“Benicia is doing its best…..”

By Stephen Golub, Benicia resident and author, “Benicia and Beyond” column in the Benicia Herald, September 6, 2026

Benicia is doing its best to close the at least $7.5 million annual resource gap left by the Valero Refinery closing. It’s doing so through budget cuts, operational reorganization and selective revenue generation. In addition, state housing mandates, the conversion of the Refinery property, inflation and emerging challenges (such as rising water levels due to climate change) will stretch police, fire, recreation, infrastructure and other city services.

Which is all a way of saying: Benicia needs additional annual revenues. Ballot Measures X, Y and Z, which we’re voting on this November 3 (or even sooner, if you wish), provide a way of raising such badly needed funds at no cost to most of us.

For a solid, relatively comprehensive explanation of why these measures are necessary, please go to the Building Benicia’s Future site, at beniciasfuture.org. In the meantime, I’ll take a shorter stab at that here.

The point of these items is not only about the present. It’s mainly to pave the way for the future: for  Benicia’s kids, grandkids and families to live in a surviving, thriving city, as fine as or even better than what we have now.

Here’s how these measures will help if passed, starting with the most significant one…

Measure Z: A Reasonable Real Property Transfer Tax

Measure Z proposes a real property transfer tax for residential, commercial and industrial sites. THE MEASURE Z TRANSFER TAX APPLIES TO ALMOST NO EXISTING HOMES AND RESIDENTS. NOW AND IN THE FUTURE, THERE WILL BE NO TRANSFER TAX ON ANY CURRENTLY EXISTING HOME UNDER MEASURE Z IF THE HOME IS SOLD FOR UNDER $2 MILLION. THE TAX  ALSO DOES NOT APPLY TO SALES OR OTHER TRANSFERS WITHIN FAMILIES, including between parents and children, grandparents and grandchildren, siblings, spouses and domestic partners. Certain affordable housing is also exempted.

So, what does Measure Z apply to? Well, for instance, if Measure Z were already in place late last year, Benicia would have pocketed a tax of $1,160,000 when commercial developers Blue Rise Ventures and DRA Advisors paid $145 million for a dozen buildings covering about 15 percent of Benicia’s industrial park. With the possibility that these or other investors could buy other parts of that area, such sales could benefit the city’s coffers considerably in the future if Measure Z is approved.

What’s more, in coming years much or all of the 900-acre Valero refinery site will be sold for industrial, commercial and housing development purposes, at a conceivable cumulative (though admittedly speculative) cost of $1 billion or more. That would mean many millions of dollars for the city. It’s noteworthy that Signature Development Group, the firm commissioned by Valero to sell the property, does not object to Measure Z (or associated Measure Y – more on that below).

Putting aside these huge projects, where does a typical Benician simply selling a private home figure in all this? Almost all of us are off the hook for any transfer tax. As I’ve emphasized, unless you sell a currently existing home for $2 million or more, you never pay the tax on that existing home.

In addition to commercial and industrial properties, the  tax mainly applies to new houses built in 2027 or later.  That is, if you or a developer sells a house that is built  in 2027 or later, the tax is $4, $6 or $8 per $1,000, depending on whether the price is under $2,000,000, from $2,000,000 to $9,999,999, or $10,000,000 or more.

Thus, with  several thousand houses due to be built in Benicia in coming years, the transfer taxes from residential sales would nicely complement the transfer taxes on commercial and industrial transfers.

Measure Y: A Necessary, Limited Charter City Status

Measure Y is the necessary companion to Measure Z. It allows Benicia to become a “limited Charter City,” which means a change in its legal status only for the purpose of increasing its real property transfer tax. Due to state law, that tax is currently capped at $0.55 per $1,000. We can’t increase that figure from $0.55 to the proposed $4-8 per $1,000 proposed under Measure Z unless Measure Y also passes and Benicia thus becomes a limited Charter City. Hence the necessity of voting “Yes” for both proposed measures.

The Opposition: Some Questionable Claims

Certain folks oppose Measures Y and Z. Perhaps you’ve noticed their signs in selected places around town. I’m sure they are sincere in their stance.

Furthermore, I dislike taxes as much as the next guy: As a self-employed person throughout my career, I did not relish the thought of having paid double social security taxes every year.

