Proposition 13 continues to be overwhelmingly popular, with 64 percent of likely voters agreeing that the 1978 property tax reform measure “turned out to be mostly a good thing for California,” according to a poll released May 26 by the Public Policy Institute of California (PPIC).
“Proposition 13 is the 1978 ballot measure that limits the property tax rate to 1 percent of assessed value at time of purchase and annual tax increases to no more than 2 percent until the property is sold,” the pollster told likely voters. “Overall, do you feel passing Proposition 13 turned out to be mostly a good thing for California or mostly a bad thing?”
The results: 64 percent “mostly a good thing”; 21 percent “mostly a bad thing”; 2 percent “mixed” (volunteered by the respondents); and 12 percent “don’t know.”
The support is nearly identical to the 64.8 percent of voters who supported Proposition 13 in the historic June 1978 election. The measure’s landslide victory occurred despite opposition from most of the political establishment, and a major campaign funding advantage for the opponents.
PPIC indicated that the poll accounts for the Democratic Party’s large registration advantage in California, as 48 percent of the respondents are registered Democrats, 24 percent are Republicans, 21 percent are independent, and 7 percent belong to another party.
Asked where they consider themselves to be politically, 15 percent said “very liberal,” 20 percent said “somewhat liberal,” 29 percent said “middle of the road,” 18 percent said “somewhat conservative,” 15 percent said “very conservative,” and 3 percent said they don’t know.
PPIC’s poll of 1,702 California adult residents – including 1,179 likely voters – was conducted May 12 through May 22 in English and Spanish. The margin of error is plus or minus 3.9 percent for the total sample, and 4.9 percent for likely voters.
Other questions in the wide-ranging survey included:
- “Do you think the people in the federal government waste a lot of the money we pay in taxes, waste some of it, or don’t waste very much of it?” The results: 54 percent said “a lot,” 32 percent said “some,” 10 percent said “don’t waste very much,” and 4 percent said they don’t know.
- “The state is projected to have a budget surplus of several billion dollars. In general, how would you prefer to use this extra money? Would you prefer to pay down state debt and build up the reserve; or would you prefer to increase state funding for education, health, and human service programs; or would you prefer one-time state spending for transportation, water, and infrastructure projects; or would you prefer to refund some of this money to the people of California?” The results: 33 percent prefer an increase in state funding for education, health, and human services; 27 percent would like the state to refund some money to the people of California; 22 percent support one-time state spending for transportation, water, infrastructure; 13 percent would like the state to pay down debt and build up reserve; 2 percent volunteer another answer; and 3 percent said they don’t know.
- “Thinking about the state as a whole, what do you think is the most important issue facing people in California today?” The answers, volunteered by respondents: 27 percent “economy, jobs, inflation”; 12 percent “housing costs, housing availability”; 11 percent “homelessness”; 7 percent “gasoline prices, oil prices”; 6 percent “water, water availability/quality, drought”; 4 percent “crime, gangs, drugs”; 4 percent “environment, pollution, climate change”; 4 percent “state budget, deficit, spending”; 3 percent “government in general, problems with elected officials, political parties”; 3 percent “immigration, illegal immigration”; 2 percent “COVID-19, coronavirus, mandates”; 2 percent “education, teachers, schools”; 2 percent “electricity costs, energy supply”; 11 percent “other”; 2 percent “don’t know.”
- “Overall, do you think public policy decisions made through the initiative process by California voters are probably better or probably worse than public policy decisions made by the governor and state Legislature?” The results: 55 percent “probably better,” 29 percent “probably worse,” 4 percent “same” (volunteered), and 11 percent “don’t know.”
Support for Proposition 13 has consistently hovered around two-thirds of likely voters in the PPIC polls since the organization began asking the question in 2003.
In a related story:
Property Owners Face Large Tax Increases in States Without Proposition 13-Type Protection. Property values are increasing across the country, leading to significant property tax increases in some states where homeowners and business owners are not protected from large annual increases.
California property owners are protected by Proposition 13, the 1978 constitutional amendment that bases the tax on acquisition value – rather than market value that can be impacted by many factors out of the property owner’s control – and limits property tax increases to 2 percent per year unless there is a change in ownership or new construction that adds taxable value.
Arizona and Florida also have property tax limits in place, and a group of taxpayers in Montana is gathering signatures for Constitutional Initiative 121, which has provisions very similar to those in Proposition 13. (Proponents of the Montana effort, who are aiming for the November ballot, recently prevailed in litigation challenging the process by which the measure was cleared for signature-gathering. However, there are indications that proponents might not meet their June 17 deadline to turn in roughly 60,000 valid signatures. The initiative faces significant opposition from groups including the Montana Chamber of Commerce, the Montana Federation of Public Employees, Montana Farmers Union, and the Montana Cattlemen’s Association.)
