Home Taxes: Yes on 90

In 1986 California voters approved a ballot measure allowing homeowners aged 55 or older to move to a new home and carry their Proposition 13 property tax breaks with them, provided they remained within the same county. This Nov. 8 California voters will act on Proposition 90, which could open the way to transferring the same Proposition 13 property tax break to another county.

The ballot measure merely authorizes the Legislature to make this change. And even then, the transfer could not be made until sanctioned by the individual counties through the adoption of special ordinances. The idea is a reasonable one, though, and The Times urges voters to vote yes on Proposition 90 when they go to mark their 1988 ballots.

Back in 1978, Proposition 13 rolled back and froze property assessments at the 1975 level. They remain at that level as long as the same owner stays in the same house. But once the residence is sold and the homeowner buys a new house, the property tax assessment automatically soars to the current market value in each case. The result is a whopping increase in the tax bill.

But suppose a man and wife reached retirement age, most likely at reduced income, and no longer needed to live in a large house that once was required for raising a family? Under the 1986 change, the couple can move to a smaller house, or perhaps a condominium, and retain the old Proposition 13 assessment level--so long as they do not move out of the county. The replacement home has to be of equal or lesser value than the home being replaced. To qualify, the taxpayer has to be at least 55 years old.

Just suppose, however, that the couple wanted to sell the old home in Los Angeles County and move to a retirement home near their children, or friends, in Ventura County. They cannot qualify for the special-assessment exemption under present law.

If Proposition 90 is approved, however, they could carry the exemption with them to the new county, but only if the Legislature subsequently implements the program, and so does that county. The tax loss would be relatively minimal, except perhaps for a small county that was particularly attractive to retirees. If that county felt the loss would be too severe, it merely could refuse to adopt the implementing ordinance.

The peculiar effects of Proposition 13 tend to make certain families virtual prisoners of their own homes because moving would load them down with a massive new tax burden. This tax trap is particularly unfair for an elderly, retired couple that wants to move to a more manageable house but cannot because of an arbitrary tax penalty. Approval of Proposition 90 will help ease that burden.