Proposition 13 — California’s long-tenured law keeping a lid on annual property tax increases — is in the cross-hairs of a new ballot initiative effort.
The initiative, titled the “California Schools and Local Communities Funding Act of 2018,” aims to amend California’s constitution to allow for increased taxes for commercial and industrial properties, as well as vacant land not intended for housing or commercial agriculture. For those properties, instead of taxes being based on the most recent purchase price with limited (2%) annual increases, the initiative would allow for taxation based on current fair market value.
The initiative contains exemptions for small businesses, and does not apply to residential properties. If passed, the increased tax revenues could amount to an estimated $6.5 million to $10.5 million, with most of those revenues going to schools and local governments.
Below are a few links to get you up to speed:
- “Is California ready for a Proposition 13 overhaul?” — East Bay Times article that provides a good, quick summary of the initiative
- California Attorney General Summary — Short, no-nonsense summary from the AG’s Office
- Initiative Text — Records received from the AG’s Office, including cover letters from the initiative proponents and the full text of the initiative
- Legislative Analyst’s Office Review — The LAO’s review of the initiative and its potential fiscal impacts
- “Split roll is an attack on Proposition 13 and California’s economy” — op-ed piece from the president of the Howard Jarvis Taxpayers Association
- “California Considering Change that Threatens CRE” — summary by the Commercial Real Estate Development Association, otherwise knows as NAIOP (disclosure: I am a member of NAIOP)
We will keep you posted as deadlines approach for the November 2018 ballot.