California counties should implement the good part of Proposition 19; the voters should handle the bad part by turning down the ballot measure this November.
Portability — taking your property tax bill with you when you move from one California county to another — rightly protects people from enormous spikes in taxes. Property owners are protected from dramatic tax increases by Proposition 13, passed in 1978, limiting increases to 2 percent a year. Portability would apply that limit even for most intercounty moves.
Right now a few California counties allow residents to bring along the property tax bill from their previous home, which is useful because taxing authorities all over the state are looking for every opportunity they can find to separate you from your money. Portability is one way to ensure a resident’s tax bill won’t get precipitously worse.
But a Prop. 19 provision would more than offset portability by reassessing a property passed from homeowners to their heirs as though it were an open-market sale, unless an heir actually occupied the inherited residence. Proposition 58, passed in 1986, prohibits this. Prop. 19 would soak at least hundreds of millions of dollars a year out of an already heavily-taxed populace and ruin for some heirs benefits their parents worked a lifetime to pass on to them.
Prop. 19’s proponents say heirs paying a lower tax unfairly takes money from all other Californians. But tax savings are not a pilfering; taking a larger share of tax savings is.
The fundamental problem is the reason why Prop. 19 seeks to raise revenues.
Prop. 19 is very similar to a 2018 ballot proposition requiring statewide portability. That measure, Proposition 5, lost by about a 3-to-2 margin. Among the foes of Prop. 5: the firefighters unions, which essentially argued that portability, allowing people to keep more of their own money, was somehow an imposition on everybody else.
Real estate interests pushing Prop. 19 (thinking, evidently, it would spur sales) cleverly got around this by adding funding for firefighting to this redo of the 2018 effort.
Prop. 19 backers can recite for you numerous reasons why firefighters need more funding, some of which may even be true, but Prop. 19 is not the proper vehicle. And offering what’s essentially a bribe to gain union backing in exchange for raising taxes on regular citizens is cynical and unfair.
If firefighting funds are a high priority, the Legislature can address it by allocating the funds it believes are needed. Same for local governments and schools. Nothing is stopping Sacramento from appropriating more money to them. It’s a matter of setting priorities.
But Prop. 19 is best understood for what it is: an attempt by real estate interests to accomplish what they couldn’t accomplish two years ago by pandering to the state’s firefighters union. This is a special-interest measure that seeks to raise hundreds of millions of new tax revenues to appease yet another special interest.
Prop. 19 has one good feature — portability. Counties ought to enable it forthwith, as a few already have done. But Prop. 19 is a cash grab, not tax reform; it’s not fair to property heirs, and it buys off a union so it has a better chance of passing. Vote it down.
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