Community survey shows difficulties for ballot measures

Proponents of a soda tax were out in force in neon green at Berkeley City Council. Photo: Lance Knobel

Proponents of a soda tax were out in force in neon green at Berkeley City Council in March. Photo: Lance Knobel

A second round survey of likely voters in Berkeley reveals the difficulty some likely ballot measures will face for passage in November.

The City Council commissioned the survey to test the waters for potential ballot measures. The first council-directed survey done in early March showed good support for a potential tax on sugar-sweetened beverages. Other measures, including a parks parcel tax, commercial vacancy tax, and a pools bond, received tepid support. The latest survey, done in the second week of April, showed diminished support for the sugar tax, some hope for supporters of the commercial vacancy tax, and a continuing struggle for parks funds. 

The beverage industry has already begun campaigning against the potential Berkeley sugar-sweetened beverage tax, with promoted tweets on Twitter and a concerted effort to enlist merchants in opposition to the tax. In the March survey of 500 likely voters in Berkeley, 66% said they would support a 1 cent per ounce tax going to the general fund. Such a tax would only require 50% plus one vote to pass in November. The April survey, however, showed only 53% support on the same question.

Results improved when the survey asked about a special tax, which requires a two-thirds majority to pass. A straightforward question on a dedicated tax with revenues devoted to a variety of health education programs received 67% support. When more information is provided about both the general tax and the special tax, support grows — to a potential yes vote of 68% for the general tax and a potential yes vote of 70% for the special tax.

Based on the history of ballot measures in Berkeley, campaigners believe support generally declines as anti-measure information is spread. On that basis, the sugar-sweetened beverage tax — whether posed as a general or special tax — could face a rough battle for passage, according to the survey.

Browse Berkeleyside’s Election 2014 coverage.

A tax of $1 per square foot for ground floors of commercial properties vacant for two years received an unprompted 48% support in the survey. When respondents were provided further details — outlining the economic incentive to fill vacant shopfronts — support increased to a potential yes vote of 67%.

Park funding measures, according to the survey, will struggle to get two-thirds voter support. A 16% increase in the existing parks parcel tax — an average household increase of $43 per year — received only 54% support in the survey. A question on issuing $15 million in bonds with a $1 million special tax only received 51% support. Supporters of parks measures could find some consolation in the improvement in the tallies when further information was provided: the parcel tax increase rose to 70% potential yes, while the bond measure rose to 68% potential yes.

The survey results will be presented and analyzed at Tuesday night’s Berkeley City Council meeting.

Related stories:
Sugar tax hits the sweet spot for Berkeley residents (03.14.14)
Willard pool reopening on agenda for park bond measure (02.13.14)
Will Berkeley be the first in the nation to impose soda tax? (02.12.14)
Willard Pool supporters turn out for parks meeting (10.17.13)
Berkeley Tuolumne Camp supporters push to rebuild (10.16.13)
Commission, public discuss priorities for Berkeley’s parks (10.04.13)
4 public meetings planned on future of Berkeley parks (09.05.13)

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  • Jimmy Riddle

    Surely with all the crazy prices that house are selling for these days they can use the extra tax money to cover these projects? I am voting no on all these taxes. We pay way too much in this city for way too few services. If you want to save some money scrap the school busing and go back to community schools.

  • DisGuested

    Grandstanding politicos, save us from ourselves! And oppress everyone else while you are at it!

  • Woolsey

    Median house prices are about twice as high in Berkely as in Oakland. At some point this should work out to about twice as much property tax revenue per Berkeley household compared with Oakland. So where does the money go?
    I might vote yes on the vacant property tax, but I will vote no on any new parcel taxes or bonds until the politicos clearly describe how Berkeley is going to address its future unfunded obligations – especially retirement. So Calpers is about 66% funded even assuming a 7.5% return on investment? Good luck with that. Us taxpayers are going to be paying through the nose to make up the shortfalls and we sure don’t need more bonds to pay off.

  • guest

    I will definitely vote FOR a commercial vacancy tax.

    I will definitely vote AGAINST a soda tax.

    I am on the fence about special taxes for parks.

    If the soda tax was amended to be a tax on all sugary drinks including sports drinks, sugar-added juice mixes, coffee drinks, sweet teas, etc, then I might consider voting for it. Right now it is just too narrow and lumps too much blame on one specific thing.

