BY ELAINE GOODMAN
Daily Post Correspondent
Becoming a charter city might allow the town of Atherton to collect millions of dollars through a real estate transfer tax and potentially fend off certain state housing requirements.
Those are some possible benefits of charter city designation outlined in a report the Atherton City Council will discuss Wednesday. The report is from a council subcommittee made up of council member Rick DeGolia and vice mayor Stacy Holland.
Council is considering going to voters in November 2026 to ask for approval of charter city status.
Most California cities — including Atherton — are general law cities, which follow state laws that cover city operations. If a city decides to become a charter city, it can set its own rules on matters such as election schedules, competitive bidding requirements and whether to have a “strong mayor” form of government. Out of California’s 482 cities, 125 were charter cities as of 2020.
With charter status, Atherton could ask voters to approve a real estate transfer tax. A 1% tax per transaction would raise an estimated $4 million a year.
More than money
Although the town previously looked into becoming a charter city as a way to raise more money, that’s not the primary reason “at this time,” said the report from council’s charter city subcommittee. Instead, the issue is having control of land use.
“For Atherton, because the town is nearly 100% residential, single-family, the town’s most important issue for local control is land use and zoning,” according to a June 2024 report to council when the charter city discussion was restarting.
Charter cities won housing suit
Council discussed becoming a charter city issue in 2015 and 2017, deciding both times not to move forward. But an April 2024 court decision sparked renewed interest in the charter city issue in Atherton and other cities.
Los Angeles County Superior Court Judge Curtis Kin ruled in favor of five Southern California cities — all charter cities — that sued the state to overturn a 2021 housing bill, Senate Bill 9.
SB9 allows lots that are zoned for a single-family home and are at least 2,400 square feet may be split into two lots without a city hearing. Two homes can then be built on each resulting lot for a total of four homes where previously just one was allowed.
The text of SB9 says “ensuring access to affordable housing is a matter of statewide concern and not a municipal affair,” therefore overriding the charter cities’ “home rule.”
The five cities — Redondo Beach, Carson, Torrance, Whittier and Del Mar — said that SB9 has no requirements that the newly created housing be affordable.
Judge Kin agreed with the charter cities. He said SB9 isn’t “reasonably related to ensuring access to affordable housing” or crafted in a way to avoid unnecessary interference in local government.
The case is now pending in California appellate court after the state and Attorney General Rob Bonta filed an appeal last summer.
For now, Kin’s decision applies to the five cities in the lawsuit, but if it’s upheld on appeal, it will apply to all charter cities in California.
Benefits unclear
Despite the court decision on SB9, it’s unclear how much a charter city designation would help Atherton fight off state-mandated housing requirements, according to the subcommittee report.
Many of the state’s housing laws declare that the law addresses “a matter of statewide concern,” meaning they apply to charter cities as well as general law cities. But there’s also a chance some new housing laws will apply only to general law cities, the report said.
If council decides to move forward with the charter city idea, the city would need to draft a charter — the new rules for city operations. At least two hearings would be held for the public to comment on the proposed charter.
Once it’s on the ballot, a majority vote would be needed to approve the charter.