Proposition 13 isn’t the problem, pensions and spending are

by The Editorial Board at The Orange County Register

January 1, 2018

Not for the first time, an effort is underway to persuade voters to “reform” Proposition 13 and raise property taxes.

“The California Schools and Local Communities Funding Act of 2018” was filed in mid-December with the attorney general’s office. It aims to raise $11 billion per year by removing Prop. 13 protections from industrial and commercial properties, reassessing them based on the unrealized, paper profits from rising real estate values.

However well-intentioned the backers of this initiative may be, it is reckless to impose a massive tax increase on nearly all California businesses, simultaneously and repeatedly.

If raising taxes was the solution to every problem, California would have no problems. The Golden State boasts the nation’s highest income tax rate and sales tax rate, and we’re within an eyelash of defeating Pennsylvania for the title of highest gas taxes.

Read more at The Orange County Register

Trying – and failing – to explain away California’s high crime rate

by Michele Hanisee in the California Political Review

December 21,2017

Imagine the reaction if, after a loan officer told an applicant they would not receive a loan because of too much debt, the applicant asked “How about we just disregard 25% of my debt?”

As illogical as this sounds, it was the approach recently articulated by a group seeking to downplay the crime rate increases in California following various criminal justice “reforms.”  In a study picked up by a few newspapers, the Center on Juvenile and Criminal Justice (CJJ) opined that the crime rate statewide in California decreased following these reforms – if you excluded Los Angeles County.  Yes, Los Angeles County, where more than one out of four residents of California reside!

The propaganda espoused by proponents of these various reform measures is that crime is not really rising very much so long as it isn’t as bad as it was 30 years ago. They continue that trend with their attempt to manipulate the statewide crime rate increase by excluding more than 25% of the population.

Read more at California Political Review

No housing bubble in sight — and other predictions for 2018

by Katy Murphy at The Mercury News

December 12,2017

A real-estate site’s predictions for 2018 offer yet more disappointing news for would-be first-time homebuyers in California hoping that the New Year might bring some relief.

“The outlook for next year is rising prices, rising rates and rising property taxes,” said Redfin’s chief economist, Nela Richardson. “I wish I could have better news.”

Read more at The Mercury News

Kern County: Where the American dream is obtainable

by Kim Schaefer 

December 11,2017

There’s a reason homeownership is still considered the “American Dream.” A home is the best means for building wealth and a pathway to strength and stability in the communities we all call home.

Middle-class families have built wealth for centuries through homeownership and real estate investment. Homeownership allows families to protect themselves against rising rents and inflation, while offering an opportunity to build equity over time. Here in Kern County, things are no different.

For many California residents, homeownership is simply falling out of their reach. There is no denying that there is a housing crisis in California. It is difficult to turn on the television or open a paper without hearing about workers that are commuting farther and farther, contributing to traffic and pollution more than ever to have affordable housing. Many California households have no choice but to spend more than half of their incomes on housing costs. Employers have difficulty finding and keeping workers. It doesn’t appear that there is much relief in sight.

Read more here

PG&E Supports Local Communities as It Pays More Than $230 Million in Property Taxes to 50 California Counties

by 360 Feed Wire

December 11,2017

Pacific Gas and Electric Company (PG&E) paid property taxes of more than $230 million this fall to the 50 counties where the energy company owns property and operates gas and electric infrastructure that serves 16 million Californians. The tax payments help support essential public services like education and public safety.

The semi-annual property tax payments made today cover the period from July 1 to December 31, 2017.

Total payments for the full tax year of July 1, 2017 to June 30, 2018 are estimated to total more than $461 million—an increase of $50 million, or 12 percent, compared with the prior fiscal year.

Read more here

They’re leaving California for Las Vegas to find the middle-class life that eluded them

by Steve Lopez in the Los Angeles Times

December  3,2017

The rent steals so much of your paycheck, you might have to move back in with your parents, and half your life is spent staring at the rear end of the car in front of you.

