After reading, at Capitol Weekly and Calitics, that the Bay Area Council’s proposal for a constitutional convention would take Proposition 13 off the table, Calbuzz was limbering up to smack the BAC around as a bunch of chicken-livered wusses.
But first we thought we’d do what we like to refer to as “actual reporting.”
And after a wide-ranging investigation, involving two telephone calls and a couple of emails, Calbuzz determined that while the council is suggesting limits on how the convention could change Prop. 13, it is not suggesting a complete ban on changes, as the Capitol Weekly headline says: “Constitutional overhaul would omit Prop. 13 property tax changes.” .
You can understand the confusion, however. There are at least three key elements of Prop. 13 that are often discussed in debates about amending the 1978 tax cut measure: the process for fixing residential rates; the possibility of a “split roll” that assesses residential and commercial properties differently; the two-thirds vote requirement for new taxes.
Here’s what the BAC’s working draft of a convention call says:
“Delegates to the convention shall be prohibited from considering and propose (sic) revisions to the Constitution that would affect
a. Property taxes associated with Proposition 13.
b. Any other direct increases in taxes”
According to Jim Wunderman and John Grubb of the BAC, the proposal — a working draft document — is meant to suggest that delegates to the constitutional convention would not have authority to propose property tax increases as part of their agenda. In other words, property tax rates as established by Prop. 13 would not be on the table.
This means that, at least in the council’s version of a convention call, delegates could not change Prop. 13’s prohibition against a tax increase except when properties change hands. So the oft-reported, two-adjoining houses-pay-very-different-tax-bills situation, in which one neighbor’s taxes are pegged to 1% of a 1975 assessment and the guy in an identical house next door pays 1% of 2009’s assessment, would not change.
Nor would the convention address the notion of splitting the property tax roll, allowing residential rates to remain in place but recalculating commercial and industrial property tax rates based on current values. “It’s an equity issue,” says Wunderman, the BAC chief exec – speaking for his corporate constituents.
But the BAC proposal would not prevent convention delegates from proposing a change in the system by which local jurisdictions are now required, under Prop. 13, to obtain a two-thirds vote for special-purpose tax increases.
“Our view is that local governments don’t have enough authority to fulfill their missions and mandates,” Wunderman said. “We generally believe thresholds (for passing tax measures) should be reduced.”
Wunderman said the current proposal – which would not make property tax rates a part of a convention’s agenda – is designed to minimize political opposition on an issue that is not as serious a structural problem as others that need to be addressed. “That’s the way we see it,” he said.
