4 ms·

Repealing Prop 13 and removing local control of zoning decisions can be done via votes in the legislature, no new technologies required, so I beg to differ with

Repealing Prop 13 and removing local control of zoning decisions can be done via votes in the legislature, no new technologies required, so I beg to differ with the "no easy fix" tag.

NtochkaNzvanova 3y ago
Then why do you think the tax-happy Democrats who control the legislature haven't repealed Prop 13 yet? After all, it is a relic of an era when anti-tax Republicans still had influence in California politics. My theory is that if it were repealed, and people had to pay property tax on something approaching the actual current market value of their homes, home values would tank. Homeowners would then "lose" a significant fraction of their net worth, get pissed off, and immediately vote out anyone who had voted for the repeal.
- seiferteric 3y ago
  Propositions can’t be repealed, it would have to be put on the ballot, but doubt it will happen.
  - NtochkaNzvanova 3y ago
    Parent comment said "Repealing Prop 13 and removing local control of zoning decisions can be done via votes in the legislature". I don't know if that is true or not, I'm responding to that premise. Either one of you could help the discussion by providing a source backing up your conflicting claims.
    - bobthepanda 3y ago
      Local zoning decisions could probably be done given that they are not expressly enumerated in the California constitution today. Cities' current authority to do so is defined by Article XI Section 7, which just says "A county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws.[1] ". Theoretically the state could just pass a general law that now conflicts with this and then localities have restrictions on zoning. Prop 13 was passed in 1978 as a constitutional amendment, so the only way to repeal or reform that would be another amendment. The process for doing so via the legislature requires a two thirds supermajority in both houses, and then it goes to the ballot anyways. https://ballotpedia.org/California_Constitution#Amending_the_constitution https://ballotpedia.org/California_Constitution#Amending_the...
    - sokoloff 3y ago
      Prop 13 is factually a CA Constitutional amendment, the reversal of which would require following the process to amend the state constitution: https://en.wikipedia.org/wiki/1978_California_Proposition_13 https://en.wikipedia.org/wiki/1978_California_Proposition_13 https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920#:~:text=A%20constitutional%20amendment%20can%20be,at%20the%20next%20general%20election https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920#:~:text=A.... Zoning control changes could (as far as I can tell) be done via legislative action alone (and probably fading some resulting lawsuits).
  - dilyevsky 3y ago
    Few years ago there was a prop to strip prop 13 from commercial properties and fund schools. It was sponsored by the zuck foundation. Even that didn’t pass
- guyzero 3y ago
  Every rational repeal proposal is a phase out with a few exceptions for seniors. And the reason it hans't been phased out is that the state has significant issues with legislative process as well as economic management. i.e. passing constitutional amendments by popular vote instead of just regular laws which makes them borderline irreversible.
- acchow 3y ago
  Homeowner ownership rate in California is 43.5%. Change is possible.
  - NtochkaNzvanova 3y ago
    Home owners vote at higher rates than renters.
    - hnav 3y ago
      they should split the state into regions (groups of counties) and put the repeal on a ballot at region granularity to see if the "fuck-you-I-got-mine" set would sink each other
      - nradov 3y ago
        There is no Constitutional provision for splitting the state based on counties for ballot propositions. https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920 https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920
    - acchow 3y ago
      But the renters can still use their vote for change, no?
