The way forward unclear for property transfer tax in San Bruno | Local News


A proposal for a new commercial property transfer tax in San Bruno moved forward this week, however, it is unclear whether the measure has adequate council support to be put on the ballot in November for approval. by voters.

City council has completed the first of two public hearings required by law to move the issue forward, but Mayor Rico Medina and council member Michael Salazar have expressed concern about passing a charter, which would move away the city from its current general law status and is required to proceed with the new tax.

At least four of the five council members will need to approve the measure before placing the question on the ballot, where it would require 50% approval or more. The tax would target commercial properties and residential buildings with five or more units, adding a 1% fee to the sale price, which the city says would generate about $1 million a year.

It’s a proposal that comes as the city has seen a growing number of high-priced real estate sales, such as the recent $328 million sale of The Shops at Tanforan, or the $215 million sale of the Bayhill campus. to YouTube.

The city also faces a projected deficit for the next five years or more as it faces hundreds of millions in unfunded infrastructure needs and per capita incomes far below those of many of its neighbors.

“We’ve had over $400 million in land sales in the last 2.5 years or so so I don’t know if we want to wait any longer and I think the more board support we have the better it will be. likely. succeeded at the polls,” said Vice Mayor Linda Mason, in an effort to persuade her colleagues.

Several neighboring towns already have a similar tax. San Mateo charges a rate of 0.5%, while others have rates as high as 1.3%. Some also have tiered rates like Berkeley’s, which slides up to 2.5% for transactions over $2.5 million.

A city-commissioned poll of 446 “likely voters” found the measure would pass by a narrow margin, with 55.4% of respondents saying they would definitely or probably vote yes.

Salazar had previously expressed concerns that the tax would have a negative financial impact on small landowners, however, he said his concerns now largely centered on the additional authority the charter might grant the city.

The city’s current general law status means that it must act within the framework of state laws and bylaws. With a charter, the city could set its own rules (still within the framework of the State Constitution) related to “municipal affairs”, including taxes and assessments.

“I’m less confident that it’s not a slippery slope because while we may be well-meaning today, a future board might have other ideas,” Salazar said.

He wondered if the city council could decide after the fact to extend the tax to single-family homes as well. He also pointed to low voter turnout at the hearing, which did not take place during the normally scheduled council meeting.

“That’s probably one of the most important things we’ll discuss this year,” he said. “I don’t believe doing this in this way and with the response we’re getting does any justice or creates a sense of trust in the community.”

According to the city’s legal counsel, any new tax, including the extension of transfer tax to other types of property, would require a new ballot measure even with a charter.

“As written, the power lies with the voters,” City Manager Jovan Grogan said.

But Rico Medina said he had other concerns and claimed the charter would allow the city council to set salaries for members above an existing cap.

“It’s great that my colleagues want to talk about ‘hey there’s potential for one-time funds,’ but all the other things that come with a charter city are also what I’m looking at as well,” he said. declared. .

To allay Salazar’s concerns about transparency, Mason and council member Marty Medina shared their support to discuss the issue once again at a future meeting before the second public hearing.

“This issue is so important that it would be great to get 5-0,” Marty Medina said. “It’s something we talked about many years ago…and here this council is still trying to figure out how to increase revenue without affecting the overwhelming majority of our residents, and that’s how we do it.”

The next board meeting will be June 14. A date for the second public hearing has not been set.


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