Portola Valley reviews draft charter and proposed real property transfer tax, staff warns filing deadline is Aug. 7

The Portola Valley Town Council on July 8 held a study-session review of a draft town charter and a proposed real property transfer tax ordinance that staff say would be presented to voters if the council decides to place the measures on the November ballot.

Town Manager Darcy Smith told the council the charter would convert Portola Valley from a general-law to a charter town and is a prerequisite to adopting a local real property transfer tax (RPTT) beyond the state's documentary transfer tax. "This charter will allow the town to adopt this real property transfer tax beyond the state approved minimum," she said, adding that staff were not presenting a rate at this meeting and planned to return July 22 to propose specific rates.

Staff counsel and finance staff framed the revenue need and priorities that an RPTT would target: storm drain repair (master plan and expected multimillion-dollar repairs), wildfire resilience and vegetation management, evacuation planning and backup power, IT modernization, facilities maintenance and ongoing pavement management. Tony, the finance presenter, recommended a continuing CIP contribution target near $750,000 per year and estimated the town's revenue need for ongoing operations and capital at roughly $2.3 million to $3.0 million annually.

Staff emphasized simplicity and recommended retaining existing exemptions that mirror state law (for example, transfers between governmental entities and certain family transfers). Staff advised against adding new exemptions at this stage, warning that additional exemptions complicate revenue modeling and can confuse realtors and property professionals who operate across jurisdictions.

Councilmembers asked whether the council could reduce rates if revenues proved excessive; staff said the ordinance includes language allowing the council to reduce or repeal rates but not to increase them beyond the voter-approved ceiling. Staff also noted the practical timing: the filing deadline to place the measures on the Nov. 3 ballot is Aug. 7. If the ballot measure passes, the ordinance would take effect 10 days after council certification of election results.

Several residents spoke in favor of raising local revenue to address deferred maintenance and resilience needs; others asked for safeguards such as council review of rates and clear exemption language. Councilmembers generally expressed support for a simple ordinance and directed staff to return with rate options and the formal resolution to place the measure on the ballot at a subsequent meeting.

No formal decision was made July 8; the council will consider resolution and rate-setting at the next meeting (staff identified July 22 as the next step).