A Lookout View: Vote no on Measure N

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Lookout Endorsement: Our affordability crisis is acute and calls for a range of initiatives to address. Unfortunately, citizen initiative N in the city of Santa Cruz offers too little bang for the buck and too much uncertainty about its real effectiveness. Measure N is well meaning, but it offers too little for what it demands.

Editor’s note: A Lookout View is the opinion of our Community Voices opinion section, written by our editorial board, which consists of Community Voices Editor Jody K. Biehl and Lookout Founder Ken Doctor. Our goal is to connect the dots we see in the news and offer a bigger-picture view — all intended to see Santa Cruz County meet the challenges of the day and to shine a light on issues we believe must be on the public agenda. These views are distinct and independent from the work of our newsroom and its reporting.

Affordable housing. Two little words that have become the buzzwords of our era, the driving force of our politics.

How we handle them, if we “get them right,” is the test of our times, the metric by which future generations will measure us, and we will measure ourselves.

That’s why city of Santa Cruz Measure N, the empty homes tax, offers such curb appeal.

It just seems wrong that so many struggle — unable to find a home, forced to live with numerous roommates packed into a place or to commute long distances to jobs in Santa Cruz — while others leave second homes vacant much of the year or own several properties, with varying degrees of occupancy. We want our teachers, service and health care workers, our artists and firefighters to live among us. We want our children and grandchildren to stay here if they choose.

We must find ways to bridge this gap, and with as much speed as possible, especially given that it can take at least five years to get any new housing from idea to completion.

But we can’t support Measure N as written. Despite our fervent wish to see faster movement on the issue before us. Despite our respect for those who believe in it and have worked tirelessly to advance it.

Measure N — in case you have missed it until now — requires all city of Santa Cruz property owners to fill out yearly paperwork stating they live in their homes at least 120 days a year. If they don’t spend that much time at a home, they must pay a tax of $6,000 a year. Supporters believe it will generate more revenue to help fix our spiraling inequity.

Our reasoning in opposing it is simple: It requires too much bureaucracy for too little gain. And it calls for a too-small revenue stream ($2.5-$4 million, by city estimates) that — if the policy succeeds and gets people to use their homes — will diminish every year.

It’s too punitive, too easy for a forgetful, well-intentioned homeowner to make a mistake, forget to send in paperwork for a week and end up with misdemeanors. It’s a speculative, too-new tool, with too little feedback from the few other cities trying it.

The wording is also flawed. If it had moved through a public process of debate, rather than arriving on our ballots whole, we might be discussing a better alternative.

And if voters turn down N, we can still come up with better options.

N advocates say they moved forward with it because the Santa Cruz City Council wouldn’t. We think there’s room on the 2023 agenda to begin considering tools with similar aims that might work better.

Measure N is well meaning, but it offers too little for what it demands.

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It also potentially creates messy and emotionally fraught gray zones — like when a family experiences a death, a mental or physical health crisis or a divorce and leaves a home unoccupied for long stretches. Who will decide if that family’s home has been unoccupied too long? What personal documentation would a grieving family need to “prove” their pain is authentic?

The $6,000 tax that Measure N would impose is a good amount — although we’re still not sure it’s the right number. Why not more? Why not $12,000?

Measure N advocates acknowledge that they came up with the number as a middle ground, a best guess. Oakland — one of apparently two U.S. cities with this sort of tax so far — uses $3,000-$6,000 fees, and Measure N is partly modeled on the Oakland model, although Measure N’s language is more punitive and doesn’t impose criminal penalties for homeowners missing documentation.

Perhaps a higher tax, but less punitive language, would work better?

Measure N also requires the city to create an oversight committee and an auditing process to catch those not in compliance. We don’t see this as the enormous bureaucratic nightmare some naysayers decry it as. But we also don’t think it will be easy.

And it will be costly — perhaps as much as $1 million in its first year, and as much as half that amount ongoingly — to run. That’s an added layer of expensive bureaucracy for an idea that might not make much difference.

Any new city committee would be fraught with politics and invite skepticism and fears of favoritism. Who would be on the committee? Who would be audited?

Also, more troublingly, it plunges us into deeper questions about privacy and why homeowners should have to prove how they use their property.

We could, perhaps, bat some of those concerns away — insist that this is something we need to do to help our community, like paying taxes and parking tickets — if Measure N were otherwise excellent.

It is not.

Part of the reason this tax doesn’t exist in many places is that it’s hard to get right.

A few European cities, plus Oakland (2018) and Vancouver, British Columbia (2017), offer examples, but those are still fledgling efforts, and none of those communities mirrors the demographics of Santa Cruz. Los Angeles and San Diego are exploring options but have no concrete programs.

In Santa Cruz, the tax would — by the city’s estimate — affect 425 to 700 homes out of the city’s 25,000. That is a small number and one that would shrink every year the tax existed, as owners work to get compliant.

Of course, we need to start somewhere, but this doesn’t feel impactful or sustainable enough to be worthwhile. Advocates say they would use the new tax funds ($2.5-$4 million) to get matching grants and up the numbers. That’s a big if.

Too big, we think.

Advocates also insist we need this. That we can’t just have “a single foot on the gas” to get more affordable housing. We need both feet. That we need to prevent developers and real estate companies from buying up and holding properties empty.

We agree. We do need more solutions.

We are intrigued by the idea of a 2024 housing bond, put forth by Santa Cruz mayoral candidate Fred Keeley. We are also not opposed to a less punitive, impactful empty homes tax.

Whatever solution we find should not be a measure that at its inception has so many foreseeable pitfalls, so much bureaucracy, so much room for error.

We recommend no on N.

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