Mayor Butt advocates for Measure M as realtor groups spend to defeat it
on November 4, 2016
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.
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“Many people think taxes are not for them, that they’re for some nefarious purpose,”
very interesting quote.
thank
Let me offer a little clarification because reporters are great at paraphrasing and adding to and subtracting from. To begin with, at the present time Jeffrey Wright is not an official spokesperson for the Contra Costa Association of Realtors on this issue or any other issue. I directed the reporter to speak to someone at CCAR on the issue. She asked me my opinion on Measure M, specifically as to why the National Association of Realtors was in opposition and she also wanted to know how Measure M will impact buyers and sellers of real estate. I gave her my opinion as a real estate practitioner with 37 years of experience in the business and as a longtime Realtor member. Two very important tenents of the National Association of Realtors are the preservation of private property rights and promoting home ownership. Issues that that are counterproductive to these tenents are subject to run into opposition. In 2013 when a select group of individuals were leading the charge to use eminent domain to seize mortgages in Richmond they were met with fierce opposition from the Realtor organization because of the infringement on private property rights as well as the potential for major disruption in the mortgage finance market which could have had a devasting impact on the local real estate market and severely impeded the options for buyers and sellers of real estate in Richmond. As I explained to the Richmond Confidential reporter, Realtors understand the need for the city to raise revenue however we are also strong supporters and promoters of homeownership because of all of the benefits that come with ownership including neighborhood stability and the injection of spending into the local economy. For real estate transactions of $400,000 or more Measure M increases the tax from $7.00 per thousand to $15.00 per thousand of transaction value which means that buyers and sellers of real estate will have several thousand dollars more in transaction costs. Several years ago many transactions were comprised of banks selling foreclosed properties and it was the banks as sellers of the real estate paying the real estate transfer taxes. That’s not the case today. Most of the local real estate transactions are taking place between regular home sellers and buyers. Additional costs make it more expensive and difficult for buyers and sellers of real estate to transact business. So, again the National Association of Realtors in conjunction with the California Association of Realtors and the local Association of Realtors – the Contra Costa Association of Realtors are interested in preserving private property rights and promoting homeownership because it is good for our communities and good for our Realtor members. On a personal note I will say this, and that is that I agree 100% with Mayor Butt’s last sentence “voters are going to have to make some value judgements.”
[…] Measure M, a new property transfer tax, did not pass. Seventy percent of voters said ‘No’ to the […]