{"slug": "san-jose-opposes-statewide-tax-measure-as-mayor-warns-2000-people-could-be-back", "title": "San Jose opposes statewide tax measure as mayor warns 2,000 people could be pushed back onto streets", "summary": "The San Jose City Council formally opposed a statewide ballot measure that could retroactively restrict local real estate taxes, with Mayor Matt Mahan warning it could force the city to shut down interim housing and push over 2,000 people back onto the streets. The measure would require a two-thirds vote for future local special taxes and eliminate a simple-majority exemption, potentially costing San Jose more than $100 million annually and jeopardizing homelessness programs, libraries, and fire stations.", "body_md": "**Getting your**\n\n[Trinity Audio](//trinityaudio.ai)player ready...A week after San Jose officials raised alarms over a proposed statewide ballot measure that could wipe out more [than $100 million a year in local revenue](https://www.mercurynews.com/2026/06/12/san-jose-budget-threat-california-tax-voting-threshold-initiative/), the City Council formally opposed the initiative Tuesday, with Mayor Matt Mahan warning it could force the city to shut down interim housing and put more than 2,000 people back on the street.\n\nThe city is concerned over a provision in the measure that would retroactively restrict it from collecting previously approved real estate taxes by amending Proposition 13 — the landmark 1978 law that caps property taxes — to strictly block these local taxes from exceeding standard state limits.\n\nWhile property taxes are the measure’s primary focus, the initiative goes beyond real estate taxes by extending strict two-thirds voting requirements to all future voter-led special taxes, regardless of whether they are real estate related. This would eliminate a long-standing legal exemption that has allowed citizen-backed special tax initiatives to pass with a simple majority.\n\nA general tax deposits revenue directly into a city’s general fund to be spent at the local government’s discretion. A special tax earmarks funds for a specific purpose. While the initiative asks voters to require a higher two-thirds threshold to pass future local special taxes, the measure itself only requires a simple majority to pass statewide.\n\nFor San Jose, which just balanced its budget through deep cuts and tapping reserve funds to fill a $50.3 million deficit, losing this revenue could gut the city’s most critical priorities, officials said.\n\nThe mayor noted that while he agrees with the sentiment of residents who spoke out during the meeting against over taxation during a cost-of-living crisis, the sheer scale of the potential revenue hit leaves the city in a precarious financial situation. He highlighted that the potential $100 million shortfall is equivalent to funding the salaries of more than 185 police officers.\n\n“I totally understand the impulse of the measure, I’ve been vocal that our focus needs to be on making government better, not bigger,” Mahan said Wednesday. “I think you can have a legitimate argument of changing the threshold moving forward, but because it’s retroactive, it would have a devastating impact on the city’s budget.”\n\nMeanwhile, cities across California are sounding off on the measure they say could paralyze their ability to deliver critical public services.\n\nThe League of California Cities has estimated the measure could cost local governments statewide $2 billion to $3 billion annually and notes that in the Bay Area, the funding squeeze would impact cities like San Francisco, Oakland, and San Mateo alongside San Jose.\n\nSan Jose officials said the financial risk centers on two specific local revenue streams: a real estate transfer tax on properties valued above $2 million that yields $55 million to $70 million annually – funding most of the city’s homelessness programs – and a separate construction and property tax that generates roughly $45 million per year to build and equip parks, libraries and fire stations.\n\nCity Budget Director Jim Shannon warned that losing those streams would jeopardize neighborhood public resources.\n\n“Capital support for libraries, recreational facilities, and fire stations go away,” Shannon said. “And there would presumably need to be closing some of those facilities.”\n\nSeveral councilmembers said they understood arguments for stricter tax thresholds, but opposed applying new limits to taxes voters already approved. Much of those taxes already support homelessness, library and fire department programs.\n\nCouncilmember David Cohen called the move to strip away already-approved voter funds a “sinister idea.”\n\n“In my mind, it’s not a question of changing the rules going forward. It’s a question of changing the rules that we were operating under previously, and it would make it very, very challenging for jurisdictions across the state,” Cohen said.\n\nIn a statement, the Howard Jarvis Taxpayers Association – which is spearheading the initiative – said the measure is designed to protect property owners from excessive taxation, rejecting warnings that it would drain municipal budgets.\n\n“Cities will have two years to replace the revenue from these unconstitutional taxes with revenue raised in compliance with the state constitution,” the association said. “Cities can place general taxes on the ballot for voter approval. General taxes require a simple majority vote of the electorate to pass. Or cities can propose special taxes, where the money is earmarked for specified purposes. Special taxes require the approval of two-thirds of voters.”\n\nCouncilmembers Bien Doan and George Casey cast the two dissenting votes, arguing that the city should prioritize protecting residents from a rising cost of living rather than shielding its own budget lines. The pair defended the measure’s stricter voting thresholds as a necessary check on government power, asserting that taxpayers deserve the ultimate say at the ballot box before taking on new financial burdens.\n\n“Why is the government uncomfortable with requiring broader public consent before making more money from people who earn it?” Casey said. “Why is the government asking taxpayers to trust it with fewer safeguards rather than more?”\n\nBut Councilmember Anthony Tordillos pointed to the city’s recent contingency planning for Measure A, a local hotel tax increase that is currently maintaining a comfortable 67% approval in recent ballot returns. Tordillos noted that the potential shortfall from the hotel tax failing would have been just a fraction of the threat posed by the November ballot measure.\n\n“We were looking at about $10 million in annual revenue, and we already saw… the elimination of police patrols, closing of libraries, and other potential programs,” Tordillos said. “So I would like all of us to think very carefully about what $100 million means.”\n\nThe measure, which qualified for the ballot in April, does not have an official title yet.", "url": "https://wpnews.pro/news/san-jose-opposes-statewide-tax-measure-as-mayor-warns-2000-people-could-be-back", "canonical_source": "https://www.mercurynews.com/2026/06/18/california-ballot-measure-cities-tax-hit/", "published_at": "2026-06-18 12:45:47+00:00", "updated_at": "2026-06-18 12:54:54.952648+00:00", "lang": "en", "topics": ["ai-policy"], "entities": ["San Jose", "Matt Mahan", "California", "Proposition 13", "League of California Cities", "Jim Shannon", "David Cohen", "San Francisco"], "alternates": {"html": "https://wpnews.pro/news/san-jose-opposes-statewide-tax-measure-as-mayor-warns-2000-people-could-be-back", "markdown": "https://wpnews.pro/news/san-jose-opposes-statewide-tax-measure-as-mayor-warns-2000-people-could-be-back.md", "text": "https://wpnews.pro/news/san-jose-opposes-statewide-tax-measure-as-mayor-warns-2000-people-could-be-back.txt", "jsonld": "https://wpnews.pro/news/san-jose-opposes-statewide-tax-measure-as-mayor-warns-2000-people-could-be-back.jsonld"}}