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06 June 2009


Account Deleted

I remember clearly in the early 70's my grandmother's property tax bill from Nevada County went up 600% in one year. My father assured her it was a mistake and would drive there himself and straighten it out. No mistake - and county officials told him it could go up again the next year even higher if they wanted to as there was no rule or law to limit the yearly increases. By the time Prop 13 was on the ballot, even my union-hugging, Dem to the core uncle was pushing for it's passage as he was being taxed out of his paid-for home in Winnetka. Whatever possible flaws are in Prop 13, it pales to the economic damage that would result from modifying or eliminating it. See you at the fairgrounds!

Steve Enos

One of the biggest issues and results of Prop 13 was the rush to sales taxes. City and counties shifted their primary funding focus from predictable property taxes to the race for sales taxes.

A cutthroat competition started as cities tried to grab and lure as much sales tax generators as possible to their city limits. This created sale tax wars where neighboring cities started doing anything and everything to get sales tax generating businesses.

Cities handed out millions and millions of taxpayers’ money to lure big-ticket sales tax businesses like auto dealerships, RV dealers, boats, etc. This started an unsustainable competition between cities. This included the rush to attract big box, mega retail power centers and shopping malls. This resulted in a lot of sprawl into farmland and then construction of a lot of very expensive infrastructure to serve them, like roads sewer, water, police and fire services.

Cities offered big subsidies to attract these retail sales tax “boxes”. Cities provided long-term tax exemptions to attract these businesses. Cities got “hooked” on the sales taxes and became sales tax junkies.

Now look what has happen. Look at what has happened to Lincoln or Roseville as an example. The Highway 80 corridor is a massive line of empty mega auto, boat and RV sales businesses. The Roseville auto mall recently asked for and received a lot of taxpayer’s money to “update” the auto mall and make them “more competitive”.

Lincoln has massive financial problems now. They grew so fast on the promise of sales taxes, expanded and undertook massive infrastructure projects and now they can’t afford to keep city hall open, much less maintain the new infrastructure.

Look around the Roseville and Sacramento area. A number of the big box centers have large vacancy rates as the “boxes” fold and close. Bye-bye sales tax, jobs and even property taxes.

Prop 13 had a lot of impacts on how we decided to grow and how cities went about funding their needs. Now that the sales tax cows are dieing cities are gong broke because they failed to understand the basic law of sales taxes… don’t count on them as they are not sustainable.

Prop 13 was and is a lot more then the amount of “income” going to the city, county or state and a lot to do about what “type” of money, where it comes from.



Very well done post, and it's absolutely true that Prop 13 has not resulted in dramatically low property taxes for Californians.

I had posted a tax burden study a few weeks ago that scored California's property tax burden at 2.58, with the lowest state's burden at 1.34 and the highest at 5.34.

Meanwhile, our overall score is 47th out of 50 states + DC. Our total taxation score is 49.685, and Nevada just across the border scores only 11.877.

Is it any wonder we're losing businesses in droves to Nevada?


Account Deleted

Steve, you are correct that Prop 13 was about more than cutting property taxes. It was also about slowing the explosive growth in govt spending. After it passed, some counties even starting getting the strange idea of doing just that. Moonbeam Brown and the Dems in the legislature couldn't have that and gave huge amounts of money to the counties and promised lots more - just keep spending, please. The counties even had money for pay raises for their workers. Where did the money come from? One source was we state workers. Arnold wasn't the first evil gov to cut state worker pay, it was good ol' Democrat Moonbeam, who even now is worshiped by the unions. That's a whole 'nother topic. There was an initial hit to the coffers by 13, but as shown in the above article, Prop 13 did not starve the counties or state govts for cash. The reason for the need for more revenue was simply more and continuing explosive growth in govt spending. It has been shown over and over that spending raced ahead of both inflation and population growth. Yes, there has been competition for the location of large sales tax generators, but to "blame" the existence of large stores and malls on the need for "lost" property tax money is just nonsensical. First of all, there wasn't any lost revenue. It went up. Did you even read the article? The rest of your rambling about lost farmland really falls apart. People live in new subdivisions outside of the cities because they like it there. All of the valley is "farmland" once you pull out all of the buildings. Actually, I thought it was oak-treed grassland and delta marsh, but maybe you know something about the area before the white guys got here that I'm not aware of. Expensive sewers? Where are all those people supposed to live? In the existing cities? The resulting increase in population density would require massive and far more expensive upgrades to the existing infrastructure than expanding out in new areas. As far as the empty stores along the hwy 80 corridor, well there are actually new dealerships going in and the places going out of business just mean that the market will adjust and the rents will go down and new businesses will eventually move in. Howe Ave in the late 60's and early 70's was a ghost town of huge empty parking lots and concrete tilt-up big box stores that had folded. Now look at it. All filled in and built up, just like you wanted. The market took care of it, not any planning expertise. The cities have failed because they are run by folks like Obama. Obama lived in a very nice area of Chicago and could afford to send his kids to private schools. He would never raise a family in the hell-hole that he and his rich corrupt liberal big city boss buddies run. There are some who prefer the city life and that's great. What I don't like is that they pick my pocket to underwrite their bankrupt policies. I prefer the suburban or better yet, rural life style and would like to have the small-minded grumps like you to stop trying to push your pathetic, self-loathing morality on me and my family.

