The Los Angeles Times reported that one of our elected leaders believes Proposition 13 “isn't in danger.” I disagree with that assessment. Three of Proposition 13's major reforms are under attack by California's pro-tax lobby.

Under Proposition 13 property taxes were capped at 1 percent of assessed value plus bonded indebtedness. However, during 2004 the California Teachers Association (CTA) and Rob Reiner sponsored an initiative that would have increased that tax rate to 1.5 percent for nonresidential real property—excluding property used for commercial agricultural production. That proposal would have resulted in a 50 percent increase in commercial and industrial property taxes. The California Taxpayers' Association reported that CTA tried to circulate a similar initiative again during 2005. It's hard to argue that Proposition 13 “isn’t in danger” when you consider these efforts to enact a 50 percent tax increase!

Proposition 13 raised the state Constitution’s voter-approval requirement to two-thirds for new taxes and bonded indebtedness. Proposition 39 has already eroded that protection; certain school bonds now require approval of only 55 percent of the voters. However, three proposals introduced during the 2005-06 Legislative Session would have further reduced the two-thirds voter-approval requirement to 55 percent in the following situations: (1) School parcel taxes (Senate Constitutional Amendment (SCA) 8), (2) Special taxes (Assembly Constitutional Amendment (ACA) 7), and (3) Supplemental funding for police and fire services (ACA 16). These attempts to weaken Proposition 13’s two-thirds voter-approval requirement illustrate the Legislature’s willingness to increase our property taxes.

Under various “split roll” proposals real property owned by corporations, partnerships, and LLC’s would lose their most important Proposition 13 protection by becoming subject to periodic reassessment. Certain members of our Legislature and other pro-tax groups have made continuing attempts to enact a “split roll.” One early example was Proposition 167 during 1992. Other such attempts include Senate Bill (SB) 1662 in 2002, Assembly Bill (AB) 1013 in 2001, AB 2288 in 2000, and SB 82 in 1991. More recently, these ideas reappeared in SB 17—from the 2005-06 Legislative Session—and SB 17 and SB 3X from the 2003-04 session. It appears to me that California’s businesses are in danger of losing Proposition 13’s most important protection.

In light of these on-going attacks, it's hard to believe that Proposition 13 “isn't in danger.” Don’t be fooled.