Palo Alto officials may soon join their counterparts in Berkeley, Oakland and Burlingame tonight in taking a formal stance against Proposition 13, the 1978 measure that capped property taxes at 1 percent of assessed value.
The City Council is scheduled to consider Monday a resolution supporting reforms to Proposition 13, which they say unfairly shifts the tax burden from commercial properties to residential ones and forces California to rely on "more volatile revenue sources." The resolution pins much of the blame for California's "chronic budged crises" on the proposition and characterizes it as exacerbating economic downturns. Largely because of Proposition 13, the resolution states, the state had to collect revenue through avenues "like income taxes and sales taxes paid by working families that move in tandem with economic cycles, causing deficits and requiring cuts to vital services that grow our economy and thereby worsening economic downturns."
Though the resolution makes an abstract case for reform, it stops short of any particular proposal to change Proposition 13. In fact, the resolution specifically states that it "shall not constitute formal support of any particular ballot measure on this or a related subject until such ballot measure is separately reviewed and endorsed by the City Council."
Both the resolution and the accompanying report from City Manager James Keene focus the argument on reform toward shifting more of the tax burden to corporations and commercial landholders. Keene's report notes that before Proposition 13, 40 percent of local tax revenue came from non-residential commercial property. Today, the number stands at 28 percent, with home and apartment owners paying the remaining 72 percent, according to Keene.
An analysis by the California Board of Equalization found that regularly reassessing non-residential property would generate at least $6 billion in additional revenue for California. Under Proposition 13, assessed value is typically equal to purchase price, which is adjusted upward by 2 percent per year. A property is only reassessed when a property changes hands.
The Palo Alto City Council has often spoke out against Proposition 13, with councilmen Larry Klein and Greg Schmid often blaming it for a large portion of California's budget woes.
The question of whether commercial properties are paying their fair share for services has also recently emerged as a topic of debate. At last week's discussion of new development fees, the council's Finance Committee tentatively endorsed a formula that would require new non-residential developments to pay 40 percent of the desired revenue for public safety and government facilities, with new residential developments paying the remaining 60 percent.
Councilwoman Karen Holman, who dissented, argued that commercial properties should shoulder a greater share of the fees and suggested a 50-50 split between residential and non-residential developments.
Comments
Palo Verde
on May 12, 2014 at 11:53 am
on May 12, 2014 at 11:53 am
At the time of Prop 13, property values were rising rapidly each year, faster than salary increases. Because the property tax *rate* was not changed, there was no vote on any "tax increase". As a result, revenues were increasing year after year w/o politicians having to do anything. Many good things were done with that "found" money, but not all was spent wisely or in ways the tax payers wanted. The *intent* of Prop 13 (IMHO) was to regulate the growth in spending. However, instead of capping the growth of *gross revenues* to the local agencies, Prop 13 capped growth in *property tax payments*. This lead to vast and gross inequities in payments by individuals.
My solution (w/o revoking Prop 13)? Cap the revenue growth at some percentage (e.g. 1% as current, I believe). Reassess property values annually (let's say each property every 2 or 3 years). Divide the capped gross revenue by the total assessed value in the area to get the tax rate. The apply that rate to every parcel to get the property tax. Everyone pays their fair share in that way (assuming you still believe that higher valued properties should pay more).
If we want to give a break to seniors, or to anyone who has a fixed or no income, then do that separately. There are several algorithms that are reasonable. One simple one is to collect some percentage of the tax bill each year, and forgo the remainder until the property is sold.
Anyway, let the discussion begin!
Community Center
on May 12, 2014 at 11:58 am
on May 12, 2014 at 11:58 am
Prop 13 will trigger the final downfall of the State of California. Most states base property taxes on appraised values, not some basis of original cost with some small cap on annual increases. I am paying $30k a year in property taxes on my home property while my neighbor (with a much larger home and lot) pays half of what I pay. Residential taxes should be based on appraised values with discounted rates for disabled and senior citizens. Commercial taxes should be calculated on appraised values as well.
Crescent Park
on May 12, 2014 at 12:06 pm
on May 12, 2014 at 12:06 pm
"which they say unfairly shifts the tax burden from commercial properties to residential ones"
You can slice this any way. Prop 13 far more unfairly shifts the burden of tax from the middle-aged to the young but you don't see the city attacking that. No, they go after the easy targets.
This was all part of how the tax was proposed. To choose to tweak one avenue is a mistake. Fix the whole damn thing or not at all.
Midtown
on May 12, 2014 at 12:22 pm
on May 12, 2014 at 12:22 pm
I have another idea for making the tax base more fair, but also keeping people from losing their homes due to property tax increases. Reassess homes every 2-3 years, whatever, but don't require payment of the full assessed value until the property is sold - in the meantime, cap it like it is now. Then when the homeowner sells his home, and reaps a huge profit, part of that profit goes towards paying his back-assessed property taxes. This way someone who pays little taxes now because they bought their home many years ago contributes more fairly to the services he is getting that are paid for by taxes. Adjustments can be made if there is no profit on the sale, and other circumstances.
I also think that prop 13 should be repealed for commercial properties for the reasons stated in this article.
Greenmeadow
on May 12, 2014 at 12:25 pm
on May 12, 2014 at 12:25 pm
"shifts the tax burden from commercial properties to residential ones"
Prior to Prop 13, commercial properties paid 60 percent, residential paid 40 percent. Now commercial has sunk to 40%, with residential bearing the burden at 60%. Why should Southern Pacific, PG&E and all the large real estate concerns get the break over residents and homeowners? Have you seen any rent or price breaks to cover what the commercial interests are saving? Me, neither.
Today, Prop 13 has shifted the commercial/residential burden burden from 60/40 to 40/60.
Remove the loopholes that keep commercial properties from being reassessed the way residential get reassessed upon turnover. Leave the rest of 13 the same.
Charleston Meadows
on May 12, 2014 at 12:30 pm
on May 12, 2014 at 12:30 pm
Please,
The City of Palo Alto is providing all the serivces that residents need.
No need to invite Government growth. Let's try to live within what the current funding mechanisms provide.
As a resident of South Palo Alto, I know that the economic diversity of our town would be destroyed if property taxes were raised. I knew the rules and what I would be paying when I signed up for the program (purchased my house.) Changes would rip the rug out from under many families with humbler means who came to this town for a good education for their children and to enjoy friendly, low-density neighborhoods.
We have changed the rules to allow hideous high-density, and now those same people want to change the rules to chase out the ordinary citizens.
Who is representing that very reasonable poin to view?
Respectfully,
Tim Gray
Duveneck/St. Francis
on May 12, 2014 at 12:35 pm
on May 12, 2014 at 12:35 pm
I am afraid I REALLY dislike the solution of deferring part of the property taxes until the property is sold. What that means is that the government will be building a lien against the property, sapping equity away from those seniors.
I remember when Prop 13 was proposed, debated, and voted in. There was a good reason for it, and there still is. Long live the revolution!
