Proposition 13 Passed

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Proposition 13 passed by the people of California in 1978 established, among other things, that a change to property taxes required a two-thirds majority vote (66 percent) of the people. That vote threshold is now under attack.

On the heels of gaining a supermajority in the California Legislature, democratic legislators have introduced a slew of constitutional amendments to make it easier to raise property taxes. If the amendments pass, local governments will be able to raise property taxes with a mere 55 percent majority vote of the people.

In total, seven amendments have cleared their first committee. Individually, the amendments would lower the voter threshold to fund fire services, police services, libraries, buildings, transportation projects, and community and economic development projects. One of the amendments, the "catch-all" authored by Senator Loni Hancock, would allow local governments to raise property taxes for any local project or service with a 55 percent majority vote.

Business and property owner associations, including AACSC, have lined up to oppose these measures.

Prop 13's two-thirds majority threshold, along with provisions limiting property taxes, is intended to inject fairness in a system that allows everyone in a community to vote on measures that burden only property owners. It is a recognition that taxes used to benefit all.

Lowering voter approval threshold requirements to make it easier to raise property taxes minimizes the need to govern within a local government's means. Lawmakers may also be encouraged to deplete funds from one budgetary area to cover expenses in another budgetary area and then replenish the depleted funds by tax hikes on property owners.

The concern is that without safeguards like the two-thirds majority threshold, budgets will be balanced on the backs of property owners through an unending series of parcel taxes.

AACSC remains involved in opposing all seven of the constitutional amendments.

Price Control on New Rental Property Bill to be Voted on Before the California Senate

AB 1229 must be voted on by the entire Senate between August 12 and September 12, 2013.

The bill is a top priority measure of AACSC. It allows local governments to mandate "inclusionary housing" laws. If enacted, local governments will be able to price control 20 percent or more of all new residential units for 55 years or more. AB 1229 accomplishes these mandates by abrogating the Palmer v. City of Los Angeles decision; a decision upholding an important provision of the long-standing Costa-Hawkins Rental Housing Act exempting newly constructed rental units from price controls.

Among Our Reasons to Oppose:

  1. Supporters of AB 1229 argue inclusionary housing is not a form of rent control. To the contrary, inclusionary housing mandates are more strict and burdensome than rent control ordinances. (See chart on previous page entitled AB 1229 (Atkins) Price Control of Privately Owned Rental Housing Comparison Chart.)
  2. Unlike rent control ordinances, inclusionary housing mandates do not allow owners to set or reset rent upon re-rental and do not allow adjustment of the rent when capital improvements or repairs are necessary. As an example, San Diego's Inclusionary Affordable Housing Implementation and Monitoring Procedures Manual states that "dwelling units affordable to targeted rental households shall remain affordable for a period of not less than fifty-five (55) years from the date of issuance of a Certificate of Occupancy."
  3. Building new affordable housing can be built without the costly and restrictive provisions that would be authorized under AB 1229. Specifically, under the Costa-Hawkins Rental Housing Act, and as a result of the Palmer decision, local governments have simply modified their inclusionary housing ordinances to require developers to pay in-lieu fees for the construction of new rental units or to provide valuable cost offsets. Valuable cost offsets include increased zoning allowances (density bon uses), relaxed development standards (reduced parking requirements), fee waivers, subsidies, expedited permit and/or approval processes, and reduced prices on the initial purchase of land.
  4. AB 1229 unjustly places the sole burden and expense of producing and owning affordable housing on the rental housing industry.

We will reach out to you very soon and ask you to call Los Angeles based Senators. The call will be brief and easy to make.

After all, what do you have to lose? Just the ability to recover your operational costs and a modest profit.

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Contact AACSC

Apartment Association,

California Southern Cities
333 W. Broadway St., Suite 101
Long Beach, CA 90802
(562) 426-8341

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