Political groups are racing to get their propositions to reform Proposition 13 onto the November ballot, with the latest one being an effort to “close the Proposition 13 corporate property tax loophole,” according to supporters.
State Attorney General Xavier Becerra approved the gathering of signatures late Tuesday for a constitutional amendment that would tax certain commercial and industrial property based on fair-market value. Current law taxes the property based on the purchase price with limited inflation.
“Californians are ready for change. Our schools are being starved of funds by billionaires and corporations who are using a loophole to avoid paying their fair share. This is the year that Californians will finally say enough is enough, and slam this corporate loophole closed once and for all,” said Veronica Carrizales, Policy and Campaign Development Director of California Calls. “We are confident of our chances of qualifying for the ballot and of raising the resources we need in order to win this campaign. Oil companies and billionaires will spend millions opposing our effort, but we are hearing from voters that they are ready to close loopholes for the wealthy if it means funding local schools and communities.”
Nancy Starczyk, a Santa Clarita-based member of the Southland Regional Association of Realtors board of directors, referred to the proposal as a way to pass a “split-roll” measure, which would harm businesses because it would assess property values every three years beginning in 2020.
“We really don’t want to see a split-roll,” she said. “The cost of doing business has gone up.”
The measure’s summary said it would exempt “agricultural property and certain small businesses” while dedicating a portion of increased revenue to local services and schools. The state’s legislative analyst expects net increases of annual property tax revenues between $6.5 billion and $10.5 billion depending on real estate markets. The legislative analyst said 40 percent of the revenues would go to schools while the other 60 percent would go to local governments.
The measure needs to collect nearly 600,000 signatures to make the November ballot.
On the opposite side of the Proposition 13 debate, the California Association of Realtors is trying to get their own initiative on the ballot, the Property Tax Fairness Initiative.
“C.A.R.’s Property Tax Fairness Initiative would allow homeowners 55 years of age or older to transfer their Prop. 13 tax base to a home of any price, located anywhere in the state, any number of times,” according to the realtor group’s website. “These protections are also extended to people who are disabled and those who have lost their homes to a natural disaster. It’s a carefully written initiative that includes appropriate safeguards while eliminating California’s property tax ‘moving penalty.’ “
Starczyk added: “This tax protection or tax fairness proposition, it really benefits (seniors).”
Starczyk said 43,000 homes would be made available if the realtors’ measure is put on the ballot and passed.