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Many public education districts in California, especially in the San Francisco Bay Area, go to their voters for “special” taxes to raise extra revenue for operating. The majority of voters in this area support these taxes, even though they take a “super majority” (two-thirds) to pass. The funds are raised by special taxes on properties. There are allowed and also prohibited methods for calculating the taxes – which show up in yearly Property Tax bills. The “special tax” cannot be on the assessed dollar value of the entire property.
How should Mountain View Whisman elementary school district set up a new replacement tax in 2023-24?
• Flat tax, regressive
• Per-square-foot building tax, very progressive – may hurt residential renters
• Per-square-foot lot tax, moderately progressive
MVWSD’s current tax is almost $200 for every parcel that gets a property tax bill. Google headquarters will get a $191 tax, a small business property will get the same tax! A single bedroom condo owner, and a large six-bedroom single family home will get the same tax. This is a flat tax, a very regressive tax on property ownership – not property wealth or size. Any property owner, no matter the size of land (parcel) or the size of building (improvement) gets the same dollar tax.
The parcel tax must meet the conditions of being “uniform,” which the courts have decided upon. A flat tax is not the only method for calculating and sending out taxes. But using this highly regressive tax method is simple and very, very common.
Mountain View Whisman used to have a “parcel-size” tax under which the largest parcels were taxed almost 10 times the smallest. Google got taxed over $1000 for each of its largest properties. Alas! The exact structure of this past tax was not “uniform.” Its replacement, Measure B, expires in 2025.
The California courts have ruled that a “per square foot” progressive parcel tax is “uniform” and legal. The per-square-foot method is to use a “rate,” like 3 cents per square foot, and multiply by the square feet in a property.
Let’s keep the following explanation simple, with a tax rate of six cents per square foot on improvements on a property, taxed every year. A 750-square-foot condo pays $45, a 1,000-square-foot business pays $60, a 2,000-square-house pays $120, and a large apartment owner of a 150,000-square-foot building pays $9,000. A 1.1 million-square-foot headquarters pays $66,000!
The county Tax Assessor keeps record of both parcel size and building improvement size.
A “uniform” per-square-foot tax can be on parcel size instead of building (improvement) size. In this case, a 3 cents per-square-foot lot tax gives would lead to 10 acre office park generating $13,068; a 2 acre commercial or apartment property generating $2,614; and a 1/8 acre single family lot $163. A small condo’s 1,000-square-foot share of property would be $30.
A return to a MVWSD progressive special parcel tax can be legally done. The legal path is clear (Dondlinger v. LA County Regional Park and Traiman v. Alameda Unified). A tax based on per-square-foot of the lot or building improvements can be used. What is less clear – at what taxation dollar level will the large parcel/large improvement property owners (the apartment owners and the chamber of commerce) fight? Maybe just place a “dollar cap,” say $8,000, on this tax for any large property.
The MVWSD has a signed contract to survey you on “taxation.” This “replacement parcel tax” will be flat tax, per-square-foot lot size, or per-square-foot building improvement. If you want to drop the flat tax ($191) and feel strongly, speak up and mail Trustees@mvwsd.org and ask for a progressive Per Square Foot tax calculation method. Or – you can ‘wait for their call’ or accept another flat tax again.
Steven Nelson is a retired Mountain View Whisman School District trustee
This conundrum is brought to you by Prop 13.
Well said, Steven Nelson. Kudos to you for sticking your neck out on this. I don’t always agree with you, but I 100% agree on this. Progressive taxes are more Fair and more Just than regressive taxes. Those who can afford to pay more … should pay more. It’s not that hard of a concept. The idea of uber-rich Google paying the exact same parcel tax as a single bedroom condo owner? To pay for the education of small children? The injustice of that brings me great pain.
@ivg, to blame this on Prop 13 is ridiculous, unless you are in favor of large corporations like Google paying property tax at market rates. If that is what you are proposing, I completely agree. That is what Prop 15 came close to accomplishing in 2020, reforming Prop 13 to remove the protections that it offers to rich and powerful corporations like Disney and Google. Prop 15 was only narrowly defeated in 2020. If we had Prop 15, we wouldn’t need a new parcel tax.
