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Investigation: With Only $55 Million in Coffers, Los Angeles Plans to Spend $150 Million From Tax

By Adam Andrzejewski

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Investigation by Adam Andrzejewski originally published by and

While only roughly $55 million has been raised from a possibly unconstitutional mansion tax in Los Angeles, the City Council recently passed a spending plan for how to use $150 million — when it comes in.

L.A.’s mansion tax redistributes money from the sales of houses above $5 million. The law, which took effect on April 1, charges 4% on all residential and commercial real estate sales in the city above $5 million and a 5.5% charge on sales above $10 million.

But the city’s new tax is facing lawsuits questioning its constitutionality, with the possibility that the city may have to pay those funds back after it spends them on eviction defense, income support for rent-burden seniors, rent debt assistance, and more.

Initially, proponents estimated the tax would raise about $900 million per year, but a March report from the City Administrative Office lowered that number to $672 million, The Los Angeles Times reported.

“But once the tax took effect, L.A.’s luxury market froze,” The Times reported. “Only two homes sold for more than $5 million in the month of April, and the market hasn’t quite recovered since.”

Luxury homeowners seeking to avoid the tax have either refused to sell their homes or hired tax specialists to find loopholes, The Times reported.

Now, Mayor Karen Bass projected only $150 million in revenue from the flawed tax — with $55 million at the moment — an amount the city will have to return if the law gets overturned.

With far less money coming in because of the freeze on sales, an option to overturn it on next year’s ballot, and lawsuits, the City of Los Angeles should call an audible and admit it made a mistake.

By Adam Andrzejewski – The #WasteOfTheDay is brought to you by the forensic auditors at

This article was originally published by RealClearInvestigations and made available via RealClearWire.

Deneen Borelli

Deneen Borelli is the author of Blacklash: How Obama and the Left are Driving Americans to the Government Plantation. Deneen is a contributor with Newsmax Broadcasting. She is a former Fox News contributor and has appeared regularly on “Hannity,” “Fox & Friends,” “Your World with Neil Cavuto,” and “America’s Newsroom.” She has also appeared on Fox Business Network programs “Making Money with Charles Payne,” “The Evening Edit with Liz MacDonald,” and “Cavuto: Coast to Coast.” Previously, Deneen appeared on MSNBC, CNN, the BBC and C-SPAN. In addition to television, Deneen co-hosted radio programs on the SiriusXM Patriot channel with her husband Tom. Recently, Deneen co-hosted the Reigniting Liberty podcast with Tom. Deneen is a frequent speaker at political events, including the FreedomWorks 9.12.2009 March on D.C. which drew a crowd estimated at over 800,000 people. Deneen is also an Ambassador with, a social media platform that promotes free speech, and with the America First Policy Institute (AFPI) which advances policies that put Americans first. Deneen testified before the U.S. House of Representatives Committee on Natural Resources in May 2011 and before the Ohio House Public Utilities Committee in December 2011. Previously, Deneen was a host, Outreach Director with overseeing its outreach program, a Project 21 Senior Fellow, and Manager of Media Relations with the Congress of Racial Equality (CORE). Prior to joining CORE, Deneen worked at Philip Morris USA for 20 years. During her corporate career at Philip Morris she worked in various positions, her last as Project Management Coordinator in the Information Management department where she was responsible for the department’s mandated quality processes, communications, sales information and database management. Deneen began her Philip Morris career as a secretary and advanced to positions of increasing responsibilities. Deneen worked full-time and attended classes at night for 11 years to earn her B.A. in Managerial Marketing from Pace University, New York City. Deneen served on the Board of Trustees with The Opportunity Charter School in Harlem, New York. She appeared in educational videos for children, worked as a runway fashion model, and auditioned for television commercials. Her interests include ancient history, pistol target shooting, photography, and volunteering at her church. Deneen currently resides in Connecticut with her husband Tom.

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