If Prop 13 is repealed I suspect that many people who currently live on my street will be forced out of their homes, as was happening in pre-prop 13 days. Do you REALLY want to bring back the bad-ole'-days of people who have been living in their homes for decades being taxed out of the bay area? Do you know what will happen to property values if the taxes shoot up, both from an ability-to-pay-the-mortgage viewpoint and from the sudden flooding sor-sale homes due to people who can no longer afford to live here?
I suspect that Prop 13 is a political third rail, and it should be. Any politician that touches it will hopefully get what they deserve.
Palo Verde
on May 12, 2014 at 12:41 pm
on May 12, 2014 at 12:41 pm
Newcomers always try to displace those who came before.
Southgate
on May 12, 2014 at 12:49 pm
on May 12, 2014 at 12:49 pm
It's easy for politicians (in public) to advocate shifting more of the tax burden from residents to corporations, but that's not the only problem. Tax law should be based on fairness and Prop 13 has caused unfair disparities between residential owners. Lowell House is for sale for $21.5M, yet is assessed at $4.6M. The City of Palo Alto subsidized the owners $200k last year and millions in the past. How is that fair? Another example is a home on Kingsley under contract for $9M that's assessed at $166k. They paid less than $2k in property taxes last year. I have no ill will towards either of these owners, but I'm sure that even they would say they're not paying their fair share of taxes.
Crescent Park
on May 12, 2014 at 12:50 pm
on May 12, 2014 at 12:50 pm
Perhaps city leaders in Palo Alto, Berkeley and Oakland should take actions within their control that clearly discriminate and are at best unethical, including stopping the practice of spiking by public employees. This money could be used for rainy day funds and to help fund what are clearly underfunded pensions,
Another Palo Alto neighborhood
on May 12, 2014 at 12:57 pm
on May 12, 2014 at 12:57 pm
Lets keep this in perspective. Commercial properties owners pass the property taxes to the tenants who are the stores owners, who then pass them on to the consumers. So increasing the property taxes by reassessing commercial properties will only benefit cities and state governments who in turn will waste these funds on useless projects that do not benefit the residents, who will be paying more for everything they purchase. Now, increasing property taxes on seniors will get them out of their homes. May be this is the way to go, first throw people over 50 years old out of their jobs then throw them out of their homes. Well, this would be capitalism at its best.
Looking at the next door neighbor paying less than I do is very short sighted because when I live in the house as long as my neighbor did I will be paying less than the person who will be buying the house from my neighbor then.
Southgate
on May 12, 2014 at 1:19 pm
on May 12, 2014 at 1:19 pm
There's a house on Kingsley under contract for $9M, assessed at $166k. The owners paid less than $2k in property taxes last year. I wish the fortunate owners no ill will, but surely even they would admit they're not paying their fair share of taxes.
Mountain View
on May 12, 2014 at 1:37 pm
on May 12, 2014 at 1:37 pm
I fear that opening the door to any modification of Prop 13, however well intended, will be the camel's nose under the tent. Once politicians get a taste of new money, they will try to suck us dry. The more they get the more they spend and that is why Prop 13 was passed in the first place.
For heavens sake, it's a Democratic controlled legislature, and spending money is how they stay in power. We would be better served working to keep our government thrifty, rather than catering to its gargantuan appetite.
I have lived in my home for 34 years and yes, I do pay fewer taxes than my newer neighbors, however I have been paying those taxes for 34 years, which is 34 years of tax dollars that my newer neighbors have not payed.
Charleston Meadows
on May 12, 2014 at 1:47 pm
on May 12, 2014 at 1:47 pm
Home purchasers know what their taxes will be when they purchase -- it does not seem to discourage the purchase. To use the fact that new buyers pay more as an argument to raise property taxes is disingenuous at best, and most likely an intentional manipulation.
People who purchased in Palo Alto paid a lower price and most have a lower mortgage -- they made their decision based on what they thought they could reasonable afford. That decision was based on a reasonable projection of property taxes into the future, in reliance on the laws in place.
It would be unconscionabe to change the rules in the middle of the game.
After Palo Alto was named the Nation's Richest medium sized town, it is easy to forget that there is are middle-class residents that also lives here, and it is not an exageration to say they would become economic refugees.
Who is representing the residents?
Best regards,
Tim Gray
Community Center
on May 12, 2014 at 1:48 pm
on May 12, 2014 at 1:48 pm
[Portion removed.] My mom is a senior citizen and can only stay in her home because of Prop 13. The jealousy of the wealthy newcomers is why you are addressing this topic. Sorry if the new people weren't here in the 70's when Prop 13 was instituted. They can suck it up and mind their own business. This city has done NOTHING to help people in regard to affordable housing. The current city council spends most of it's time brown nosing the nouveau riche in the area and completely ignoring everyone else.
As to Prop 13 for businesses, most of the small proprietors in this city have been driven out by greedy landlords. Some of those greedy landlords are making a double killing by Prop 13 and exorbitant rents. Yet, Palo Alto does nothing. You want to do something about Prop 13? Look at the people who are actually making money from it, not those who need it to maintain a roof over their heads.
Reading these comments make me ill. Living in a liberal area, with a bunch of people who consider themselves "enlightened," I'm half sickened and half amused at the whining about "Not fair, boo hoo" from the same people who have no issue with the middle class paying more of their hard earned money to support just about everyone else in this country. Who have no issue with a tax posing as health insurance (which burned many middle class people). Who have no issue telling people who have been in Palo Alto for years, to GET OUT, change happens, go somewhere more affordable.
They get away with this behavior because they apparently have the full backing of the Palo Alto City Council. Why don't you look at the needs of ALL of your residents, instead of looking at dollar signs. Seems that your collective memory is short. When the last bubble burst, and all of these newbies fled Palo Alto for greener pastures, and Palo Alto was almost a ghost town, it was your long term residents who toughed it out, who stayed, who spent money at the local businesses, who still gave a crap about community. [Portion removed.]
Community Center
on May 12, 2014 at 2:03 pm
on May 12, 2014 at 2:03 pm
P.S. This would also mean no roof over my head either. I work at a white collar job for almost three times the minimum wage and can't, for the first time in 40 years, afford to live in Palo Alto. I HAVE RENTED HERE FOR 40 YEARS. All I want is a small place, near to my mom and sister and kids, to call home. But, that is denied to me by the greed of the local and overseas landlords. I can't afford to live anywhere in the Bay Area. I can't afford that joke Health Insurance, basically, I can't afford much. I live with my mom so that I'm not living in the homeless camp in San Jose. I can't afford to live in Palo Alto, and can't afford to leave. I lost three rental houses in three years due to landlords selling the houses to capitalize due to the "market rate." No one in this city speaks for the middle class. The only people I ever hear about are the wealthy residents of the area, and the most poor. The rest of us have fallen down a very ugly rabbit hole.
