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So @svgop is hosting @joncoupal of Howard Jarvis @HJTA
in @townoflah at Fremont Hills Country Club, to speak against a ballot initiative to reform Prop 13 and have corporations pay their fair share of property tax.
in @townoflah at Fremont Hills Country Club, to speak against a ballot initiative to reform Prop 13 and have corporations pay their fair share of property tax.
As a reminder, Prop 13 was the ballot initiative passed in the 70s that capped property tax in CA at 1%, and limited increases to 2% per year.
It also gutted our education system, kickstarted the housing crisis, and created a literal, honest-to-god hereditary landed gentry.
It also gutted our education system, kickstarted the housing crisis, and created a literal, honest-to-god hereditary landed gentry.
You could hardly find a better place to commemorate Prop 13 than Fremont Hills Country Club. See, that's in Los Altos Hills, a town with 1 acre minimum lot si
zes and an average home price of $4.3m ( https://www.zillow.com/los-altos-hills-ca/home-values/).
https://www.google.com/maps/place/Fremont+Hills+Country+Club/@37.3762183,-122.1441686,230m/data=!3m1!1e3!4m13!1m7!3m6!1s0x808fb0424e8b7625:0x9c56e58f6d2780f7!2s12889+Viscaino+Pl,+Los+Altos+Hills,+CA+94022!3b1!8m2!3d37.375832!4d-122.144286!3m4!1s0x808fb069fe170007:0x1f4c3ba1f465e704!8m2!3d37.3767111!4d-122.1453175
zes and an average home price of $4.3m ( https://www.zillow.com/los-altos-hills-ca/home-values/).
https://www.google.com/maps/place/Fremont+Hills+Country+Club/@37.3762183,-122.1441686,230m/data=!3m1!1e3!4m13!1m7!3m6!1s0x808fb0424e8b7625:0x9c56e58f6d2780f7!2s12889+Viscaino+Pl,+Los+Altos+Hills,+CA+94022!3b1!8m2!3d37.375832!4d-122.144286!3m4!1s0x808fb069fe170007:0x1f4c3ba1f465e704!8m2!3d37.3767111!4d-122.1453175
So you might be wondering, what sort of property tax does the Fremont Hills Country Club pay? Glad you asked! The assessed value is around $3.6m, for an annual tax bill of $360k.
https://www.sccassessor.org/index.php/online-services/property-search/real-property
https://www.sccassessor.org/index.php/online-services/property-search/real-property
Keep in mind a single home in LAH goes for $4.3m, and this entire country club is only assessed for $3.6m.
How could that be? Well, note the transfer date: 1/1/1973. Under Prop 13 properties are only reassessed when improved or transferred. Otherwise, they can only go up 2%/yr.
How could that be? Well, note the transfer date: 1/1/1973. Under Prop 13 properties are only reassessed when improved or transferred. Otherwise, they can only go up 2%/yr.
Prop 13 passed in 1978 but was retroactive to 1976, 43 years ago. As a result, if a property has not changed hands or improved since 1976, its taxes could only increase by a factor 1.02^43, or 130%. Keep in mind that inflation since 1976 has been 360%!
https://data.bls.gov/cgi-bin/cpicalc.pl?cost1=1&year1=197601&year2=201908
https://data.bls.gov/cgi-bin/cpicalc.pl?cost1=1&year1=197601&year2=201908
Now there have certainly been improvements to the Fremont Hills Country Club. They make up $2,864,930 of the assessed value. But the land itself is only assessed at $391,227.
Keep in mind that 2 years ago a teardown in the Palo Alto, which, despite being absurdly expensive is still cheaper than Los Altos Hills, sold for 2.5 million dollars, solely based on the value of its 7,500 sq ft lot.
Prices have increased since. https://www.cnbc.com/2017/05/04/this-silicon-valley-teardown-just-sold-for-2-6-million.html
Prices have increased since. https://www.cnbc.com/2017/05/04/this-silicon-valley-teardown-just-sold-for-2-6-million.html
So if 7,500 sq ft of land under a falling down shack in a less expensive city is worth 2.5 million, if the average home in Los Altos Hills is worth 4.3 million, imagine what the land under an entire country club is worth compared to how it is actually being taxed.
Prop 13 has been utterly devastating to our state. The UC went from being nearly free when Prop 13 was passed to costing nearly 14,000$ a year: https://admission.universityofcalifornia.edu/tuition-financial-aid/tuition-cost-of-attendance/
Adjusted for cost of living, our spending per K-12 student is 41st in the nation--up from dead last in 2012-2013. https://www.politifact.com/california/statements/2018/jan/17/delaine-eastin/does-california-rank-41st-student-spending-no-1-pr/
And those high sales and income taxes @svgop claims to hate so much? They're so high precisely because Prop 13 has made it impossible to effectively tax property.
And the cherry on top? If somehow I ended up with enough money to buy a home in Los Altos Hills (lol), it would be reassessed to market value when I bought. I'd be on the hook for full $430,000 per year, which is more than this entire goddamned country club owes.
Oh, did I mention you could pass on your Prop 13 assessment your children or grandchildren? https://www.latimes.com/politics/la-pol-ca-california-property-taxes-elites-201808-htmlstory.html
Prop 13 has literally created a hereditary landed gentry. The further back your family bought land, the easier it is to hang on to it. You literally get a tax break for inheriting land instead of buying it yourself.
Not only that, it shifts the incentives locally. Whereas previously homeowners might want to keep their properties from appreciating too much to keep their tax bills down, now they have no incentive not to try to push their home values as high as possible.
Which they have been able to do by maintaining a statewide exclusionary zoning regime that has kept roughly 80% of our residential land zoned for single family homes: http://citylab.com/equity/2019/04/california-affordable-housing-bill-sb50-single-family-zoning/586519/
So say you're a plucky immigrant who pulled yourself up by your bootstraps and want to buy a home. Not only are you on the hook for a massively inflated price, you have to pay taxes on that full sum.
Meanwhile your classmate who inherited his $2.5m Palo Alto Eichler from Mom and Dad, who bought it in the 60s for $40,000, gets to keep paying taxes like it's 1987.
Maybe he'll rent it out to you for $5,000 a month. That'd be a steal.
Maybe he'll rent it out to you for $5,000 a month. That'd be a steal.
Prop 13 is class and generational warfare. It enriches the "old families" at the expense of the young, the incumbents at the expense of the newcomers, the landed at the expense of the landless. And the @svgop and Howard Jarvis @HJTA revel in it.
Californians will have the opportunity to start correcting the damage next November, by passing split-roll and taking Prop 13 away from large corporations and by reforming the inheritance pass-through.
But ultimately this is not enough. The entire rotten thing must be repealed.
But ultimately this is not enough. The entire rotten thing must be repealed.
Now no one should be forced to leave their home because they cannot afford to pay taxes. There are ways to keep senior citizens and others in their homes. Many states allow property taxes for senior citizens to accumulate as a lien, payable when the home is sold or inherited.
But the system we have today, where the longer your family has owned a piece of land the less you have to pay, is simply monstrously unfair to literally everyone else. It is repugnant. It is unjust. It. Must. Go.
Ceterum censeo propositio XIII esse delendam.
@threadreaderapp unroll this.
