Small Measures Can Provide Large Benefits to Taxpayers

Those who follow the political machinations in Sacramento might well conclude that not much good emerges from the California Legislature. Gas taxes, attacks on home ownership, a tax increase on commercial property, ever-expanding  pension deficits, high speed rail, there seems an endless list of proposals for which the average taxpayer is supposed to foot the bill, while others receive the benefit.

With all this bad news, it is easy to overlook some relatively obscure bills that could have an oversized beneficial impact on taxpayers.
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Assembly Bill 809 by Assembly Member Jay Obernolte (Hesperia) is a proposal that will aid local voters deciding on tax measures by providing some much needed transparency. Under current law, there is no word limit requirement on the ballot label – the descriptive information that appears on the ballot — for local tax measures. The ballot label is the last thing most citizens see before casting their vote. The label is often filled with whole paragraphs explaining how the funds will be spent, but little or no information that helps voters determine what it will cost them.

AB 809 states that the ballot label will include the tax rate increase, its duration, and a revenue estimate of what it will generate annually. If voters approve a county-wide sales tax increase for 30-40 years, they should at least be fully aware of the cost in the years to come. By placing this information in the ballot label, voters can make informed decisions that will best benefit their communities.

Assembly Bill 1378 by Assembly Member Chris Holden (Pasadena) expands the provisions of Proposition 60, which was based on an idea by Howard Jarvis and approved by voters in 1986, that provides property tax relief for seniors. Proposition 60 allows for an individual over the age of 55 to transfer the Proposition 13 base value of their property to a new residence in the same county as long as it doesn’t exceed the value of their current home based on its sales price. While this provides a tax benefit to seniors, any cost to government is made up when the first home sells and goes on the assessor’s books at market value for tax purposes. Without being able to retain their Proposition 13 tax base, many seniors would be locked into their current residence, unable to move, and their homes would remain off the market.

Under current law, a married couple can only take advantage of this tax exemption once. AB 1378 would allow each individual in a married relationship to take advantage of the exemption, allowing them to move a second time and transfer their lower tax base. The result is increased residential flexibility that benefits our seniors.

With life expectancy increasing, we cannot assume that individuals will remain in the same house in retirement for 30 years. Individuals may decide to move again to be closer to their children or because of health difficulties that makes their current home impractical. They should not be punished with higher property taxes in retirement for circumstances that may be beyond their control. AB 1378 is a common-sense proposal that adapts California law to the changing lifestyle requirements of our aging population.

Just like the small, often overlooked, belt buckle can have tremendous impact on the success of a pair of pants, these unheralded bills, AB 809 and AB 1378, have the potential to contribute significantly to the well-being of all taxpayers. AB 809 and AB 1378 deserve to be adopted by the Legislature and signed into law by the governor.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.