Duveneck/St. Francis
on May 12, 2014 at 2:43 pm
on May 12, 2014 at 2:43 pm
If you city counsel members want more money to play with, why don't you try a little frugality. Start with re-vamping the pension programs that award a full-salary pension, with spiking, to people who a) were overpaid in the first place, and b) have been in the workforce for only half the time I have. You want me to pay for their comfy lifestyle by keeping me slaved to a job long after retirement age so you can suck me dry with taxes?
[Portion removed.]
South of Midtown
on May 12, 2014 at 3:04 pm
on May 12, 2014 at 3:04 pm
Prop 13 has stripped our once fine public school system all the way through the UCs, which are now rejecting qualified California students in favor of out of state tuition payers in order to make ends meet. One example of Prop 13 being not only unfair, but bad for our schools, is when a family is able to hand over their Palo Alto home to their descendents, whom, no matter how many children they may have in our schools, are able to get away with paying very little in property taxes, no matter how much the education of their children costs in today's dollars. This is bad for the schools, and results in an unfair burden being placed on newer residents to pay for these students. I understand why someone who is on a fixed income needs some protection, but I do not agree that their grandchildren are owed a free ride in the schools. And I do agree that the burden should be shifted back in the direction of businesses. For many companies, the resulting tax bill would amount to chump change. Also, the landlords in town are already fleecing restaurant owners and other small business renters to an unacceptable degree. This is why restaurants here don't last long. A shift in the tax burden will have little impact in what is already an abusive landlord tradition.
Another Palo Alto neighborhood
on May 12, 2014 at 3:30 pm
on May 12, 2014 at 3:30 pm
City Council should be out protesting the unfunded mandates of ABAG and applying to the state office that deals with paying for unfunded mandates for updates to our infrastructure and other huge costs and impacts of all the densification. (And no, densifying Palo Alto does NOT make it more affordable, frankly, it actually raises average rents because new rentals are the most expensive by far, and all landlords start to expect it.)
This Council has been such a disaster for Palo Alto, I am always left to wonder about the subtext in everything they do -- what's in it for their developer friends? The sooner we get rid of them, the sooner we can start trying to deal with the horrible mess they've made.
another community
on May 12, 2014 at 3:31 pm
on May 12, 2014 at 3:31 pm
@MakeItFair
You're exactly right about how it wasn't increasing property taxes that was the problem, it was the increased value. Rather than address the out of control rise in home values, Prop 13 actually has incentivized it, your home equity is free money, don't have to work for it, don't have to pay taxes on it. People talk like businesses are leaving the state because of too much regulation, but that's not quite right, its because costs are too high, which can be attributed directly to Prop 13.
Duveneck/St. Francis
on May 12, 2014 at 3:46 pm
on May 12, 2014 at 3:46 pm
I am an old man who has lived in Palo Alto for over 50 years. Having been retired for well over 25 years the taxes I have to pay are important. My retirement income hasn't gone up (except a little social security) so if Proposition 13 is voted out and my house is reappraised I could not afford to pay the new real estate tax and I don't know what I would do!
Greenmeadow
on May 12, 2014 at 4:13 pm
on May 12, 2014 at 4:13 pm
Go for it, Palo Alto. Drive all of us long time residents out of here. First densification, now raise the taxes on the retired. Why? so your developer and realtor buddies can sell our homes to those willing to pay ridiculous prices in cash and so that you will gain the new assessed value in property taxes to fund more densification and consultants to study "traffic calming" or such. (which wouldn't be needed if we weren't cramming more families into less space)
Without Prop 13, I'd have been outta here in 1978. In fact, I voted for it so I could stay. Any rise in taxes will only be squandered by the self-serving politicians, Dems and Republicans alike. We've seen it before.
This city is not as nice a place as it was 30, even 20 or 15 years ago. That being said, it's still a great place to live.
College Terrace
on May 12, 2014 at 4:27 pm
on May 12, 2014 at 4:27 pm
My house gets reappraised every year, by a maximum of 2% (the maximum allowed by Prop 13). Of course, I like this! I want to maximize my equity in my own home value...maybe I can sell for a maximum value down the road, to some person who can pay a lot more than I did. That is how the market works...supply and demand.
In the meantime, my income is locked...and I cannot afford to pay property taxes based on updated (current) property assessments. I suppose some would love it if I was forced out, but I don't intend to go anywhere, and I will continue to argue for neighborhood protections, especially against the welfare housing invasions into non-elite neighborhoods, as well as the Prop. 13 threats.
To contemplate that Larry Klein wants to open the door to Prop 13 changes makes me worry that he can afford the hit, while many others cannot. He would be more believable if he offered up his own neighborhood for future welfare housing. Larry, are you willing?
Another Palo Alto neighborhood
on May 12, 2014 at 4:36 pm
on May 12, 2014 at 4:36 pm
Residential Prop 13 definitely needs some tweaking. It isn't right that some elderly neighbors are just about making ends meet while living in their homes while others seem to be passing on the benefits of low property taxes to their children (and grandchildren) who are living virtually rent free. If people are living in their homes and want to stay in their homes, they shouldn't be forced to move because they can't afford the taxes, but if they are not living in the homes and renting them out (often at very low rents to family members) then should the same apply? Inheritance is another good point.
I do begrudge paying a lot more in taxes than some of my neighbors while I know others are paying a lot more than me, but is there a fair one system fits all scenario?
I would like to see more opportunity for California residents to get into UCs. I would like to see more statewide investment in infrastructure. I would like to see more County investment in infrastructure and likewise city infrastructure. Prop 13 is used as an excuse every time funding comes under discussion particularly in infrastructure matters. I would like to see more money spent on things such as public transit, technological updates on infrastructure which is sorely needed, and third level education. But taxing those who are barely able to afford to live in Palo Alto although they have owned their homes for most of their adult lives is not the way to go.
Barron Park
on May 12, 2014 at 4:36 pm
on May 12, 2014 at 4:36 pm
The average Californian lives in their home for 4 years so the effects of Proposition 13 is minimal. It does help retired people who live in their homes for a long time before they pass on.
Save money by reforming the pension of public employees who have gold plated pension and health benefits.
Stop looking for new ways to steal money from Palo Alto and California residents.
Old Palo Alto
on May 12, 2014 at 4:46 pm
on May 12, 2014 at 4:46 pm
I have been in my small house for 53 years. We paid $22,500 for it, and boy, that was a stretch. However, I voted against Prop 13 because I thought it would damage the schools, and it has done so.
If I had to pay taxes based on the current value of my land -- my home would surely be a "scraper" when this property sells again after I am gone -- I couldn't possibly afford to stay here. This is where my kids grew up, where I have practically lifetime friends. It is pretty scary to think what I would have to do if the taxes were based on the current value of my property. There is nowhere in Palo Alto where I could afford to live now if I had to move.
Duveneck/St. Francis
on May 12, 2014 at 4:58 pm
on May 12, 2014 at 4:58 pm
Just a quick question: When the housing crunch hit a few years ago, who was it in Palo Alto that got their houses re-appraised at lower values so as to reduce their property taxes? I seem to remember reading that total property valu reductions came to many millions of dollars, and not for the "cheaper" houses. Are these the same guys saying my taxes should be increased now?
another community
on May 12, 2014 at 5:22 pm
on May 12, 2014 at 5:22 pm
And to all you folks who wouldn't be able to afford living here if your home was reassessed, some words of encouragement from your community (taken from other town square threads):
"Can't afford it, can't have it. Why such sense of entitlement?"
