming to the COC,” committee member Jeanne Nishimoto said during the meeting. She went on to say the bid for a fast-tracked move to make changes to ULA “highlights that this body is being pushed aside.”

Democratic Socialist Nithya Raman, a leader among local progressives who represents the 4th District on the City Council, introduced her proposed changes on Friday. They seek a 15-year exemption from ULA on new multifamily, commercial and mixed-use projects in what is the most significant proposed change to the ordinance since it rolled out nearly three years ago. In addition, the motion called for a one-time, three-year carveout from ULA for property owners impacted by a natural disaster and retroactive to Jan. 7, 2025 to address Palisades Fire damages.

Raman and supporters of the ULA changes had hoped for consideration and a vote from the 15-person council this week. However, the bid to push it onto the June ballot evaporated on Wednesday, the deadline for the city attorney to prepare a resolution for such a measure.

Instead, Tuesday’s council meeting kicked Raman’s proposal down to the Housing and Homelessness Committee, which has yet to place the item on a future meeting agenda.

While the ULA oversight committee’s decisions do not create policy, the group acts as an advisor to the city and is billed as a cross-section of individuals with experience in housing development and finance, renter protection, and also includes two youth — ages 16 to 21— advisory seats.

“Unintended consequences”

As of Thursday, Measure ULA has raised $1.1 billion across 1,497 transactions since inception. Supporters of the tax often point to the metric as proof of its successes.

Critics often take aim at the figure and harken back to 2022, when the ballot measure and its backers estimated to voters that $600 million to $1.1 billion could be generated each year from ULA.

The largest contributing segment to that total has been single-family residential of which 864 deals have brought in $441.5 million, according to data from the Los Angeles Housing Department through the end of 2025.

Multifamily, which generally refers to apartments and is the driver behind Raman’s proposed changes, is the third-largest bucket of ULA revenue, behind offices and various other types of commercial properties. Since April 2023, the multifamily segment generated has $171.9 million, or 13 percent of the overall pie.

Raman and others, including real estate industry executives, argue that the tax has stifled multifamily construction, which runs counter to ULA’s stated goal of housing affordability and homelessness prevention. Across the real estate industry brokers, agents and developers have offered similar takes as deals and construction stalls.

Mike Leipart, co-founder and managing principal of real estate sales and advisory firm Redeavor, told a crowd gathered Tuesday in Beverly Hills for The Real Deal’s “Building Luxury” panel that he’s seen apartment owners go for conversions and sell units individually rather than try to market a whole building and pay the ULA tax.

Sean Burton, CEO and chief investment officer of Cityview, told TRD on Monday he’s seeing a similar trend play out.

“It’s interesting the way ULA is structured, it’s actually an incentive for many landlords and property owners to break up their multifamily projects and sell them as individual units and take them out of the renter pool,” Burton said. “I think that’s just starting to happen, but I’ve heard a number of landlords talk about that because they simply feel they have no choice. I think that would be really unfortunate because the last thing we need is to be taking multifamily units out of the renter pool. It’s only going to drive rents up for everybody else.”

While the changes would be a boon to apartment and commercial construction, some say they don’t address the pain points of what luxury single-family residential agents have faced with deals falling apart or extended negotiations over the tax.

“Natural disaster exemptions are especially important, but there is still work to be done to ensure ULA does not continue to discourage investment at a time when Los Angeles needs housing and economic momentum,” Christie’s International Real Estate Southern California founder and CEO Aaron Kirman told TRD this week.