Opinion: Blowback: Debunking the Prop. 13 debunkers
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Jon Coupal, president of the Howard Jarvis Taxpayers Assn., responds to Steve Lopez’s June 1 column, ‘Debunking the myth of Prop. 13.’ If you would like to write a full-length response to a recent Times article, editorial or Op-Ed piece, here are our FAQs and submission policy.
In his latest attack on Proposition 13, columnist Steve Lopez retreats to the ivory tower for moral support. When a USC demographics professor tells Lopez that support for Prop. 13 is based on myth, and that blocking tax increases is pathetic, dishonest and a long-term disaster, Lopez accepts the professor’s words as gospel.
The only ‘myths’ to debunk about Proposition 13 are those promoted by the tax-and-spend lobby and public employees unions, which would like you to believe that the state’s landmark 1978 initiative to limit property tax increases has ‘devastated’ California’s education system while at the same time not providing any real benefits to homeowners and renters today.
First and foremost, Proposition 13 did not dictate how our government would spend property tax revenues. It simply set a property tax rate of 1% and limited annual tax increases to no more than 2%.
Proposition 13 is not responsible for shifting the responsibility of education funding from the local level to Sacramento. Years before Proposition 13 passed, the California Supreme Court ruled in Serrano vs. Priest, an equal-protection case, that school funding must be equalized for all California students. That meant education funding could not be based on property tax receipts, because wealthy neighborhoods with high property values could spend more per student than poor neighborhoods with lower property values. The funding of our education system based on varying property tax receipts was found unconstitutional, but you never hear the Proposition 13’s opponents discuss this ruling or its implications.
You also never hear them talk about the fact that spending per pupil has actually increased 30%, adjusted for inflation, since Proposition 13 passed in 1978, according to research by the Howard Jarvis Taxpayers Assn.
Second, everyone benefits from Proposition 13. The moment California homeowners get the keys to their new home, they benefit from the law’s protection -- and not just when the home value soars or if they’ve lived in their home for decades. Proposition 13 protects Californians from potential annual percentage increases in their tax bills in the double digits or more. For example, just a few months before Proposition 13 passed in 1978, then-Los Angeles County Assessor Alexander Pope announced that many parcels of property would see assessed valuations increase by as much as 100%.
Proposition 13 saved many homeowners and businesses by simply setting the tax limit to provide stability. It allowed property owners to budget for their future and gave them protection from runaway taxes that would have forced many to sell their homes.
Government also benefits from Proposition 13, protecting it from severe yearly swings in revenue, including when the real estate market crashes and results in huge decreases in property value. The value reserve built into the system lets government predict revenues coming in, although, unfortunately, that doesn’t prevent many politicians from spending above and well beyond that amount.
And renters also reap benefits. Without Proposition 13, you can be sure that higher business property taxes on apartment buildings would be passed on, in the form of higher rents, to working families and seniors living on fixed incomes.
The truth is, the system works. Critics such as Lopez say commercial property owners receive more benefits from Proposition 13. But since the measure passed, the assessed value of homeowner property has grown at an average of 8.1% per year, and assessed value of non‐homeowner property subject to Proposition 13 has grown an average of 8.4% per year, according to data from the California State Board of Equalization.
Finally, California property taxes are not among the lowest in the nation. Even with Proposition 13, we still rank higher than 36 other states when it comes to per-capita property taxes, according to the Tax Foundation. Without Proposition 13’s protections, California taxpayers would fare far worse and property taxes would be at or near the top, just as we are when it comes to sales, car, gas and personal income taxes.
There is one thing Lopez and I can agree on: California politicians are too busy bickering and tinkering rather than doing their jobs. But instead of blaming California’s problems on Proposition 13, it’s time to focus on the real issues, such as runaway pension costs and unaccountable politicians refusing to rein in spending, while beleaguered California working families are forced to cut back.
-- Jon Coupal
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