I've been asked for my views on the "split roll" initiative, which would partially repeal Prop 13 and assess certain commercial and industrial property at their current assessed values for property tax purposes. So here are my INITIAL impressions, subject to change:
Let's start with the obvious: Prop 13 SUX. It has completely decimated local governments' ability to fund basic services, and forced them to rely on fees and gimmicks that raise the cost of housing and reduce governmental accountability, to put it mildly.
Did you know that before Prop 13 community colleges in CA were FREE? This is yet another instance of intergenerational inequality. Something boomers enjoyed for free you now have to pay thousands for. But you know, avocado toast and everything...
Prop 13 was never supposed to be about commercial and industrial property. The purpose of the initiative, at least according to all the publicly available material, was to give tax relief for homeowners. But the initiative was either sloppily drafted, or deliberately deceptive.
My main concern about split roll is strategic. Local govs are massively resisting state intervention into land use, and threatening an initiative to preserve local control. The main stick the state has is $. Do we want to hand LGs a bucket of $ when we need leverage over them?
I could get behind split roll if the $ goes to the state, and the state has to distribute the $ to cities based on how much housing they entitle, or how loosely they zone, or some similar metric.
It's folly to presume that once cities have more $, they'll entitle more housing. Look at redevelopment: cities had billions in cash in redevelopment agencies, and did almost nothing on housing. Now they're all saying "if only we still had redevelopment $, we would build hsg."
I could also get behind split roll if cities' receipt of the cash were contingent on cities getting rid of excessive developer fees. RN there's no guarantee cities will do that. They'll just add the new $ to their coffers and keep doing business as usual.
Now here's a less popular take. We already tax business plenty in this state. The people who are severely undertaxed are homeowners. Now, I understand split roll is an opening wedge to destroy Prop 13 eventually, but there's no guarantee you get there.
Split roll accepts the dominant narrative that businesses rather than homeowners need to bear the burden of subsidizing public goods. We need to be challenging that narrative.
And another thing, let's not be deluded about the property tax. It's a crappy tax. You get a bigger tax bill because your neighbor sold their land? That strikes a reasonable person as very unfair. And yeah you can refinance but that isn't free. Maybe you don't want more debt.
Property tax punishes you for improving your property. What we need is a land value tax, not a property tax.
Anyway, I might vote for split roll just to symbolically show my dislike of Prop 13, but I don't think it has any chance of passing.
