DREAM GREEN. REPEAL PROP 13.

By Maurice Jerome Walker

When we repeal Proposition 13 we will not only return the state to a fair and equitable real estate property tax collection system but most importantly restore its fiscal solvency.

And for what? To maintain a tax roll that in the last 25 years since Prop 13 passed has resulted in the residential proportion of the overall real estate tax billings in the state going way up and the commercial proportion going way down. One of things Prop 13 did was roll back all property values to their March 1, 1975 levels. Unless property changes hands or has new construction, the assessor cannot touch that March 1, 1975 value except by increasing it a maximum of 2% a year. Real estate appreciation has averaged more than 2% per year in CA for the last 25 years, far more. That's why we now have the highest valued real estate in the world.

Most of corporate CA has figured out since Prop 13 how to avoid corporate changes of control that would trigger reassessments. Most are still paying real estate taxes as if it's still March 1, 1975. I contend that this is the primary reason the state is broke. And that it was already broke by the mid 1990's, but that the revenues generated by the dot com bubble in the late 1990's masked this. Well, most economists agree that speculative economic bubbles such as that one only occur about once a centuty. So, we cannot expect another high tech "miracle" to save us and the state's infrastructure this time.

I say the only source of the billions in additional revenues we need is the real estate taxes that corporate CA would be paying if their properties were assessed at their actual market values every year. Millionaires, not to mention billionaires (as Warren Buffet himself has pointed out) should also be paying their fair share on their beachfront/hillside mansions and penthouse condos. And we middle class homeowners should be paying our fair share as well. All of us should pay property taxes on what the property is worth as of the date of the assessment.

Only fair assessments across the board will consistently generate the revenues we need to start repairing the state's infrastructure, especially our schools and the environment.