You’d like to think it will get better, but when? All around you, young and old alike are saying goodbye to California.

“Best thing I could have done,” said retiree Michael J. Van Essen, who was paying $1,160 for a one-bedroom apartment in Silver Lake until a year and a half ago. Then he bought a house with a creek behind it for $165,000 in Mason City, Iowa, and now pays $500 a month less on his mortgage than he did on his rent in Los Angeles.

Read more at Los Angeles Times

The Great American Single-Family Home Problem

by Conor Dougherty in The New York Times

December 1,2017

BERKELEY, Calif. — The house at 1310 Haskell Street does not look worthy of a bitter neighborhood war. The roof is rotting, the paint is chipping, and while the lot is long and spacious, the backyard has little beyond overgrown weeds and a garage sprouting moss.

The owner was known for hoarding junk and feeding cats, and when she died three years ago the neighbors assumed that whoever bought the house would be doing a lot of work. But when the buyer turned out to be a developer, and when that developer floated a proposal to raze the building and replace it with a trio of small homes, the neighborhood erupted in protest.

Read more at The New York Times

Don’t let California become Chicago

by Jon Coupal on The Orange County Register

December 1,2017

Well, it happened again. Homeowners in Chicago now face yet another property tax increase to pay for the city’s mounting pension debt. Local taxpayers have already been slammed with nearly $1.1 billion in property tax increases, primarily for police, fire and teacher pensions. That’s on top of a 29 percent tax on water and sewer bills to save the Municipal Employees pension fund; a 56 percent telephone tax hike in 2014 and another 28.2 percent next year for the Laborers fund. Other “revenue enhancements” include a new garbage collection fee, a bag tax, and increases in water, sewer and city sticker fees, hotel and parking taxes and parking fines.

A few weeks ago, the Chicago Sun-Times reported that another shoe is about to drop — a property tax hike scheduled in 2020 to pay for police and fire pensions. Many Windy City residents have had it. According to the U.S. Census Bureau, the greater Chicago area leads the nation in population loss and has had two such years in a row. This is what happens when taxes become so burdensome — people vote with their feet. Not surprisingly, the number-one destination for residents of Illinois fleeing their high-tax state (the fiscal woes are not limited to Chicago) has been Texas — a state with low taxes and greater economic opportunity.

Without a radical shift in policy away from high taxation and toward economic freedom, Chicago is bound for the same fate as Detroit, a city which reached its population peak in the 1950 census at over 1.8 million people, and decreased in population with each subsequent census. As of the 2010 census, the city has just over 700,000 residents, reflecting a loss of a staggering 61 percent of the population.

We’ve written about Chicago before and hope that what is happening there will serve as a clarion call to California policy makers. But given the fact that California now has the highest income tax rate, state sales tax rate and the highest gas tax in America, we’re less than sanguine.

Read more at The Orange County Register

Rising Rent Costs Blocking Homeownership Dreams for Many

by David Wharton in Daily Dose

November 29,2017

It’s no secret that rent prices are taking a big bite out of many Americans’ incomes, especially for those not in a position to purchase a home. Even worse, it’s a real obstacle toward being able to save toward a down payment that could make buying a home a feasible possibility. A new report from Zillow highlights just how bad it’s become—renters are spending nearly $2,000 a year more in 2017 than they would have been prior to the housing bubble.

Read more here

Should California make it easier for seniors to buy and sell homes?

by The San Diego Union-Tribune Editorial Board

November 28, 2017

Proposition 13 — the 1978 initiative putting a limit on property tax rates and how much they can increase each year — has long been ripped by critics who say it has starved the state of needed funding. But one Proposition 13 upside is rarely acknowledged: The initiative keeps retirees from having to pay crushing taxes as the value of their homes soars during one of California’s periodic housing bubbles.

Read more on The San Diego Union-Tribune