Measure ULA, Los Angeles’s groundbreaking mansion tax to fund affordable housing and homelessness prevention, just survived its most serious legislative threat to date. On Friday, after days of mounting public pressure, Mayor Karen Bass and her allies in Sacramento pulled SB 423, a bill that would have carved out massive exemptions from ULA, slashing its revenue by up to 30 percent and gutting its ability to deliver on voter mandates.

The bill, co-written by State Senator Lena Gonzalez and Assemblymember Tina McKinnor and quietly negotiated by Bass’s office, would have reduced tax rates for newly constructed commercial and multifamily properties, and loosened affordability covenants tied to distressed properties funded through ULA. It was drafted hastily and without the input of the city agencies or community groups implementing the measure. The timing could not have been more brazen. The bill was introduced just days after the city opened applications for $387 million in ULA funding. its largest affordable housing investment to date.

Supporters of the bill claimed that ULA was stifling housing production. Relying on economic studies promoted by real estate interests, they argued that the tax had a chilling effect on development and was undermining efforts to expand the housing supply. But a new report by researchers from UCLA, USC, and Occidental College dismantled that argument. The authors challenged the methodology and conclusions of the anti-ULA studies, pointing instead to rising interest rates, construction costs, and the city’s own zoning overhaul as more likely explanations for delays in development. “Timing is everything,” said Joan Ling, one of the report’s co-authors and a longtime UCLA lecturer.

ULA is doing exactly what voters intended when they passed it in 2022 with nearly 58 percent approval. Since going into effect, it has raised over $830 million to fund tenant protections, affordable housing construction, rent relief, income support, and homelessness prevention. More than 100,000 Angelenos have been helped through legal defense, emergency assistance, or job creation. The $387 million made available last week will fund thousands of new units and represents more than five times what the city’s housing department typically allocates to affordable housing developers.

Since ULA passed, it has faced relentless attacks from billionaire landlords, corporate real estate groups, and anti-tax organizations like the Howard Jarvis Taxpayers Association. Lawsuits and local repeal efforts have failed but with SB 423, the threat came from within. Our own city and state leaders who claimed to support affordable housing worked behind the scenes to dismantle one of the most powerful housing justice tools in the country.

A coalition of tenant unions, affordable housing developers, labor unions, legal advocates, and grassroots organizations fought back and won, for now. On Thursday, groups rallied across Los Angeles to demand the bill be pulled. In an open letter addressed directly to Mayor Bass, organizations signed on to a letter denouncing her role in advancing the bill, calling it “profoundly undemocratic.” “You sold out the majority of Angelenos who voted for you in favor of appeasing special interests,” the letter stated. The groups accused her of cutting a deal that would devastate Los Angeles’s best chance at reversing the housing crisis while eroding the public’s right to self-determination. For these groups, ULA is not just a local tax but a national model exemplifying what is possible when cities tax extreme wealth to build public good. And it is under attack precisely because it is working.

ULA supporter may have won this battle, but SB 423 is expected to be reintroduced in January. Meanwhile, the Howard Jarvis Taxpayers Association continues to gather signatures for a 2026 ballot initiative that would repeal ULA entirely and ban local governments from enacting similar measures in the future. Take action now using the Housing NOW! Protect ULA Toolkit.