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MEASURE TO BE SUBMITTED TO THE VOTERS AUTHORIZING THE CITY OF BERKELEY
TO LEVY A PARCEL TAX TO FINANCE AFFORDABLE HOUSING, GREEN
ENERGY/INFRASTRUCTURE, AND SMALL BUSINESSES THROUGH A PUBLIC BANK
The People of the city of Berkeley do ordain as follows:
Section 1. Title
Increasing long term investments for Affordable Housing, Green Energy, and Small Business
through Public Banking Parcel Tax
Section 2. Findings
The People of the City of Berkeley find and declare as follows:
A. Berkeley faces overlapping challenges of high housing costs, climate vulnerability, a
challenging small business environment, overreliance on big corporate banks that
extract wealth from the community, and unreliable federal funding.
B. First, housing costs are too high in Berkeley, with more than 40% of long-term Berkeley
tenants being rent burdened according to the City’s 2022 Tenant Survey. Reducing
housing costs can increase city residents’ ability to live and thrive.
C. Second, climate change threatens Berkeley through rising sea levels, heatwaves,
wildfires, and more. Transitioning to green energy can help reduce pollution, increase
community resilience, and lower energy bills while also reducing climate threats.
D. Third, Berkeley’s small businesses are struggling in part due to a lack of access to
capital. Increasing their access to loans and financing can help them grow and thrive.
E. Fourth, big corporate banks prioritize shareholder profits, rather than Berkeley’s needs.
Big banks lend Berkeley’s taxpayer dollars outside of our communities and against our
values, including supporting fossil fuels, the war economy, and private prisons. Lending
that prioritizes Berkeley’s needs would include loans for affordable housing, green
energy/infrastructure, and small businesses.
F. Fifth, 2025 saw the longest federal government shutdown in history and unprecedented
cuts to federal funding including to UC Berkeley’s research grants. A robust public
banking structure builds local financial institutions and helps communities manage the
demands of natural disasters, economic downturns, and veering winds of federal policy.
G. In the face of these challenges, Berkeley can use public dollars to make long-term
investments in affordable housing, green energy/infrastructure, and small businesses.
H. While big corporate banks invest our public tax dollars outside of our community, a
public bank can recirculate our money in our community to fund projects and build a
stronger, more resilient, local community aligned to our values.
I. At a time when the federal government has made many sudden grant cancellations, a
public bank can provide local resilience to changes in federal funding flows or from
federal government shutdowns while building community wealth.
J. A special parcel tax within the City provides an equitable mechanism for funding capital
investments in the City’s future. An exemption from the tax for low-income homeowners
helps ensure the cost of the measure is not a burden for residents on fixed or limited
incomes. A split-roll tax under which commercial properties pay more than residential
properties, as used in numerous prior parcel taxes, ensures equity in raising funds.
K. A public bank is a powerful tool for community development. Because banks create
money in the process of lending, public banks can multiply the impact of every dollar
invested, and increase community wealth.
L. A public bank will make Berkeley and the broader region a place where more families
can afford to stay, more entrepreneurs can thrive, and more neighborhoods are resilient
and full of opportunity.
Section 3. Code Amendment
A new Chapter 7.03 is hereby added to the Berkeley Municipal Code as follows:
Chapter 7.03
Increasing long term investments for Affordable Housing, Green Energy, and Small Business
through Public Banking Parcel Tax
7.03.010 Special Tax - Purpose.
A. A special tax for the purpose of funding long term investments for affordable housing, green
energy/infrastructure, and small businesses is hereby authorized to be imposed on all
improvements in the City of Berkeley as more fully set forth in this Chapter. To accomplish this
purpose, tax revenue collected by this measure will go into a special fund to capitalize and
support a public bank (the “Bank”) that includes Berkeley in its service area.
B. The City Council shall impose the tax authorized by this Chapter up to the rate, and subject to
inflation adjustments, set forth in Section 7.03.020.
C. All funds received from the tax are subject to the review, allocation, and approval by the City
Council, subject to the terms of this paragraph 7.03.010.
D. The proceeds of the tax imposed by this Chapter shall be placed in a special fund to be used
only for the purposes set forth in this Chapter.
E. Returns earned by the special fund shall be reinvested in the special fund and used only in
furtherance of the purposes set forth in this Chapter.
