We were successful in the campaign to stop Prop. G, the so-called “anti-speculation tax” on last November’s ballot. Had it passed, the ordinance would have added an exorbitant surtax onto the existing transfer tax. But the tenant groups who coalesced around the issue haven’t given up. They are still talking, have a Facebook page and are preparing to come back this year.
Spokesman Quintin Mecke, who has been advocating an assortment of left-wing causes for years has finally found his big issue – with backing by the San Francisco Anti-Displacement Coalition. Count on him to hang on to it like a dog with a bone.
He cost of defeating a populist bill like G was enormous. Estimates are as high as $1.8 million. SPOSFI members contributed generously, especially with “boots on the ground.” Other owner groups contributed as well, most notably, the San Francisco Association of Realtors, backed by their state and national affiliates. But we can’t afford to keep beating back these reckless ballot measures forever when the proponents have nothing to lose. As George Bernard Shaw said, “The government that robs Peter to pay Paul will always have the support of Paul.”
How Will They Repackage Prop. G?
They will do it by addressing its perceived weak points. Ideas range from:
- lessening the number of years the buyer has to own the building from five to three
- taxing only the profit, not the entire sales price
- extending it to buildings over 30 units
- excluding homes with in-law units and
- including exemptions for hardship or special circumstances
My guess is that these things are in the works right now.
What tenant zealots fail to understand is that, like it or not, “speculation,” a dirty work in their eyes, is one of the foundations of real estate economics. Confiscatory penalties like those found in Prop. G lead to a series of unpleasant consequences that only further limit the availability of rental units.
But, hey, it’s too early to start mounting a defense. It’s only February and we have leaks to mend and taxes to prepare. Just don’t say we didn’t warn you.
Karen Crommie is a SPOSFI member. Reprinted with permission of the Small Property Owners of San Francisco Institute (SPOSFI) News. For more information on becoming a member of SPOSFI or to send a tax-deductible donation, please visit their website at www.smallprop.org or call (415) 647-2419.