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Santa Monica Voters to Decide Fate of Two Ballot Measures

Bob Kronovetrealty
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By Jorge Casuso

August 4, 2020 -- Local voters will decide whether to boost Santa Monica's luxury real estate tax to help fund municipal services and amend the City Charter to help diversify its workforce.

The measures -- which the City Council unanimously voted to place on the November 3 ballot last Tuesday -- require a simple majority of the vote.

The proposed funding measure would double the real estate transfer tax on sales exceeding $5 million from $3 to $6 per $1,000.

The change would generate some $3 million next fiscal year, a total expected to double in five years as the economy recovers, said City Finance Director Gigi Descavalles-Hughes.

The new revenues will help address the "devastating impacts of the COVID pandemic" on the City's budget, which shrank by 25 percent, Descavalles-Hughes said.

The unprecedented budget shortfall forced the Council to slash jobs, programs and services ("City Council Slashes Up to 247 Full-time Jobs," May 6, 2020).

If approved, the tax would impact few residential properties, Descavalles-Hughes said.

A review of real estate transactions in 2019 found that 81 parcels sold for more than $5 million, she said. Of those 51 percent were residential, with a third of them single-family homes.

Finding new sources of funding is necessary given the "changes to the economic landscape that have shaped traditional local government revenue structures, compounded by the catastrophic economic impact of the COVID-19 pandemic," the Finance Director wrote in her report.

"New reliable funding sources" will help "protect Santa Monica’s foundational services into the future," Descavalles-Hughes said.

A poll taken in the last week of May found that 62 percent of Santa Monica registered voters backed the proposed measure ("COVID-19 Impacts, Homelessness Top List of Voter Funding Priorities," June 19, 2020).

More than half of the respondents thought it was important to use the money to clean and disinfect public spaces, including parks, beaches and libraries.

Reducing homelessness and public safety -- two longstanding priorities -- remained at the top of voters' concerns, according to the poll.

The other measure the council placed on the ballot would help diversify the City's workforce by making it easier to hire minorities and women ("Council to Consider Ballot Measure Changing Hiring Rules," July 24, 2020).

The proposed measure would amend and repeal sections of the City Charter that guide civil service appointments and promotions by eliminating appointment rules, according to the staff report.

The rules require "vacant positions to be filled using a closed internal promotional recruitment" and "selecting from only the top three highest ranked internal candidates."

These rules benefits "a narrow pool of internal recruitment candidates" and "artificially excludes other qualified candidates from even being considered," staff wrote.

If the measure passes, the Council would need to approve an ordinance replacing the affected sections.

"The measure would simply remove language from the Charter," said interim City Attorney George Cardona. "It would not alter the language.

"It would leave the Council free to make amendments to the municipal code provisions," Cardona said.

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