STOP ULA
THE UNFAIR LA TAX

LA voters passed Measure ULA in November 2022 which imposed a new “Homelessness and Housing Solutions” tax on all real estate sales transactions in the city over $5 million. Though it is commonly referred to as the “mansion tax,” it applies to all residential, commercial, and land transactions.

The Initiative was proposed by, among others, labor unions seeking to extract the equity from your properties, comprising 4% of all gross proceeds of sale (with no deduction for indebtedness and regardless of whether money was made) for properties of over $5 million and 5.5% of all gross proceeds of sale for properties of over $10 million. Much of the money raised will be used to provide attorneys to tenants to fight their landlords. The "tax" has already had the effect of stopping LA real estate development in its tracks.

Two lawsuits each entitled Newcastle Courtyards, LLC et al. v. City of Los Angeles et al. challenging the ULA "tax" are the only ones filed in both state and federal court and contain 17 claims. (The only other case, brought by the Howard Jarvis Taxpayers' Assoc. and Apartment Assoc. of Greater LA was brought only in state court asserting a single claim.) The Newcastle lawsuits allege that the "tax" is structured in a patently unfair way and is illegal and unconstitutional.

The Newcastle lawsuits represent the LA real estate community’s best hope to overturn the ULA and to protect property owners from the crushing assessment of 4% or 5.5% of the gross proceeds. We are up against the City, the County, and the Unions (represented by the big LA firm Irell & Manella). Without the support of the LA real estate community, we will not be able to prosecute these critical cases.