Brief

Councilmember Tim McOsker, seconded by Katy Yaroslavsky, introduced a motion on August 5, 2026, proposing to exempt specific expenditure categories from ULA Citizen Oversight Committee oversight and to apply that exemption retroactively. The motion has been referred to the Housing and Homelessness Committee and is currently pending. Details on which expenditure categories are targeted and the rationale for retroactive application are not yet specified in available materials.

Full summary

Measure ULA, approved by roughly 60% of Los Angeles voters in November 2022 and implemented in April 2023, imposes a documentary transfer tax on high-value real estate sales to fund affordable housing production and homelessness prevention. The measure has generated over $1 billion in revenue since launch. It already exempts certain nonprofits from the tax — specifically organizations in good standing with the IRS for at least 10 years, those with assets under $1 billion, government entities, and constitutionally protected entities. LLCs and limited partnerships managed exclusively by nonprofits can also qualify. The problem Councilmember Tim McOsker identifies is a gap in that exemption framework. Nonprofits routinely create new subsidiary corporations when acquiring property in order to isolate legal liability and satisfy the requirements of lenders and public or private grant programs. Because these subsidiaries are newly formed, they do not meet the 10-year IRS standing requirement and therefore are not clearly covered by the existing exemption — even though they are wholly controlled by and serve the mission of a qualifying parent nonprofit. McOsker argues this is an unintended consequence of how ULA was drafted, and that it delays property acquisitions, raises administrative costs, and discourages nonprofit real estate activity that serves public interests ranging from affordable housing to community centers, clinics, and schools. The motion directs three things. First, the Chief Legislative Analyst and the Office of Finance are instructed to formally present the proposed exemption clarification to the ULA Citizen Oversight Committee, which under city law has a role in opining on whether changes to the measure's application further ULA's purposes and align with its approved expenditure categories. Second, the Office of Finance is directed to report back within 90 days identifying which nonprofit organizations would have qualified under the proposed amendment — effectively mapping the scope of the problem since April 2023. Third, the Office of Finance, working with the City Attorney, is asked to analyze whether exemptions can be extended retroactively and whether tax collections from affected nonprofits could be refunded. The motion was introduced August 5, 2026, and immediately referred to the Housing and Homelessness Committee, where it remains pending. No hearings have yet been scheduled. The file expires in August 2028 if no action is taken.

Activity (2)

• 2026-08-28 City Clerk rereferred item to Housing Committee, pursuant to Council File No. 26-2000.
• 2026-08-05 Motion referred to Housing and Homelessness Committee.

Documents (1)

• 2026-08-05 Motion · motion