You'll Never Believe How L.A.'s 'Ambitious Effort' to Fix Homelessness Totally Failed

Sometimes, a simple I-told-you-so just won't do. Some failures are so massive and utterly predictable that they call for an I-told-you-so dance, or better yet, an entire I-told-you-so song-and-dance number from a 1950s Hollywood Technicolor musical, complete with a chorus line, water skiers, and possibly an elephant in a tutu.

So join me now as we sing and dance our way through L.A.'s latest effort to tax its way out of the homeless crisis.

Five years ago, a coalition of the usual lefty pressure organizations — public labor unions, progressive activist groups, and "housing advocates" — pushed for a citywide ballot initiative called United to House L.A. or ULA.

Here's the initiative that made the ballot in 2022: "Shall an ordinance be adopted to add a tax on the sale or transfer of real property valued at over $5 million to fund affordable housing and tenant assistance programs?"

It passed, naturally, because voters like to feel good about themselves for doing their bit to promote "affordable housing and tenant assistance," while feeling even better about not having to actually pay for any of it. Set a cap at "soak the rich level," and you'll be amazed at how altruistic people become with other people's money.

It was billed as a "mansion tax" to fund low-income housing.

And Another Thing: If you really want to advocate for housing, just start cutting regulations and taxes. The developers will do the rest.

Over at the L.A. Times way back when, staff writer Benjamin Oreskes actually led with "an ambitious effort to address the homelessness crisis," because the paper wasn't at all pushing a lefty agenda. No, sir-ee. 

Meanwhile, RAND warned in 2022 that "the revenue raised by Measure ULA may disappoint," pointing to "the city's Affordable Housing Linkage Fee — a 2018 program that amounts to a tax on new market rate housing construction to fund affordable housing construction — suggested that it would raise $100 million per year. However, the actual revenue to date has been around one third of that amount or lower."

Supporters claimed the "mansion tax" would raise $900 million a year, or $2.7 billion over its first three years. "Instead," the New York Post reported this weekend, ULA "brought in about $1.2 billion." That's less than half the expected revenues, nearly three years after passage.

Cue the dancing girls.

But wait — there's less!

“It is a major threat,” Dan Yukelson, executive director of the Apartment Association of Greater Los Angeles, warned a few weeks before the 2022 election. “It sounds great. It’s a great rallying cry for voters — ‘We’re going to take all this money from rich people and help the homeless.’ In the long run, this is going to come back and bite us in the ass.”

Turn around, L.A., because here comes the bite.

And Another Thing: For what it's worth, L.A.'s likely new mayor, Nithya Raman, was a big ULA supporter. "I’ve heard some concerns that ULA’s transfer tax would reduce new construction, but UCLA’s Shane D Phillips and Maya Ofek found that the effect would be very minor – and *significantly* outweighed by the new housing we’d get with the funds raised," she tweeted in 2022 — and couldn't have been more wrong.

The Post also reported that ULA "blocked the building of 9,100 homes, wiped out 16,650 full-time construction jobs and cost $452 million in revenue." So ULA might have raised $1.2 billion, but at the cost of nearly half a billion in lost income taxes, and more than 16,000 jobs.

And that affordable housing? Still hasn't happened: "The City has barely touched the cash, spending just $114 million as of May — less than 10% of the money raised," the Post reported, but no new affordable housing units have been built.

But the best part might be that RAND also estimated that of the 9,100 homes that didn't get built because of ULA, about 1,000 would have been low-income units.

We're gonna need more elephants in tutus. 

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