"Palo Alto hasn't been affordable, by & large, for quite sometime - why is it suddenly trying to be? "
"There is plenty of room in East Palo Alto, East Menlo Park, the area on the north side of 101, etc."
"Lots of affordable housing in EPA......Just saying......."
Fairmeadow School
on May 12, 2014 at 5:37 pm
on May 12, 2014 at 5:37 pm
> Lowell House is for sale for $21.5M, yet is assessed at $4.6M.
> The City of Palo Alto subsidized the owners $200k last year
> and millions in the past. How is that fair?
The fact that the house is assessed at $4.6M is understandable, since the last transfer date of the title was 2001 (per the Santa Clara County Assessors DB on property assessments). That $4.6M reflects the sale price in 2001. The fact the that property is worth more now is expected.
As to PA subsidies—what exactly are you talking about? Can you provide details?
So—what exactly is your point? Are you unhappy that these people are only being taxed on $4.6M—as is every one else in California? Isn’t everyone being taxed the same a basic requirement for “fairness”?
Fairmeadow
on May 12, 2014 at 5:41 pm
on May 12, 2014 at 5:41 pm
Small clarification need:
So—what exactly is your point? Are you unhappy that these people are only being taxed at 1% on $4.6M—as is every one else in California? Isn't everyone being taxed the same rate a basic requirement for "fairness"?
Adobe-Meadow
on May 12, 2014 at 6:35 pm
on May 12, 2014 at 6:35 pm
Anyone remember when property taxes rose so fast that many older people LOST their paid-for homes to the county for a property tax bill that was larger than their limited income????
We are in a similar real estate bubble where property values are rising unnaturally high u naturally fast......it will all happen again.
This time, use reason and logic.
Another Palo Alto neighborhood
on May 12, 2014 at 7:14 pm
on May 12, 2014 at 7:14 pm
I'll be forced to sell if I'm reassessed. Down with this council.
South of Midtown
on May 12, 2014 at 7:28 pm
on May 12, 2014 at 7:28 pm
Although I continue to defend people who are on fixed incomes, but who have spent their lives here, I would like to bring up a point. The fact is, it costs a lot more to educate students, build infrastructure, have police and firefighters than it did when your home cost so little. Now, your property is worth a great deal, and yet you sat by and let others pay for these increases, while you gained equity, and our schools went from the top, where they were when your children went to school, to bottom performing, where they are now. Where were your voices then? I think you've left us all to clean up a big mess, and you are lucky your needs will likely be taken into consideration, as they already have been, as the much needed changes to 13 are hashed out. I wish you'd spoken up for improvements on behalf of our students before things deteriorated to this point.
Another Palo Alto neighborhood
on May 12, 2014 at 7:31 pm
on May 12, 2014 at 7:31 pm
@robert:
Your post is mean spirited
Old Palo Alto
on May 12, 2014 at 7:33 pm
on May 12, 2014 at 7:33 pm
Any politician that votes for a repeal of Proposition 13 will never be re-elected.
Maybe that is a good thing for this incompetent, short sighted city council. We need to remove our current city council, or way or another.
Fairmeadow
on May 12, 2014 at 7:43 pm
on May 12, 2014 at 7:43 pm
> The fact is, it costs a lot more to educate students, build
> infrastructure, have police and firefighters than it did when
> your home cost so little.
All of these cost increases can be attributed directly to increased cost of labor (to include lavish pensions). The value-returned-per-dollar-of-taxation in no way refects the increase in costs over the years.
People who don't see why things are more expensive now are not really helping the situation when the close their eyes and simply rubber-stamp anything that governments says about cost increases.
South of Midtown
on May 12, 2014 at 7:45 pm
on May 12, 2014 at 7:45 pm
Repeal of Prop 13 is not under discussion.
South of Midtown
on May 12, 2014 at 7:49 pm
on May 12, 2014 at 7:49 pm
Yes, labor costs account for some of the increase. This is because current workers have to pay more to live here, and they have to pay a greater share of the taxes than those who have lived here longer. This is because of Prop 13. What is also due to Prop 13, although some here are only concerned with their own situations, is that commercial properties are also taxed disproportionately low compared with property owners who have purchased more recently. The proposed changes, while not a repeal, would close the loopholes that keep commercial property revenues so low. Once again, our schools have been gutted. Change is needed.
Barron Park
on May 12, 2014 at 7:57 pm
on May 12, 2014 at 7:57 pm
[Post removed.]
Another Palo Alto neighborhood
on May 12, 2014 at 8:06 pm
on May 12, 2014 at 8:06 pm
@my take
What is under discussion is effectively a repeal of Prop 13. Claiming the proposals are minor modifications is dishonest.
Another Palo Alto neighborhood
on May 12, 2014 at 8:09 pm
on May 12, 2014 at 8:09 pm
To those who claim that 13 somehow "saves the middle class" and that the only harm done is to those new wealthy folks invading your city, I ask this: Have you ever once considered the unfair burden that 13 places on middle class folks like yourselves who have attempted to buy and keep homes in PA over the past 15 years? Didn't think so.
13 practically guarantees that the ONLY folks buying new homes in PA will be the ultra wealthy. Is that what you want?
This is not about saving the middle class - its only about saving those who got in under the wire and continue to benefit. Yes we can and should create assistance paths/exemptions for those who qualify. But there are plenty more who pay much less than they can afford and expect the rest of us to cover for them. In what universe does this even remotely make sense?
Fairmeadow
on May 12, 2014 at 8:10 pm
on May 12, 2014 at 8:10 pm
> Once again, our schools have been gutted
This is so often repeated that some people have come to believe it. Reality is that the State has seen its revenues increase yearly since 1978, with the exception of 1979. Prop.13 reduced the outflow of one spigot, but new spigots were created almost immediately.
There are many reasons that the school performance is critcized. Unfortunately, the Education Establishment can not be dependended upon to tell the public the truth about the Education System in California. Sadly, there too many people who are readily animated to make these unsubtantiable claims about "gutting" when the issues are much deeper.
Fairmeadow
on May 12, 2014 at 8:17 pm
on May 12, 2014 at 8:17 pm
> 13 practically guarantees that the ONLY folks buying new homes in
> PA will be the ultra wealthy. Is that what you want
Not true. The increasing cost of housing is why only the ultra-wealthy will be moving here in the future. The City and the PAUSD have provided financial projections that suggest that prices for homes will effectively double every 10 years--for the forseeale future (30-40 years).
Most people probably don't think about the impact of property taxes when they move here--but over time, the taxes go up and up and up. One poster above identifed a property at 215 Lowell Avenue as being on the market at/about $21.5M. This means that whoever buys this property will need to be able to pay over $200K a year in property taxes. If the property is held for 30-40 years, this yearly property tax will eventually double. If the property is turned over periodically, then the property tax will like double a lot sooner.
