Hoping to expedite recovery efforts in the Pacific Palisades burn area, Mayor Karen Bass called on the City Council Thursday to adopt an ordinance allowing for a one-time exception to the city's so-called "mansion tax" to speed property sales and expedite rebuilding projects.
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In November 2022, Los Angeles voters approved Measure ULA, which assesses a 4% tax on property sales of more than $5 million and 5.5% on sales of more than $10 million, with the revenue earmarked for affordable housing and homelessness-prevention initiatives.
As of August of this year, the measure had generated roughly $830 million, according to the city.
In a letter sent to the City Council Thursday, Bass wrote that providing a one-time exemption from Measure ULA for fire-affected homeowners who want or need to relocate from the fire zone will make it easier for them to sell their properties.
"Many homeowners affected by the fires are long-time residents living on fixed incomes and with much of their life savings tied to the equity in their property," Bass wrote in her letter to the council. "Some of these owners want to leave the fire zone area and rebuild their lives in other communities, giving an opportunity for a new owner to rebuild on the now vacant lot or renovate an older home still standing.
"But potential buyers of these Palisades residential properties are factoring in the cost of Measure ULA to make lower than market value offers. Sellers may be unable or unwilling to accept these low offers resulting in vacant residential lots that continue to sit empty and houses not destroyed being stuck on the market. This makes it harder for homeowners, even if they need to or wish to move, and delays or potentially misses the opportunity for the recovery and rebuilding of the Palisades."
Bass urged the council to approve an ordinance allowing the city director of finance to enact rules granting the limited one-time exemption from Measure ULA. After the ordinance is adopted, Bass said she would issue an executive directive instructing the finance director to allow for the exemption.
According to the mayor's office, the proposed Measure ULA exemption was an idea born from a meeting between Bass and her former mayoral election opponent, businessman Rick Caruso, founder of the wildfire recovery organization Steadfast LA. Caruso "proposed ideas to help address this issue," according to Bass' office.
Bass, speaking Wednesday night at Bloomberg's Screentime event, told the crowd that she met with Caruso "a couple of weeks ago" and said they were "working on a couple of things together."
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