When we change Proposition 13, we will not only return the state to a fair and equitable real estate property tax collection system but most importantly restore its fiscal solvency
Do you agree with this statement? Whether you do or not, you, hopefully, cannot argue with the fact that the state is in a financial crisis and, with the exception of the financial heyday associated with the dot com bubble, has been for quite some time.
Consider the following:
- Our state is in
massive debt and it's getting worse-- more/new income needs to come from
- One main driver for this
lack of revenue comes from the shift in the state's revenue source caused by Prop 13. Before Prop 13, property taxes provided a fairly consistent revenue base for the state which, arguably, the legislators could then use to base their expenditures on so we could have something resembling a rational budget. After Prop 13, the main source of revenue shifted to income taxes which fluctuate with the economy while state expenditures on infrastructure, schools, health services, etc. do not. Hence, the problem.
- Another side effect of Prop 13 is the widening disparity between the market value and assessed value of property throughout the state. Long time property owners benefit from lower assessments (essentially locked in by Prop 13) while new, and often younger, property owners shoulder the burden of assessments that can be as much as ten times greater than the owner(s) of a similar property held for many years. What’s this mean? People who have owned their homes long enough to be on the “positive” side of Prop 13 are increasingly happy and don't want to pay more property taxes (indeed – 60% of voters do not support changing Prop 13—guess who?).
- Existing property owners can pass their homes down to their children without an increase in property taxes. The house transaction is supposed to be at market value which provides some transaction fee taxes, but the property tax basis does not adjust like with all other "non-family" transactions. What's this mean, another generation of home owners "locked in" to low property taxes thanks to Prop 13.
- The result-- local governments (cities/counties) are continuously engaged in efforts to raise revenue for schools, parks & recreation, emergency services, infrastructure. Even this adds to the budget woes since it costs money to do this.
The incredible frustration about this whole situation is no politician has skin thick enough to take this on-- no one wants to "raise taxes." What's it going to take? - houses burning down because fire stations are closing due to no money? What about the schools slipping further in per-pupil spending-- do we want to be the lowest state in the country in our support for educational spending (aren't we already)? Don't even start on social services.
The objective of this site is to support an open exchange of information/thoughts/issues surrounding Prop 13. Specifically, what options exist for changing Prop 13? Changing the way commercial property is taxed is one.
If you're interested in getting
-- before cities & counties start declaring bankruptcy and the state ends up in junk bond status on its debt-- then
join the Repeal Prop 13 Organization. All that's needed is an email address and
your county of residence.
sign up page and
join the effort to change Prop 13!
Any questions? - send us an email