Aug 24 2020

ELECTION: Two Piedmont Tax Measures: Pool Bonds and Increase in Real Property Transfer Tax

Piedmont voters will decide on November 3 two ballot measures taxing Piedmont properties.  Both measures were approved for the ballot and are supported by the Piedmont City Council.  There is official opposition to both ballot measures. The two measures will be located near the end of Piedmont ballots.

The arguments for and against the measures are linked below.

Each measure has an analysis by Piedmont’s attorney linked below.

Measure TT  increases the Real Property Transfer Tax (RPTT) on the sale of Piedmont residences to fund general City purposes.

Measure UU is a bond to fund the reconstruction of the Piedmont Municipal Pool and build new associated facilities.

Questions on the ballot >  Notice of Election – Measures

Measure TT – Transfer Tax Increase on Real Property Sales

Measure UU – Pool Construction Bonds 

2 Responses to “ELECTION: Two Piedmont Tax Measures: Pool Bonds and Increase in Real Property Transfer Tax”

  1. Measure UU – NO, NO, NO! First – Not advaorem. This is a totally overblown project! Repair what you already have and maintain it properly. Piedmont property owners already pay excessive taxes; especially seniors!

  2. Thanks PCA for consolidating these measures into one page where residents can dialogue. As with any ballot measure, to have a discussion of the merits it’s important to get the facts straight. Here’s my fact check on some of the pro and con ballot statements.

    Argument in favor of TT

    “When tax revenue exceeds the forecast, Council allocates the excess for equipment replacement, facilities maintenance, and to address long-term liabilities.”

    True, but. What that statement leaves out is that annual transfer tax revenues ($3.5M) have exceeded forecasts ($2.8M) every year for the past 10 years, resulting in $5M in the Facilities Maintenance Fund. To justify the Measure TT, the BAFPC [Budget Advisory Financial Planning Committee] forecasts the transfer tax will be flat at $2.8M for the next 10 years, essentially ignoring growth of the past 10 years. Projections show annual transfer tax revenue growing to almost $5M by 2030. ( Even without measure TT, the City will raise the funds it says are needed for facility maintenance.

    Argument against TT

    “The proposed increase of the City’s transfer tax rate would make it the highest flat rate in the entire State of California and could cost homeowners tens of thousands of dollars when buying or selling their home.”

    True. Other cities have higher top-tiered rates for properties over $2M but when you average all the tiers in those cities, the average rate is lower than Piedmont’s. The median price of a Piedmont home is $2.2M and all homes pay one rate whereas other cities scale the rates. Piedmont does have the highest overall tax rate of comparable cities (see October 2019 report, and the cost of housing has been identified as a top concern in community surveys.

    Argument in favor of UU

    “The three existing pools will be replaced with two pools to meet resident needs….Replaced pool facilities, restrooms, and related areas will conserve energy and water…..If Measure UU does not pass, the Piedmont Community Pool is on track to be closed permanently”.

    True, but and false. True, the proposed new aquatic center has only two pools but has triple the water area than the current pool. Compared to the current leaking pool, the new pool would likely save water but that depends on the TBD filtration technology for the pool. An upgraded pool would likely use the same technology. As to energy, a new pool would use the latest energy-efficient technology but so would a rebuilt pool. The key energy question for a new pool is how much greenhouse gas will it emit – the current pool generates over half of municipal CO2 emissions. Consultant estimates for the new pool show it will increase the city’s greenhouse gas emissions.

    The pool is not on a track to be closed permanently. Unless I missed it, Council has taken no action to permanently close the current pool. That decision will be made by a future Council with more thorough consideration of repairing or rebuilding the current pool should UU fail.

    Argument against UU

    “In the first seven months of 2020, the volume of Piedmont home sales dropped by $33,494,500, reducing transfer tax revenue by over $435,000; annualized, the number would be almost $750,000.”

    True but. Transfer tax revenue was $3.8M in 2019 so 2020 revenue was lower ($3.5) but still came in above the $2.8M forecast. But, if passed, UU bonds will be paid for by a new ad valorem tax (average rate of 2.6 cents per $100 of the assessed valuation, or about $575 for a $2.2M house) so transfer tax revenue will not be used on UU debt.

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