OAKLAND — Early returns showed voters opposing a city tax proposal that would patch future budget gaps as pension costs loom over Oakland’s economic future.
Measure E, projected to raise roughly $34 million for the city, had just 45% voter approval in election night returns, which reflected 156,000 ballots or 16% the total Alameda County voter population.
The proposed parcel tax — which, through a technicality, requires only majority approval rather than the typical two-thirds vote — was the flagship measure of a relatively quiet June 2 election in Oakland.
It would cost the owners of single-family land parcel in Oakland an additional $191 annually on their property tax bills, which already are among the steepest in the Bay Area.
Elsewhere on the ballot, a tax break for local businesses was on its way to passing in Tuesday’s earliest returns with 76% approval, while a procedural move to scale back the responsibilities of a pension review board was also coasting to victory with 72% of the vote.
The tax break, which appeared on ballots as Measure C, would exempt businesses generating less than $1 million in gross receipts from paying license fees to operate, while a newly opened business of any size would be excused from taxes on the first $1 million it generates.
Of the ballot items, only Measure E spurred any meaningful political spending, with the city’s largest public labor unions spending over $1 million to bankroll citizen groups that gathered petitions and later to campaign for the tax’s approval.
The ballot language promises to fund police, fire and homelessness services to “keep public spaces clean, safe and accessible.”
In reality, however, there would be few legal guardrails protecting how the money is used. City leaders have often bypassed the provisions of past taxes to continue paying worker salaries.
Fed up with this practice, the political arm of Oakland’s fiscally moderate class — a group named Empower Oakland — spent about $300,000 on late-game advertisements warning not to fall for the city government’s promises.
Consistently, though, the city’s approach of simply asking for more has paid off. Voters last outright rejected a tax proposal here in 2011, during the mayoral administration of Jean Quan.
Mayor Barbara Lee speaks during a press conference at police headquarters in downtown Oakland, Calif., on Monday, May 18, 2026. Three people died when a speeding pickup truck crashed into a crowd of people in East Oakland late Saturday, authorities said. (Jane Tyska/Bay Area News Group)
Mayor Barbara Lee campaigned hard for the new parcel tax, unveiling a spending plan last month that promises to budget nearly two dozen new police officer positions and replace outdated fire engines with newer models.
“It’s crystal clear to me,” Lee said at a recent news conference, “that we as a city do lack the resources that residents need and deserve.”
Property owners in this city already face steep taxes across both flat rates for parcels and supplemental taxes that vary based on a home’s assessed value.
Just to cover the city’s various bond measures, the owner of a home with an assessed value of $1 million pays around $1,145 annually. An additional $191 would appear on that yearly tax bill, while owners of apartments and commercial real estate would face similar burdens.
The city has fallen back on multiple tax measures to draw more money, though spending cuts have also alleviated — for now — yearly deficits in the General Purpose Fund budget, which pays for most salaries and daily operations.
But ballooning pension obligations through the end of the decade threaten to keep revenues well below costs, which may lead officials to seek yet more taxes down the line.
“The city will need to consider additional, more aggressive fiscal policies to increase funding to responsible levels to ensure the city will be able to meet its obligations,” stated a five-year financial forecast published last year.
Measure E’s journey to the ballot may itself reflect the unique brand of politics in Oakland, where union leaders often work in lockstep with the government officials who sign their labor contracts.
Recent state Supreme Court precedent allowed governments to require approval from only a majority of voters for citizen-led tax initiatives, rather than the standard two-thirds threshold.
In Oakland, city leaders budgeted revenue from the anticipated new parcel tax, but instead of drafting the ballot language they simply let SEIU 1021 and IFPTE Local 21 fund petition-gathering for what eventually became Measure E.
The gambit, which led the tax measure to require only majority approval, may soon become the subject of a legal challenge from attorney Marleen Sacks, who already has sued to obtain communications between city officials and labor leaders.
Shomik Mukherjee is a reporter covering Oakland. Call or text him at 510-905-5495 or email him at shomik@bayareanewsgroup.com.