  • rhuberry

    We already have a special tax for parks. What does this cover that the previous one doesn’t?

  • guest

    I would totally vote for the vacancy tax. When Zaki Kabob House is forced out by an untenable $700,000 asking price for a storefront that would be vacant except for their genius in running a restaurant, something is totally messed up in the commercial real estate market.

  • fran haselsteiner

    There is a basic logical fallacy in imposing a commercial vacancy tax: the landlord needs a business interested in investing there.

  • http://berkeleyhomes.com/ serkes

    Doesn’t the owner of a vacant commercial property already have a self-imposed tax of 100% of the market rent?

    WIth a marginal tax rate less than 100%, it seem like any income from the property is better than no income … unless the owner is a Fellow at the Milo Minderbinder School of Economics.

    I’m no fan of vacant storefronts (adjust the rent to market, for goodness sake) but if an owner decides to keep a storefront vacant, lost income and taxes likely won’t make much of a difference.

    Ira

  • guest

    You must be a Marxist – Groucho style.
    https://www.youtube.com/watch?v=4v3etuIw-aM

  • guest

    Perhaps you could interview a few land owners of vacant commercial property, and ask for their comments on why they keep their places empty. You can start with the owner of the NE corner of University and California, who recently was asking 6000 / month for a store front which has a parking lot, easy street parking, and has been empty for some years.

    I suspect that in the boom and bust world of modern real estate, they owner is holding the place empty for a time, perhaps many years from now, in which they could secure a very valuable lease with a tenant with very deep pockets. The fallacy of your any income argument is in the length of the lease. Commercial leases can be quite long, and so it is important to set the initial rent high. In residential leasing, leases are typically 1 year, so it is more important to get a tenant quickly. Basic arithmetic.

    Unfortunately in the mean time, we all have to give up the density benefit of living in town, and travel farther to get things, which is wasting time and energy, and making Berkeley less nice than it could be.

    Adam Smith and Henry George seemed to be for it.
    http://en.wikipedia.org/wiki/Land_value_tax#Real_estate_values
    The prop 13 protection makes the existing real estate tax too low to have the desire incentive effect.

  • guest

    Keep in mind that commercial property and the property of large landlords rarely turns over, so as time goes on, the proportion of property taxes paid by business actually falls. Prop 13 has the effect of transferring the cost of government away from corporations and on to individuals.

  • John Freeman

    I agree that a dinky tax/penalty won’t have impact (and add that a large one would have legal problems).

    But this:

    WIth a marginal tax rate less than 100%, it seem like any income from the property is better than no income … unless the owner is a Fellow at the Milo Minderbinder School of Economics.

    There’s a deeper problem. I think in a lot of cases the city’s interest in not having vacancies is simply at odds with the landlords’ interest.

    A vacancy you say?

    (a) So what? Do you know how rich that landlord is? He doesn’t care.

    (b) Do you know much that landlord considers his own time worth? Renting a retail space is a real pain in the ass. Keeping an eye on it. Fixing stuff. Dealing with complaints. Collecting when the tenant has a bad few months. Getting rid of a tenant that doesn’t want to let go.

    (c) What about lost opportunities? Fine, so the landlord finally signs a lease with some tenant and practically the next day a better tenant comes along or maybe someone who wants to redevelop the whole place. What a hassle.

    (d) You know, I’ll bet if the landlord holds it vacant a few more years, maybe they’ll get desperate and weaken zoning limitations.

    (e) The landlord’s banker doesn’t mind when the landlord says: “Oh, that place? A few very good offers but I think we can do better.” But the banker may start rethinking that line of credit if the landlord says “That new tenant? No, they don’t pay much but I just needed to get someone in there.”

    (f) Maybe it’s just an equity play. The landlord plans to sell it. Buyers aren’t going to need to see a tenant to figure out what the location can be worth.

    (g) Hey that vacancy is a great poker chip. Maybe some day he can lease it to his buddy’s nephew to help encourage is buddy to let the landlord in on that land deal in the South Bay.

  • guest

    How about this delightful vacant blighted property: 1600 Bancroft Way. It used to be a store with a living space upstairs. Total annual tax $4,455.40. Their tax assessment is only $48000. So almost all their tax is $3k in special taxes. Their assessment based tax is only 610.20 per year.

