A first-of-its-kind ballot measure that would have raised property taxes to fund affordable housing development across the Bay Area’s nine counties has been yanked from the November ballot.
In a unanimous vote Wednesday, the commissioners of the Bay Area Housing Finance Authority decided to withdraw Regional Measure 4 — a proposed $20 billion bond — after opponents challenged the ballot item’s language and annual calculations.
The vote to reverse course is a stunning setback for housing activists and local officials who spent four years putting together the measure, banking on high voter turnout during the presidential election.
Among the most egregious discrepancies uncovered was the annual projected cost to taxpayers through fiscal year 2077-78. On the ballot, RM 4 listed the cost at $670 million, when the amount would actually be about $910 million after interest — a discrepancy of 35%.
Wednesday was the last day measures could be pulled from the ballot.
The bond would have increased property taxes at a rate of $19 per $100,000 of assessed value. That shakes out to an annual increase of about $190 for a home assessed at $1 million. BAHFA had estimated that taxpayers would have had to pay off a total of nearly $50 billion in loans resulting from the bond measure.
But the errors uncovered in the proposal became too glaring to ignore even for its staunchest advocates, who, sources say, feared that RM 4 could negatively affect other bond measures down the line.
“We deeply regret this recommendation [to pull the ballot measure],” said Heather Hood, the Northern California market leader for Enterprise Community Partners, choking up in tears at the meeting. The national housing nonprofit has worked with BAHFA since its inception in 2020 and was instrumental in crafting the bill.
“We’ve had to think about the long run, and unfortunately, we think it’s now going to have to be longer,” she said, adding that she believed the bill would have a better shot with voters in a future election.
With the ballot measure shelved, the pro-RM 4 campaign will turn its attention to advocating for Proposition 5, an amendment to the state Constitution that would lower the vote threshold for local bond measures on affordable housing from 66.7% to 55%. BAHFA had introduced the two bills together in an effort to get the housing bond across the line, since polling indicated that obtaining two-thirds approval from the electorate would be unlikely.
“We’re pulling all of our efforts into passing [Prop. 5] so that we can win later down the road,” Hood said.
The decision is a blow to affordable housing developers who typically need a steady influx of public funds to move projects forward. A separate statewide affordable housing bond, sponsored by Assemblymember Buffy Wicks (D-Berkeley), also failed to make it onto the ballot after dying in the Legislature.
“The No. 1 problem we have in developing affordable housing is the lack of funding,” said Karoleen Feng, chief real estate officer for the Mission Economic Development Agency.
Opponents of the bill who spoke at the special meeting criticized BAHFA for its mathematical mistake and said passing costs to taxpayers would have been unfair.
“This is going to make it harder for people to keep their homes, since high taxes get passed down to owners and renters alike,” said Johnny Khamis, a former member of the San Jose City Council who advocated against RM 4. “If you’re going to do something like this, it needs to be fully baked.”
Other pro-housing advocates pushed the commission to stand its ground. By punting to 2026, the housing bond would potentially appear alongside a massive public transportation funding measure, which may be too steep of an ask for taxpayers.
“We let a small technical error get weaponized by anti-government losers,” said Laura Foote, executive director at Yimby Action. “We lost a huge amount of labor during the last economic downturn, and this was our shot to do some real counter-cyclical spending.”
Without a mass influx of public funds for the foreseeable future, the construction of approved new homes is in peril.
“This is going to break the pipeline for affordable housing in the Bay Area,” Alfred Twu, a California Democratic Party delegate and candidate for the Berkeley Rent Stabilization Board told The Standard after the BAHFA decision.
“The Bay Area housing crisis is regional,” Twu added. “Silicon Valley or San Francisco’s housing shortage causes rent to go up in the East Bay.”
Twu said the decision to pull the measure should have been made weeks ago to give cities time to draft local bonds.
“A regional bond would have connected the tax base of cities with lots of jobs with votes from cities where their workers live,” Twu explained. “However, next time it may be necessary to scale back to areas where support is higher.”