For nearly a decade, Bank Tax proponents have sought to create bank subsidized by a tax on homes and businesses (a complete history is here). The proposed policy was to collect shared contributions from Oakland, Berkeley, Richmond, and Alameda County to finance housing, energy and businesses development. The estimated cost was approximately $40 million, with Berkeley contributing about $2.5 million. That shared financing model never materialized. Now Berkeley homes and businesses are being asked to cover 100%+ of the costs, $58.3 million for an experimental bank that may never receive regulatory authorization to operate.

Berkeley Pays, Everyone Benefits

Yet, proponents still promise to finance projects throughout the East Bay, including Oakland and Richmond, with no guarantee that Berkeley will receive benefits proportional to its financial contribution, nor does it require other jurisdictions to contribute before Berkeley taxpayers do. This measure requires Berkeley property taxpayers to subsidize other jurisdictions. 

Berkeley already faces a $30 million structural deficit. Before imposing another parcel tax, voters should ask whether (1) Berkeley should finance projects in cities that are not contributing, or (2) new tax revenues should address Berkeley's fiscal crisis.

Duplicates Existing Efforts

As taxpayers, we already invest generously in affordable housing, clean energy, and small-business development. Existing local, state, and federal programs finance these needs on a scale measured in billions of dollars.

• Affordable housing: Billions annually via programs such as HCD, CalHFA, LIHTC, AHSC, HOME, CDBG, Berkeley and Alameda County housing bonds.

• Clean energy: Tens of billions in state and federal programs from CEC, CPUC, IBank, Cap-and-Invest, Ava Community Energy.

• Small business: Billions in lending and credit programs via SBA, California SSBCI, IBank, CalCAP, CDFIs.

No Taxpayer Protection

The measure creates unique affordability risks not present in traditional parcel taxes. It mandates automatic annual tax increases based on the greater of inflation or California personal income growth. Every other city parcel tax authorizes City Council to suspend, reduce, or modify these increases if they become unnecessary or financially burdensome. Nor does the measure provide a mechanism to reduce the tax if capitalization is achieved. Tax increases are automatic; benefits are not.

Berkeley deserves policies that provide clear local benefits, equitable regional cost sharing, meaningful oversight, and strong taxpayer affordability protections.

Protect Berkeley residents and businesses. Local taxes should deliver local benefits, and have City Council controls.

WOM Berkeley has published a detailed history of the Bank Tax.