June 25, 2024 Breaking News, Latest News, and Videos

This May Be the Year Prop. 13 Intent is Restored

By Tom Elias

Thomas B. Elias, Columnist

Any time traveler revisiting the California of 1978 would have an easy time understanding why Proposition 13 passed so handily that year, lowering property taxes throughout the state to 1 percent of the latest sale price or 1 percent of the 1975 assessed value.

Such a traveler would enter a land with skyrocketing property taxes based on the latest market value of each property. Not the latest sale price, but an arbitrary market value assigned to every piece of property by county assessors basing their numbers largely on “comparables,” the prices of similar homes in the same or nearby neighborhoods.

Many senior citizens and others on fixed incomes lived in dread of the annual assessment letter informing them of their home’s purported new value. Plenty (no one knows the exact number) felt compelled to sell.

Then along came longtime Los Angeles gadfly Howard Jarvis and his Sacramento-based pal Paul Gann with Proposition 13, which they sold as a measure to give homeowners financial stability and predictability. So long as a property stays in the same hands, that initiative still dictates, basic property taxes on it can rise no more than 2 percent per year.

One major result: California has had systematic tax inequality for the last 39-plus years, with neighbors in similar houses or condominiums paying radically different taxes, mostly based on when they bought and not on current values.

There is no significant move today toward changing those provisions. But some change nevertheless may come to the sacred-cow law later this year.

That would be in the form of a “split roll,” where commercial and residential properties are taxed at different rates.

This has some basis in history, for anyone going back to view the Jarvis-Gann campaign of 1978 would not hear much about commercial or industrial property taxes. Yet owners of those kinds of properties enjoy the same benefits as homeowners and their share of the overall property tax burden has dropped by several percent since 1978.

Advocates of more funding for public schools and other local services have long contended the split roll is the best way to make up what those causes lost under Proposition 13. The idea has been kicked around in Sacramento and elsewhere for a generation, but never went anywhere.

And yet, a 2015 survey of 104,000 likely voters found 75 percent favored withdrawing Proposition 13 protections from non-residential property.

As the 40-year anniversary of Proposition 13 approaches in June, proponents of the split roll have for the first time submitted a proposed initiative to make this change. One reason they chose the initiative route rather than trying to get the state Legislature to put the change on the ballot: Democrats – usually more sympathetic than Republicans to the idea of taxing businesses – have narrowly and at least temporarily lost their two-thirds majority in the state Assembly because two members felt compelled to resign when charged with sexual improprieties and another left for unspecified health reasons.

Advocates of the change say it could raise billions of dollars to improve public schools and colleges.

“I think the cumulative effects of the unfair tax system have gotten to the point where it’s created crippling…impacts on the state,” said Melissa Breach of the state’s League of Women Voters.

The measure has not yet been assigned a title by Attorney General Xavier Becerra and so petitions are not now being circulated for signatures.

But it’s for certain the Howard Jarvis Taxpayers Assn., named for the Proposition 13 co-author, will fight it vigorously. As with previous tentative moves toward a split roll, the hard-fighting organization will brand this measure as an attempt to crack the solid protections homeowners get from Proposition 13. The Jarvis group and its allies usually claim that once any Proposition 13 provision is changed, it will be only a short time before homeowner protections would be lost.

While the 2015 poll makes it look easy to get this passed via an initiative, looks can deceive. The fears of California homeowners, who already pay far more than average state and local income and sales taxes, are not difficult to stoke.

All of which means this may be the year Proposition 13 changes. But don’t yet bank on it.

Related Posts

SM.a.r.t Column: The Up Zoning Scam (Part 2)

June 23, 2024

June 23, 2024

Last week’s SMart article  (https://smmirror.com/2024/06/sm-a-r-t-column-the-up-zoning-scam-part-1/)  discussed the ambitious 8895 units (including 6168 affordable units) that Santa Monica is required to...

SM.a.r.t Column: The Up Zoning Scam (Part 1)

June 16, 2024

June 16, 2024

Over the last few years, the State of California has mandated a massive upzoning of cities to create capacity for...

SM.a.r.t. Column: Shape Up – On Steroids

June 9, 2024

June 9, 2024

Nine years ago, SMa.r.t wrote a series of articles addressing the adaptive re-use of existing structures. We titled one “Shape...

SM.a.r.t Column: The Challenge of Running a City When City Staff Have Different Priorities

June 2, 2024

June 2, 2024

Living in a city has its perks, but it can be a real headache when the folks running the show...

SM.a.r.t. Column: A Path to Affordable Ownership in Santa Monica

May 27, 2024

May 27, 2024

[Note: our guest author today is Andres Drobny, a former Professor of Economics at the University of London, the former...

SM.a.r.t. Column: A Path Forward for Santa Monica: Part II

May 19, 2024

May 19, 2024

As referenced in Part I of this article, the state’s use of faulty statistics and forceful legislation has left a...

SM.a.r.t. Column: A Path Forward for Santa Monica: Part I

May 12, 2024

May 12, 2024

To quickly summarize, California grapples with an ongoing housing crisis spurred by state implementation of over 100 policies and mandates...

SM.a.r.t. Column: Where Will Our Huddled Masses Sleep? Navigating California’s Affordable Housing Mandates

May 5, 2024

May 5, 2024

Just as Lady Liberty beckons the “huddled masses” of immigrants to America, cities like Santa Monica have an ethical obligation...

SM.a.r.t Column: SMCLC SPEAKS

April 28, 2024

April 28, 2024

SMart (Santa Monica Architects for a Responsible Tomorrow) periodically invites guest columnists who have made a significant contribution to the...

SM.a.r.t Column: Building Modern Boxes Lacks Identity

April 21, 2024

April 21, 2024

In the relentless pursuit of modernity, cities worldwide have witnessed the rise of so-called architectural marvels in the form of...

SM.a.r.t. Column: Santa Monica Needs Responsible Urban and Architectural Design

April 14, 2024

April 14, 2024

[SMa.r.t. note: Eight years ago, our highly esteemed and recently-passed colleague Ron Goldman documented his thoughts on the need for...

SM.a.r.t. Column: BLINK NOW!

April 7, 2024

April 7, 2024

Nine years ago, I wrote a column for SMa.r.t. titled SANTA MONICA: BEACH TOWN OR ‘DINGBAT’ CITY? (https://smdp.com/2015/05/09/santa-monica-beach-town-dingbat-city/)Here is the...

SM.a.r.t Column: ARB Courage (Part 2 of 2)

March 31, 2024

March 31, 2024

Last week we discussed the numerous flaws of the Gelson’s project as a perfect example of what not to do...

ARB Courage (Part 1 of 2)

March 24, 2024

March 24, 2024

On March 4, 2024, your ARB (Architectural Review Board) ruled in favor of the 521-unit Gelson’s Project at Ocean Park...

SM.a.r.t Column: Can California ARBs Balance Affordable Housing with Community Character in the Face of New Housing Laws?

March 17, 2024

March 17, 2024

By suggestion, I attended the March 4th ARB (Architectural Review Board) meeting that addressed the Gelson Lincoln Boulevard Project.  After...