Here is what yimbyaction said about Prop 15 in 2020: https://yimbyaction.org/endorsements/november-2020/california/#props
“Proposition 15 will get rid of property tax breaks for big businesses, and put billions of dollars towards schools and local services.
“Currently, thanks to 1978’s Prop 13, owners pay property taxes based on the price they originally paid for that real estate—typically a lot less than what it’s worth today. Prop 15 will roll this back for many large businesses, raising property taxes to be assessed based on the property’s current (probably much higher) market value. Prop 15 will raise approximately $6.5 to $11.5 billion — 60% for cities, counties and special districts, and 40% for schools and community colleges. Homeowners and businesses with under $3 million in California property will be exempted, along with farm land.”
Schools would get more $$$, and cities could use $$$ from Prop 15 to fund more affordable housing units for low-income and average workers.
Leslie, I’ve often valued your contributions to our discussions, and I appreciate your perspectives. However, I’m curious about instances when you seem to attack others, even when they’re seemingly in agreement with you. Understanding your viewpoint could enrich our conversations. I believe it’s essential for all of us to maintain a respectful environment as per the terms of service, where truthfulness, relevance, and mutual respect are valued. Let’s aim for future dialogue with kindness and understanding.
For sure, one uniform dollar amount per parcel isn’t fair (one of the most unfair one is the $12 each parcel pays to address Bay level rises: Googleplex -affected by sea level rise- pays $12 …like any other parcel 50 feet or more above sea level).
As to why school districs don’t move to a more progressive parcel tax? You provide the answer: ” What is less clear – at what taxation dollar level will the large parcel/large improvement property owners (the apartment owners and the chamber of commerce) fight?” Since school parcel taxes require a 2/3 super majority, it’s a pretty small fight for say the CAA to tank a progressive parcel tax. Can’t blame the school districts to play if safe….
Leslie, why do you have to call my position ridiculous even when you agree with me?
why fight, Peace and Love / @ivg and @Clarance: it just might be ‘bad air’ out here in the Cuesta Park neighborhood where Leslie and I live! Gets in through the lungs.
I am consistently not in agreement with the things Mr Nelson says. This is actually a reasonable proposal.
Steven Nelson’s letter, while making a good point, misses the big picture. Have you looked closely at your property tax bill, and noticed all the tax assessments? Most voters are not property owners and I get that and they vote for taxes for “the other guy.”
It doesn’t have to be this way, and actually, it’s not like this in most of the country. For example, if you get a property tax bill in nearby Arizona, you might find 3 or 4 small assessments and that’s all. Last year AZ property tax was actually lower than in 2022. Can you imagine that in California?
@Jay What I cannot possibly imagine, is living in Arizona and having Kari Lake as Governor OR representing me in the US Senate! (old enough to remember AZ Senators John McCain III and Barry Goldwater)
Local taxes – a “small picture” issue.
Peace and Love in MV, CA, USA, Earth, Sol’s System, Milky Way Galaxy, Local Cluster,
Are you sincere, @Clarence? Based on our previous conversations, I have my doubts. Whenever I make a comment, you often show up quickly and attempt to discredit me in your own special way. And here you are now, choosing to have a conversation about me personally, instead of on the essay itself. Am I surprised? No. I’ve come to expect it.
But since you asked, I will answer.
I am part of a class of persons who has been FALSELY ACCUSED as being responsible for the high cost of housing in MV. All because I managed to buy a home in MV about 30 years ago, when it was a dumpy little working class town. The rumor is that SFH owners like me all meet and conspire to block supply of housing, in order to drive up the value of our own homes. No evidence has been provided to prove it, however, or even that NIMBY activism is the PRIMARY root cause of high housing costs. It’s all just rumors.
Scapegoating innocents is an old political tactic, did you know that? It was used in pre-War Germany. I learned about it when I visited Dachau decades ago. Hyper-inflation was raging in the 1920’s, the people were suffering greatly. A certain political group gained tremendous power by spreading the idea that the Jewish people were to blame, they were somehow “taking the money”. Once that group got power, it took a World War to get rid of them. See “How Hyperinflation Heralded the Fall of German Democracy” https://www.smithsonianmag.com/history/how-hyperinflation-heralded-the-fall-of-german-democracy-180982204/ My takeaways? 1) Scapegoating innocents is morally wrong, 2) clever politicos are willing to do it if it gives them a path to power.
