A controversial proposal to tax foreclosure sales of commercial and multifamily properties in San Francisco has successfully navigated the Budget and Finance Committee with a unanimous 3-0 vote, advancing towards a full Board vote, a crucial step before it can be placed on the November 3, 2026, ballot.

The measure, championed by Mayor Daniel Lurie and Supervisor Bilal Mahmood, aims to generate an estimated $200 million over three years by eliminating a four-decade exemption, dating back to 1984, for properties acquired through foreclosure. Its passage out of committee signals significant momentum for the initiative, which seeks to level the playing field in the city's complex real estate transfer tax landscape.

San Francisco’s proposed ballot measure, Legislative File 260692, targeting commercial and multifamily foreclosure sales, achieved a significant milestone on July 15, 2026, when it passed the Board of Supervisors’ Budget and Finance Committee with a 3-0 vote. Supervisors Connie Chan (D1), Danny Sauter (D3), and Matt Dorsey (D6) voted in favor, sending the measure forward for consideration by the full Board of Supervisors.

The committee's approval follows the measure's introduction on June 9, 2026, by Supervisor Bilal Mahmood. It has garnered considerable support, including co-sponsorships from Supervisors Chyanne Chen, Matt Dorsey, Myrna Melgar, Shamann Walton, and Alan Wong (D4). Mayor Daniel Lurie has also publicly backed the initiative, stating, "This measure will make our tax code simpler and fairer — that anyone buying a building plays by the same rules."

The core of the proposal is to eliminate an existing exemption from the real property transfer tax for properties acquired through foreclosure, an exemption that has been in place since 1984. If approved by voters, this change would take effect on March 1, 2027. Proponents estimate the tax could generate approximately $200 million over three years for the city; this figure has yet to be independently confirmed by an official analysis.

The path to the November 3, 2026, ballot is not yet complete. While the committee vote is a major step, the measure still requires formal approval from the full Board of Supervisors to be officially placed before the city's voters. The legislative record from SF Quorum indicates the measure was scheduled for further committee review on July 22, 2026, with a full Board vote pending. This initiative represents a new approach to tax policy in San Francisco, driven by the city's ongoing fiscal and housing discussions.