2024 Local Tax Ballot Measures: Voters in Dozens of Communities Will Shape Local Policy

Next month, voters across the country will weigh in on many local ballot measures that will have a profound effect on the adequacy of our local tax systems and on whether cities and communities can fund public needs. These are in addition to statewide ballot questions, many of which have local implications this year.  

Sales and excise taxes 

Eleven medium and large municipalities in five states are considering increasing or creating local sales taxes. Many of these would be used to shore up public safety , prevent homelessness, or invest in transit. Though sales taxes are regressive, they are often the only option in states with strict property or income tax limits, like California, Colorado, and Washington. Municipalities may have no choice other than sales tax increases to pay for essential services or programs.  

California has the most with seven major local referenda.  

• Los Angeles County has Measure A, which would replace and raise the sales tax supporting homelessness services from 0.25 percent to 0.5 percent.  

• Berkeley has an excise tax on the ballot that would place a tax on the use of natural gas by commercial property owners and landlords. The funds would go to support ongoing green building and decarbonization projects in the city.  

• The City of Orange is proposing a 10-year temporary sales tax hike to support public safety, including 911 services.  

• The City and County of San Diego are proposing their own local sales tax increases to fund general expenditures and transportation infrastructure, respectively.  

• The City of Sonoma has two different increases on the ballot; Measure I would support childcare programs and Measure T would support general city spending.  

Colorado has three, all of which are in the Denver area: The City of Denver is proposing two different sales tax increases (one to support affordable housing development and one to support Denver Health), while voters across the region will vote on extending the existing sales tax that supports transit in the Denver area.  

Voters in three other metro areas will decide whether to support public transit with new taxes.  

• The transit authority in Columbus, Ohio, wants to raise the sales tax to support bus rapid transit development.  

• Nashville is proposing a sales tax to improve transit access citywide, as well as provide sidewalk and roadway improvements.  

• Atlanta suburb Cobb County will vote on a new 1 percent sales tax to support transit services.  

Meanwhile, sin taxes are on the ballot in a few localities.  

• Littleton, Colorado, is considering raising the marijuana tax from 4 percent to 7 percent to support public safety priorities.  

• Berkeley, California, is seeking to make its soda tax permanent. The tax helps fund school nutrition programs.  

• Down the coast, Santa Cruz is also considering creating a soda tax, with no specific programs funded by the tax.  

• In Washington, Spokane and Snohomish County are both proposing sales tax increases to support public safety. Snohomish County also wants to use the funds to support drug use prevention.  

Property, mansion, and vacancy taxes

There are thousands of property tax levies on the ballot every election. These are generally tied to municipal bond offerings, which allow cities, schools, and other special districts to sell bonds for large projects, pension obligations, and other uses. These municipal bond offerings do raise property tax rates, but residents often vote on these as community investments rather than simply tax increases. In addition, some states, like Ohio, require voter approval for any property tax over a minimum levy, which leads to annual or biannual referenda to support ongoing government services. We will highlight a few notable referenda not connected to a municipal bond offering.  

South Lake Tahoe, California, has a vacancy tax on the ballot. The vacation town is seeking to place a tax up to $6,000 annually on properties that are vacant for more than half the year (with certain exceptions). The city would use the funds to develop affordable housing. Vacancy taxes in tourist towns are important tools to advance local tax equity and fund critical priorities, as the vacant properties are assumed to be second homes for wealthy vacationers.  

Voters in St. Helena, California, will weigh in on creating a transfer tax on properties sold for over $1 million, also known as a mansion tax.  Overall, these taxes play an important role in rebalancing upside-down tax codes, advancing racial and economic equity, and raising new revenue to build more resilient and inclusive communities. According to multiple sources, the median home price in the city is over $1 million. St. Helena’s city council has approved the proposal and requires the approval of voters to make it law. However, the city also needs voters to approve becoming a charter city, which would allow them to enact this tax. 

In Austin, Texas, the school district is proposing a 9.1 cent property tax rate increase to support school funding. However, due to Texas’ Robin Hood school recapture statute, the district must raise the rate much higher than needed. Of the estimated $171 million the levy would raise, the district can only keep $41 million, which is what they need for their bond. Because of the state recapture statute, nearly half of all property tax revenue raised in Austin’s school district is forfeited to the state. While this is meant to equalize school funding statewide, functionally it means that large school districts, primarily ones in urban areas, are directly subsidizing small school districts. This also means that school districts with rising property values receive less money from the state, and as a result suffer lower receipts from the Robin Hood fund. Texas’ school funding statutes are harmed by Texas’ lack of state funding for almost anything, and the state has overall remarkably high property taxes for residents.  

Elsewhere:  

• Seattle is proposing a continuation of its expiring transportation property tax levy.  

• Pitkin County, Colorado, whose largest city is the ski town Aspen, is floating a dedicated property tax increase to support affordable housing development.  

• Jackson County, Missouri, is asking voters to approve a property tax levy specifically for senior services.   

• Edgar Springs, Missouri, has an increase on their ballot to pay off a court settlement to one resident.  

• St. Paul is asking residents to vote on a property tax increase to support child care subsidies.  

• Lexington, Kentucky, is voting for a dedicated property tax increase to support park programming and expenditures. 

• Carson City, Nevada, is proposing a vehicle value tax, a type of property tax levied on cars and trucks, to support road maintenance. 

Local business taxes

Two major referenda in San Francisco might change the business tax environment. Proposition M is a wholesale reorganization of the city’s business taxes that lowers taxes and fees on small businesses and raises taxes on medium and large businesses. The proposition has been supported by the business community as a simplification and modernization of San Francisco’s business taxes. The city does not expect the reorganization to lead to a loss of revenue.  

Proposition L would create a gross receipts tax on all rideshare services, with higher rates for businesses with higher revenues. The tax would support the city’s public transit service, including increased service, new routes, and low- or free-fare programs. Due to California’s strict revenue limits, the tax would only be in place for four years without further voter approval.  

However, Proposition L can only become law if it gets majority approval and it gets more votes than Proposition M. Because Prop M would lower gross receipts taxes in the city below the thresholds listed in Prop L, unless Prop L gets more votes in the affirmative, Prop M would immediately repeal Prop L.  

Local governments are struggling  

Rising costs, increased demand for services from residents, and falling revenues are leading to a fiscal crunch for cities across the country.  

This blog does not even cover the referenda already taken off the ballot in Colorado and Richmond, California, nor does it cover the multiple tax and fee fights happening in city halls and statehouses across the country, including: 

• Nebraska’s attempt to cut property taxes by replacing local school revenue with state funding  

• New York’s ongoing fight over congestion pricing in Manhattan 

• Municipal budget shortfalls in Austin, Chicago, Kansas City, Kansas, and Durham, North Carolina, as well as a school funding crisis in San Francisco  

• Local property tax caps in Tarrant County, Texas 

States seeking widespread changes to the property tax system are eroding the most stable and robust funding mechanism for local governments. Some cities are increasingly reliant on earmarked referenda, particularly through sales taxes, to make ends meet. 

States and the federal government should prioritize helping cities, towns, school districts, and local governments of all sizes offer comprehensive and equitable services to their residents. The erosion of local tax bases through state property tax cuts, caps, and exemptions leads to the adoption of regressive sales and sin taxes. Local governments need to use stable, broad, progressive revenue streams to deal with some of the biggest issues of our time – education, housing, public safety, and transportation. 

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