However, with all due respect, it seems to me that these opponents’ main anti-Y/Z arguments actually undercut their case. Their points are technically true but incomplete and to my mind misleading. That in turn makes me doubt the overall thrust of their contentions.

I’ll accordingly quote and briefly rebut a few of their officially stated claims (as found at the city’s Voting and Election Information site that presents arguments both for and against these two measures):

Opponents’ Claim: “If Measure Y passes, the City can seek to change the charter at any time.”

The Reality: The city government can’t change the charter on its own. Any expansion of the limited charter would require a whole new measure and a whole new vote by Benicians. This would simply be democracy in action.

What’s more, the city has indicated no intention at all to seek to change the proposed limited charter down the line. Measure Y is only for the purposes of instituting a real property transfer tax. Period. It involves nothing else.

The only thing Measure Y  opens the door to, then, is badly needed revenues.

Opponents’ Claim: Once Measure Z passes, City Hall can seek to reduce or eliminate that exemption [for homes selling for up to $2 million].”

The Reality: Again, any reduction or elimination in the $2 million floor for the tax would have to be via a future ballot measure that all of us could vote on.

In addition, any city council member who even proposed such a change could lose their next race and otherwise be ostracized, plus the measure could and almost certainly would be voted down. Again, this is all subject to democracy in action.

Opponents’ Claim: “All three California cities that filed bankruptcy — San Bernardino, Stockton, and Vallejo — were charter cities.”

The Reality: There are 25 cities in the Bay Area alone that are charter cities; only one of them (Vallejo) went bankrupt – due to reasons other than its charter status. And as of 2024, roughly a quarter of California cities are Charter Cities. Many have transfer taxes higher than Measure Z proposes for Benicia. This tax is not the kiss of financial death by any means.

Again, Benicia is not even seeking full charter status. Instead, Measure Y proposes just limited status for the sole purpose of transfer tax revenues.

Opponents’ Claim: “Measure Z would raise [only] $230,000 a year.”

The Reality: The point about Measure Z is not what it yields in the next few years (though it could well be higher than $230,000 per year), but that it sets up Benicia for raising millions of dollars down the line, as various housing, commercial and industrial developments take place that in turn trigger increasing transfer taxes.

Measures Z (and Y) are mainly about fueling a future in which Benicia survives and thrives, not about the past or even the present. Let’s also bear in mind the $1,160,000 that Benicia in effect forfeited from the industrial park sale by virtue of not having the Measure Z transfer tax in place a year ago.

Measure X: Modernizing Our Antiquated Business Tax

Measure X modernizes Benicia’s antiquated business licenses tax structure by, among other things, eliminating taxes for any business (be it a home, office or commercial establishment) making less than $100,000 annually. It also helps the city catch up with many years of inflation. The city council approved it unanimously as a ballot measure.

The upshot is that about 1,900 local businesses will no longer be subject to the tax, with over an additional 2,200 either paying less or no tax during the first year after Measure X is enacted.

For larger enterprises, the tax will be capped at $1,500 per year initially (with the rates of $0.25 to $1.25 per $1,000 in gross receipts, depending on the nature of the business). The rates then increase 10 percent per year up to a maximum of $25,000 annually.

Bear in mind, too, that the maximum would apply only to businesses far larger than the typical Benicia establishment.

A significant additional source of revenue under Measure X will be a separate tax of $3 per $100 on receipts for the Benicia Marine Terminal’s (largely auto-based) business.

The Bottom Line: Vote Yes on X, Y and Z

Benicia faces a big fiscal hole of at least $7.5 million per year, which it is addressing through a combination of budget cuts, operational reorganization and enhanced revenues. In addition, as new residential, commercial and industrial developments are built, police, fire, recreational and infrastructure needs will expand.

We accordingly need to approve additional revenue streams, not just for today but for many tomorrows down the line. Some such streams (as in Measures Y and Z) will impose no cost on the vast majority of us. Others (as in Measure X) are simply reasonable attempts to catch up with inflation and replace an antiquated business tax structure; they even eliminate or decrease taxes on some of us.

In a sense, then, the case for these steps is as simple as a, b, c. So…

PLEASE VOTE YES ON MEASURES X, Y AND Z.

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Stephen Golub writes about democracy and politics, both in America and abroad, at A Promised Land: America as a Developing Country.

…and… here’s more Golub on the Benicia Independent

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