No New Taxes
Voters passed Proposition 13 in 1978 limiting general property taxes to 1% of a property’s market value and restricting increases in assessed value to 2% per year. Those two rules combine to keep California’s effective property tax rate at just 0.81%, compared with a national average of over 1.1% When you compare California’s median household income of $64,500 – 10th best nationally – to property tax bills, you find the burden equals 4.8 percent of the household pay. Some 30+ states pay more property taxes than we do.
Senior homeowners currently enjoy two laws designed to ensure taxes don’t force people from their homes. Currently Proposition 60 and 90 each allow seniors and those who are disabled a one-time transfer of their existing tax assessment. Give that the transfer to a new principal residence is in the same county (or in one of 11 counties that opted to accept “inter-county” transfers – Santa Barbara is not one of them) and as long as the new home value is equal or less than the old one. So why the expansion now? Why does California usurp the vote on what Santa Barbara wants? Now more than ever we need to focus on community needs and keep our firefighters funded in our county.
Under the initiative to expand Prop 13, there would be no limit on how many times, or to where, a senior homeowner could transfer their old tax assessment. And the new home could be more expensive than the old one (currently to transfer an old tax base you need to be within 100% of the home’s sales price). Arguments in favor claim that more seniors would move, freeing up homes and stimulating the economy. But the California State Association of Counties is very concerned that the proposal would reduce revenue and affect social services most adversely as they rely on property taxes and do not receive sales tax revenue.
Allowing seniors to maintain their low tax bill across county lines sounds good, but if some are saving, who’s paying? Santa Barbara firefighters are funded largely by property tax. The toll for the Thomas Fire is over $74 million dollars so far! The Legislative Analyst’s Office concluded that it would decrease property taxes by $300 million in the first year and as much as $2 Billion dollars a year in the long run.