South of Midtown
on May 12, 2014 at 8:37 pm
on May 12, 2014 at 8:37 pm
"Wayne" Please do not go on just making stuff up. It doesn't help the discussion. There are no magical spigots. Please do some research. For instance, did you know that many schools in California borrowed heavily just to keep their doors open? Much of the revenue from Prop 30 went to pay down some of the debts, but did little to improve anything in the schools themselves. Did you know that there are schools where classroom temperatures are often over 80 degrees, but they have no money to install fans or windows to improve circulation. Did you know that many very qualified California students are being turned away from the UCs in favor of out of state or out of country students who will pay higher tuition? The spigots are in your imagination.
Adobe-Meadow
on May 12, 2014 at 9:37 pm
on May 12, 2014 at 9:37 pm
When we bought our house in Palo Alto 20 years ago, people thought we had paid a horrendous amount of money for it. We thought our property taxes were really high compared to our neighbors.
Now, houses go for much more than we paid ours, and some of our neighbors pay higher property taxes. So, in a way, we've traded spots, although our old, old neighbor still pays much less than we do.
As far as I know, people know how much they'll pay in property taxes when they buy a house. It should not come as a surprise.
At this point, if prop. 13 is entirely repealed, we won't be able to afford the taxes they would want us to pay on our current home value. As to those who say such taxes should accrue and then be collected when we sell our house, please, just wait a few years, build some equity in your house, and then speak again. I can guarantee you that by then, your views will have changed.
Barron Park
on May 12, 2014 at 9:40 pm
on May 12, 2014 at 9:40 pm
Perhaps someone can enlighten me. Won't Prop. 13 eventually fade away, as seniors enjoying its benefits die off, or downsize as many do and sell their Prop. 13 benefited homes? That is exactly what happened to the homes on either side of me. In fact one was torn down and a multimillion dollar home took its place. Is my thinking erroneous?
Palo Verde
on May 12, 2014 at 10:43 pm
on May 12, 2014 at 10:43 pm
For a hypothetical recent buyer with $1M mortgage on $2M home and income to support it, I'll estimate $30,000 interest expense and $23,700 property tax for the year. Say 28% Fed and 9.3% State bracket. Is there a savings of $18,600 on income taxes?? Or does the AMT or other unfathomable rule wipe out some of that?
I don't know the answer -- not my situation -- just pointing out a small mitigating factor.
We can probably rationalize that it's fair the renter next door and the retiree across the street don't get $18,600 handed to them. Or is that approximately the amount they didn't pay in property taxes?
Duveneck/St. Francis
on May 12, 2014 at 11:03 pm
on May 12, 2014 at 11:03 pm
"Perhaps someone can enlighten me. Won't Prop. 13 eventually fade away, as seniors enjoying its benefits die off, or downsize as many do and sell their Prop. 13 benefited homes? That is exactly what happened to the homes on either side of me. In fact one was torn down and a multimillion dollar home took its place. Is my thinking erroneous?"
Richard, your thinking is erroneous-I will enlighten you.
You have extrapolated too much from seeing one tear down.
Prop 13 will not fade away because commercial properties can be sheltered indefinitely. Also children and grandchildren can inherit houses and maintain the low tax basis.
My street has numerous homes owned by the children of the previous owners and rented out to families with children that attend Palo Alto schools, burdening the school system and contributing almost nothing.
Of course the continued viability of Prop 13 (or of CA government)also depends of variables like the rate of inflation, housing turnover, housing demand, etc.
Green Acres
on May 12, 2014 at 11:04 pm
on May 12, 2014 at 11:04 pm
I've seen enough red flags from our city officials to be convinced that they do not represent me or most regular people in my neighborhood. First they tried to build some low-income housing against the wishes of the neighborhood, and now they are trying to increase some taxes by changing the rules in the middle of the game.
Maybe these council members live a different reality from mine or my neighbors', but I would rather they focus on more relevant and attainable items that impact most of us on a daily basis.
Duveneck/St. Francis
on May 12, 2014 at 11:05 pm
on May 12, 2014 at 11:05 pm
@My Take - The state has more money than ever, it just doesn't end up in the schools, and when it does, it doesn't end up in the classrooms. Schools aren't poor due to lack of taxation, California has the highest taxes in the country. Schools are poor because the money is wasted. And there is no real reason to think that if there was a big influx of property tax revenue, it would make it to classrooms. There is a 99% chance any new tax revenue will have to go to bailing out all the bankrupt pension funds across the state.
Midtown
on May 12, 2014 at 11:07 pm
on May 12, 2014 at 11:07 pm
My Take: UC has doubled the number of high paid administrators in the past 20 years from 2,000 to 4,000 - these are vice presidents, vice chancellors, assistant chancellors, etc, each at $200,000+ (including benefits) for each position. Instead of cutting back on these positions, they raised tuition, fees, and cut the number of California students admitted, and admitted more non-state residents. So what do you think UC would do with more money - hire more administrators.
The City of Palo Alto, as the budget has grown from $140 million/year to $160 million/year in the last 4 years, has hired a PR czar, a Sustainability Czar, a 2nd assistant city manager (proposed), management analysts for the Sustainability czar (proposed), increased raises for all employees (worsening future pension liabilities); all the increases in budget of the past 4 years could have paid for a new public safety building, which was deemed of critical importance. What do you think the city would do with more money?
And as previous posters have said, any increases on commercial properties get passed on to tenants, who pass it on to their customers in the form of higher prices - the grocery stores would raise their prices, so would all those restaurants and service shops.
By the way, in Palo Alto, the median single family house in 2011 sold for $1.4 million; in 2013, the median sales price was $2.1 million. Without prop 13, all those buyers in 2011, would be paying another $7,000 per year in property taxes. How many of those buyers have seen their salaries go up by 50%? If not regulated by prop 13, many would who bought just two or three years ago would be taxed out of their houses today. It's not just the old timers who are being protected, it's also the newcomers as well.
In my opinion, many politicians want to spend other people's money on their pet causes or to help their special interest group friends. They do this by stoking the emotion of envy and of turning one neighbor against another - like on this property tax issue. Those are politicians we want to get rid of.
Fairmeadow
on May 12, 2014 at 11:29 pm
on May 12, 2014 at 11:29 pm
> Please do not go on just making stuff up
I've made nothing up. How about yourself?
> Please do some research. For instance
I'm pretty well-known for the research that I do. How about yourself?
> did you know that many schools in California borrowed heavily
> just to keep their doors open?
Really? There are about 1100 school districts in CA. Can you provide us with any names of such districts?
There are a number of cases of districts that have failed, over the years--districts which have been taken over by the State. Mismanagement of funds has always be the basis for these takeovers.
> Did you know that there are schools where classroom temperatures are
> often over 80 degrees, but they have no money to install fans or
> windows to improve circulation.
