ALERT – SPLIT ROLL PROPERTY TAX INITIATIVES FILED

On November 6th, two initiatives were filed to change Proposition 13 and end tax protections for commercial real estate by enacting a Split Roll Property Tax. Multiple sources indicate that the California Teachers Association (CTA) is the sponsor of these measures.

These two initiatives join one other measure introduced last month, and come after successfully defending Proposition 13 in several different venues this past year, including legislative measures, in the state budget, and at the Tax Commission. 

There are several different approaches that can be taken to enact a split roll.  One of CTA’s measures increases all commercial taxes by .55%.  The other requires continuous reassessment and bases taxation on current value.

Both of CTA’s measures have political “sweeteners” thrown in like doubling the homeowners property tax exemption, doubling the renters tax exemption, and increasing the types of agricultural properties that are not subject to the commercial assessment.  One of the measures lists a number of benefits to education, meant not only as a way to fully control the monies to assure benefit for teachers, but also as rhetorical devices for the campaign (“vote for Prop X to ensure class size reduction and improve school safety!”).

Although this is the beginning of the official process, BOMA California is already taking actions to prepare to respond, such as meeting with those responsible for writing the ballot analysis, analyzing the economics of the measures, formulating an opposition campaign, and fundraising. 

In addition to these three measures, we are also expecting to see split roll measures from at least one public employee union and from the SF Assessor Phil Ting-led group “Close the Loophole,” which was registered this year specifically to pursue a proposition.
 
These measures seek ways to allow California State Government to continue spending taxpayer dollars without addressing issues of overspending. 

If you have any doubt about the negative impacts of a split roll, please see this study that examines the potential economic impacts by taking into account how a split roll would affect the behavior of individuals and businesses who own commercial property.  

Click here to read the study entitled "The Economic Effects of California Adopting a Split Roll Property Tax."

These are clear and present dangers to anyone that owns commercial property in this state and we ask that you help us with your talent or your funds and make others aware of this oncoming attack and ask them to join us to stand against, and defeat these ill-conceived ideas.