bass Seeks ULA Exemption for Palisades Homeowners Impacted by wildfires, Sparking Equity debate
Los Angeles mayor Karen Bass is requesting a temporary exemption from teh city’s Measure ULA, a real estate transfer tax often referred to as a “mansion tax,” for homeowners in the Pacific Palisades whose properties were damaged or destroyed by January wildfires. The proposal, announced October 9, has ignited a debate over equity and the future of a voter-approved initiative designed to fund affordable housing and homelessness prevention.
Bass’s proposal, outlined in a letter to the City Council, calls for a three-year exemption for residents directly affected by the fires. Measure ULA, enacted by voters in 2022, levies a tax on property sales exceeding $1 million, with higher rates for sales above $5 million. City officials initially touted it as vital for increasing housing production, it did not account for the financial strain imposed by natural disasters and that the tax itself was now hindering sales in fire-damaged areas.
The proposed implementation involves a two-step process: first, the City Council would need to pass an ordinance granting the director of finance the authority to establish rules for the exemption. Subsequently, the mayor would issue an executive directive instructing the department to enact those rules. According to her office, the exemption would be limited to owner-occupied residential properties in the Palisades at the time of the fire, designed to prevent loopholes and ensure long-term revenue generation as rebuilt homes would still be subject to Measure ULA upon resale.
Though, the proposal has drawn sharp criticism from housing advocates who argue it prioritizes the interests of affluent property owners over the needs of renters and those experiencing housing insecurity.Critics point out that Measure ULA specifically targets high-value assets and that even a fire-damaged $5 million home represents significant wealth.
“This is a tax on high-value assets,not hardship,” stated one housing organizer. “If you’re selling a multimillion-dollar home, you don’t need a break from a programme that keeps renters housed and builds affordable housing.”
The situation is further intricate by the involvement of developer Rick Caruso, a long-time opponent of measure ULA and a property owner in the Palisades. following a meeting with Bass, Caruso publicly praised the idea as “common sense,” raising concerns among advocates about the mayor’s alignment with a vocal critic of the initiative.
Since its implementation in 2023, Measure ULA has generated over $830 million for affordable housing and homelessness prevention efforts, funding eviction defense, rental assistance programs, and the construction of new affordable housing units. Bass herself has previously highlighted the measure’s positive impact on stabilizing households across the city.
Supporters of Measure ULA fear that even a limited exemption could erode the program’s credibility and set a hazardous precedent. They warn that granting exceptions to a voter-approved measure could open the door to further demands from other wealthy neighborhoods.
the debate extends beyond the immediate context of the Palisades fire recovery. A recent article published by Jacobin highlighted the limitations of Los Angeles’s market-based approach to rebuilding after disasters, contrasting it with Singapore’s rapid construction of public housing following the 1961 Bukit Ho Swee fire.
Los Angeles,the article argues,continues to rely on private growth,tax incentives,and ad-hoc exemptions rather of prioritizing public investment. Despite possessing vacant land, a public housing authority, and a dedicated revenue stream through Measure ULA, the city’s leadership appears inclined to weaken the funding source rather then fully utilizing its existing resources.
Bass maintains that the exemption could ultimately strengthen Measure ULA by accelerating rebuilding efforts and generating future taxable sales. However, housing economists and advocates counter that uncertainty, rather than taxation, is the primary obstacle to progress. They argue that each time the measure is challenged, it creates doubt and delays housing development. “Stability builds housing,” one advocate said.”Uncertainty delays it.”
This article was originally published in Mar Vista Voice on October 16, 2025.