Arizona’s limit, approved by voters in 2012, protects owners from increases above 5 percent. The Center Square reported May 10: “A decision by voters 10 years ago is keeping most Arizonans’ property taxes from skyrocketing as the market values on their homes rise as fast as anywhere else in America. … Proposition 117 ensures homeowners in places like Phoenix don’t fall prey to a sudden increase that matches its 30 percent home value spike over the past year.”
Florida’s Save Our Homes law covers homeowners with homestead exemptions, restricting the annual increase in assessed value for such homes to 3 percent or the annual inflation rate, whichever is less. Last year, the cap was 1.4 percent, but it will be the maximum 3 percent this year.
Some states have reacted to the hot real estate market by taking action to reduce the impact on property taxes.
Colorado Governor Jared Polis signed bills this month to decrease assessment rates. KDVR reported May 16: “The new law comes after several years of proposals to bring down property taxes did not successfully bring down the taxes for most Coloradans. This new measure takes effect immediately, and unlike other efforts in the past, it has the support of Democrats, Republicans and the business community. … ‘Every Colorado homeowner will have their property tax rate go down,’ Polis said. ‘In addition to that, there is an even bigger property tax cut for commercial properties because commercial properties in Colorado wind up paying, somewhat unfairly, a much higher rate. That’s because of a formula that Colorado used to use that voters finally revoked, but its legacy is still there.’”
In Kansas, legislation signed into law earlier this month reduces property taxes for more than 1 million property owners in the state.
A review of news stories from around the country indicates that homeowners and business owners in many other states will be digging deeper into their family budgets to cover property tax increases:
Alabama: WPMI News reported April 27: “If you live and own property in Baldwin County you more than likely experienced ‘sticker shock’ when you opened the latest property valuation notice. Those notices went out last week and many of you are now looking at a 15- to 20-percent increase in your annual property tax owed.”
Connecticut: The Hartford Courant reported April 26: “The wild surge in housing prices comes with a downside for some Connecticut homeowners this summer: soaring tax assessments. … The impact varies in each town or city, and generally businesses and some homeowners will be paying less this year – while others face tax bills 10 or 15 percent higher than last year’s. … Some East Hartford homes jumped in value by 50 percent in the past five years because of the super-heated housing market. Those owners can expect tax bills in July that are up 15 to 20 percent from last year – even though the town just cut its tax rate from 49.35 mills to 41, and will be collecting the same overall tax receipts as it did last year. … Connecticut towns and cities recalculate their tax bases every five years.”
Georgia: 11Alive reported April 21: “A new study indicates Georgia is among the leaders when it comes to property tax hikes, and the rise will continue in the coming months. In the Grant Park neighborhood, homeowners like Nancy Mitchell welcome part of the trend sweeping neighborhoods all over metro Atlanta. However, with soaring property values are soaring taxes. … According to a report by data analysts at ATTOM, the average property tax bill in Georgia jumped 11 percent between 2020 and 2021. It’s one of the biggest jumps in the nation but not a surprise when you consider that property values in Georgia jumped 43 percent over that same time period. Metro Atlanta’s average property tax bill jumped 10 percent between 2020 and 2021 while values increased 42 percent. … Fulton County homeowners pay the most in the state. Property tax bills there average a little over $5,000, reflecting an 18 percent jump in taxes that doesn’t compare to the 46 percent increase in property values.”
Hawaii: Hawaii Business Magazine reported January 18: “The hue and cry went up on social media almost immediately after O’ahu homeowners received their annual real property tax assessments from the City and County of Honolulu last month – with some home assessments shooting up 40 percent. … The City and County of Honolulu bases its annual real property tax assessments on market data, or how much homes are selling for in a neighborhood. Because of that, some areas on O’ahu that saw great price appreciation over the last year also saw double-digit jumps in their assessments for the first time. … That translates to higher property tax bills for the 2023 fiscal year, with the first payments due in August. … Homeowners benefit from the higher value of their real estate when they sell, but longtime residents and those living on fixed incomes who want to keep living in their homes are hit with higher and higher tax bills each year.”
Illinois: The Mendota Reporter reported May 24: “Illinois property taxes have far outpaced household incomes and home values since 1990, a Wirepoints analysis shows. Tax bills per household have grown 268 percent since 1990, while average home values have grown 114 percent.”
Indiana: The Herald-Times reported May 2: “Home values in Monroe County have risen 15 percent in the past year, but some homeowners are seeing sharply higher increases, which will mean bigger property tax bills next year. … While the total value of residential properties has risen 15 percent, the value changes for individual homes can fluctuate wildly from one part of the county to another or even from one neighborhood to another, depending on the sales in that area or whether owners have made improvements such as adding a basement or porch. Sales contribute to the changes in assessment of other homes in their vicinity: For example, a home near the country club saw its assessed value rise nearly 21 percent in the past year, even though the owner had not made any significant improvements to it. [County Assessor Judy] Sharp said homes in the area simply sold for much more than their previous assessed value. When that happens, the value of all homes in the neighborhood rises – even if the owners don’t so much as replace a shingle. The assessed value of that same home near the country club has more than doubled since 2018: Its value that year was about $56,000. This year its value is $119,000. … Kathy Bridwell, a 71-year-old retiree, said she and her husband, John, have lived in their home on the city’s north side since 1978, and have never seen their property tax jump as much as this year. Their annual tax bill, about $2,400, rose by $400. It has gone up more than $730 since 2019.”
