The California Taxpayers Association ("Cal-Tax") is one of the leading pro-taxpayer organizations in Sacramento. I cannot tell you how many assaults take place on California taxpayers that only come to light because of the work they do focusing on the vast amount of terrible legislation proposed by Sacramento liberals.
Leading up to tomorrow’s 30th anniversary of Proposition 13, Cal-Tax President Teresa Casazza (pictured to the right) unveiled a new study today that lbusts a myth perpetrated by -the spending lobby. According to the Tax study, “Revisiting Proposition 13,” the landmark initiative has NOT shifted the property tax burden from businesses to homeowners, as the liberals constantly claim.
Cal-Tax says: “Since passage of the initiative, the assessed value of non-homeowner property subject to Proposition 13 has grown an average of 8.5 percent per year, while homeowners’ property has grown an average of 8.3 percent.”
What that means is that property taxes paid by businesses have outpaced those paid by homeowners. And that .2 percent difference is huge, considering that trillions of dollars of property value are involved. Cal-Tax notes, for example, that “in 2006-07, taxes on non-homeowner property were $6.2 billion higher than those on homes.”
The study uses data from the Board of Equalization – a state agency that was VERY opposed to Proposition 13 when voters approved it 30 years ago – to show that business property is now assessed much closer to market value than are homes. Since 1988, business property has been assessed, on average, at 75.1 percent of market value, while homeowners’ property has been assessed at 66.4 percent of market value. (In other words, if Prop. 13 were repealed and we went back to assessing property every year based on market value, homeowners would experience a much bigger hit than business owners.)
Of course, if we went back to the old system, we’d also be returning to a time when property taxes could skyrocket from one year to the next, with no warning. If the housing market got hot in your area, your taxes would go up, big-time. If the local assessor decided your property would be worth more under a different use – like if it was converted into apartments – he could put a much higher value on it, and you’d have to pay taxes on what it COULD be worth, rather than what it IS worth. (That’s the “highest and best use” nonsense that was one of the factors that created the movement for property tax reform in the ‘70s.)
It’s also noteworthy that the property tax has provided more revenue to the government every single year since Prop. 13 passed, even during years when the housing market was in the pits.
For the full report, click here.
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