On Super Tuesday (March 5), California voters weighed in on a statewide ballot measure and a handful of local ballot measures to address housing and homelessness. At the time of writing, many measures remained too close to call as votes are still being counted. Proposition 1, a statewide $6.38 billion behavioral health bond paired with reforms to California’s Mental Health Services Act, was narrowly leading on a vote of 50.3 to 49.7 percent. Voters in San Francisco appeared poised to approve a $300 million affordable housing bond, a waiver of the city’s real estate transfer tax for office-to-residential conversions, and a harmful measure that would require compulsory drug screening and treatment for recipients of county-level cash assistance. Santa Cruz voters approved citywide and county-level sales tax increases that will boost resources for housing and homelessness programs and rejected a measure that would both increase the required percentage of affordable homes in large buildings and require voter approval for height and density increases. Voters in Larkspur, CA, were narrowly split on whether to affirm or reject a city-approved rent control ordinance that caps residential rent increases at either 5% plus inflation or 7% per year (whichever is lower).
Statewide Measure: Proposition 1
Proposition 1, a two-part statewide ballot measure championed by Governor Gavin Newsom, authorizes a $6.38 billion behavioral health bond that will fund supportive housing and treatment beds for people experiencing behavioral health crises. The measure would dedicate $4.4 billion to the state’s Behavioral Health Continuum Infrastructure program to build 6,800 inpatient mental health and substance use disorder treatment beds. Project Homekey, an extension of California’s pandemic-era hotel and motel conversion program, will receive $2 billion to build 4,350 supportive housing units, of which approximately half will be reserved for veterans. Proposition 1 was narrowly leading on a vote of 50.3 to 49.7 percent at the time of publication.
The measure would also reform the state’s Mental Health Services Act, which funds county-level mental health programs with a 1% tax on personal incomes over $1 million. Proposition 1 would require counties to spend 30% of this tax revenue on housing programs, including rental subsidies and housing navigation. The county would require half of these resources to be spent on programs that serve people experiencing chronic homelessness or living in encampments. Up to one quarter of the revenue could be spent on building or purchasing housing units.
NLIHC state partners Housing California, California Housing Partnership, and Nonprofit Housing Association of Northern California (NPH) endorsed Proposition 1. In their endorsement statement, California Housing Partnership and Housing California wrote that “[b]y pairing housing resources with the assertive community treatment model proposed in Proposition 1, this initiative will help get people off the street and lead to better outcomes for those with behavioral health needs.”
The measure’s opponents criticized the loss of flexibility for county spending on mental health programs, as the mandate to spend 30% of mental health services funds on housing could redirect funds away from existing programs. Some advocates also opposed the measure due to a last-minute legislative amendment that removed language prohibiting the money from being used on locked treatment facilities.
Local Measures: San Francisco
Measure A, a $300 million affordable housing bond, appears on track to pass in San Francisco, with 68.5 percent of voters’ approval. Local and regional housing bond measures to fund housing and infrastructure in California must meet a two-thirds supermajority vote for passage. The bond would provide $270 million to build, acquire, and rehabilitate housing for low-income people (between 0 and 80 percent of AMI). A total of $30 million would be set aside to create housing for low-income households experiencing trauma-related homelessness, street violence, domestic or sexual abuse, or human trafficking. It is estimated that Measure A would create more than 1,600 new homes for low-income San Franciscans. NLIHC state partner NPH endorsed the measure.
San Francisco voters also approved Measure C, which will waive the city’s real estate transfer tax for office-to-residential conversions. Initial results show Measure C leading on a vote of 54 to 46 percent. While the measure could increase housing supply and revitalize downtown neighborhoods, the loss of transfer tax revenues could also decrease resources for affordable housing programs. Critics point to a provision in the measure that authorizes the Board of Supervisors to “amend, reduce, suspend, or repeal the transfer tax without approval” but would still require voter approval of a transfer tax increase. An analysis by the San Francisco Bay Area Planning and Urban Research Organization (SPUR) notes that the transfer tax exemption would not be sufficient to close the feasibility gap for most office-to-residential conversion projects.
