Dan Walters

Opinion: Low-income housing plan needs GOP votes on taxes

Assembly Speaker Toni Atkins, terming the lack of affordable housing “likely the No. 1 threat to our economy and way of life,” is trying to resurrect the transaction tax in a package of bills to build housing for low-income Californians feeling the pinch of high rents.
Assembly Speaker Toni Atkins, terming the lack of affordable housing “likely the No. 1 threat to our economy and way of life,” is trying to resurrect the transaction tax in a package of bills to build housing for low-income Californians feeling the pinch of high rents. hamezcua@sacbee.com

The Capitol’s chatterers had much to say when Democrats won two-thirds supermajorities in both legislative houses three years ago.

It gave Democrats the power, at least on paper, to pass tax increases, constitutional amendments and urgency bills without Republican votes.

But it was, for the most part, only on paper. Actually getting Democrats to agree on any of those things proved difficult, and the supermajorities were largely nonfactors before being erased by Republican gains in 2014.

One of the very few times a supermajority was employed was on May 29, 2013, when the Senate voted 27-12 for a bill that would tax real estate transactions to raise money for low-income housing projects.

However, legislative leaders had tied it to another measure in hopes of neutralizing opposition from the California Association of Realtors and the ploy failed, so the housing bill died in the Assembly without a vote.

The low-income housing squeeze is very real, as a report from the Legislature’s budget analyst, Mac Taylor, highlighted last week. Poor families must shell out two-thirds of their incomes to pay California’s high rental rates. But that tactical miscue – failing to use the Assembly supermajority when it still existed – may thwart one effort to do something about it.

Assembly Speaker Toni Atkins, terming the lack of affordable housing “likely the No. 1 threat to our economy and way of life,” is trying to resurrect the transaction tax in a package of bills to build housing for low-income Californians feeling the pinch of high rents.

Atkins wants to take a bite – a nibble, really – out of the problem by imposing the $75 tax on real estate transfer documents, up to $225 per parcel, increasing the state’s low-income housing tax credit by $300 million, tapping into federal housing funds, and using savings from reduced prison costs to provide housing for former inmates.

But because the real estate transaction element is a tax, it requires two-thirds votes of both legislative houses, and since Democrats no longer have supermajorities in either house, it would need at least a few Republican votes.

Opposition to new taxes is a bedrock tenet for Republican politicians. The last Republicans who violated it and voted for taxes, during Arnold Schwarzenegger’s governorship, paid very stiff political prices for their acts.

One assumes that the California Association of Realtors would still oppose it, but even were the Realtors to switch, it’s still doubtful that any Republicans would walk the political plank.

Even were the transaction tax and tax credit enacted, they would provide only a small fraction of what would be needed to make a serious dent in the low-income housing squeeze. Without the tax, Atkins’ housing package is little more than a declaration of good intentions.

Call The Bee’s Dan Walters, (916) 321-1195. Back columns, sacbee.com/dan-walters. Follow him on Twitter @WaltersBee.

  Comments