F. If the Bank does not secure authorization to conduct business by or before June 30, 2033, the
special fund may be used to offer loans which support affordable housing, green energy/
infrastructure, and/or small businesses until such authorization has been secured, consistent
with this Chapter.
G. Proceeds of the tax may be used to pay or reimburse the City for actual, verifiable costs of
City staff when they are performing work necessary to accomplish Section 7.03.010(F).
7.03.020 Tax Authorized - Tax Rate and Allocation - Adjustments for Inflation
A. The City Council is hereby authorized to impose and allocate a special tax as follows:
1) Residential Rate: For all dwelling units, the tax shall be imposed at the rate of up to
$0.06 per square foot of improvements.
2) Non-Residential Rate: For all other property, the tax shall be imposed at the rate of up
to $0.09 per square foot of improvements.
B. Annually in May, the City Council shall increase the previous year’s rate by up to the greater
of the cost of living in the immediate San Francisco Bay Area or per capita personal income
growth in the state, as verified by official United States Bureau of Labor Statistics data. If either
index referred to above is discontinued, the City shall use any successor index specified by the
applicable agency, or if there is none, the most similar existing index then in existence.
7.03.030 Duration and Renewal
A. This measure shall remain in place for 6 years from the effective date, unless extended by
the voters.
7.03.040 Reporting and Accountability
A. The City Manager shall prepare and submit to the City Council an annual report of
performance metrics, outcomes, and accomplishments that reflects progress of the Bank
capitalization and charter. This report shall contain the amount of funds collected and expended.
B. All expenditures, and verification of progress towards the goals set forth in Section 7.03.010,
shall be subject to an independent performance audit by the City Auditor, at least once every
three years, to confirm that the tax expenditures and reports are accurate and consistent with
the intent of this chapter.
7.03.050 Definitions
For the purposes of this chapter, the following terms shall be defined as set forth below:
A. A “public bank” (the “Bank”) shall be a bank as defined in Section 57600 of the state
Government Code, which was added to the Government Code in the California Public Banking
Act adopted by the State of California in November 2019:
“Public bank” means a corporation, organized under the Nonprofit Mutual Benefit
Corporation Law (Part 3 (commencing with Section 7110) of Division 2 of Title 1 of the
Corporations Code) or the Nonprofit Public Benefit Corporation Law (Part 2
(commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code) for the
purpose of engaging in the commercial banking business or industrial banking business,
that is wholly owned by a local agency, local agencies, or a joint powers authority formed
pursuant to the Joint Exercise of Powers Act (Article 1 (commencing with Section 6500)
of Chapter 5 of Division 7 of Title 1) that is composed only of local agencies.
B, “Affordable housing” is defined as housing below 120% of AMI (Area Median Income), based
on the City of Berkeley’s most current data on income levels, housing costs, and housing
availability.
C. “Green energy/infrastructure” is defined as improvements to residential, commercial, and/or
public property, buildings and structures, designed to further net zero carbon and Fossil Fuel
Free City commitments. This initiative includes but is not necessarily limited to energy savings in
the built environment, community resilience, zero-carbon energy generation, electrified
transportation and industry, sustainable materials management, and waste reduction.
D, “Small businesses” is defined as businesses (especially those run by minorities, women, and
people of color) within the Bank’s geographical lending area, including Berkeley, which meet
any of the following criteria 1) growing but still too small to receive adequate support from
traditional banks; 2) start-up support for entrepreneurs and businesses in early stages, 3)
businesses whose accounts receivable are on longer terms and whose accounts payable are on
shorter terms; 4) funds that specialize in employee ownership transitions; and 5) any other
businesses which the Bank’s management believes can grow and thrive with loan support that
they cannot obtain from traditional banks.
7.03.060 Exemptions.
A. The tax imposed by this Chapter shall not apply to parcels and improvements exempt from
taxation by the City pursuant to the laws or constitutions of the United States and the State of
California.
B. The tax imposed by this Chapter shall not apply to any property owned by any person whose
total personal income, from all sources, for the previous calendar year, does not exceed that
level which shall constitute “very low-income,” as may be established by resolution of the City
Council. Any taxpayer claiming the exemption under this section shall be required to
demonstrate their entitlement thereto annually by submitting an application and supporting
documentation to the City Manager or their designee in the manner and at the time established
in regulations and/or guidelines hereafter promulgated by the City Manager subject to review by
the City Council in its discretion. Such applications shall be on forms provided by the City
Manager, or their designee, and shall provide and/or be accompanied by such information as
the City Manager shall require, including but not limited to, federal income tax returns and W-2
forms.
