DECEMBER 2022 – When the City of Hercules, CA threatened to establish a Real Estate Transfer Tax to help pay for services and maintenance, members of the Contra Costa Association of REALTORS® raised their voices in opposition. The REALTOR® Party’s Advocacy Everywhere program helped to get the message across.
Like many jurisdictions around the country, the City of Hercules, California, was searching for ways to shore up its funding for city services and maintenance. By becoming a Charter City, it would be able to establish a real estate transfer tax (RETT), which, on the surface, could generate the revenue it sought. But the local REALTORS® saw the danger in that plan and opposed it using the REALTOR® Party’s Advocacy Everywhere program – not once, not twice, but in a three-part Call For Action. The proposed tax failed, but the revenue is being raised through an increase in an existing user utility tax, which the REALTORS® supported: a win-win, all around.
Heather Schiffman, Government Affairs Director of the Contra Costa Association of REALTORS®, explains that the real estate transfer tax would have concentrated the burden of paying for programs and services that benefit the community at large on a relatively narrow base of property owners, including seniors and first-time homebuyers. “A lot of cities are attracted to the real estate transfer tax as a quick and easy revenue solution. The problem is, they think of it as a specific amount, when, in reality, the yield is too cyclical to reliably serve the General Fund. So, not only is it unfair, it doesn’t make good economic sense.” In terms of the real estate industry, she notes, ‘There’s no question that a real estate transfer tax would decrease the affordability of housing in Hercules by adding yet another cost to a growing list of expenses involved in the purchase or sale of a home. Making housing less accessible for teachers and first-responders is not going to be in the best interests of the community.”
Despite having commissioned polling that showed insufficient support for the charter city/RETT plan, the Hercules City Council was still eager to put it in the ballot. In response, the REALTORS® launched targeted Calls For Action prior to each of two hearings on the issue. “The system is so refined, allowing us to contact members who live in Hercules, though it’s only one of several cities we represent, with certain areas of overlap,” says Schiffman. “Our members were great about participating, and our board members went the extra mile by reaching out to brokers in their area.”
The third CFA, issued just prior to the vote to put the Charter City issue on the ballot, not only opposed it, but pointed the City Council toward a more fair and economically sound solution: increasing the user utility tax, in which the full community supports the General Fund through the communication, electric, and gas services it receives. This possibility had received favorable support in the City Council’s own polling, and in a unanimous vote, the council placed it on the November ballot for the citizens to decide; it passed handily, with nearly 70% of the vote.
“I can’t recommend Advocacy Everywhere enough,” says Schiffman, who, as a veteran GAD, has used it many times. “It’s so user-friendly, and Calls For Action are really the best way to get an advocacy message through to elected officials, when you need to show them you’ve got voters behind the message.”
To learn more about how the Contra Costa Association of REALTORS® is working to protect property owners from an unfair tax burden, contact Government Affairs Director Heather Schiffman at [email protected] or 925.295.9232.
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