Being falsely scapegoated has been a strange experience for me. For at least 2 years I have been trying to engage in the kind of respectful dialog that you are calling for. I wrote https://www.mv-voice.com/news/2021/09/25/guest-opinion-housing-affordability-bills-math-doesnt-add-up to explain why building “more housing of any kind” was a deeply flawed strategy that would not help “teachers, service workers, and kids who don’t code”, aka the supposed poster children of the YIMBY movement. The first comment left on the essay is a great example of the “truthfulness, relevance, and mutual respect” given back as a reward for my efforts: “No one hates Mountain View and hates the economy more than NIMBYs. All they want is to destroy this town and turn mountain view into a rust belt town where there are no jobs and a bunch of old people happy that everyone leaves them alone.”
For several YEARS now, people have demonized those of us who hold the “wrong beliefs” as NIMBYs. Our efforts to respectfully share our concerns – related to density mandates from the state – about funding for public schools and parks, traffic congestion on city streets, parking, water supply resulted in sneering comments about “quality of life” issues.
“Leslie, why do you have to call my position ridiculous even when you agree with me?”
I support Prop 15, it reforms Prop 13 but does not repeal. Protections to help lower income and average workers to stay in their homes are a good thing. And you agree? Fantastic! If I misjudged you on this, I apologize. NextDoor is full of so many comments from young people who hate Prop 13, but they never mention Prop 15. I must have confused you as being one of them, I’m sorry.
Jay, in Maryland and Chicago, there are plenty of assessments for parks, water, sewers, schools pension liabilities, etc.
@ivg, your original words were ambiguous, you wrote “This conundrum is brought to you by Prop 13.” You never mentioned Prop 15, so it was easy for me to make my mistake.
On NextDoor there is a fairly recent post that is getting lots of activity, “Just got our property tax bill and all I can say is…Thank God for Prop 13.”
Many of the comments in that post reveal that younger people would like to see ALL of Prop 13 repealed, though. For example:
“And those of us who were only able to purchase our homes in the past few years and saying G– D— Prop 13! We are quite unwillingly subsidizing YOU.”
I fear that this is a common concern of many young YIMBYs. They don’t complain about the high cost of the house itself, they complain bitterly about the unfairness of being required to pay 1% of that amount in property taxes. That’s kind of odd to me. They think that it is unjust that they pay more in taxes than their neighbors, they want everyone to pay the same amount, even if it would result in lower income people and those on fixed incomes being forced to sell their homes.
Frankly, I have not seen any comments from them calling for Prop 15. Which is why it is so refreshing to hear that YOU agree with me. I think that one’s attitude towards Prop 13 is a bit of a litmus test regarding one’s attitude towards affordable housing for “teachers, service workers, and kids who don’t code”. If Prop 13 was repealed tomorrow, it is the teachers, etc., who would be forced to sell their homes. Striking down Prop 13 would do little to make housing more affordable, but it would do MUCH to make housing more UNAFFORDABLE to a huge portion of the population.
Passing Prop 15 would retain the protections of affordable housing from Prop 13, and also dramatically increase the funds available to schools. If we had Prop 15, MV Whisman wouldn’t be needing to pass a parcel tax, which would be the best benefit of all.
It’s important to clarify that opponents of Prop 13 generally advocate for a fair property tax system where everyone pays the same percentage based on the value of the asset they hold. The goal is not to force everyone to pay the same fixed amount, which could indeed harm lower-income individuals and those on fixed incomes. The concern lies in seeing Prop 13 as a system that benefits wealthy owners of multimillion-dollar mansions and vacation homes, shielding them from paying their fair share. It’s essential to strike a balance between equity and ensuring those in need are protected while addressing property tax fairness. Many repeal proposals include hardship exemptions for just this reason, rather than preserving a giveaway to the rich.
