Los Angeles Delays Spending Most of the Funds Raised by “Mansion Tax” Until Legal Challenges Are Resolved

Apartment Association of Greater LA and Howard Jarvis Taxpayers Association Sue

Los Angeles will delay spending most of the money collected from a voter-approved “mansion tax” until the legal challenges against the initiative are resolved, according to Mayor Karen Bass’s 2023-24 budget plans. The city intends to allocate just $150 million of the funds raised by Proposition ULA, a ballot initiative that took effect this month, to fund the construction of more affordable housing as reported by MSN.com. This decision will prevent the city from taking a loss if a lawsuit succeeds in reversing the tax, according to budget documents released this week. 

The city anticipates it would qualify for $150 million in federal reimbursements to make up the amount. A lawsuit filed by the Howard Jarvis Taxpayers Association and the Apartment Association of Greater Los Angeles against Proposition ULA is challenging the tax, claiming it violates California’s constitution. The levy imposes an added 4% on the sale of properties valued over $5 million and 5.5% for those sold for $10 million or more, paid by the seller. City officials predict that the tax will bring in $672 million in the fiscal year starting in July, which is at the lower end of initial projections that ranged as high as $1.1 billion.

A shortage of approximately 500,000 affordable housing units is currently affecting Los Angeles County, which is worsening the region’s homelessness crisis. Within the past ten years, the number of homeless people in the area has increased by over 75% to nearly 70,000, leading to the presence of makeshift shelters on sidewalks, tent encampments, and camper vans across the county.

Los Angeles County is currently facing a shortage of approximately 500,000 affordable housing units, which is worsening the region’s homelessness crisis. The homeless population has grown by more than 75% over the past decade to almost 70,000, with individuals sleeping in tents, on sidewalks, and in camper vans across the county.

Opposition from the real estate industry to Proposition ULA has emerged, as they claim that the tax may exacerbate affordability issues by increasing rents for both commercial and residential tenants. They have also raised concerns about the timing of the tax, as higher interest rates have already had a cooling effect on the housing market. The Howard Jarvis Taxpayers Association and the Apartment Association of Greater Los Angeles have filed a lawsuit against Proposition ULA, stating that the tax violates California’s constitution, as reported by the Los Angeles Times.

Residents have previously supported tax revenue measures to address homelessness, an issue consistently ranked as a top concern in polls. In 2016, LA city taxpayers approved Measure HHH, a $1.2 billion bond measure to fund over 12,000 housing units for the homeless. However, less than half of the units have been completed, according to the Los Angeles Housing Department. The program drew public ire last year when the city controller reported cost overruns, with some units costing $840,000 each.

Stephanie Klasky-Gamer, president of LA Family Housing said, as quoted by MSN.com, “While it’s disappointing, we appreciate the city’s caution. Ideally, the city would borrow against its reserves so that they can spend more aligned to the projected dollars raised via ULA.”

Related Posts

Suspect Killed by Los Angeles County Sheriffs in Shooting in West Hollywood

July 22, 2024

July 22, 2024

Incident on N. Gardner St. Under Investigation by Sheriff’s Homicide Detectives Los Angeles County Sheriff’s Homicide detectives are investigating a...

(Video) School of Rock Offering Summer Camps for Future Rockstars

July 22, 2024

July 22, 2024

Various Camps Are Offered for Beginners and Experienced Musicians Alike @palisadesnews Camps are offered for musicians of various skill levels...

Brush Fire Extinguished on Palisades Drive

July 21, 2024

July 21, 2024

There Were No Reported Injuries Firefighters swiftly contained a small brush fire in Pacific Palisades on Thursday afternoon, authorities said....

Michelle Bisnoff Arrested for $2 Million Investor Fraud Scheme

July 19, 2024

July 19, 2024

CEO of ESOS Rings Faces Securities and Wire Fraud Charges A Boca Raton woman was arrested today on charges of...

Even After Improvements, Santa Monica Beach Still Ranks as L.A.’s Most Polluted

July 18, 2024

July 18, 2024

A New Report Cites “Continuous Urban Activities” in the Area That Exacerbate Pollution By Zach Armstrong Water quality concerns continue to...

Pierson Playhouse to Present ‘Ride the Cyclone (High School Edition)’

July 18, 2024

July 18, 2024

The Tpteen Production Features a Cast of 13 Youth Actors Theatre Palisades Teen (TPTeen) is set to stage the cult...

Police Drone Catches Car Burglar in the Act, Suspect Apprehended

July 18, 2024

July 18, 2024

The Drone as a First Responder Program Incorporates a Sworn Officer Pilot Who Flies the Drone From a Launch Site...

New Summer Menu Introduced at SALT Restaurant & Bar

July 18, 2024

July 18, 2024

To Complement These Dishes, Salt Offers Two New Cocktails SALT, the waterfront restaurant at Marina del Rey Hotel, has introduced...

Charlie XCX-Themed Event Coming to Venice West

July 18, 2024

July 18, 2024

Many Have Referred to the Season as “Brat Girl Summer” By Zach Armstrong Venice Beach is going to be ‘bumpin’ that....

LAFD Rescues Two Hikers in Pacific Palisades Over Weekend

July 17, 2024

July 17, 2024

The Incidents Occurred About 7 Miles Apart By Zach Armstrong In two separate incidents over the weekend, one day apart...

Renowned L.A. Nursery Opens Fourth Location in Santa Monica

July 17, 2024

July 17, 2024

It Is a Transformation of an Abandoned Car Wash Into a Vibrant Garden Space L.A.-based nursery Rolling Greens has opened...

Judge Issues Final Ruling in Favor of Barrington Plaza Tenants Association

July 17, 2024

July 17, 2024

Decision against Landlord Finds Intent Does Not Meet Ellis Act Standards The final ruling in the case of the Barrington...

Power Outage Leaves Over 300 Without Electricity in Pacific Pali

July 16, 2024

July 16, 2024

DWP Crews Assessed the Cause of the Disruption More than 300 people were without electricity in Pacific Palisades following a...

LAPD and Family Seek Public’s Help to Locate Missing 69-Year-Old Woman

July 16, 2024

July 16, 2024

Beryl Angela Thomas Last Seen in Fairfax Area; May Be Disoriented The family of Beryl Angela Thomas and detectives from...

Residents Sue City of Los Angeles For Stalling Affordable Housing Development

July 16, 2024

July 16, 2024

The New Lawsuit Also Comes After Two Separate l.a. Superior Court Rulings Rejected a Coalition’s Multi-Year Effort to Halt the...