The city imposes a property transfer tax when real estate changes hands, but foreclosures and similar transactions are exempt. This measure would eliminate that exemption for large commercial properties. Residential properties with five or fewer units would continue to be exempt, as would smaller mixed-use properties. The controller’s office estimates Proposition J could raise up to $150 million annually over the first five years for the general fund. Passes with a majority vote.
Yes Argument
Right now, the real property transfer tax exemption on foreclosures benefits corporate lenders at the expense of residents. Passing Proposition J closes that loophole while maintaining the tax break for families and small businesses facing hard times. It would apply to office towers, industrial buildings and mega-complexes that already exist, not new housing. It taxes lenders, not builders. And it raises vital revenue while the city is facing a budget shortfall.
No Argument
This measure would cripple the city’s economic recovery by creating a punitive, unpredictable environment for lenders. No other major city in California penalizes lenders by taking back collateral on distressed properties. It would make lending significantly riskier in the city, potentially leading to higher interest rates and higher down payments or forcing lenders to leave the city entirely. It’s a blank check for politicians, with no legal guarantees for how the money will be spent.
Key Supporters
In Support
- Daniel Lurie, mayor, San Francisco
- Bilal Mahmood, supervisor, San Francisco
- Scott Wiener, California state senator
- San Francisco Democratic Party
- SEIU Local 1021
In Opposition
- Quentin Kopp, president, San Francisco Taxpayers Association