Steve Enos

Hey Russ... the follwong comment from Scott Obermuller is a personal attackon me for just posting my thoughts about Prop 13 and sales tax. Are you going to apply your new posting rules and remove this post for making a personal attack that has nothing to do with the topic? Russ... will you apply your new postinfg rules?

"I prefer the suburban or better yet, rural life style and would like to have the small-minded grumps like you to stop trying to push your pathetic, self-loathing morality on me and my family".

Steve Enos

OOPS.. sorry George, for a second I thought I was on Russ's website.

None the less...how about removing this baseless, useless personal attack that has noting to do with the issue being discussed?

Is it possible to have a discussion on your site that covers a range of views without being personally attacked for holding a differing view?

Account Deleted

OK - I'll apologise and admit that calling you a grump was out of bounds. Won't happen again. I guess that if some one called me a grump I wouldn't even care but I have to allow for others feelings. It did have to do with the what we were discussing, and I feel it wasn't baseless or I wouldn't have brought it up. You claim you want a discussion and yet you did not respond to my arguments. You only tried to get rid of me. Is that a discussion?

George Rebane

Steve, thanks for that detailed analysis of the aftermath of Prop 13. I didn't understand whether your final conclusion was that what you spelled out is the causal thread that evolved from the passage of Prop 13, or simply a recounting of the aftermath as history. Also, according to your lights is there a limit, in the aggregate, as to what proportion of income or assets governments can confiscate through taxation? If so, how is it determined?

Steve Enos

Hey Scott... You posted "stop trying to push your pathetic, self-loathing morality on me and my family".

How does posting my thoughts on the results of Prop 13 do this? Sorry you couldn't offer a real apology for your personal attack.

Seeing how George failed to resond to your posting it's looking like having a discussion of differing views isn't possible on George's webite.

George... I'll ask again. Is Scott's post the type of thing you want to condone on your website? Does this promote the opportunity to have a dialog of ideas and issues? How does allowing this uncalled for type of personal attack promote rational, civil discussion?

Scott Obermuller

My family and I have been (along with many others in Ca and the nation) financially assaulted by folks like you that want your view to prevail on the uses of private land. I know you probably don't agree, but I feel this is due to your view of reality that is connected to your world view and yes, morality. I do not consider this to be a baseless attack. However, I don't want to continue something that you see in a different light. I can assure you that I wouldn't be personally offended if the tables were turned. But I think at this point no one else is reading this thread and you seem to be clear that you don't want to continue so I will cease to post on this subject. I again apologise if I have hurt you as I certainly never meant to.

Steve Enos

Scott too bad you can't enguage in a rational, adult discussion wihout making childish, personal attacks. So now you and your family have been "financially assaulted by folks" like me.

Scott... do you know what an Ad Hominem attack is?

George... I'll ask you again. Is Scott's post the type of thing you want to condone on your website? Does this promote the opportunity to have a dialog of ideas and issues? How does allowing this uncalled for type of personal attack promote rational, civil discussion? George do you have any standards here?

George... I know that you know what an Ad Hominem attack is.

mikey mcd

The problem is government spending. Curb gov spending and this debate is mute.

Anyone have a guess as to how high the politicians/socialist would have our property taxes today if it were not for prop 13? Do I hear 5%, 10% 25%?

George Rebane

Gentlemen, please! Ad hominem covers a broad area from the unsavory characterization of an individual, to their placement into a class that contends with another class. We should avoid the former and stick to the subject ideas and events under consideration. However, the latter is more difficult to avoid, and should be done with all the decorum that the writer can muster. Let's stick to finding fault with the other's reasoning, and not his parentage or upbringing.

Steve Enos

Thanks for the response George. I hope Scott takes your direction to heart.

Discussing issues and differing views and ideas can take place and should take place without personal attacks. This is the only way forward.

Prop 13 had good and bad effects. One bad was the launch of the now abused California ballot box initiative system. As history shows anything, regardless of how insane can get placed on the ballot. Then special interest money from all sides go to war.

A number of dumb, harmful measures have passed because far to many voters fail to get informed prior to voting. The initiative system in California is abused and needs to be reformed as does the state budget system.

I am a supporter of holding a California Constitutional Convention so the people of California can take action on the out of control, clueless folks in Sacramento that fail to "get it".

I love living in Northern California and everyday it looks like the only cure to the insanity is packing up and moving to Montana or Idaho.

I am outraged at what California has done and is trying to do to restrict and take my gun ownership rights away. The latest attempts focus on ammunition sales. Good news is Nevada is close by and for now it's legal to cross the board to buy ammo and return to California.

George Rebane

Good words Steve. I was under the impression that California adopted the initiative process back on 11 October 1911, and has a decades long history of using this mechanism to allow politicians to duck the hard decisions by throwing critical issues back at a compliant electorate manipulated through the media.

ps. Didn't know you were a fellow 2nd Amendment supporter.

