CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, AUGUST 16, 2013, OR THEREAFTER
FOR RELEASE: FRIDAY, AUGUST 16, 2013, OR THEREAFTER
BY THOMAS D. ELIAS
“PARCEL TAX FAIRNESS WILL WAIT ‘TIL NEXT YEAR – AT BEST”
The unfairness of parcel taxes is
obvious. With them, owners of every piece of property in a city or school
district almost always pay an identical levy, no matter what their holdings are
worth. A 700-square-foot one-bedroom house pays the same as a huge indoor mall.
But these have been the rage in recent
years among California school officials because the money they raise stays
home, unlike more general tax increases based on property value or sales
prices, much of which goes to Sacramento for distribution to poor districts
under terms of a 1971 court decision.
One small district tried five years
ago to make things a little more fair. It has now failed and may have to pay
back as much as $7 million in taxes collected under its now-illegal plan.
That
district is the Alameda Unified School District across the Bay from San
Francisco, where voters in 2008 favored a local parcel tax proposition called
Measure H by a margin of 66.9-33.1 percent, barely over the two-thirds
threshold set by the 1978 Proposition 13 for passage of most new taxes.
The measure imposed a $120 per year
parcel tax on residential property atop a pre-existing $189 per year levy on
all properties. At the same time, commercial and industrial properties were
required to pay 15 cents per square foot if they exceeded 2,000 square feet.
This was a classic example of the
split roll form of taxation – commercial properties taxed more than residential
– which some critics of Proposition 13 have advocated ever since that landmark
property tax limitation initiative passed. The split roll is not authorized
under any California law even if legislators have occasionally tried to adopt
it.
For sure, it offers more fairness than
the Proposition 13 formula of taxing all properties at 1 percent of their most
recent sales price, with maximum increases of 2 percent of the tax bill each
year. And it’s much more fair than parcel taxes.
But Measure H is no more. It was
struck down first last December by a state appeals court, the ruling upheld by
the state Supreme Court early this summer.
This could have led to desperate times
for the Alameda schools, which had come to depend on the parcel tax money.
Suspecting Measure H might be struck down, school officials proposed another
parcel tax in 2011, and it won by a 68-32 percent vote. This one also may prove
problematic, taxing all property owners 32 cents per square foot of structure
on each parcel. Residents with homes of 1,600 square feet, for example, would
pay $512 per year, while owners of larger properties might pay much more, up to
a per-parcel cap of $7,999 per year.
That’s also more fair than either
standard parcel taxes or the Proposition 13 formula, but it might stand up
under legal fire.
All this leaves a few other parcel tax
plans aiming for more fairness in an uncertain state. In Davis, for example,
voters last year approved a school parcel tax of $204 per year for
single-family homes and $20 per unit yearly for multi-unit apartment buildings.
Some state legislators want to end the
confusion, at least in the parcel tax realm. One bill introduced in January
would let school districts assign different tax rates for various types of
properties. But that proposal was shelved, at least for this year, when critics
asserted it would conflict with Proposition 13, whose basic rules can only be
changed via a statewide ballot proposition.
This proposal might come back next
year, but if it does, there’s no reason to expect it to get any farther than it
has so far. That’s because 2014 is an election year and few lawmakers will want
to be accused of tampering with Proposition 13, as sacred a cow as there is in
California politics.
All of which puts hopes for tax
fairness in California on hold for quite awhile.
-30-
Elias is author of the current book “The Burzynski
Breakthrough: The Most Promising Cancer Treatment and the Government's Campaign
to Squelch It,” now available in an updated third edition. His email address is
tdelias@aol.com.
For more Elias columns, go to www.californiafocus.net
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