COCOTAX INVITATION TO ATTEND A BOARD/MEMBERS LUNCHEON MEETING FRIDAY August 23, 2024 AT 11:45 AM

The Contra Costa Taxpayers Association (CoCoTax) invites you to attend a LUNCHEON Board /Members Meeting at Denny’s Restaurant 1313 Willow Pass Road, Concord, on Friday AUGUST 23, 2024 at 11:45 am. Please register in advance on the CoCoTax website where you can pay ONLINE, or bring cash or check on Friday and pay at the door-$25 for members, $30 for guests.

In addition to our speaker this month, we will devote considerable time to reviewing all measures headed for the November ballot.

 INTRODUCING OUR SPEAKER: TOM RUBIN

AND HIS TOPIC: THE $20 BILLION HOUSING BOND

Thomas A. Rubin, CPA, CMA, CMC, CIA, CGFM, CFM is the President of 20 BILLION Reasons to Vote No on the Bay Area Housing Tax, which is the nine-county organization leading the opposition to what will be Regional Measure 4 (RM 4) on the nine-county ballot.  Tom has over five decades in government policy and finance as the Chief Financial Officer of two large California special districts and as a consultant and auditor for hundreds of governments of all types and sizes all over North America.

The Metropolitan Transportation Commission, and its housing component unit, the Bay Area Housing Finance Authority, are putting Regional Measure 4 (RM 4) on the nine-county ballot.  MTC projects that we will pay $48.,281,750,400 in higher property taxes to pay for 72,000 new and rehabilitated affordable housing units.

There is, of course, no guarantee on the 72,000 units – we’ll let each of you decide how solid the $48,281,750,400 in taxes will be.

For those of you keeping score at home, that $670,000 for each unit …

… and that is nowhere end of the costs of each unit to the taxpayers.

If RM 4 passes, there will be a nine-county property tax, the same for every city and county, that, for a $1 million house purchased this year, would require over $20,000 in property tax payments over the 53 years of the bond debt service.  The total tax bill will be – according to the Metropolitan Transportation Commission (MTC)/Bay Area Housing Finance Authority (BAHFA), the sponsor – will be $48.3 billion.

Even though there are great differences in housing needs, and the costs of satisfying these needs, by city and county in the Bay Area, everyone will pay the same tax.  While 80% of the funding is to return to source, the county of origin (and four designated cities, Napa, Oakland, San Jose, and Santa Rosa), 20% will be retained and managed by MTC itself, which likely will mean that the counties with lower needs (such as the four North Bay counties) will be funding the bigger population counties with bigger needs, particularly Alameda County and the City and County of San Francisco.

There is, of course, no guarantee on the 72,000 units – we’ll let each of you decide how solid the $48,281,750,400 in taxes will be.

Although there is mention of homelessness, there is very little in the actual business and spending plans for homelessness, beyond the usual “trickle-down” (if moderate income people get more housing, that will open up more units for low-income people; when there are more units for low-income people, that will open up more units for very-low income people, etc., etc.) – other than, if MTC can get around some current legal prohibitions, it will be able to borrow over 35 years to pay the rent for people who are about to be evicted.  We’re OK with trying to help people make their rent (without causing the landlords to go out of business), but borrowing long-term to pay short-term expenses is NEVER a good idea.

This measure has nothing for the operating and capital renewal and replacement costs of these units.  For new very-low income units, many residents will not be able to pay any rent at all because they have no income.  There are on-going requirements for utilities, cleaning, repairs, and maintenance.  All capital assets start deteriorating the moment they are created and the costs for keeping them working increases over time as they age.  While there is funding for rehabbing the approximately 25,000 existing of the 72,000 total units, there is NO provision for any capital renewal and replacement for the 47,000 new units.

Also, the overall plan is for “stack-and-pack” for the majority of the new units in the core cities and major transportation corridors.  This will require major new infrastructure for everything from new and used water, electricity, and other utilities; roads and transit; public safety – fire, police, emergency response; hospitals, etc.

So, well beyond the $48,281,750,400 in new taxes to pay the interest and return of capital on the bond, there will be substantial new taxes – WHICH ARE NOT EVEN MENTIONED ANYWHERE IN THE MTC PLANS – for operations, maintenance, etc. for these units, their capital renewal and replacement; and for all the other non-housing unit infrastructure increases and maintenance and replacement of existing and new infrastructure requirements.