Building Trades Win Major Housing Measure

A union-led, powerhouse grassroots campaign, years in the making, scored a big win with Los Angeles voters in the Nov. 8 election, offering a reconfiguration of the vexing challenge of affordable housing and homelessness prevention at an unprecedented scale.

The United to House LA measure—a transfer tax on property sales over $5 million in the city of Los Angeles that could fund nearly $1 billion in affordable housing production, homelessness prevention and renter aid each year—introduces a structural change that, proponents say, will allow them to intervene in the spiraling crisis. 

Mega-mansions that sell for more than $5 million will generate money for affordable housing.

The Building Trades helped lead and fund the campaign from start to finish, along with a broad coalition of community organizations.

It won 512,808 votes—a 58 percent margin.

“That’s a mandate,” said Chris Hannan Executive Secretary of the Los Angeles/Orange Counties Building and Construction Trades Council. “We are turning this crisis into an opportunity for better homes and better, lifelong careers for our current and new union members.”

New Mayor Karen Bass made an immediate “state of emergency” declaration on homelessness when she took office in December 2022. 

In order to cut the number of tent encampments across the city, Mayor Bass is concentrating on interim measures like tiny home villages.

But any long-term solution will have to increase permanent affordable housing, and that’s where Measure ULA comes in. It confronts the uncomfortable reality that homeless Angelenos are not an abstraction; they are people who were once housed. They are people who will lose their housing.

Community activists support Measure ULA.

The ULA tax is expected to bring in $600 to $900 million annually, funding the union construction of 26,000 affordable units over the next decade and assisting tens of thousands of renters each year. 

Unlike Measure HHH, the $1.2-billion bond voters approved in 2016 with a 10-year term, ULA secures a permanent, ongoing funding source. 

Jeannette Brown, senior director of public affairs at coalition member SCANPH, said ULA “could be a game changer” in how the industry produces affordable housing. “The affordable housing community, the builders, so much of what we spend time on is advocating for resources; we will never get close to what we actually need but at least ULA is a step in the right direction,” Brown said.

The measure will increase the city’s transfer tax on property sales over $5 million by 4 percent, adding to an existing 0.45 rate, and raise to 5.5 percent for sales over $10 million. 

While often referred to as a “mansion tax,” only around 3 percent of single family home sales will be affected, according to an analysis from the UCLA Lewis Center. Most of the revenue will come from commercial real estate transactions, with around 4 percent of total transactions affected. About 72 percent of revenue will come from properties sold for over $10 million.

The bold measure already has opposition while it is being enacted. Three anti-tax, anti-worker groups have filed lawsuits. However, the city is moving ahead with collecting the ULA funds while it defends Measure ULA.

“It is not surprising that our opponents, who lost at the ballot box, will turn anywhere to stop this,” Hannan said. “They’d be better off spending their money building more housing.”

The ULA money will be earmarked specifically for housing and renter aid, instead of flowing into the general fund. Seventy percent of the tax revenue will fund construction and acquisition, and 30 percent will go to direct cash aid and legal help for renters.

All ULA projects of 40 units or more will be built under a Project Labor Agreement with the Building Trades Council, creating an estimated 44,000 construction jobs over the next decade. The PLA is the same as that already in effect with the city, offering benefits and career pipelines for apprentices from diverse and disadvantaged backgrounds. 

The Council’s longtime headquarters in Historic Filipinotown served as the base for “Get Out the Vote” efforts in the last weekend of the campaign.

 “ULA brought together tenant advocates, affordable housing developers, construction workers and service employees in a unique way that’s never been seen before in the city of LA, and that’s going to transform how we build affordable housing and how we create more affordability for unionized workers in the city,” said Eli Lipman, Executive Director of Move LA, an originator of the initiative. 

IBEW Local 11 political director Antonio Sanchez, involved early on in the process, estimated around 80 percent of the campaign funding came from organized labor. He noted that the Building Trades first took a stake by funding the signature-gathering to get Measure ULA on the ballot. It needed 61,000 signatures and guaranteed success by turning in 98,000.

“This measure would not have won, the signatures would not have been collected on time, it wouldn’t have been written, and the campaign from ULA would not have been as robust without the Building Trades and IBEW,” Sanchez said, also pointing to support from the State Building Trades, SEIU Local 2015, UTLA, UniteHere and other unions.

United Way was really proud to be part of the broadest coalition to ever advance a housing proposal in the city of LA,” said Tommy Newman, the organization’s vice president of engagement and activation. “Labor, housing justice and community organizations came together in a really broad and diverse way—over 200 of them—which is a really big deal.”

Los Angeles is having an affordable housing crisis.

With Measure ULA, more people can live in new, safe, affordable homes.

The LA County apartment vacancy rate was 3.5 percent as of the first quarter of 2022—a 22-year low, according to recent reports—and average rent for a one-bedroom apartment in the city is nearly $2,500 (a 12 percent increase over last year). A 2020 USC survey found nearly half of renters were already spending more than half of their household income on rent and utilities before the Covid-19 pandemic. 

Those are signs of housing insecurity. Emergency assistance and eviction moratoriums during the pandemic are expiring. 

The city hit just 34 percent of its goals for permitting homes for very-low-income households, 30 percent for low income, and 6 percent for moderate income, according to a UCLA report. 

Proposition HHH, passed in 2016, is on track to create 10,000 units by 2026, but the need is compounding. According to the 2022 Homeless Count, the homeless rate in LA County increased 4.1 percent over 2020 (to 69,144 from 66,436). In LA city, the number increased by 1.73 percent in the same period (to 41,980). While hundreds of people find housing each day, more than that become homeless.

Advocates are seizing this opportunity to redirect the focus to long-term solutions. That includes bringing union labor standards to the housing industry.

“As an Angeleno, I grew up in the city of LA, and I don’t want to leave it,” Sanchez said. “I want my kids to be able to afford to live here too. So we have to help decrease the cost of housing, we have to build more. Everything has to be on the table so working families can stay in the city of LA.”

Looking ahead, the coalition must maintain momentum, and commit to using the power it generated during the campaign. “The ‘Yes’ side won 512,808 votes,” Hannan pointed out. “That’s a strong mandate.”

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