Be interested in learning about the names of these districts. Given how mild California's climate is--it would be very interesting to know how many school days a year each of these schools is subject to these sorts of environmental conditions. With the list of names you might provide, we can easily look up the expenditures per student, and the total dollars per shcool to see just how much money each of these shcools was provide by the State, and local sources. You will provide us with a list, won't you.
Available Funding:
Web Link
I don't make things up. How about yourself?
Interested to see your answers.
South of Midtown
on May 12, 2014 at 11:29 pm
on May 12, 2014 at 11:29 pm
Here is an article about the causes of UC tuition increases being caused by cuts to UC funding in 2011. Web Link
In fact, in the last 18 years, UC enrollment has increased by more than 70 per cent. This costs more money, and requires more administration to oversee. In addition, there are far more regulations universities must follow, which adds a huge amount to the cost of keeping the campuses open. To pretend the money is all going to a bunch of useless fat cats is just wrong. People who work at these universities are highly qualified, and work very hard. Shame on you for empty hot air puffed into this discussion.
South of Midtown
on May 12, 2014 at 11:42 pm
on May 12, 2014 at 11:42 pm
"Wayne", See Web Link for one example of how funding per student has been misrepresented in California. While these funds are claimed to be used for education, they are, in many cases, pilfered by local decision makers and repurposed for non school spending. But they show up as school funding in state budget and tax reports. Once again, California schools have been gutted. Palo Alto schools are no exception, however, as I have pointed out elsewhere, the shortfall is patched over by PIE funding, and an army of parent volunteers. As one of these volunteers, I can affirm that our schools are reliant on this free labor for their success. Oh, and don't forget the army of privately paid tutors without whom the test scores would not be so impressive.
Duveneck/St. Francis
on May 13, 2014 at 8:58 am
on May 13, 2014 at 8:58 am
The abysmal state of our education systems is not a California-specific phenomenon. It is nationwide. For blame for it, I start with the teachers union, the most anti-child and anti-education organization out there.
But one thing seems clear to me: The school systems can waste money faster than we can pour it in. I see in the news today that the $100M gift that Mark Zuckerberg made to the NJ schools has been largely wasted. It was a nice (and expensive) gesture, but that outcome was predictable. I almost expect to hear now that the NJ schools cannot continue to function unless that $100M gift is guaranteed annually.
Sorry Mark, it was a waste. The only way to salvage something from that situation would be to examine where the money went and start firing and/or jailing some people. Oh, wait, they cannot be fired, I forgot.
another community
on May 13, 2014 at 9:24 am
on May 13, 2014 at 9:24 am
1.)They want to DISCUSS SHIFTING MORE of the burden from Commercial & INDUSTRIAL properties from residential, people.
2.) Residential properties turn over far more frequently than Corporate-owned commercial/industrial properties.
3. Changing the percentage back to 40% residential burden vs. 60% commercial burden might be fairer, however, Corporations have (bigger, highly paid) lobbyists to fight such changes.
4.) When commercial/industrial properties do turn over, they usually are done so via a tax-deferred vehicle know as an IRS 1031 Exchange. Homeowners cannot qualify from capital gains exclusions, unless their profit is below a certain threshold, OR if they were to convert their primary residence into a rental for two years first, at which point it qualifies as investment property, and capital gains tax can be deferred exchanged IF the "relinquished property" is used to purchase another like-kind property "replacement property".
5.) Other states have town or county assessors who, when the municipal entity needs more money, go out and randomly reassess properties at their whim. In Massachusetts, my Mom got a terrible shock one year, upon reassessment, and was forced to down-size... a burden on an older individual.
6.) Municipalities & Special Districts (Schools for instance)often feel they "Need" to acquire more and more of OPM (Other People's Money)to fund capital improvement projects or higher salaries & benefits for public employees. These increases to spending are only levied onto Property Owners via Bonds or Parcel Taxes. Bonds can be as long as 40 years in length and are notched to increase with ad-valorem rates (The 2% incremental assessment increase assessed by Prop. 13). There are no Senior exemptions for Bonds, and there can be for Parcel Tax levies, but the process is not highly publicized for OBVIOUS reasons. When it comes to Bonds, every Area has their own special needs that feels the "Need"to tap property owners for their tax money such as:
Up-coming June 2014 Measure AA: Web Link
7.)And new entities are being "created" all the time. Has anyone heard of the Bay Area Restoration Authority? Coming soon to YOUR property tax bill to pay for the South Bay Shoreline Levee which is is expected to cost well over $100 million, and will be assessed to every property owner in every county surrounding the Bay, in spite of the main direct benefit to the large corporations that have been built along Hwy 237 (Mountain View to Milpitas including Alviso). Even property owners in distant counties such as Sonoma in the North Bay will be subsidizing the "Googlplex Levee", including residents far from the inner Bay, such as the the Coastal Communities subject to Sea Level Rise. This newly created "Authority" will "sell" the taxation for the laudable environmental benefits, and obscuring the massive corporate benefits, errr.... subsidies. Already Green-washing the issue:Web Link and: Web Link
8.) Let's keep older retired people in their homes and have corporations and commercial entities bare MORE the burden & pay their fair share.
Fairmeadow
on May 13, 2014 at 10:05 am
on May 13, 2014 at 10:05 am
There are any number of people who claim that “schools are underfunded” .. yet when asked directly what the current per-student spending amount is, they can’t answer. When asked: “what should it be so that no one in the state will say that the schools are underfunded” .. they generally have no answer.
The LAO (Legislative Analysts’ Office) states: “The Governor's budget provides total K–12 per–pupil funding (PPF) of $11,626 for 2008 09.”
LAO/Per Pupil Funding:
Web Link
The following chart offers a view of per-pupil spending over a ten year view:
Web Link
One of the problems with trying to use school funding numbers is that most schools only report the operating funds to the press, and their advocates. The costs of capital spending are frequently buried in “other accounts”—so that the real total costs of education are never really known. To make matters worse, the pension system is run at the State level, so all the costs of pensions for each school district is unknowable unless one makes the Herculean effort to make Public Information Requests of CalSTRS for all of the pension payout data for those in CalSTRS, and then fold that expense back into the individual school districts—which is not an easy task for people without a lot of time on their hands, and a lot of technical expertise to apply to these sorts of problems.
Which brings us back to Prop.13 “gutting schools”. With per-pupil spending at/above $10K—there just isn’t a lot of room to make that case.
South of Midtown
on May 13, 2014 at 10:27 am
on May 13, 2014 at 10:27 am
Even if our students were getting $11 worth of funding each, it costs more than that to have good outcomes. See the Advocacy pages of your Sixth District PTA website for lots of information and links to more about how CA schools stack up in funding and outcomes. We are in almost dead last place in the US in both. Web Link
Fairmeadow
on May 13, 2014 at 10:38 am
on May 13, 2014 at 10:38 am
> it costs more than that to have good outcomes.
How much does would it cost to insure that every child is educated to the standard of "good outcomes". Please be specific. Please define "good outcomes" so that everyone will agree with you.
