San Francisco voters in November will choose whether to raise taxes on real estate sales and transfers over $5 million, which would generate enough revenue to make City College of San Francisco free to city residents.
Proposition W, or the Real Estate Transfer Tax on Properties Over $5 Million, would increase the already existent transfer taxes collected by The City.
Supporters say the tax on The City’s wealthiest will help pay for an already passed resolution that would make CCSF free, among other things. CCSF was last free in 1983.
“Education, as all of us know, is the key to upward mobility, financial stability and the tool we know works to help low-income wage workers increase their earning potential,” Supersior Jane Kim has said.
But opponents, including the San Francisco Apartment Association, counter that the tax will not simply collect funds from the rich but will impact renters since some large rental properties sell for millions because of their size and not their luxury.
Prop. W would increase the transfer tax rate for real estate sold for more than $5 million.
The sale or transfer of property from $5 million to $10 million is taxed at a 2 percent rate currently. Transfers and sales for less expensive homes are progressively taxed less as the cost decreases. The lowest tax rate is .68 percent for sales that are more than $250,000 and less than $1 million.
Prop. W would not change the rate of transfer tax for sales under $5 million. For sales over $5 million the tax would increase by .25 percent.
The money raised will go into San Francisco’s general fund.
City Controller Ben Rosenfield has calculated that, based on the most recent business cycle, the measure could increase revenue on average by $45 million a year.
The measure was put on the ballot by of 10 of the 11 supervisors, the only exception being Supervisor Mark Farrell.
The measure requires more than 50 percent of the votes to pass.