- hnav 3y ago
  They definitely cannot just repeal it outright, but they could give the housing marking a "soft landing" by just changing the max increase %. Let's say that we want to deal with the case of properties' real values being 5x the assessed tax value, assuming 0 future appreciation here's how long it would take for property taxes to catch up at 2%: log(5)/log(1.02) = 81 years and at 8%: log(5)/log(1.08) = 21 years
Justin_K 3y ago
How would ruining the financial plans for millions of homeowners solve the problem? It's so easy to say "just increase taxes" but the reality is our spending is insane.
- rapsin4 3y ago
  sunset it over 10-15 years...
  - hnav 3y ago
    Don't even have to, just tweak the maximum increase from 2% to some number that better reflects the growth of CA property values.
- NtochkaNzvanova 3y ago
  Agree that spending needs to be cut. But my understanding is that before Prop 13, California's tax revenue was more balanced between property, sales, and income taxes, and thus less subject to the boom and bust cycles that we see now (https://calmatters.org/explainers/california-budget-whiplash/ https://calmatters.org/explainers/california-budget-whiplash...).
- AbrahamParangi 3y ago
  California has the lowest rates of home ownership in the country at 18%. More people are subsidizing the current system than are benefiting from it.
  - hot_gril 3y ago
    I feel like homeowners in California are giving more than they are taking overall.
  - nradov 3y ago
    You're way off. The California home ownership rate is 55%. But some other states are significantly higher. https://www.census.gov/housing/hvs/data/rates.html https://www.census.gov/housing/hvs/data/rates.html
mistrial9 3y ago
a secret about Prop 13 is that .. the media spin at the time was "saving aging homeowners from terrible tax increases" mainly by the Howard Jarvis Tax group; however, Corporate entities that own land in California also benefited from this measure, and continue to do so. I have never seen this in the media at any time -- only known by talking to a retired attorney recently
- bobthepanda 3y ago
  There was actually an initiative to repeal Prop 13 for commercial land which failed. https://ballotpedia.org/California_Proposition_15,_Tax_on_Commercial_and_Industrial_Properties_for_Education_and_Local_Government_Funding_Initiative_(2020) https://ballotpedia.org/California_Proposition_15,_Tax_on_Co...
  - Melatonic 3y ago
    This is the real answer in my opinion. Prop 13 does make some sense (especially in its current form now that the other measure passed that limits prop 13 for homeowners over 1 million in value). But for commercial real estate ? That seems totally ridiculous. There is so much tax that could be collected there!
    - bobthepanda 3y ago
      I suspect that given it was rejected in 2020, which was not that long ago, in an election where Prop 19 (the other one you're referring to) passed, the powers that be have divined that revisiting the question now is a little early.
    - mistrial9 3y ago
      California already collects record revenue via State taxes, and has for a long time. Those who run Sacramento dole it out in large quantities. Only Jerry Brown has had the strength and skill to balance a budget in decades. Notably, the current Gov started tenure with a substantial surplus, and mysteriously now has record deficits again.
cscurmudgeon 3y ago
California should mandate no new taxes till corruption and wastage of tax funds are measured and a goal is set for reducing that? https://www.sfchronicle.com/bayarea/article/embattled-nonprofit-mismanagement-providence-19361438.php https://www.sfchronicle.com/bayarea/article/embattled-nonpro... https://www.cbsnews.com/sanfrancisco/news/san-francisco-city-workers-charged-corruption-scheme-bribery/ https://www.cbsnews.com/sanfrancisco/news/san-francisco-city...
- margalabargala 3y ago
  Maybe all states should do that. California is not the most corrupt state. This analysis puts it at 24/50 in fact. https://bestlifeonline.com/most-corrupt-state-america/ https://bestlifeonline.com/most-corrupt-state-america/