  • guest

    People who are against a vacancy tax because they expect property owners to act rationally, think about these two words:
    Ken Sarachan
    He is responsible for half the vacant storefronts on Telegraph.

  • guest

    Amazing how you have gone from loudly proclaiming that it couldn’t be done at all, to now doing everything you can to explain why it won’t work.

    These comments read like a press release for landlords with vacant properties who are trying to defeat a new tax measure.

  • http://www.berkeleyside.com/ lknobel

    The proposed measure would tax all sugar-sweetened beverages, not just soda.

  • http://www.berkeleyside.com/ lknobel

    The survey tested two parks measures. One would increase the current parks parcel tax by 16%. The other would issue a new $15 million bond for parks, and institute a new tax for continuing maintenance.

  • guest

    That property is particularly disgusting and really drags down the surrounding area. Gang graffiti and a fire hazard. Surprised the neighbors haven’t started working with their councilperson to get it declared a nuisance.

  • guest

    They are including a hardship exemption for landlords who genuinely cannot find a tenant.

  • bgal4

    It is NOT the responsibility of residents to force action on blighted properties by code enforcement.

  • guest

    Well the city sure ain’t gonna do it. All they care about is finding more ways to get into our pocketbooks.

  • bgal4

    Yep. You are of course correct, this is just another reason why I will NOT support new taxes.

  • guest

    Regarding the current state of 1600 Bancroft Way, it is totally un-rentable. The front of the building is collapsing. A rat could enter and exit without ducking. So the self imposed tax that Ira Serkes refers to is Zero dollars per year. However, if someone tore it down and built a house, or if someone rehabbed it and opened a store, the rent for that would be more than $2000 / month.

    Currently the taxes only about to 400 / month. So maybe a vacant property tax of $1000 / month would get the owner to make a move.

    Since the cost of real estate is currently so high, it seems like even the slightest bit of tax should get them to make a move.

  • http://berkeleyhomes.com/ serkes

    So …. if an owner has $0 income from a vacant property, pays $12,000/year in expenses (insurance, taxes, maintenance) and is in the 30% incremental tax bracket, they save $3,600 in taxes.

    Their $12,000/year loss is offset by $3,600 in tax savings … leaving them with $8,400 in sans-quotes-losses (until the IRS wonders if they really are running a business and disallows the losses).

    Seems like they’re still losing money, but at least making it up on volume.

    Ira

  • Completely_Serious

    In the boom or bust cycle of commercial real estate, eventually there will be a shortage of commercial/retail space. Will the Council then enact a tax for renting vacant space too quickly, not giving the beloved small business owner a chance to get in there? Or maybe a tax rebate, of, let’s say, $1.00 a square foot, for each space rented for more than two years?

    If BRT or any of the other AC Transit knuckleheaded plans take away vehicle and foot traffic in front of a building and it becomes undesirable as a place to put a business, will the Council provide the property owner an “economic equalization payment” and waive the vacancy tax?

    Could the Council please focus on issues within its purview, like potholes, crime and cleaning up the bums? (Hey! Let’s pay the bums $3000 each to move to Albany!)

  • Completely_Serious

    And if I owned a vacant commercial site that the city wanted to tax, I’d be putting up a sign that said, “Completely Serious, LLC, Private Consulting by Appointment Only” and some curtains.

    Kind of like the psychic that moved into the camera store on College at Webster. She must have seen this coming.

  • guest

    I don’t like adding new taxes but Berkeley has a real problem with developers making apartment buildings with ground floor retail that remains empty for years and blights neighborhoods.

    How long has the ground floor retail in the building at San Pablo and Delaware been empty? 6 years? More?

  • Mbfarrel

    Obviously the owners expect that the market value of their properties will increase dramatically. The bookend to this in is the “Million Dollar Home” article. The days of 40 year-old PhD candidates living in garages is long over and the lovely old homes rented by the room are going to succumb to the market as well. Home prices make Berkeley unavailable to many as it historicaly has been.

    All the strutting and fretting will not change this.

  • berkeleyan

    …add Black Oak Books, Fifth String, Fine Arts Cinema, Tupper and Reed, Alko’s, and etc…

  • fran haselsteiner

    Maybe landlords obtain a tax advantage in losing money on their properties. I don’t know. But also consider how hard it is to open a business in the city of Berkeley.

  • RedRyderz

    The only thing a tax on soda will accomplish is to increase Morbid Obesity in Government.