“It’s important to clarify that opponents of Prop 13 generally advocate for a fair property tax system where everyone pays the same percentage based on the value of the asset they hold.”
Striking down Prop 13 would indeed result in “everyone pays the same percentage based on the value of the asset they hold”.
And that would result in lower income people and those on fixed incomes being forced to sell their homes.
Whether or not one can consider that situation “fair” is in the eye of the beholder. Back in 1978, a MAJORITY OF VOTERS considered that situation to be UNFAIR. And in the appeals processes that occurred in the years following, the judges allowed Prop 13 to stand.
And @Clarence, your comments focus entirely on residential property, not commercial. Which makes me doubt the sincerity of your previous comment, “However, I’m curious about instances when you seem to attack others, even when they’re seemingly in agreement with you.” The words “seemingly in agreement with you” were very clever. You make it very clear now that I was quite correct in recognizing @ivg’s first comment as a dog-whistle call to repeal all of Prop 13, and not a genuine call for Prop 15.
Note that striking down Prop 13 would cause the same “harm to businesses” as passing Prop 15. Those who are open to striking down Prop 13 should be open to passing Prop 15. The biggest unfairness in Prop 13 lies in the tax advantages given to large corporations like Google.
I appreciate your feedback and I want to clarify that I was attempting to elaborate on the views of individuals who advocate for the repeal of Prop 13, as you mentioned earlier. I understand that your concern extends to commercial properties as well, and I acknowledge the complexity of the issue.
It’s interesting to note that, based on my interactions, those opposing Prop 13 have also supported Prop 15. This consistency suggests a broad alignment in their beliefs, aiming for fairness in property tax policies, whether it pertains to residential or commercial properties. Their argument, as you rightly pointed out, is that the tax advantages given to large corporations under Prop 13 contribute to the unfairness in California’s tax system. From their viewpoint, addressing these advantages is crucial, and Prop 15 is seen as a step in the right direction.
I understand your frustration with the perceived insincerity in some people’s arguments, especially concerning commercial properties. It’s essential to have open and honest discussions about these issues to find a fair solution that benefits all Californians. Your insights are valuable in highlighting the complexities of this debate. Let’s continue this conversation with mutual respect and understanding.
@ Leslie not my (bane). Could you think about maybe doing your own ‘math works’ on the issues of PARCEL TAX? It would help if we can get the Assessor’s rolls for MVWSD parcels that are Taxable (exclude churches, Gov., non-profits).
Then apply a penny PSR rate to Lot Size and see how much $Total. Same for Improvements, penny PSF.
– that would give a research level tax distribution histogram –
In fact, just asking the MVWSD Total parcels, Total of lot sizes, and the Total of Improvements sizes would do the trick. And it might be possible to get the Public Record on those Three Numbers from the Assessor just doing a Public Records Act request. (“From the Assessor’s Database records – what are the numbers for …total. …”)
With your background – having a Residential, Multi-unit, and a Business breakdown might be really interesting ‘to calculate’. We could even do the residential, Multi-unit, and Business $bin total for the Flat Rate ($191) and compare it to the MVWSD tax receipts, and what the One Cent PSF equivalents would be.
-What Would Hurt New below-median affordability Least? – What would hurt the housing Goal Most –
Without someone thinking/computing Housing + Affordability interaction, it might result in a good-outcome for schools / yet a poor push-direction for below median cost new housing.
thanks for thinking, calculating, posting
This is a symptom of the modern American disease that people fall back on defensive attacks about politics, like the comments from @Steven Nelson because if you can’t defend the high taxes throw around some stereotypes.
I would rather argue about the Christmas tree that’s my property tax bill than red vs blue states.
By the way, Kari Lake is not the AZ governor, it’s Katie Hobbs (D) so how about some of that peace and love you like to quote for all Americans no matter the party? I want a Christmas tree at my house this year, not my property tax bill.
@Steven, thank you for your kind comments. Sadly, I have other pressing commitments and am not able to volunteer for your project, I think it is an interesting idea that could be very persuasive, facts and data are respected by many people. Good luck to you, I hope someone else can step forward to help you.