Gov. Jerry Brown talks Prop. 13 (LA Times)

[pinto]

Brief, but interesting comments. Brown was Governor when Prop 13 was passed (which gutted local finances). He helped engineer State support for many programs at risk due the Proposition. A needed short term effort, but one that couldn't stand over time state-wide. I'm really glad to see him re-open the issue. ~ pinto

Gov. Jerry Brown talks Prop. 13

By Anthony York
Los Angeles Times Staff Writer
January 4, 2011, 12:43 p.m.

On his first full day on the job, Gov. Jerry Brown walked right up to the third rail of California politics. As he headed into a meeting with local government officials, he talked about how the state response to Proposition 13's limitations on property-tax rates have contributed to state's financial dysfunction.

Brown's remarks come as he prepares to unveil a budget plan next week that will include proposals for unwinding the consolidation of government power in Sacramento that has taken place since voters approved the ballot measure in 1978, when Brown was first governor.

Brown's goal is to work with cities and counties to return many state government functions back local governments.

Proposition "13 started the centralization of power," Brown said to reporters before entering the closed-door meeting with local officials at the Sacramento headquarters of the California State Assn. of Counties. "After that, the state started dictating what we did."

More at -

http://www.latimes.com/news/la-brownprop13-m,0,6620032.story?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fnews+%28L.A.+Times+-+Top+News%29&utm_content=My+Yahoo

[slackmaster]

1. The "gutting" of local finances was an unintended consequence of localities taking advantage...

...of a windfall that hit them in the form of rapidly rising property values that started in the late 1960s.

My parents happened to own a home in one of San Diego's more desirable neighborhoods. By 1978, the market value of their home had quintupled from what my mom had paid for it in 1967. Under the pre-13 rules, the county reassessed about 20% of properties per year, so that on average you were supposed to get hit once every five years. The San Diego County Assessor/Recorder selectively reassessed properties in neighborhoods that had the fastest-rising values, and my parents got hit with increased tax bills every year for several years.

The authors of Proposition 13 cleverly linked reasonable limits on residential property tax assessments and increases, with similar rules for commercial property - which made it possible for owners of the latter to dodge market-driven tax increases indefinitely by restructuring businesses so that ownership could change hands without triggering a reassessment. People like their homes, and people who own homes are likely to vote. 13 was an easy sell. I even voted for it although I was only 20 years old, because I could see what the abuse of reassessments by our county government was doing to my parents' finances.

The good parts of Proposition 13 have helped millions of families keep their homes, and allowed them to have predictable tax bills. As long as any proposed changes don't threaten the residential property tax constraints for families, the "third rail" will not be touched.

[pinto]

2. I think the loopholes for commercial property was a big and unfair hit overall.

:hi:

[slackmaster]

3. Business interests would howl about needing to increase prices and lay off workers

But eliminating or limiting the commercial property loopholes would not be difficult to pass, IMO, as long as it's clear that people won't be hit on their homes.

[ProgressiveProfessor]

10. There has been some studies of that over time

they have mixed results as I recall, but none said it was any kind of panacea.

[yurbud]

12. commercial property doesn't pay property taxes?

[pinto]

13. They're exempt from property tax increase after sale or transfer of title.

Individually owned property (largely homes) gets re-assessed on sale and re-evaluated for taxation (unless sold to a family member). Commercial property has a loophole to avoid re-assessment. In effect, their property taxation remains at Prop 13 limits.

[yurbud]

15. jesus. I could see having it for residences but giving business that big a break is too much.

[slackmaster]

16. Thank you for making an effort to learn the whole story about Prop. 13

It's not as simple as it's often described on these forums.

[LuckyLib]

4. There are many many stories of folks with very good incomes who pay next to nothing

in property taxes -- case in point, my relatives, who own a $700,000 home and pay about $300 per year in property taxes. Sorry, they aren't paying what they should.

[ProgressiveProfessor]

9. You might want tio check your figures

That would mean the house is assessed at $25K, highly unlikely.

[Hell Hath No Fury]

17. Not unlikely at all --

My Mom bought our house in 1964 for something like 24k. It is valued currently around 500k. Property taxes for us run around $900 a year. I am one of the working-class beneficiaries of Prop. 13 -- if the taxes weren't so low we would be forced to sell and move.

Tommy Ammiano from SF is working on rethinking Prop. 13 in a way that doesn't hurt folks like myself but does make good changes that will increase property tax revenue. I completely support him.

[BlueMTexpat]

5. Prop. 13 was one beginning of the end for the CA Dream ... I'm glad to see Brown

literally taking the bull by the horns.

[pinto]

6. We used to have a really affordable public college system, stable funding for local schools,

fire, police, etc. While Prop 13 wasn't the only chink in the system, I agree, it was a major blow.

[3waygeek]

7. Remember that it was Jerry's dad Pat....

that enacted the Master Plan for CA's public college/university system. Maybe Jerry can begin the restoration of his father's greatest accomplishment.

[BlueMTexpat]

8. I remember in the 40s-70s, California really was the "Promised Land."

I used to bug my mom endlessly about why on earth she hadn't stayed there during WWII. I was conceived in San Diego, but my mom chose to return to MT to be with her family while my father was in the South Pacific. And so, the die was cast. After the war, he too returned to MT and that's where the whole family was raised.

A French friend who is a pilot and travels to CA and NYC quite often says that he can't believe the difference in CA over the years. It's really gone downhill in his opinion - and that's an outsider's point of view. It must be worse for those who have had to live through the experience.

[ProgressiveProfessor]

11. His real focus to change the concept of the state as the source of local funding except for schools

The latter is not on the table.

[thetonka]

18. School funding source started with Serrano v. Priest

Prop 13 just made it a mess.

[bemildred]

14. Yep. That is where we are going to have to go.

And it's going to have lots of consequences, it's going to be a war.