A harmful proposal, Measure F, is on track to pass with approximately 62 percent of voters’ approval. Measure F requires compulsory drug screening and treatment as a condition for receiving cash assistance from the county of San Francisco. In a joint statement of opposition, the National Alliance to End Homelessness and All Home California, an NLIHC member organization, wrote that “[p]overty is more of a root cause of homelessness than substance use, which is why we oppose cutting people who are already struggling to survive off the cash assistance they rely on. Prop F ignores the evidence on treating substance use and preventing overdoses and would be a significant step backward for San Francisco’s efforts to address the drug crisis and homelessness.”
Local Measures: Santa Cruz
Voters in the city of Santa Cruz approved Measure L, which increases the city’s sales tax rate from 9.25 percent to 9.75 percent. Approximately 60 percent of voters supported the measure. The tax increase is estimated to generate an additional $8.3 million in annual revenue for the city’s general fund, which will support programs including housing and homelessness services. Voters in the county of Santa Cruz approved Measure K, a parallel measure that applies to unincorporated areas of Santa Cruz County, with approximately 54 percent of voters’ support. Measure K will increase the county’s 9 percent sales tax rate to 9.5 percent, which will raise an estimated $10 million annually. County supervisors indicated that they would spend $1 million of the first year’s revenue on housing and essential workforce retention and $1 million for countywide homelessness services. Housing Santa Cruz County, an NLIHC member organization, endorsed both measures.
Santa Cruz voters rejected Measure M, a two-part ballot initiative that would have amended the city’s inclusionary housing requirements and zoning rules, with approximately 40 percent of voters in favor and 60 percent opposed. The initiative would have increased the required percentage of deed-restricted affordable units from 20 percent to 25 percent for developments with 30 or more units. Measure M would have also required voter approval for a change to the city’s zoning code to allow development of a building higher or denser than current limits. Currently, the Santa Cruz City Council can approve changes to height or density limits; Measure M would have required an election each time a developer sought an amendment to city rules. Opponents of Measure M, including Housing Santa Cruz County, noted that Measure M would impede the development of affordable homes, despite its stated intentions to increase affordability.
Local Measure: Larkspur
The Larkspur City Council passed an ordinance last year that caps annual rent increases at the lower of 5 percent plus inflation or 7 percent. Opponents of the ordinance, however, gathered enough signatures to place a referendum on the ballot. The initiative, Measure D, would affirm the rent stabilization ordinance that the city passed in September 2023. In addition to the annual rent increase cap, the ordinance would create a rental registry. The ordinance, which would expire in 2029, exempts owner-occupied properties, accessory dwelling units (ADUs), and rental homes that came on the market after February 1, 1995. The ordinance also includes provisions for landlords to petition the city for rent increases above the cap. Measure D was leading by a razor-thin margin of just 46 votes and remained too close to call at the time of publication.
Preview of California Statewide Measures in November 2024 Elections
California voters will have additional opportunities to approve new resources for housing affordability in the November 2024 elections. Campaigns are underway for statewide housing ballot measures that include:
- ACA 1, which would lower the approval threshold for local and regional housing and infrastructure bonds from two-thirds to 55 percent. Under the 55 percent threshold, many housing bond measures that receive an overwhelming majority of support but fell short of the two-thirds threshold would have been enacted.
- A $10 billion statewide affordable housing bond. Advocates are pushing the legislature to approve the Affordable Housing Bond Act of 2024 (AB 1657), which would place the bond measure on the November 2024 ballot.
- SCA 2, an amendment that would repeal Article 34 of the state constitution, Article 34 requires local governments to receive voter approval for construction of publicly financed or publicly owned affordable housing projects. This racist provision limited affordable housing development in California in the mid-twentieth century and reinforced segregation. The city of Millbrae is now using Article 34 to block the conversion of a motel into housing for people experiencing homelessness through the Homekey initiative.
- The Bay Area Regional Affordable Housing Bond, a nine-county bond measure that would raise $10-20 billion to develop up to 45,000 affordable homes in the Bay Area.
Organizers that are working on ballot measure campaigns for upcoming elections, or are considering ballot measures for future election cycles, will find guidance and tools from NLIHC’s Our Homes, Our Votes campaign. Our Homes, Our Votes is a nonpartisan initiative to boost voter turnout among low-income renters and elevate housing as an election issue.
For Our Homes, Our Votes resources on ballot measures, visit: www.ourhomes-ourvotes.org/ballot-measures