California Schools Suffering as Proposition 13 Tax Cap Breeds Fiscal Chaos
By Michael B. Marois and James Nash - Jul 11, 2011 9:01 PM PT
July 12 (Bloomberg) -- California State Assemblyman Tom Ammiano, a San Francisco Democrat, talks with Bloomberg's Michael B. Marois about the state's property-tax law known as Proposition 13. The measure, passed by voters in 1978, chopped tax rates by more than half and is also blamed for California's perennial budget crises, the proliferation of strip malls and auto dealerships, a slide in education spending and unequal tax bills among neighbors. They spoke on July 7. (Source: Bloomberg)
Three decades after Californians voted to limit their property taxes and helped start a national revolt with Proposition 13, some consequences are still emerging.
The average California real-estate tax rate is 60 percent lower than when the law passed in 1978, according to the Board of Equalization, the state’s tax administrator. The most populous U.S. state ranks 28th nationally in combined state and local property-tax collections per person in a 2011 study by the Washington-based Tax Foundation.
Yet the measure that inspired tax-limiting laws in New York and New Jersey is also blamed for California’s perennial budget crises, the proliferation of strip malls and auto dealerships, a decline in the state’s once top-10 ranking for spending on students and unequal tax bills among neighbors.
“Prop. 13 helped usher in the modern anti-tax movement,” said Robert Ward, the deputy director of the Rockefeller Institute of Government inAlbany, New York. “Now, other states look at Prop. 13 as an example of what to avoid.”
Proposition 13 was born in a petition drive that gathered enough