LA Council to tap into 'mansion tax' funds for fire relief

The Los Angeles City Council Tuesday advanced an effort to re-allocate some $15 million from the city's so-called "mansion tax" to an emergency rental assistance program for survivors of January's wildfires.

In a 14-0 vote two years to the day after Measure United to House Los Angeles went into effect, the council requested the city attorney, Housing Department and chief legislative analyst to report on how they can disencumber up to $15 million, and up to 10% from each House LA Fund expenditure category, to support fire survivors. Councilman Curren Price was absent during the vote.

The voter-approved “mansion tax” also celebrated its second year with attendance by city leaders and community activists at an event. According to their press release, the measure has raised more than $632 million to build housing, protect tenants, and create jobs. 

Without discussion, the council approved a motion first introduced by members Bob Blumenfield, Traci Park, John Lee and Heather Hutt on Jan. 29.

The Palisades Fire destroyed nearly 7,000 structures, killed 12 people and burned down much of Pacific Palisades, leaving thousands of residents displaced.

Voters passed Measure ULA in November 2022. It levied a 4% tax on property sales of more than $5 million and a 5.5% tax on sales of more than $10 million.

Revenue generated by the tax supports 11 designated ULA program categories: development of multifamily housing; alternative housing solutions; acquisition, preservation, lease, rehabilitation or operation of affordable housing; homeownership opportunities; rental and income assistance, eviction defense and prevention; tenant outreach and education; tenant harassment protections; and the formation of a tenant council.

About 70% of revenue generated by ULA supports affordable housing programs and the remaining 30% funds homelessness prevention initiatives.

Critics of the measure such as the Howard Jarvis Taxpayers Association and the Apartment Association of Greater Los Angeles previously warned that it would have a chilling effect on the city's real estate market.

As of February, ULA has raised a total of $632 million. According to the ULA Citizens Oversight Committee, a 15-member panel overseeing ULA funds and programs, it has kept 11,000 residents in their homes through rental assistance, funded the start of construction on 795 affordable homes and created thousands of jobs.

Joe Donlin, director of the United to House LA Coalition, told the LA Daily News that the group does not support the council's approach because it would "divert essential administrative funds, trigger a complex revision process and potentially put the city out of compliance with the ordinance."

He suggested a different approach that would update eligibility requirements for the existing $14.5 million ULA Income Support program to help wildfire victims.

The city has taken steps to support wildfire victims, such as implementing rental protections and expediting rebuilding efforts.

However, in March, the City Council shot down a proposal by members Eunisses Hernandez and Hugo Soto-Martinez, who called for an eviction and rent increase moratorium to help residents and workers who were financially impacted by the fires.

Additional reporting by City News Service.