New Split Roll Initiative, Same Old Problems

Supporters of the split roll ballot initiative already qualified for the 2020 ballot to tax commercial property on a different basis than residential property made “adjustments” to the measure’s language. They claim they are strengthening the measure to help it pass. What they are doing is recognizing flaws in the initial version and not changing the thrust of a measure designed to raise taxes, consumer costs and undercut Proposition 13. 

The flaws in the measure are costly for the proponents. 

An initiative to qualify for the ballot, in this case a constitutional amendment, needs signatures that equal a percentage of votes cast for governor in the last election. The previous initiative required 585,407 and cost over $3 million to qualify. Since the number of petition signatures required has increased to 997,113 after the last governor’s race, the proponents will have to spend double or more while the initial investment is down the drain. 

Or is it? 

The proponents have yet to pull the first measure already qualified for the ballot despite its flaws. They have the power to do that. Even if the measure has obvious problems acknowledged by proponents, will they leave it in place while trying to gather the necessary signatures to qualify the new measure to use as some form of leverage or in case they fail to gather enough signatures in time? If the old initiative stays active with its admitted flaws it will be very difficult, if not impossible, to pass. 

Of the new measure, Rob Lapsley, president of the California Business Roundtable and co-chair of Californians to Stop Higher Property Taxes said, “This is just another, equally flawed measure aimed at dismantling Proposition 13.” Lapsley added, “Proponents should at least withdraw their existing measure, which they now acknowledge is fatally flawed. However, there are no tweaks or amendments that can be made to this split roll measure that will prevent it from being a major, multi-billion-dollar tax on all Californians in the form of higher prices on everything we buy – from groceries and gasoline to diapers and day care.” 

Among the changes the Schools & Communities First initiative is dealing with are fixing school funding formulas and clarifying tax relief for small businesses, according to the campaign’s press release.

Schools in basic aid districts complained they were not getting a fair share of the new taxes the split roll intended to raise. The press release notes that business changes include delaying reassessments on buildings that have 50% or more small businesses occupying a building. The idea is to protect businesses that rent from property owners and have the property tax increase passed to them as many leases require.

However, it only means delayed pain for small businesses; that pain is still coming. Apparently, small businesses that rent in a building that has less than 50% small business occupants are out of luck. 

With the state already sitting on billions in reserve money, proponents are going to have to explain why attacking businesses is a priority that will lead to higher consumer costs, lost jobs and a damaged economy. 

With polls at best showing a bare majority of support for the split roll when the polls don’t follow up with opposing arguments, the split roll effort becomes more complicated by adding new, confusing language to the measure. 

Whatever the changes, the overall threat to the long term existence for Prop 13 will be a focus of the 2020 campaign.

Jon Coupal, President of the Howard Jarvis Taxpayers Association and co-chair of Californians to Stop Higher Property Taxes stated, “It is no secret that split roll proponents have had their eye on unraveling Proposition 13 protections for decades. Homeowners will not tolerate any changes to Proposition 13 now or in the future.” 

(Disclosure: I have worked on efforts to oppose major changes to Proposition 13 over the years.)

Joel Fox is editor and co-publisher of Fox and Hounds Daily.

This article was originally published by Fox and Hounds Daily.