Prop. 13 is not the problem
California has some of the highest taxes in the nation. We rank No. 1 among states for sales- and income-tax rates. Our gas tax is second highest, but when cap-and-trade costs are added, we’re No. 1. Even with Proposition 13, the Golden State is in the top third of states in per capita property tax collections. This completely belies the argument that local governments are “starved” due to the 1978 landmark measure. Nonetheless, Prop. 13 continues to provide a convenient excuse for local governments that are prone to overspending and mismanagement.
Thus, it is not surprising that detractors point to Prop. 13 for the poor roads in Moraga. With little analysis, the Aug. 1 report “Setbacks place affluent Moraga in fiscal straits” turned to Prop. 13 as the reason why the city faces a fiscal emergency. Moraga, like California, has a severe spending problem — not a revenue problem.
While still providing local governments a stable source of property tax revenue, Prop. 13 succeeded in stopping out-of-control property taxes by limiting both the tax rate as well as annual increases in taxable value.
Sadly, cities across California suffer from spending more money than they can afford, then face potential bankruptcy that takes decades to remedy. The cities of Vallejo, Stockton, Mammoth Lakes (Mono County) and San Bernardino are just a few victims. While Moraga does not appear close to bankruptcy, it should — as should all municipalities in California — be more careful with its spending.
It is difficult to understand how any city, county or special district in California can be pleading poverty in 2017 given that the aggregate assessed value of real estate has increased more than 5 percent statewide in just the last year.
While Moraga might receive a smaller slice of the property tax pie relative to other cities in Contra Costa County, that is the fault of the apportionment formula enacted by the Legislature, not Prop. 13. That formula can be changed by statute.
Cities facing financial difficulties have no one to blame but themselves. Prop. 13 isn’t the problem now, nor has it ever been.