With the election days away, a battle over Measure M, a ballot initiative that would increase so-called documentary transfer tax rates, is suddenly heating up.
In the last month, the National Association of Realtors and the California Association of Realtors spent a combined $75,000 on mailers, online ads, and telephone calls urging Richmond residents to vote No on Measure M, while Mayor Tom Butt has defended the measure for the revenue it would raise: an estimated $4 to $6 million per year, which would go into Richmond’s general fund.
Richmond’s current documentary transfer tax—a fee home-sellers must pay when closing on the sale of their home—is currently set at 0.7 percent per thousand dollars. Measure M will bump the tax up to one percent on properties sold for less than $400,000 and one and a half percent on properties sold for an amount equal to or greater than $400,000.
Jeffery Wright, a former spokesperson for the Contra Costa Association of Realtors, the National Association of Realtors branch that represents Richmond, said that a higher documentary transfer tax would deter people from buying or selling a home in Richmond. “We don’t want anything that would put obstacles up between a buyer or seller,” he said.
In his Oct. 30 e-forum, Butt said that the people most likely to be affected by Measure M are commercial property owners, not homeowners.
But Wright says that Measure M will “affect the average Joe.”
“Nowadays most real estate transfers are between homeowners, not just commercial property or foreclosures,” Wright said.
An argument in favor of Measure M was not posted to the City Council website until Oct. 30. The argument against Measure M, filed by Contra Costa Taxpayers Association President Jack Weir, was filed with the City Clerk’s office on Aug. 24.
The mayor said that the revenue generated by Measure M is critical to strengthening city services. Without it, Butt said, “the police department, the fire department, the library and other city services could face budget cuts.”
Butt also said that opposition to Measure M is “shortsighted,” as improving city services with the extra revenue would make Richmond a more desirable place to live.
“The value of property is based on people’s quality of life in the community, which is dependent upon the quality and range of services Richmond can provide,” he said.
According to Butt’s Oct. 30 e-forum, Measure M has roots in an April 2016 presentation by Russ Branson, a senior management consultant with the San Francisco firm Public Financial Management, on the city’s plan to balance its five-year budget. City Council would have to either cut back on city services or generate revenue through additional taxes, Branson said; he suggested the documentary transfer tax was a lucrative way to raise money for the city.
“Many people think taxes are not for them, that they’re for some nefarious purpose,” said Butt. “But taxes are for getting something in return. Voters are going to have to make some value judgements.”
This article has been updated: Jeffrey Wright is a former, not current, spokesperson for the Contra Costa Association of Realtors.