California is currently spending 40% of its State budget on education, before the local spending is considered. There comes a point where additional spending is totally wasted--since no measurable results can be ascertained. Some of the States with the highest student test results are found in States with the lowest per-pupil funding. This is because education is cultural--tighly linked to home life, and the education of the parents, particularly the mother.
No amount of funding to the schools is going to equalize the outcomes of students coming from homes of every walk of life. There are solutions to some of these problems that can be found by using Cloud-based education systems--but that gets in the way of those who want to spend every penny they can on "education".
Fairmeadow
on May 13, 2014 at 10:41 am
on May 13, 2014 at 10:41 am
> Let's keep older retired people in their homes and have
> corporations and commercial entities bare MORE the burden
> & pay their fair share.
I agree with most everything you said until this point. Can you clarify what the "fair share" of government spending of "corporations and commercial entities" might be? By that I mean--show how much these entities are costing government to provide them services they need to survive, or flourish.
South of Midtown
on May 13, 2014 at 11:35 am
on May 13, 2014 at 11:35 am
To quote from the Advocacy pages of the Sixth District PTA website I suggested you visit for specifics, "Wayne",
Per-Student Spending:
$16,000 – $22,000 - top performing states
$12,000 – national average
$8,500 - Governor Brown proposed for 2014-15
I believe that since this was published, more funds were allocated per student, but it would not bring California students anywhere near the spending that is leading to better outcomes, specifically in Math Science, and Reading scores. A bad score in, say, math, suggests that the student has not learned enough on the subject to compete with other students in things like getting into college, being successful in a math related job, you know, success. A bad score in something you were supposed to learn as part of the education that is your right as a citizen of this country means you have received an education, for what ever reason, that was inadequate. Having directed you several times to more information, I'm bowing out of this 'discussion' now. I'm disappointed in some of the posters here who clearly are only concerned with their own situation, and refuse to look beyond that. If you've been here for a long time, enjoying the good job market, the great weather, and all the other benefits people come here for, I believe you owe it to those who come after you to take their well being into consideration. In promoting school funding for all Californians, I'm doing that now, whether it will benefit me directly or not, even though you did not.
Crescent Park
on May 13, 2014 at 12:18 pm
on May 13, 2014 at 12:18 pm
Luckily PAUSD is a basic aid district and receives a majority of its funding directly from PA property taxes. And as most people know, we have assessed ourselves parcel taxes over the years to help with budget needs, as well as rebuilding/expanding campuses.
IMHO, the "school district has been failing" argument is a bit over-stated. The fact that PAUSD is not as highly ranked as 20 years ago may have more to do with other schools finally catching up. Splitting hairs in my opinion. It's not like PAUSD scores have dramatically dropped, if at all.
The complaint about older residents renting to their children --- is this really a big thing? Exactly how many? I'm guessing not that many. Speculation on a problem that really isn't moving the needle much (IMHO).
For those folks complaining about the high taxes on a recently purchased home in PA...my advice is to hang around for 20 years (or more) and you'll receive the same benefits that long-time residents receive today. It works out over time just fine.
another community
on May 13, 2014 at 12:21 pm
on May 13, 2014 at 12:21 pm
As with so many such issues, this is multi-faceted and complicated. From my perspective (even though I do not benefit from the property tax "break" of Prop. 13, alas!!) I see this as an enhancement to the community. Lower property taxes on homes in particular that have been in the same ownership for decades has enabled now older folks to remain in their homes. Many seniors live on limited incomes, and if they had to pay currently assessed property value taxes it is likely that they would have to sell and move. Move where?!! And think of it this way too: grandma and gramps will be "going to their heavenly rest" one of these days anyway. Be patient. The properties in question will sell and therefore the new and much higher tax rate will kick in and benefit the City's needs and services.
Duveneck/St. Francis
on May 13, 2014 at 1:00 pm
on May 13, 2014 at 1:00 pm
"The complaint about older residents renting to their children --- is this really a big thing? Exactly how many? I'm guessing not that many. Speculation on a problem that really isn't moving the needle much (IMHO"
I don't believe that is the issue. The issue is that a large number of Palo Alto school children live in rental homes and apartment buildings that pay a very low amount of property tax. I would be very surprised if less than 20% of students live in rental homes or apartments. Of course we are both guessing, because the data has never been collected.
As for your 20 year projections for the value of Prop 13 to current home buyers, I suggest you look at the accumulated pension debt for cities and play with with inflation scenarios--There are many potential problems. We can always raise state income taxes to 20% or more; see you in Texas.
University South
on May 13, 2014 at 1:16 pm
on May 13, 2014 at 1:16 pm
Prop 13 makes it possible for older and low income individuals to stay in houses that they were lucky enough to own. What will be the effects of a sudden jump in taxes, based on assessed valuations that are the product of silicon valley land speculation? The result will be that developers will develop every square inch of land for offices and apartments and billionaires who build mega-mansions will be the only folks in town.
Crescent Park
on May 13, 2014 at 1:34 pm
on May 13, 2014 at 1:34 pm
Home values are a phantom. Taxing homes on their values in a market like this doesn't make sense and would not be fair. Hardly anything is fair these days anyway because unlike income, property tax is not progressive. We don't tax people's stock portfolios by what they are worth, we tax them when they are sold, and real estate sales are taxed as well when they are sold. The tax system in the US is a status quo thing that is unfair in many way and has been accommodated for so long that now anything that is done would be catastrophic for many.
One reason to buy a home is to avoid the rising cost of rents and homes by buying. Now housing values are rising so much that just to taxes can force someone out of their place, and then, where to go?
If there is a problem with commercial property, fix it, but at this point things are best left alone. In time those who think they are paying high taxes will realize what high taxes really are and be glad they can avoid them.
another community
on May 13, 2014 at 2:50 pm
on May 13, 2014 at 2:50 pm
Why aren't people who are complaining about their property taxes also complaining about the price they paid for their homes which is a hundred times the amount of their property taxes. The same people who would pay so much for a home in Palo Alto may just be genetically disposed to have children who don't do well in Palo Alto schools. Maybe it's not the schools fault.
Palo Verde
on May 13, 2014 at 5:43 pm
on May 13, 2014 at 5:43 pm
@My Take, your per-student spending figures from the PTA look like propaganda. The $8,500 number is 2013-14 Prop 98 funding alone, not counting additional state and local funds. The 2014-15 California budget shows $9,200 in Prop 98 funds, plus $3,600 from other sources. The bookkeeping is sufficiently convoluted to arrive at any conclusions necessary to advance one's position. Throwing more money at a problem is an inefficient solution for mismanagement.
Midtown
on May 13, 2014 at 6:51 pm
on May 13, 2014 at 6:51 pm
My take - You are being selective in your use of examples; for example Newark, NJ spends $20,000 per student, but no one would classify them as high performing (and read the news this week on how the $100 Million donation from Zuckerberg was squandered).
Another example is the Fremont Union High School District - it's per student funding is on the low side $9000/student - it has high performing schools - Monta Vista High, Lynbrook High; above average schools Cupertino High & Homestead High, and a below average school Fremont High.