Steve Enos

The use of the initiative process in California really took off post Prop 13. Prop 13 was a bit of a turning point in the use of the initiatve process in California.

Prior to Prop 13 the initiative process wasn't used much. Now it's a way for any dumb idea to by-pass Sacramento. In many cases it has been used to drive us into deep debt by measures that require the sale of massive bonds. Little if any consideration is given to the financial effects of the bond measures. If one can make a measure warm and fuzzy, why give any thought to the costs?

I'm a big fan of the 2nd Amendment. I am a former deputy sheriff and former federal law enforcement/drug enforcement officer. I grew up hunting and was instructed at an early age about gun safety and their proper uses. One of those uses being personal defense.

I hold the position that most gun laws fail to keep guns out of the hands of the bad guys. The bad guys seem to have ready access to whatever firearms they want, while law abiding citizens get restricted.

The recent efforts to restrict ammunition is yet another step in the wrong direction. This would do nothing more than restrict the rights of law abiding citizens while the bad guys take whatever they want.

The 2nd Amendment has been under relentless attack and if it wasn't for the NRA we wouldn't "be allowed" to have firearms. I view firearms as tools and support the recreational use of firarms too. I enjoy shooting and I enjoy sleeping well at night knowing I have the equipment and skills to provide for my own self defense if needed.

George Rebane

Steve, that is a remarkable declaration which totally runs counter to the political profile that many in the community have of you. I feel more than a little embarrassed if you have made these sentiments known before, and I have overlooked them. If those last comments were published without your name at the bottom, and members of this community were given multiple choices as to their authorship – your name included – I venture that NO ONE, at least no one of my persuasion, would have checked Steve Enos.

I am heartened that there seems to be a chance for some bridge building here, for I’m sure that you retain, to some great measure, the ideas that you’re known for supporting. But perhaps now we can start carefully carving out and delineating their boundaries, along with the lines that define where the more conservative voices reside – e.g. ScottO, MikeM, AaronK in this thread, and others. The outcome may yield some great cross fertilization, at a minimum both sides would better understand the bases for the other’s beliefs. And who knows, minds may even be changed.

With this hopeful interlude, I’d like to resubmit the two questions that I asked above arising from my presentation of the Prop13 numbers? To wit “…according to your lights is there a limit, in the aggregate, as to what proportion of income or assets governments can confiscate through taxation? If so, how is it determined?”

Russ Steele

— Chris Reed, editorial writer at the San Diego Union-Tribune in defense of Prop 13 in Blame the Unions at NRO.

... the claim that California voters balk at paying for what they want is easily refuted. There is no evidence that the public wanted the state and public-schools work force to explode by 24 percent — from 719,000 to 895,000 — between 1997 and 2007. There is no evidence that the public wanted never-ending pay and benefit increases for these public employees, in particular an obscene 37 percent raise given to prison guards. There is no evidence of public support for a 1999 law that allows many of these workers to retire in their 50s with pensions of up to 90 percent of their last annual salary.

Meanwhile, the argument that the two-thirds requirement to raise taxes has subverted sound governance implies that this obstacle has kept taxes unrealistically low. Hardly. California has the nation’s highest sales and gasoline taxes, the first- or second-highest income tax (depending on how it’s measured), and the highest business taxes in the West.

The claim that Proposition 13 crippled California’s revenue stream also doesn’t hold up. Because assessments can be raised to current values when property changes hands, property-tax revenue went from $6.4 billion in 1980–81 to $43 billion in 2006–07. That’s a nearly 600 percent increase, which is far higher than the combined rate of population growth and inflation over the same period. In fact, property-tax revenue went up at a slightly higher rate than overall state revenue. Krugman’s assertion that Proposition 13 amounts to a budgetary “straitjacket” is further undercut by the latest Tax Foundation data, which rank California 19th (out of all 50 states) in property taxes as a percentage of total state taxes.

Given this backdrop, it’s simply daffy to blame California’s budget process, its voters, or Proposition 13 for the state’s inability to live within its means. Blame the majority Democrats in the state legislature who have done unions’ bidding for the past decade — spiking public employees’ pay and benefits, expanding government programs to offer ever more taxpayer-subsidized services, using borrowing and other gimmicks when revenue was weak and spending every last dime when it was strong, and constantly adding new burdens to business that hurt tax collections and drove employers (and jobs) elsewhere.

Once merely a powerful special interest, these public-sector unions now have a chokehold on the state. Here’s how extreme it is: For years, two of California Democrats’ top priorities have been enrolling more poor children in state health programs and encouraging individual homeowners and businesses to install solar panels to generate their own power. But at the behest of unions, Democratic legislative leaders killed a measure to allow parents to enroll their kids online because it might have led to layoffs of clerks at county social-services offices. They also killed a bill touted by Gov. Arnold Schwarzenegger to create incentives for solar-panel installation because it didn’t mandate the use of union labor.

Such immense union power is the central reality of California politics. That is why Schwarzenegger spent his first two years as governor trying to rein it in. Unfortunately, he gave up in late 2005 after his reform initiatives were defeated in a special election. Since then, he has focused on becoming a Teutonic Green Giant on climate-change issues.

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