Analysis of Raman's Measure ULA carveouts estimates $177M revenue hit

"A proposed ballot measure to create aggressive carveouts to the city's Measure United to House L.A. tax is going through the ringer following the release of a study which estimated changes to the tax could cut its revenue by 35 percent, or $177 million. New findings presented to the committee tasked with evaluating any changes to Measure ULA seemed to beg more questions than answers. Friday's discussion offered little on which way the city of Los Angeles should go on possible amendments to the so-called mansion tax, as local leaders sparred over the interpretation of opposing data sets."

"Measure ULA, which went into effect in 2023, currently applies a 4 percent tax on real estate deals starting at $5.3 million and increases to 5.5 percent on transactions of $10.6 million or more. Those price thresholds will change to $5.4 million and $10.9 million after June 30. The analysis presented on Friday to the Measure ULA ad hoc committee marked the first time a study from within City Hall has gone before the panel."

"That analysis, which was conducted by the Los Angeles Housing Department, evaluated the implications of ULA exemptions 4th District Council Member and mayoral hopeful Nithya Raman sought to get her peers to fast track onto the June ballot back in late January. Instead, that proposal drew the ire of some, who suggested the move lacked a full public discussion. We're tracking the discussions underway in the ad hoc committee on Measure ULA reform and look forward to engaging further when this matter comes before the full council, Raman said in a statement to The Real Deal."

"The Raman proposal from January, which would have provided a 15-year carveout for newly built multifamily, commercial and mixed-use projects, would reduce ULA revenue by 13 percent, according to LAHD. When factoring in remodels done to those same property segments, the revenue reduction would be 29 percent. In the case"

A proposed ballot measure would create aggressive carveouts to Los Angeles’s Measure ULA, a tax on high-end real estate transactions. A study presented to the Measure ULA ad hoc committee estimated that changes could cut revenue by 35%, or $177 million. New findings raised more questions than answers, with local leaders disputing interpretations of opposing data sets. Measure ULA took effect in 2023, applying a 4% tax on deals starting at $5.3 million and 5.5% on deals of $10.6 million or more, with thresholds scheduled to adjust after June 30. The Los Angeles Housing Department analysis was the first internal City Hall study brought to the panel. A January proposal by Nithya Raman sought a 15-year carveout for newly built multifamily, commercial, and mixed-use projects, reducing revenue by 13%, or 29% when remodels were included.

Read at therealdeal.com