Chamber Expresses Opposition to San Diego Housing Federation's Proposed Ballot Measure, ''Homes For San Diegans''

 
For Immediate Release
Contact: Chris Thorne
Phone: (858) 217-8970.
Email: chris@sdbusinesschamber.com
www.sdbusinesschamber.com
 
For Immediate Release
 
North San Diego Business Chamber Expresses Opposition to San Diego Housing Federation's Proposed Ballot Measure, "Homes For San Diegans"
 
San Diego, Calif. – February 2, 2024 - The North San Diego Business Chamber, representing over 800 business members across San Diego County, has issued a letter of strong opposition to the San Diego City Council concerning the proposed Real Estate Transfer Tax outlined in the San Diego Housing Federation's Proposed Ballot Measure titled "Homes For San Diegans." This opposition follows the Economic Development & Advocacy Advisory Council's vote against the measure.
 
RE: Strong Opposition to San Diego Housing Federation’s Proposed Ballot Measure titled: Homes For San Diegans
 
Dear Members of the San Diego City Council,
 
I am writing to you on behalf of the North San Diego Business Chamber, representing over 800 business
members across San Diego County, including over 400 in the City of San Diego, to express our deep
concern and opposition to the proposed Real Estate Transfer Tax outlined in the Proposed Ballot
Measure Homes For San Diegans. Our members represent more than 350,000 employees, ranging from
global businesses with 5,000+ headcount, to minority owned small business and sole proprietorships.
Across this spectrum, there is broad concern for the profound and adverse effects on various sectors
within our community. It would essentially serve as a tax on job creation, burdening renters, and
imposing significant financial strains on single-family homeowners. Moreover, it would represent the
largest business-to-business wealth transfer in the City's history.
 
Our opposition to the Proposed Ballot Measure Homes For San Diegans Real Estate Transfer Tax is
grounded in several key concerns, including the proposed tax thresholds and rates, particularly noting
the absence of a sunset provision for the tax in the event of the establishment of a duplicative County,
State, or Federal property transfer tax. Ranging from 2.5% to 6.5%, these rates would impose substantial tax burdens on real estate transactions of various scales. Transactions exceeding $25 million, for
instance, could incur transfer taxes upwards of $1.625 million. Drawing from the cautionary tale of Los
Angeles' similar measure, we anticipate severe repercussions. The drastic reduction in real estate
transactions and revenue shortfalls observed in LA serve as stark warnings of the potential economic
strain that could befall San Diego. It is worth noting that the proposed tax measure in San Diego exceeds the severity of LA's, indicating an even greater potential for economic hardship.
 
Concrete examples further illustrate the exorbitant tax liabilities that businesses and individuals would
face under this measure. Transactions in Mission Valley, Little Italy, and Sorrento Mesa, among others,
could incur millions in transfer taxes, stunting growth and development in these areas, further reducing
already stressed housing inventory and creating broad swaths of derelict commercial property.
Comparing the proposed tax revenue to existing affordable housing funds reveals a troubling
disproportion, with the proposed tax unfairly burdening specific developments. Areas undergoing
redevelopment also face significant risks, as financial support may dwindle, halting projects and
diminishing community revitalization efforts.
 
Further, as a regional Business Chamber, it is our responsibility to advocate for strong safety nets in
support of our workforce. The Real Estate Transfer Tax proposed in the Ballot Measure Homes For San
Diegans poses substantial threats to our local economy and community well-being. We stand united
with various stakeholders, including job creators, rental housing owners, restaurants, contractors, and
small businesses, in formal opposition to this measure.
 
In conclusion, while we understand the importance of addressing the needs of affordable housing for
San Diegans and homelessness prevention, we urge careful consideration of the far-reaching
consequences and implore you to oppose this measure. Our organization remains committed to
engaging in further dialogue and collaboration to explore alternative solutions that are both reasonable
and less impactful on our community.
 
Thank you for considering our perspective on this matter. We appreciate your commitment to serving
our community and would welcome the opportunity to further discuss our concerns. Please do not
hesitate to contact me directly at chris@sdbusinesschamber.com or (858) 217-8970.
 
Respectfully,
Chris Thorne
CEO (Chief Executive Officer)
North San Diego Business Chamber
 
The letter outlines several key concerns, including:
 
Tax Thresholds and Rates: The proposed tax rates ranging from 2.5% to 6.5% are highlighted as burdensome, particularly for transactions exceeding $25 million, potentially imposing transfer taxes upwards of $1.625 million. The Chamber draws from the cautionary example of a similar measure in Los Angeles, emphasizing the potential for severe economic repercussions.
 
Sunset Provision Absence: The letter notes the absence of a sunset provision for the tax, expressing concerns about the lack of contingency planning in the event of duplicative County, State, or Federal property transfer taxes.
 
Impact on Development: Concrete examples are provided to illustrate the potential exorbitant tax liabilities that businesses and individuals could face, particularly in areas like Mission Valley, Little Italy, and Sorrento Mesa. The Chamber warns of stunted growth, reduced housing inventory, and the creation of derelict commercial properties.
 
Disproportionate Burden: A comparison between the proposed tax revenue and existing affordable housing funds reveals a troubling disproportion, potentially burdening specific developments and risking community revitalization efforts.
 
Community and Economic Impact: The letter emphasizes the Chamber's commitment to advocating for a strong safety net for the workforce and highlights the substantial threats posed by the proposed Real Estate Transfer Tax to the local economy and community well-being.
 
While acknowledging the importance of addressing affordable housing needs, the North San Diego Business Chamber urges careful consideration of the far-reaching consequences and implores the San Diego City Council to oppose the proposed measure. The Chamber remains committed to engaging in further dialogue and collaboration to explore alternative solutions that are both reasonable and less impactful on the community.
 
For more information or to discuss the Chamber's concerns further, please contact Chris Thorne directly at chris@sdbusinesschamber.com or (858) 217-8970. To learn about joining the Economic Advocacy Advisory Council email Senior Programs Manager Sophia Hernandez at shernandez@sdbusinesschamber.com
 
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About North San Diego Business Chamber:
North San Diego Business Chamber is a regional chamber of commerce located in San Diego County, California. Representing over 800 businesses and organizations employing more than 350,000 employees, the Chamber serves as a networking and advocacy organization, providing resources and support to help businesses grow and succeed. Services include networking events, business education and training, marketing opportunities, and advocacy on behalf of local businesses. North San Diego Business Chamber is dedicated to promoting economic development in the region and supporting initiatives that attract and retain businesses.
For more information and to join the North San Diego Business Chamber, please visit our website at SDBusinessChamber.com. For media inquiries, please contact Marketing & Member Relations Specialist Kayleigh Venne at kayleigh@sdbusinesschamber.com.