Poll

Prop 13 keeps property taxes low for residential and commercial properties by only allowing governments to add 2%/year to the market price..  On the NOV 2020 ballot, voters can exclude commercial properties from Prop 13 protection.  Do you think we should

yes - Commercial properties should be excluded from prop 13. (pay more property taxes)
7 (31.8%)
no - Commercial properties stays the same with prop 13 protection. (same as today)
11 (50%)
I need more information
4 (18.2%)

Total Members Voted: 22

Author Topic: PROP 13 & commercial properties  (Read 2445 times)

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Offline nosuchreality

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Re: PROP 13 & commercial properties
« Reply #15 on: January 13, 2020, 03:55:55 PM »
The ballot should be to remove prop 13 alltogether. I would be paying about 4-5k less per year in taxes (property Taxes + mello Roos) than if I just paid 1% on the value of my house

Minor nit, prior to prop 13, property tax was just short of 3% on average much like other States.

That $880,000 median list price of homes in Irvine would be looking at an average $27,000 tax bill on the pre-Prop13 tax rolls.  As would every existing owner.

I did receive a call the other night for a survey on the proposed ballot initiative, test floating pro/con arguments on fixing Prop 13.  The questioned from proposed names on the ballot to for and against arguments and how well they were received, schools played a prominent roll as did big bad business getting a free ride and small business getting screwed because of triple net leases.  (Yes, they actually referenced triple net leases).

For a side note, Tustin is putting another School Funding bond on the ballot.  Asking for 0.03% assessment to fund Elementary School updating in non-mello roo areas.   

That will be in addition to the prior 3 SFIDs that passed the ballot to Rehab High Schools, Middle Schools and roll out Technology to the schools.  Assessments for priors weigh in at 0.03%, 0.018% and 0.016%.    All total under 0.1% SFID funding directly to the schools.  On an equivalent million dollar home that's a $1000 in additional taxes. Far lower than the typical Mello Roo associated to new builds at that price point.
« Last Edit: January 13, 2020, 04:11:08 PM by nosuchreality »

Offline Soylent Green Is People

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Re: PROP 13 & commercial properties
« Reply #16 on: January 13, 2020, 04:12:44 PM »
I'd consider it worth voting for if they tied the initiative to a conversion of all State of California pension obligations to no more than minimum wage x 40 hours per week total, allow anyone who doesn't like it to opt out of their pensions, then everyone with less than 10 years in the pension system booted off and offered 401k plans.

Changing the taxation of property is the stick. What's the carrot here? For me, it's pension overhaul. Something has to be done with these hyper unrealistic obligations sooner rather than later. 

My .02c

Offline Kangen.Irvine

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Re: PROP 13 & commercial properties
« Reply #17 on: January 13, 2020, 07:13:03 PM »
Just like Social Security, those currently employed are paying the benefits for the retired. Yes, the amounts are very different, but the result is similar. Of course the districts are on the hook per bargaining for a much higher percentage. CTA has too much influence on elections.

I would call for an audit on all school dollars and how they are spent. So much money is wasted at the district admin level and does not reach the students directly. Indirect money should be limited to 5% and the other 95% should go directly to any program IN the classroom; not advisors, administrators, TOSAs, District office employees, etc. I would make any “me too” clause illegal in collective bargaining.

Offline haiku

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Re: PROP 13 & commercial properties
« Reply #18 on: January 13, 2020, 10:38:30 PM »
If it makes the ballot, please vote no.
It’s impossible to determine market value for commercial property after initial purchase price. You can have 2 single unit buildings across the street from one another and the rents will vary greatly. 1 may be on nnn, one may be starbucks where the rent increases once every 5 years, the other on an annual basis. The price per sq ft will vary greatly.
Depending on the lease, tenant, city, cap rates  will fluctuate, as well as cap rates fluctuating to the market. What would end up happening is everyone would fight their valuation, and the extra tax revenue would go to additional gov agency payroll and pensions to investigate valuations and I’m sure they’ll create addl fees for you to dispute. Plus as I stated earlier, taxes will be passed to tenants, then to the customer. 99% of Irvine leases are prob nnn. Prop taxes for commercial are also already taxed at a higher rate. Also how fast would valuations change if/when you sign tenants to a new lease at a higher rate or a tenant leaves and there’s a vacancy. This will impact the market value of the property greatly. Point is, it’s impossible to determine market value wo access to rent rolls and p&l. Even guesstimating market value of residential real estate is impossible even though it should be easier...just look at how off Redfin/Zillow estimates are as proof.
The economy is booming and yet gov still wants more money and it seems more people are in need. What happens during the next recession.
« Last Edit: January 13, 2020, 11:21:10 PM by haiku »

Offline freedomcm

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Re: PROP 13 & commercial properties
« Reply #19 on: January 14, 2020, 06:42:13 AM »
So you favor public school teachers having to pay their 10% contribution in order to receive half the payout of social security?  in your 401k scheme, is their employer matching?

personally, I think that punitive approach will result in a big decrease in the quality of teachers.

I'd consider it worth voting for if they tied the initiative to a conversion of all State of California pension obligations to no more than minimum wage x 40 hours per week total, allow anyone who doesn't like it to opt out of their pensions, then everyone with less than 10 years in the pension system booted off and offered 401k plans.

Changing the taxation of property is the stick. What's the carrot here? For me, it's pension overhaul. Something has to be done with these hyper unrealistic obligations sooner rather than later. 

My .02c

Offline Soylent Green Is People

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Re: PROP 13 & commercial properties
« Reply #20 on: January 14, 2020, 09:46:21 AM »
There is little if any correlation between teacher pay and teacher quality. Look no further than public schools paying $80k plus to teachers who long ago should have been "termed out". Example: We had several teachers at our kids HS who refused to post grades on-line (although the remaining majority did...) because of their lack of experience with com-pew-tors. Should those teachers be considered high quality, even at the pay and pension they are receiving? Eh, not really. Ask yourself,"Does high pay correlate to high quality workers for private employers?" The answer is self evident.

No issue in having the State offer matching funds. It's reasonable, and a lower cost option than paying a pension for 30+ years post retirement.

The keys here are that less people suckling on the public teat will always a good thing. Unsustainable pensions provided to public servants need to be reformed. This proposed Prop 13 commercial property tax adjustment is one of those faux "It's for the children...." schemes. OK, if it's really "For the children", what guarantees are there for any beneficial use of these funds? What other types of accountability in spending should we demand to offset this tax increase? As none has been provided, no change in Prop 13 should be granted.

My .02c

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Offline Kangen.Irvine

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Re: PROP 13 & commercial properties
« Reply #21 on: January 14, 2020, 08:11:07 PM »
I wouldn’t tie teacher quality to online grades. Some teachers choose for students to track their grades so they are more accountable for their grade. Technology is a great resource, but might be overused by both teachers and students in the classroom.

 

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