  - Affric 3y ago
    Needs a more Bayesian understanding of the corruption stats they are using.
  - cscurmudgeon 3y ago
    True! https://www.ktvu.com/news/california-hasnt-been-tracking-homeless-programs-effectiveness-audit-finds https://www.ktvu.com/news/california-hasnt-been-tracking-hom...
bobthepanda 3y ago
Prop 13 is a constitutional amendment, so requires a two thirds threshold in both chambers of the legislature and then also an additional majority ballot vote. https://ballotpedia.org/California_Constitution https://ballotpedia.org/California_Constitution
- scoofy 3y ago
  Or we could amend the way we amend the constitution. The idea that Prop 13 is set in stone is just not the case anymore. I was changed in 2020 and nearly removed completely for corporations.
  - bobthepanda 3y ago
    Amending the way you amend the constitution, unsurprisingly would also require a constitutional amendment. The legislature cannot, currently, legally override the constitution.
    - scoofy 3y ago
      My point is that the electorate that passed our ridiculous amendment process is no longer the current electorate. I suspect that our generation would be extremely open to changing the scope of our constitution to not include trivial things like tax legislation.
AnotherGoodName 3y ago
Could it be repealed via a legal case? I suspect any law that effectively says "established residents have next to no property tax while new residents have the tax recalculated" would definitely affect some protected groups negatively compared to others. In which case this law cannot exist right? You can't make a law that has a negative effect on a protected group specifically, even if unintentionally. We had a proposition in Palo Alto that only local residents could use some of the parks. That was challenged and now doesn't exist as you can guess how police identified non-locals. Can we do the same for prop 13?
johnea 3y ago
Something only the rich could love. Repealing prop 13 would cause the single biggest increase in homelessness in the states history. A huge percentage of California homeowners would be evicted as a consequence of their next 10x higher property tax bill...
- HDThoreaun 3y ago
  And then theyd move somewhere cheaper with their newfound wealth. For me kicking people out of their home is frankly the point. If you cant afford you taxes you cant afford your home. Let someone who can afford it live there
zbrozek 3y ago
Deleting zoning would be be an incredible boost for the economy, but I don't think it's politically possible. Prop 13 is a constitutional amendment that the legislature can't repeal. Folks are addicted to spending money, and the results don't really matter. It took national outrage to get us to value-engineer a $1.6M toilet down to $1.0M.
WalterBright 3y ago
The problem is California isn't taxing people enough?
- xvedejas 3y ago
  The problem is the kind of taxation, not the amount. Beyond the fact that property tax is less of a burden on economic activity than income tax, it's also the case that property tax is less likely to bankrupt the state because of reduced revenue during economic downturns.
- sobellian 3y ago
  The problem is that it creates a distortionary tax. Appreciation has given people multi-million dollar homes that they pay a pittance in tax on. So they hold that property as long as possible to enjoy the low tax rates - if they move their tax bill soars since that event triggers an assessment on their new home. This takes homes off the market and drives prices even higher. The proposition was intended to prevent appreciation from pricing people out of their homes - in other words, to decrease the volume of transactions on the real estate market. This is government interference in the market - on top of the government interfering in the construction of new homes in the first place... If they regularly re-assessed property values while lowering the applied rate, they could collect the same amount of money overall without distorting the market.
- HDThoreaun 3y ago
  The problem is that its tax scheme sucks