Money is a secondary factor in a school's performance - it has more to do with family, and social economics of the student population.
And to repeat in 2011 the median single family home in Palo Alto sold for $1.4 million; in 2013 the median single family home in Palo Alto sold for $2.1 million, a 50% jump in two years. Many who bought in 2011 would find it difficult to budget an additional $7000/year.
And also in states without something like prop 13, they can adjust the tax rate and you can see property taxs at 2% or 3% of value.
Another Palo Alto neighborhood
on May 13, 2014 at 9:10 pm
on May 13, 2014 at 9:10 pm
No one cares what this out of touch city council thinks about Prop 13. They need to focus on Palo Alto issues. They have lost all credibility with the voters. They all need to be voted out.
another community
on Jun 19, 2014 at 4:45 pm
on Jun 19, 2014 at 4:45 pm
California is one of the top state for property tax revenue per capita. Those making this false claim that prop-13 is the cause of our local and state budget problems, and not the bloating of our government workforce and their obscene levels of pay and benefits... including their six-figure per year pensions beginning at age 50 or 55... well, they are either ignorant or they have their hand in the government payola bucket. Raising property tax rates in this state just make property that much more expensive and out of reach for many families and businesses. It also increases rents. And why do it? So we can have even more 50 year old government employees being paid six-figure pensions.
Leland Manor/Garland Drive
on Jun 19, 2014 at 6:43 pm
on Jun 19, 2014 at 6:43 pm
Americans have shockingly short memories. By 1977, many, many retired people, as well as quite a few younger people, lost their homes ( paid for, in most cases) because they could not afford their ever-increasing property taxes. The tax assessor's office gained ownership of someone's home for the price of one missed property tax payment. They then auctioned these cheaply acquired homes and padded the county's coffers with the proceeds.
That was what all the outrage was about.
I can see raising the rate somewhat for the sake of the schools, but don't go back to pre-Prop 13 times. Just modify it a bit
Another Palo Alto neighborhood
on Jun 20, 2014 at 7:27 pm
on Jun 20, 2014 at 7:27 pm
The problem is that most people who buy homes even with the obscene taxes they pay, are not necessarily wealthy and are banking on the stability of Prop 13 over time. Taking that away is pulling the rug out from under middle class people who have sacrificed to live in their homes long enough for them to, frankly, finally afford them.
If Prop 13 is changed for homeowners, everyone with an existing home should have their rates grandfathered in, frankly. Anything else would be patently unfair.
Finding a way for businesses to pay more of their fair share again would probably be a good thing, though, especially if it allowed a lower tax rate for homeowners.
Greater Miranda
on Jun 21, 2014 at 8:39 pm
on Jun 21, 2014 at 8:39 pm
This will not be solved overnight as it is such a political hot potato. One way of helping our schools would be that when PIE comes around in August looking for donations that the parents who have owned their homes for over five years should be offered a challenge. They should look at what their taxes would be based on the present market value of their home, subtract the amount of taxes they presently pay and then donate the difference to PIE. We have had to move back and forth to Palo Alto due to transfers and are one of those families that pay comparatively more taxes than our neighbors. I am always slightly irritated when a spokesperson who is financially better off than I and has owned their home at least 15 years pressures me to do my share. If you are a parent benefiting from Prop 13 please do the right thing and donate the difference if you are able..
Greater Miranda
on Jul 18, 2014 at 6:02 pm
on Jul 18, 2014 at 6:02 pm
I am convinced that envy and greed will be the downfall of this nation.
Gosh...why don't we go back and tax anyone who has jewels that have appreciated in value? Or some antiques?
C'mon folks, stop grabbing for more money. Those of us who bought, bought under the rules at the time with the hoped for ability to budget and pay for all time the taxes on our properties esp after the mortgage was paid and we had hit the point of no ability to increase our pay.
Those buying now pay more in taxes because they are willing to pay more for houses. Great for them, congrats on being that rich, I feel no envy or need to take even more from you to supplement the fact that staying here is hard for a lot of us. Our choices, your choices.
Live with them, and leave us alone. Or try to sleep well at night when you drive half of us out of California again.
Greater Miranda
on Jul 18, 2014 at 6:07 pm
on Jul 18, 2014 at 6:07 pm
And, by the way, have any of you just bought a home and are grousing with envy about your neighbor considered that you will instantly lose home value as buyers think about what they can afford to buy with an eye toward increasing values in the future? You are cutting off your noses to spite your face.
Think about it..if you knew that your taxes would rise exponentially over the next 20 years, would you have paid as much for your new home? I doubt it.
As for "increased taxes"..whenever taxes go up, people buy less..and the actual tax revenue decreases. Basic economics. So in all ways possible, trying to increase housing taxes cuts off every one of your noses
Registered user
Palo Alto Hills
on Aug 9, 2014 at 12:10 pm
Registered user
on Aug 9, 2014 at 12:10 pm
It's about time the entire State of CA takes a look at this or they won't be able to pay their unionized pensions.
Old Palo Alto
on Aug 9, 2014 at 2:43 pm
on Aug 9, 2014 at 2:43 pm
Allow me to mention the unmentionable:means testing.
Adobe-Meadow
on Aug 9, 2014 at 10:20 pm
on Aug 9, 2014 at 10:20 pm
wth.... folks are only talking about taking away the loophole for commercial properties
Charleston Gardens
on Aug 9, 2014 at 11:57 pm
on Aug 9, 2014 at 11:57 pm
I guess the dense city council didn't learn their lesson (or the lesson of their immediate predecessors) when it comes to taking a formal position on an issues that is vague, not precisely defined, but has the potential for devastating implications to the town they're supposedly here to protect. LUDICROUS!
Clearly, someone has an agenda in getting this resolution before the council, and we're sure to be blindsided by the REAL specifics when they are revealed down the road.
Much like the council's naive (or super slimy?) resolution to support HSR before they even knew the details (or so they claimed.) We now have a monumental high speed disaster barreling at us, because we had our own city council signaling to the people - hey this is a good thing for out town. How many people voted for HSR because they assumed council's endorsement meant they KNEW something about the impacts?
So now, we have council preparing to support a vague resolution with no specifics, basically supporting a ticking time bomb - with nothing more than vague generalizations about what it is they're even supporting, who will be impacted, how much it will cost, how much it will change the economy of the town, the residents and the businesses.
Something smells.
Greater Miranda
on Aug 12, 2014 at 5:56 am
on Aug 12, 2014 at 5:56 am
To Boscoli
Well, why not simply "from each his ability, to each his need"?
Old Palo Alto
on Aug 12, 2014 at 6:47 am
on Aug 12, 2014 at 6:47 am
Why not have those who can afford more, pay a higher rate? Why should rich pay ridiculously low property taxes just because they bought their houses before Prop. 13? And since the rich have been plundering this nation for so long, buying up the entire political system and getting all the breaks, maybe it's high time we take for each according to his ability and give to each according to his needs. We;ll be a much more just society.