The Golden Land: A Prop 13 “Q & A”

Heidi Siegmund Cuda
Former Investigative Producer for Fox 11 News in Los Angeles and the Creator and Host of the Economic Series, "Saving the California Dream." She is currently producing and hosting the series, "Ripoff Report Investigates."

“The future always looks good in the golden land, because no one remembers the past.”

Joan Didion wrote that line about California a decade before Prop 13, the Great Tax Revolt of 1978. The revolt was born out of concern for older Californians, who were being priced out of their homes by high property taxes. But as time speeds on, memories get vaguer and the reason the revolt occurred in the first place gets muddied by the Politics of Taxation.

As a teen in the late ’70s, I grew up with passionate discourse, both pro and con, on Prop 13. Savior or Boogie Man? Depends who you asked. My dad bowed to the altar of Prop 13, while my educator friends said it destroyed the state.

In order to combat the vagueries as Prop 13 defends its purpose once again in Sacramento, I was one of thousands of Californians who dialed in to a conference call hosted by Howard Jarvis Taxpayers Association President Jon Coupal and Asm. Diane Harkey (R-Dana Point), both of whom say they became activists on behalf of Prop 13 because they lived it.

“Prop 13 is continually under assault,” says Harkey. “The mission of anyone who is concerned about California and keeping people in this state is to constantly remind everyone what happened before Prop 13.”

“The first challenge is many new homeowners weren’t here in the ‘70s,” says Coupal. “The second challenge is all the disinformation, that Prop 13 somehow hurt California.”

I had an opportunity to ask Coupal and Harkey answers to some of the questions that have become California memes.

Q: “Did Prop 13 destroy our schools?”

JC: “That myth is displaced very easily, by considering just one thing and that is: in the mid ‘70s, prior to Prop 13’s enactment, everyone agrees schools were good. We are now spending on a per student inflation adjusted basis 30 percent more than we were spending on the glory days of California education. It’s being grossly misspent. We attribute the decline in education to two major things: the first was the California Supreme Court decision which took away local control. And the second big thing, which we think was a disaster, was Jerry Brown when he was governor back then, agreed to allow teachers to collectively bargain. So the entire school operation was taken out of the hands of local taxpayers and put in the hands of the union.”

Q: “Californians hear that and they immediately think it’s anti-teacher, and we love our teachers.”

JC: “It’s not anti-teacher. It’s anti-union policy and as you know there’s been a growth in union activists among teachers who don’t like their union.”

Q: “For those who weren’t here in 1978, can you describe the storm that led up the revolt?”

DH: “I was in my 20s, working for Pacific Bank, and it was really very very difficult for people. I was handling a lot of the payments, we housed our mortgage loans. We didn’t syndicate them, and I had a thousand clients. Back then, we impounded taxes and as a banker, I would get a billing from the county. But you never knew what it would be, you couldn’t predict it because they would come out and assess your property and the sky was the limit. It seemed like it, because property values were going up. There was a lot of inflation and each time the property values spiked, so did the property taxes. People were coming into the bank, waving their taxes around, saying, ‘What is going on!!!’ They literally could not afford or predict the property tax increases and that’s what perpetuated Prop 13. In Hawaii, the property taxes were ratcheted up so severely, locals had to leave their homes. So that was what was going in California.”

Q: “Why should renters care about Prop 13?”

DH: “The only way to get renters to understand how it’ll impact them is for them to understand when you buy something for an income, you expect to get an income. Not all landlords are wealthy, and if taxes go up, they increase the rent. It’s that simple.”

Q: “Why aren’t more Democrats standing by your side?”

JC: “I think they are afraid of upsetting their financial base. I’ve had several Democrats in the state tell me they’d never repeal anything about Prop 13. One, who told me that, it turned out he didn’t tell the truth, and he had voted against Prop 13. He got tossed out. That vote was used against him in his attempt to be reelected. More than a third of the HJTA members are Democrats so I know many would like to see it remain in place.”

Q: “How do you respond to, ‘Greedy owners don’t want to pay their share…’?”

JC: “Most sane people who are vested in California’s growing economy, they want to at least slow down the loss of business out of the state of California and any weakening of Prop 13 would accelerate business flight. You can hate on business all you want, but if they leave, they take their jobs.”

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