Kentucky: WLKY News reported May 12: “It’s no secret property values in Jefferson County have skyrocketed over the past year, which also means property taxes are going up. Now, there’s a call for those in Frankfort to give relief to retired and disabled Kentuckians so they don’t get priced out of their homes. In areas such as Prospect, Property Valuation Administrator Colleen Younger says property taxes may go up by as much as 30 percent this year.”
Maryland: The Daily Record reported April 28: “Maryland’s top tax collector is calling on local and municipal governments to reduce their property taxes in the coming year. … [State Comptroller Peter] Franchot, who is seeking the Democratic nomination for governor, is making a habit of calling for tax relief. Earlier this year he spearheaded the push that led to a 30-day holiday on the state excise tax on gasoline. … ‘I live in the People’s Republic of Takoma Park,’ said Franchot. ‘If it moves, they tax it. I just got my tax notice, they’re raising taxes 7 percent in order to balance next year’s budget. That’s not a good situation for particularly seniors on a fixed income that want to stay in their homes, want to stay in Maryland.’”
Pennsylvania: The Philadelphia Inquirer reported May 15: “While reassessments have been a political powder keg in Philadelphia for decades, gentrifying areas like this – where construction of new homes is widespread and local leaders fear rising property taxes will quicken the displacement of long-standing Black or Latino communities – have increasingly become battlegrounds over city tax policy. Philadelphia’s new property reassessment, its first in three years, bumps up residential property values 31 percent on average citywide, but an Inquirer analysis of assessment data found that residents in some rapidly developing areas could see hikes three to eight times that.”
Tennessee: Chattanoogan.com reported May 11: “The Lookout Mountain, Tn. Commissioners adopted the annual budget and tax rate for fiscal year beginning July 1, 2022 and ending June 30, 2021. The new tax rate has been set at $2.02 per every $100 of assessed value which equates to a 7.4 percent tax increase.”
Texas: The Texas Tribune reported April 22: “As Texas’ exploding real estate market dramatically drives up home values, homeowners are getting sticker shock after receiving notice of their properties’ new appraised values – which help determine how much they pay in property taxes. The growth rate of home values in the state’s major metropolitan areas has surged by double digits. In Harris County, the state’s most populous county, residential values have risen between 15 percent and 30 percent, according to Roland Altinger, the county’s chief appraiser. … And in Travis County, where the state’s housing crunch has been most apparent, the median home value has skyrocketed – climbing more than 50 percent since last year to $632,208. … But an increase in value doesn’t necessarily guarantee a dramatically larger tax bill, appraisers and property tax experts caution. … It’s likely that at least some local governments will have to cut their property tax rates in order to fall in line with recent state laws meant to slow property tax growth. And the state’s top elected officials are already making new promises to bring down Texans’ property tax bills. But recent laws haven’t stopped property tax growth altogether. … Facing reelection, Gov. Greg Abbott has deemed property tax reduction a top priority when state lawmakers reconvene next year.”
Vermont: CBS News reported May 20: “Anne Van Donsel said she didn’t quite believe it when her hometown of Burlington, Vermont, last year sent her a new property tax assessment stating that the value of her home had doubled – raising her property taxes by 20 percent. Her property taxes jumped to about $12,000 a year, up from $10,000, a bump she said is adding to the financial strain as inflation pushes up the cost of food and other necessities. While Van Donsel appealed the assessment, she was given only a small reduction in the value of her home, which didn’t make a dent in her new tax bill.”
Virginia: WTVR News reported May 6 that Virginia’s annual personal property tax bills are increasing for many residents because the tax is based in part on the current market value of taxpayers’ vehicles. “Diligent record-keeper Alesha Moore did a double-take when she opened her personal property tax bill a few days ago. Moore’s 2022 tax bill was significantly higher than her 2021 bill. … After looking back on her tax bills in the two previous years, she found out why: her 2018 Nissan Murano with 80,000 miles was assessed at a much higher value. After dropping $650 in value in 2021 to $16,000, the vehicle was assessed at $22,350 in 2022, an increase of $6,350. … According to officials in multiple Central Virginia counties, tax assessors are required by law to assign a fair market value for vehicle assessments using a recognized pricing guide. Most localities use the JD Power Used Car Guide for the Eastern Region. Because of high demand and limited supply for used cars, prices skyrocketed in 2021, which in turn drove up assessed value.”