Hard-selling U

At housing summit, Mayor Darrell Steinberg says it’s sales tax or bust

A public battle over stripped park benches on K Street and continuing tensions over the city’s anti-camping ordinance backdropped a late-game pitch by Sacramento Mayor Darrell Steinberg at a housing summit this week.

On Monday, while appearing at the Sacramento Regional Affordable Housing Summit, Steinberg lobbied hard for his Measure U sales tax increase by saying it was the city’s main hope for tackling homelessness and tenant displacement.

“Our big play in Sacramento is Measure U,” he stressed, adding that some of the new revenues would be used to create a capital equity fund specifically for housing. The mayor estimated such an initiative could generate $450 million in additional revenue for affording living projects and an arsenal of improved homeless programs.

“We can’t put on the measure what we’re going to do, but I can be specific from my bully pulpit,” Steinberg told the crowd.

Steinberg made no mention of reinstating the city’s inclusionary housing rules that were ditched in 2015, which mandated developers build affordable units as part of any project. He did address questions about why Sacramento hasn’t attempted to pass a general obligation bond for housing, a type of property tax hike that’s recently netted between $550 million to $1.2 billion for jurisdictions such as Alameda County, Santa Clara County and the city of Los Angeles.

“I’m fine with the concept, but I’m wary of anything that requires a two-thirds vote,” Steinberg said of pursuing a bond. “We’ve had too many attempts here where we’ve lost on those votes.”

West Sacramento Mayor Chris Cabaldon backed Steinberg up on that point.

“We may have turned the corner when it comes to people weaponizing the term ‘affordable housing,’ but we’re far from being in a place where I think our voters will approve a property tax,” Cabaldon said.

That’s made Measure U a gamble for some. Constructed as an initiative that requires a simple majority vote to pass, any money raised through the doubled-up sales tax will go straight into the city’s general fund, meaning the city council can spend it as it pleases.

Fiscally conservative groups such as Eye on Sacramento and the Sacramento Taxpayers Association contend that means the money raised through the regressive tax will have to go toward the city’s mounting pension debt rather than the priorities Steinberg has outlined. Both groups helped form the No on Measure U coalition, which has made City Hall officials nervous about losing a revenue stream they’ve already woven into Sacramento’s future.

Steinberg, who recently called for park benches to be returned to the K Street corridor after Sister Libby Fernandez highlighted their removal on social media as hostile to homeless people, was also asked at the summit why Sacramento hasn’t considered passing a real estate transfer tax to help build affordable housing.

“Part of it is a political consideration,” he admitted. “A sales tax doesn’t have built-in opposition, a real estate tax does. It helps when you’re trying to sell these things that there’s not a major-funded opposition getting involved.”