LA’s Measure ULA Ad Hoc Committee Meets to Weigh Pros, Cons

The committee formed to tackle all matters related to Measure United to House Los Angeles met for the first time on Friday in what’s shaping up to be another contentious battle over the so-called mansion tax.

At the heart of the tussle is whether the Measure ULA ad hoc committee will make recommendations to the Los Angeles City Council that would pave the way for amendments to the tax to appear on the November ballot. Decision time is limited, as the group is expected to dissolve April 30.

Friday’s meeting didn’t address specific amendments. Instead, the three-person body sped through approving a consultant to work with city departments and the community on ways to address the tax’s impact on housing construction and investment. It also instructed the chief administrative officer to conduct a 15-day study on the impact of the tax and review similar measures in Culver City and San Francisco.

Los Angeles City Council members approved the committee’s formation this month to consolidate all proposed changes to ULA within a single body.

“We are not here to rewrite the measure or go beyond what voters approved or were told they were voting on,” committee member and 6th District representative Imelda Padilla said during Friday’s meeting. “We’re here to figure out how to make it work post an era of observing it and now we want to focus on the best practices and… pros and cons.”

Padilla is joined on the ad hoc committee by Ysabel Jurado, who represents the 14th District and serves as chair, along with 12th District Council Member John Lee.

ULA, which voters passed in November 2022, applies a 4 percent tax on all real estate transactions within the city starting at $5.3 million and increases to 5.5 percent on deals of $10.6 million or more.

During the meeting, Padilla – who supported ULA in 2022 – acknowledged more recent feedback on financing challenges for projects and questions around “how the program is functioning in practice” across the city.

Those are concerns that have come into sharp focus this year with some council members acknowledging roadblocks ULA has created when it comes to affordable housing development. That includes Council President Marqueece Harris-Dawson, who cited a 30 percent to 50 percent drop across commercial, industrial and multifamily deals since the tax’s April 2023 rollout in his motion to create the committee.

There’s also 4th District Council Member and mayoral hopeful Nithya Raman, who proposed in late January a 15-year exemption for new multifamily, commercial and mixed-use development as part of a June ballot measure to jumpstart housing development in the city.

While advocates of Measure ULA led calls on Friday for the committee to keep the tax intact, others pushed for the use of data and studies before making any rollback recommendations.

The latter addresses a key critique of Raman’s earlier attempt to fast-track her proposed carveouts to the June ballot without what some said was sufficient public input.

Friday’s meeting comes a day after the Measure ULA Citizens Oversight Committee met for its monthly session. The COC was established under the ballot measure as a watchdog over the tax’s implementation.

On Thursday, it voted to support recommendations for changes around ULA-financed affordable housing projects, some of which overlap with Raman’s proposal. That includes expanding the definition of what qualifies as an affordable housing organization to include limited liability companies or limited partnership structures. There was also the loosening of affordability restrictions on ULA-funded projects, which are currently written into the measure as being senior to any liens, deeds of trust or other restriction.

Since April 2023, ULA has generated $1.1 billion, with nearly 60 percent of the transactions coming from single-family residential deals totaling $463.4 million, according to Los Angeles Housing Department data last updated on Wednesday. Commercial transactions have brought in the next largest revenue share of $406.1 million, accounting for 25 percent of all transactions.