Prop 13 is once again being blamed for just about everything. I don’t agree with this site’s master, Joel Fox, on much, but I do agree with him that Prop 13 gets blamed far too often for California’s troubles, and for far too many of those troubles.
Where we don’t agree is on 13 itself. I think the state’s future requires making changes in it. We’re going to see attempts next year to use the ballot to lift the Prop 13 limits on property tax increases, at least as they apply to commercial property. This is the so-called split roll. We’ll also may see an initiative to roll back the requirement of a two-thirds vote to raise taxes.
I’d like to see both changes, but the time is right only for one, not the other.
Ending the super-majority requirement is urgently needed. Whether you’re on the left or the right, whether you think taxes are too high or too low, it’s undeniable that the super-majority requirement makes it very, very hard to govern our state. Getting two-thirds of legislators to agree on anything is just about impossible. So California lawmakers are unable to respond in any sort of coherent or timely way, even in the midst of an economic and fiscal crisis.
But that same crisis offers a good reason why now is NOT the time to change the property tax structure put forward by Prop 13. I say that as someone who would like to blow up that structure and start over. The trouble is: it makes little sense to do that in the midst of a real estate collapse that has spread to the rest of our economy. Commercial property is in deep trouble right now; adding to the tax on such property will deepen that slide.
What’s the right time? When real estate prices bounce back and start to surge again. In fact, wisely-timed changes to Prop 13’s property tax protections could help prevent another bubble.
So full speed ahead on 2/3. Keep your power dry on split roll.