Repealing Prop 13 and removing local control of zoning decisions can be done via votes in the legislature, no new technologies required, so I beg to differ with the "no easy fix" tag.

NtochkaNzvanova 3y ago

Then why do you think the tax-happy Democrats who control the legislature haven't repealed Prop 13 yet? After all, it is a relic of an era when anti-tax Republicans still had influence in California politics. My theory is that if it were repealed, and people had to pay property tax on something approaching the actual current market value of their homes, home values would tank. Homeowners would then "lose" a significant fraction of their net worth, get pissed off, and immediately vote out anyone who had voted for the repeal.

seiferteric 3y ago
Propositions can’t be repealed, it would have to be put on the ballot, but doubt it will happen.
- NtochkaNzvanova 3y ago
  Parent comment said "Repealing Prop 13 and removing local control of zoning decisions can be done via votes in the legislature". I don't know if that is true or not, I'm responding to that premise. Either one of you could help the discussion by providing a source backing up your conflicting claims.
  - bobthepanda 3y ago
    Local zoning decisions could probably be done given that they are not expressly enumerated in the California constitution today. Cities' current authority to do so is defined by Article XI Section 7, which just says "A county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws.[1] ". Theoretically the state could just pass a general law that now conflicts with this and then localities have restrictions on zoning. Prop 13 was passed in 1978 as a constitutional amendment, so the only way to repeal or reform that would be another amendment. The process for doing so via the legislature requires a two thirds supermajority in both houses, and then it goes to the ballot anyways. https://ballotpedia.org/California_Constitution#Amending_the_constitution https://ballotpedia.org/California_Constitution#Amending_the...
  - sokoloff 3y ago
    Prop 13 is factually a CA Constitutional amendment, the reversal of which would require following the process to amend the state constitution: https://en.wikipedia.org/wiki/1978_California_Proposition_13 https://en.wikipedia.org/wiki/1978_California_Proposition_13 https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920#:~:text=A%20constitutional%20amendment%20can%20be,at%20the%20next%20general%20election https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920#:~:text=A.... Zoning control changes could (as far as I can tell) be done via legislative action alone (and probably fading some resulting lawsuits).
- dilyevsky 3y ago
  Few years ago there was a prop to strip prop 13 from commercial properties and fund schools. It was sponsored by the zuck foundation. Even that didn’t pass
guyzero 3y ago
Every rational repeal proposal is a phase out with a few exceptions for seniors. And the reason it hans't been phased out is that the state has significant issues with legislative process as well as economic management. i.e. passing constitutional amendments by popular vote instead of just regular laws which makes them borderline irreversible.
acchow 3y ago
Homeowner ownership rate in California is 43.5%. Change is possible.
- NtochkaNzvanova 3y ago
  Home owners vote at higher rates than renters.
  - hnav 3y ago
    they should split the state into regions (groups of counties) and put the repeal on a ballot at region granularity to see if the "fuck-you-I-got-mine" set would sink each other
    - nradov 3y ago
      There is no Constitutional provision for splitting the state based on counties for ballot propositions. https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920 https://www.dgs.ca.gov/Resources/SAM/TOC/6000/6920
  - acchow 3y ago
    But the renters can still use their vote for change, no?
hnav 3y ago
They definitely cannot just repeal it outright, but they could give the housing marking a "soft landing" by just changing the max increase %. Let's say that we want to deal with the case of properties' real values being 5x the assessed tax value, assuming 0 future appreciation here's how long it would take for property taxes to catch up at 2%: log(5)/log(1.02) = 81 years and at 8%: log(5)/log(1.08) = 21 years

Justin_K 3y ago

How would ruining the financial plans for millions of homeowners solve the problem? It's so easy to say "just increase taxes" but the reality is our spending is insane.

rapsin4 3y ago
sunset it over 10-15 years...
- hnav 3y ago
  Don't even have to, just tweak the maximum increase from 2% to some number that better reflects the growth of CA property values.
NtochkaNzvanova 3y ago
Agree that spending needs to be cut. But my understanding is that before Prop 13, California's tax revenue was more balanced between property, sales, and income taxes, and thus less subject to the boom and bust cycles that we see now (https://calmatters.org/explainers/california-budget-whiplash/ https://calmatters.org/explainers/california-budget-whiplash...).
AbrahamParangi 3y ago
California has the lowest rates of home ownership in the country at 18%. More people are subsidizing the current system than are benefiting from it.
- hot_gril 3y ago
  I feel like homeowners in California are giving more than they are taking overall.
- nradov 3y ago
  You're way off. The California home ownership rate is 55%. But some other states are significantly higher. https://www.census.gov/housing/hvs/data/rates.html https://www.census.gov/housing/hvs/data/rates.html

mistrial9 3y ago

a secret about Prop 13 is that .. the media spin at the time was "saving aging homeowners from terrible tax increases" mainly by the Howard Jarvis Tax group; however, Corporate entities that own land in California also benefited from this measure, and continue to do so. I have never seen this in the media at any time -- only known by talking to a retired attorney recently

bobthepanda 3y ago
There was actually an initiative to repeal Prop 13 for commercial land which failed. https://ballotpedia.org/California_Proposition_15,_Tax_on_Commercial_and_Industrial_Properties_for_Education_and_Local_Government_Funding_Initiative_(2020) https://ballotpedia.org/California_Proposition_15,_Tax_on_Co...
- Melatonic 3y ago
  This is the real answer in my opinion. Prop 13 does make some sense (especially in its current form now that the other measure passed that limits prop 13 for homeowners over 1 million in value). But for commercial real estate ? That seems totally ridiculous. There is so much tax that could be collected there!
  - bobthepanda 3y ago
    I suspect that given it was rejected in 2020, which was not that long ago, in an election where Prop 19 (the other one you're referring to) passed, the powers that be have divined that revisiting the question now is a little early.
  - mistrial9 3y ago
    California already collects record revenue via State taxes, and has for a long time. Those who run Sacramento dole it out in large quantities. Only Jerry Brown has had the strength and skill to balance a budget in decades. Notably, the current Gov started tenure with a substantial surplus, and mysteriously now has record deficits again.