C. Any person or entity claiming an exemption from the tax imposed by this Chapter shall file a
verified statement of exemption on a form prescribed by the City Manager prior to June 30th of
the first fiscal year for which the exemption is sought.
7.03.070 Duties and Authority of the City Manager.
It shall be the duty of the City Manager to collect and receive all taxes imposed by this Chapter
and to keep an accurate record thereof. The City Manager is charged with the enforcement of
this Chapter, except as otherwise provided herein, and may prescribe, adopt, and enforce rules
and regulations relating to the administration and enforcement of this chapter, including
provisions for the re-examination and correction of returns and payments.
7.03.080 Collection with Property Tax - Penalties and Interest.
The special tax imposed by this Chapter shall be due in the same manner, on the same dates,
and subject to the same penalties and interest as established by law for other charges and
taxes fixed and collected by the County of Alameda on behalf of the City of Berkeley. The
special tax imposed by this Chapter, together with all penalties and interest thereon, shall
constitute a lien upon the parcel upon which it is levied until it has been paid, and shall
constitute a personal obligation of the owners of the parcel on the date the tax is due.
7.03.090 Collection.
The amount of any tax, penalty, or interest imposed under the provisions of this chapter shall be
deemed a debt to the City. Any person owing money under the provisions of this chapter shall
be liable to an action brought in the name of the City for the recovery of such amount. The City
shall be entitled to reasonable attorneys' fees and its costs of suit in any such action.
7.03.100 Refunds.
Whenever the amount of any tax, penalty, or interest has been paid more than once or has
been erroneously or illegally collected or received by the City under this chapter, it may be
refunded as provided in Chapter 7.20 of the Berkeley Municipal Code or any such successor
chapter.
7.03.110 Savings clause - Severability.
The provisions of this chapter shall not apply to any person, association, corporation, entity, or
property as to whom or which it is beyond the power of the City of Berkeley to impose the tax
herein provided. If any sentence, clause, section, or part of this chapter, or any tax against any
individual or any of the several groups specified herein is found to be unconstitutional, illegal, or
invalid, such sentence, clause, section or part shall be severable and such unconstitutionality,
illegality, or invalidity shall affect only such clause, sentence, section, or part of this chapter and
shall not affect or impair any of the remaining provisions, sentences, clauses, sections, or other
parts of this chapter. It is hereby declared to be the intention of the City Council and the People
of the City of Berkeley that this chapter would have been adopted had such unconstitutional,
illegal, or invalid sentence, clause, section, or part thereof not been included herein.
7.03.120 Violation - Penalty.
Any person who fails to perform any duty or obligation imposed by this chapter shall be guilty of
an infraction as set forth in Chapter 1.20 of the Berkeley Municipal Code. The penalties
provided in this section are in addition to the several remedies provided in this chapter.
Section 4. Increase appropriations limit.
Pursuant to California Constitution Article XIIIB, the appropriation limit for the City of Berkeley is
hereby increased by the aggregate sum authorized to be levied by this special tax for each
fiscal year during which the tax is in effect.
Section 5. Effective date.
The tax imposed by this Chapter shall be operative on January 1, 2027.
Section 6. Conflicting Ballot Measures
(a) In the event that this measure and another measure(s) relating to local taxes to fund any or
all of the uses permitted in this measure are approved by a majority of the voters at the same
election, and this measure receives a greater number of affirmative votes than any other such
measure(s), this measure shall control in its entirety, and the other measure(s) shall be
rendered void and without any legal effect. If this measure is approved by a majority of the
voters but does not receive a greater number of affirmative votes than the other measure(s), this
measure shall take effect to the extent permitted by law.
(b) If any provisions of this measure are superseded by the provisions of any other conflicting
measure approved by the voters and receiving a greater number of affirmative votes at the
same election, and the conflicting measure is subsequently held to be invalid, repealed, or
terminated, the provisions of this measure shall be revived and shall have full force of law.
Section 7. Special Tax; Majority Vote Requirement. This Ordinance imposes a special tax for
restricted purposes and is being placed on the ballot via signature petition. It shall be effective
only if approved by a majority of the voters voting thereon.
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