That, and Texas has electricity...
Posted on 01/21/2020 8:38:18 PM PST by nickcarraway
The 2020 ballot initiative would amend the state constitution to require commercial and industrial properties, except those zoned as commercial agriculture, to be taxed based on their market value.
Under the new initiative, residential properties are excluded from this potential policy and would continue to be taxed under the original requirements of Proposition 13, when property ownership changes or when new construction is done.
Property tax rates would not change, and there would be a qualified exception for some small businesses, according to official documents.
First set in 1978, Proposition 13 places a cap on tax rates for residential, commercial and industrial properties at 1 percent of the property’s purchase price, with an annual adjustment equal to the rate of inflation or 2 percent, whichever is lower.
This is meant to protect financially vulnerable property owners, as market values in California tend to increase faster than 2 percent per year, meaning the taxable value of commercial and industrial properties is often lower than the market value, according to the state Legislative Analyst’s Office.
The passing of Proposition 13 in 1978 has been credited with reducing California property taxes by about 57 percent.
The projected fiscal impact of passing the modification of Proposition 13 would be a net increase in annual property tax revenues of $6.5 billion to $10.5 billion in most years, depending on the strength of real estate markets.
After paying for county administrative costs and repaying state income tax losses related to the measure, the remaining $6-10 billion would be “allocated to schools (40 percent) and other local governments (60 percent),” according to the official language of the proposed modification.
“We’re asking for companies like Disneyland or Universal Studios that make huge amounts of money to pay property taxes based on fair market value—the same thing that homeowners and, frankly, most businesses have to do,” said Josh Pechthalt, president of the California Federation of Teachers, in an August 2018 interview.
Critics of the proposed measure warn that in a state with high property values, the measure could force large employers to pass higher costs on to consumers, cut back on hiring or flee to low-tax states.
In February 2019, Tom Campbell, former state director of finance from 2005 to 2006, said, “From the point of view of attracting and retaining businesses and jobs, the power of Prop. 13, rather, was in allowing California to tell a business: go ahead and sink that concrete into Texas if you want, but you’re taking a big risk that Texas won’t revisit that building a few years later and double your tax assessment. With California, you’re safe. … In repealing Proposition 13 for businesses, California will be forfeiting our best argument to attract new jobs – a long-term sacrifice that will hollow-out California’s economy, costing us far more (than) $10 billion in a very short time.”
These constitutional amendments would, among the previously explored taxation adjustment, create the Local School and Community College Property Tax Fund. It would be this fund where 40 percent of the revenue from the adapted proposition would go.
On the Ballot
A “yes” vote would support the constitutional amendment to require commercial and industrial properties, except those zoned as commercial agriculture, to be taxed based on their market value, rather than their purchase price, and allocate revenue from the change to local governments and school districts.
A “no” vote would oppose the constitutional amendment, thus continuing to tax commercial and industrial properties based on a property’s purchase price, with annual increases equal to the rate of inflation or 2 percent, whichever is lower.
For more information on the measure, read the full text here.
The Democrat Party is determined to turn California into Venezuela.
The top Party members will wield increasing power and enjoy unbridled wealth.
Everyone else will become proles.
That’s cute that Californians think they can pass a ballot initiative that the legislature and courts won’t just disregard.
This is being pushed by Dolores Huerta and the United Farm Workers, thus the exemption for “those zoned as commercial agriculture”.
Translation: the Mexicans want to suck the money out of the Gringos using the biggest extortion stick they can find: your money or we take your property.
The worthless Republicans in California should have proposed repealing the very idea of property tax or at minimum freezing the valuation at the time of sale a long time ago.
Proof that they, just like the Rats, are only interested in stealing at a level where people just barely can take it.
More teacher’s union greed...ugh.
Whew...for a minute, I thought those wascally Democwats would go after our residential property taxes. Thank God we are safe!
In other news, Idaho being overrun with Californians...
As West Coast Transplants Pour In, a Small Idaho Town Has a Big Dilemma
Star’s population is booming and housing prices have more than doubled; ‘The growth is beyond what people can handle’
City’s population has doubled in the past nine years to more than 10,000.
One suspects that since tech is doing well in the Trump economy, Cali benefits from that, tax-wise.
If the Dems ever get back in, Cali will flip financially underwater in an instant.
This is why Cali should be courting small businesses, including commercial properties, rather than shooing them to Texas.
So, a multi-unit dwelling (think: duplex, quadraplex, or even high-rise) belonging to absentee-owners would still be taxed at the residential rate, but a little, family-operated used-book shop would be taxed at the (exploding) commercial rate, right?
Regards,
Democrats greed at work. California got a budget surplus. So Gov Newsom wants to waste it on more boondoggle projects like tunnels to LA to pipe more water, stealing it from the north (that's what the aqueduct waterway already does). Instead of channeling the surplus to schools etc., or heaven forbid, reducing state tax burdens. Every year these Democrat thieves try to repeal Prop 13, because there's never enough money to steal from the citizens in order to hand out to freeloaders like illegals and bums.
Jarvis-Gann has lasted since 1979. The legislature and courts haven’t overturned it, but they think voters will overturn the commercial part this time.
I was thinking that apartments would fall under commercial and houses would be residential.
That, and Texas has electricity...
Simply put, income redistribution from citizen ownership to illegal undocumented. This is being SOLD as a yet again “For The Children and Public Schools”. Well in California that is basically a cry to fund the kids of illegal aliens.
That's what Prop 13 does. It freezes it to when you bought it.
So, a duplex where you reside in one unit and rent out the other unit - that would be "commercial" (or at least the rental unit)? And the little, family-owned used-book shop or corner mini-market? That would be taxed at the horrendous commercial rate?
Regards,
In the 80’s the California lottery was sold as all the money going to the schools. 34 years later we’re still waiting for the money going to the schools.
Residential property will be next.
Good point. I haven’t seen the actual law yet.
That’s my point.
Lol...the utilities there don’t cause wild fires either.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.