San Rafael property owners could face a fivefold increase in the city's real property transfer tax if the City Council votes Monday, July 20, to place a measure on the November 3 ballot.
The proposed "San Rafael Essential Services Protection Measure" would raise the tax from 0.2% ($2 per $1,000 of assessed value) to 1.0% ($10 per $1,000), generating an estimated $6 million in new annual revenue for the General Fund, according to a staff report prepared by Interim City Manager Paul Navazio. The tax applies only when a property is sold.
The city's General Fund currently collects about $1.5 million a year from the transfer tax. Navazio told the council at its June 15 budget adoption meeting, "We are currently doing work on either a general purpose tax measure or a public safety tax measure." The council chose the general-purpose route. A voter poll commissioned by the city and conducted June 18–29 showed 50% initial support, rising to 56% after respondents heard arguments for and against, according to the staff report.
San Rafael's current 0.2% rate is among the lowest of charter cities in the region, the staff report states. The proposed 1.0% would place the city in the mid-range, well below jurisdictions charging 1.5% to 3%.
The measure needs a simple majority to pass. If approved Monday, Mayor Kate Colin and Councilmember Maribeth Bushey are authorized to file the ballot argument.
Opportunity Zone 2.0 nominations
The council will also vote on nominating five census tracts for the federal Opportunity Zone 2.0 program, which offers capital gains tax breaks to investors who fund projects in designated areas. The application window to the state closes Monday, July 20.
Staff ranked Southeast San Rafael (tract 1122.02) as the top priority, followed by Downtown San Rafael (tract 1110.01), Waterfront Canal, Central Canal, and Francisco Blvd. West/Woodland. The San Rafael Chamber of Commerce's East San Rafael Working Group also backed tract 1122.02 as its first choice, according to the staff report prepared by Economic Development Manager Stacey Laumann.
The Downtown tract hosts several entitled projects totaling close to 500 new housing units, according to the staff report.
Two Canal tracts already carry OZ 1.0 designations that expire December 31, 2026. After the first round in 2018, investors purchased Canal buildings, raised rents, and evicted tenants, Canal Alliance CEO Omar Carrera told NorCal Public Media in a July 6 report. The city responded with an ordinance establishing relocation fees for residents in OZ-designated properties. Staff said it will return with updated tenant-displacement protections but gave no specific date beyond "late summer or early fall."
350 Merrydale Road housing project
The council will establish a subcommittee of Colin and Bushey to review developer proposals for a permanent affordable housing project at 350 Merrydale Road, a 2.5-acre site near Highway 101 zoned for 80 to 137 units under state density bonus law, according to the staff report. The city purchased the property in November 2025 and issued a developer RFP in February 2026, with units to be entitled by June 30, 2028.
On the consent calendar: a $989,825 contract with Ghilotti Brothers, Inc. (plus $98,983 contingency) for site preparation at 350 Merrydale's interim shelter, which will house up to 65 unhoused individuals.
Other business items
The council will take final votes on three ordinances introduced June 15: a park impact fee, a transportation mitigation fee, and updated parking regulations. It will also authorize the sale of a remnant Andersen Drive parcel to Marin Sanitary Service or another adjacent owner for no more than $40,000, and approve a temporary closure of Fourth Street between F and G streets for the West End Block Party.
The meeting begins at 6 p.m. at San Rafael Council Chambers, 1400 Fifth Avenue. Residents can join online at tinyurl.com/city-council-2, by phone at (669) 444-9171 (ID 860-6190-5675#), or submit written comments to [email protected] before the meeting.
