The Los Angeles City Council has approved a $150-million spending plan for funds generated by Measure ULA, a tax measure passed by Angelenos in November. This marks the first time that funds will be specifically allocated since the tax was approved. The expenditure plan will be directed towards six programs aimed at addressing the housing crisis in the city.
The programs include short-term emergency rental assistance, eviction defense, tenant outreach and education, direct cash assistance for low-income seniors and people with disabilities, tenant protections, and affordable housing production. Councilmember Nithya Raman described this as the largest source of revenue specifically designated for these purposes that the city has ever had, saying it is transformative for Los Angeles.
Out of the $150 million, $23 million will be allocated to eviction defense, $23 million for income support for rent-burdened seniors, and $18.4 million for rent debt assistance. The first program to be implemented will be an emergency rental assistance program, scheduled to open on September 19.
Measure ULA, also known as the ‘mansion tax’, came into effect on April 1, imposing a 4% charge on all residential and commercial real estate sales above $5 million, and a 5.5% charge on sales above $10 million. The tax has generated approximately $55 million since its implementation. However, the city can only spend the funds as they come in, so the full $150 million cannot be utilized until the tax generates that amount.
Before the City Council’s vote, tenants and community activists voiced their support for the funding, emphasizing the urgent need for assistance in outreach and defense programs. The funding will provide legal representation for tenants facing eviction, leveling the playing field with landlords. Activists stressed the importance of housing as a human right and urged the council to pass the allocation plan.
While $55 million is a significant amount, it falls short of the original projections for the measure. Early estimates anticipated an annual revenue of around $900 million, but this has been revised to $672 million. The slowdown in the luxury real estate market, combined with some homeowners avoiding the tax, has influenced the lower revenue. Mayor Karen Bass’s budget proposal accounted for only $150 million from Measure ULA.
However, regardless of any potential overturning of the measure, Councilmember Bob Blumenfield assures that the full $150 million will be spent. The measure currently faces challenges in court and a state ballot measure that may impact its future. If overturned, the city would have to repay the funds raised.
Sources:
– Los Angeles Times: https://www.latimes.com/homeless-housing/story/2022-09-07/los-angeles-city-council-approves-measure-ula-spending-plan-housing
– LAist: https://laist.com/news/measure-ula-los-angeles-city-council-money