SPECIAL REPORT / ELECTION PREVIEW : DECISION ’94 / A Voter’s Guide to State and Local Elections : Propositions : PROP. 178
What it is: Like Proposition 177, this measure would grant an exemption from the taxes on new construction added on to existing property. In this case, the exemption would be allowed on installation of water-saving equipment used in agriculture--adding to property value by replacing a sprinkler irrigation system with a more expensive drip system. Analysts estimate that the exemption could save farmers and ranchers $7 to $10 per acre.
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Arguments for: Tax savings available under Proposition 178 would encourage the installation of equipment requiring less water for crops and thus help conserve water. Particularly in a state subject to drought, it is unfair and counterproductive to extract a higher tax based on improvements to property that cut back on water consumption.
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Arguments against: Tax losses from this measure would leave a hole in revenues needed for local governments to fund critical services and for schools. Farmers who install water-saving devices will automatically enjoy a reduction in their costs, in the form of reduced water bills. They don’t need a tax break to boot.
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Who supports it: Sen. Mike Thompson (D-St. Helena); heads of the California Farm Bureau Federation, the Planning and Conservation League and the Assn. of California Water Agencies.
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Who opposes it: Assemblyman Gil Ferguson (R-Newport Beach); Assemblywoman Debra Bowen (D-Marina del Rey).
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