cscurmudgeon 3y ago

California should mandate no new taxes till corruption and wastage of tax funds are measured and a goal is set for reducing that? https://www.sfchronicle.com/bayarea/article/embattled-nonprofit-mismanagement-providence-19361438.php https://www.sfchronicle.com/bayarea/article/embattled-nonpro... https://www.cbsnews.com/sanfrancisco/news/san-francisco-city-workers-charged-corruption-scheme-bribery/ https://www.cbsnews.com/sanfrancisco/news/san-francisco-city...

margalabargala 3y ago
Maybe all states should do that. California is not the most corrupt state. This analysis puts it at 24/50 in fact. https://bestlifeonline.com/most-corrupt-state-america/ https://bestlifeonline.com/most-corrupt-state-america/
- Affric 3y ago
  Needs a more Bayesian understanding of the corruption stats they are using.
- cscurmudgeon 3y ago
  True! https://www.ktvu.com/news/california-hasnt-been-tracking-homeless-programs-effectiveness-audit-finds https://www.ktvu.com/news/california-hasnt-been-tracking-hom...

bobthepanda 3y ago

Prop 13 is a constitutional amendment, so requires a two thirds threshold in both chambers of the legislature and then also an additional majority ballot vote. https://ballotpedia.org/California_Constitution https://ballotpedia.org/California_Constitution

scoofy 3y ago
Or we could amend the way we amend the constitution. The idea that Prop 13 is set in stone is just not the case anymore. I was changed in 2020 and nearly removed completely for corporations.
- bobthepanda 3y ago
  Amending the way you amend the constitution, unsurprisingly would also require a constitutional amendment. The legislature cannot, currently, legally override the constitution.
  - scoofy 3y ago
    My point is that the electorate that passed our ridiculous amendment process is no longer the current electorate. I suspect that our generation would be extremely open to changing the scope of our constitution to not include trivial things like tax legislation.

AnotherGoodName 3y ago

Could it be repealed via a legal case? I suspect any law that effectively says "established residents have next to no property tax while new residents have the tax recalculated" would definitely affect some protected groups negatively compared to others. In which case this law cannot exist right? You can't make a law that has a negative effect on a protected group specifically, even if unintentionally. We had a proposition in Palo Alto that only local residents could use some of the parks. That was challenged and now doesn't exist as you can guess how police identified non-locals. Can we do the same for prop 13?

johnea 3y ago

Something only the rich could love. Repealing prop 13 would cause the single biggest increase in homelessness in the states history. A huge percentage of California homeowners would be evicted as a consequence of their next 10x higher property tax bill...

HDThoreaun 3y ago
And then theyd move somewhere cheaper with their newfound wealth. For me kicking people out of their home is frankly the point. If you cant afford you taxes you cant afford your home. Let someone who can afford it live there

zbrozek 3y ago

Deleting zoning would be be an incredible boost for the economy, but I don't think it's politically possible. Prop 13 is a constitutional amendment that the legislature can't repeal. Folks are addicted to spending money, and the results don't really matter. It took national outrage to get us to value-engineer a $1.6M toilet down to $1.0M.

WalterBright 3y ago

The problem is California isn't taxing people enough?

xvedejas 3y ago
The problem is the kind of taxation, not the amount. Beyond the fact that property tax is less of a burden on economic activity than income tax, it's also the case that property tax is less likely to bankrupt the state because of reduced revenue during economic downturns.
sobellian 3y ago
The problem is that it creates a distortionary tax. Appreciation has given people multi-million dollar homes that they pay a pittance in tax on. So they hold that property as long as possible to enjoy the low tax rates - if they move their tax bill soars since that event triggers an assessment on their new home. This takes homes off the market and drives prices even higher. The proposition was intended to prevent appreciation from pricing people out of their homes - in other words, to decrease the volume of transactions on the real estate market. This is government interference in the market - on top of the government interfering in the construction of new homes in the first place... If they regularly re-assessed property values while lowering the applied rate, they could collect the same amount of money overall without distorting the market.
HDThoreaun 3y ago
The problem is that its tax scheme sucks