Prop 15 Defeated by Proposition 13

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

The odds were all to the Yes on Proposition15’s liking. If they were ever going to inflict changes to California’s iconic property tax law, Proposition 13, the 2020 general election was the time to do it. But Prop 15 failed because of the respect Proposition 13 still has from Californians.

The Yes campaign saw this 2020 election opportunity from afar. Remember, they had already collected enough signatures for the 2018 election on a split roll property tax to assess business property on a regular schedule. But looking at the landscape of the 2020 election—a presidential contest featuring incumbent Donald Trump that large majorities of California voters in poll after poll indicated they detested—would bring a mass of voters, theoretically sympathetic to a split roll.

So split roll advocates went to work again, ignored the millions of dollars spent to qualify the earlier measure, and gathered more signatures for what became Proposition 15.

Then they received a gift from the Attorney General’s office, which is required to write a balanced ballot label, title and summary for every initiative. The AG submitted a biased title and summary that was even criticized by newspaper editorials in newspapers that eventually endorsed Proposition 15. However, because courts give deference to the Attorney Generals when it comes to writing ballot summaries, the description of the AG stood.

Many voters, who don’t study ballot measures deeply, rely on the wording of the label, title and summary to decide how to vote.

Then the pandemic hit. The effect on the voters could have flowed to either side of the Prop 15 debate.

Yes on 15 supporters originally argued that the chief reason Proposition 15 must pass was to supply money for schools. However, with the pandemic cutting government budgets for supplies, protective equipment and needs to confront the crisis, the language shifted. Money was needed to allow local governments to battle the results of the disease. Not that schools were lost in the equation. The proponents’ message said that school budgets were in jeopardy as well.

On the other hand, voters recognized that businesses were damaged by the lockdown and would have a hard time recovering if the property tax increase supposedly aimed at big companies trickled down to small businesses.

The voters who took part in the election were not particularly against taxes. While the score is still being tabulated, a good percentage of local taxes and bonds passed election day. But not the big property tax measure on the statewide ballot.

Given the circumstances surrounding the Proposition 15 campaign, it must be concluded it was allegiance to the Proposition 13 tax revolt, more than 40 years after passing, that helped defeat Proposition 15.

Rob Lapsley, president of the California Business Roundtable and a co-chair of the No on Prop 15 campaign, put Proposition 13’s place in California tax policy in perspective: Proposition 13 was “the last tax protection in the highest tax state in the country.”

Homeowners were concerned that Proposition 15 was the first step in dismantling Proposition 13 for residential property.

What was revolutionary about Proposition 13 was the certainty it provided taxpayers. Before Proposition 13 passed, that certainty belonged to the tax collectors. After Proposition 13, certainty in property taxation was in the hands of individual taxpayers. They knew what they had to pay and how much the tax bill would go up year to year. No surprises.

Certainty is no small thing when it comes to taxation. Adam Smith, author of the seminal work on economics, The Wealth of Nations, wrote in his book, “The certainty of what each individual ought to pay is, in taxation, a matter of so great importance, that a very considerable degree of inequality…is not near so great an evil as a very small degree of uncertainty.” 

Proposition 13 preserves tax certainty for voters. 

Proposition 13 defeated Proposition 15.

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