A proposed initiative for the November ballot is looking to remove Proposition 13’s restrictions on reassessments and tax increases for corporate-owned property. The proposed initiative is being backed by a coalition of liberal groups that claim that the initiative would keep Prop. 13’s protections for farmers, homeowners, residential renters, and small businesses. The proposed initiative is called the California Schools and Local Communities Funding Act of 2018 and proponents claim that it would bring in a projected $11 billion in new revenue from corporate property taxes. Jon Coupal, president of the Howard Jarvis Taxpayers Association, states,
It’s still a foot in the door to changing a fundamental feature of Prop. 13. The way the law is now, businesses can predict with certainty what their property taxes will be in the future.
Prop. 13 was passed in 1978 and limited property taxes to one percent of a property’s cash value, while capping increases at two percent per year. Prop. 13 allows a reassessment of a property’s value and a larger increase in its owner’s tax bill only after it changes hands or new construction is completed. The proposed initiative would change this for commercial property and, according to proponents, the new revenue from corporate property taxes would be used to provide funding for schools and community colleges as well as bridges, health clinics, home-building, homeless services, libraries, parks, and roads. In order for the proposed initiative to qualify for the November ballot, eight percent of the total votes cast in the last election for governor would be needed, which is 585,407 petition signatures. We will have to wait and see if the proposed initiative qualifies for the November ballot.
