Prop 13 ballot measure to reassess commercial properties gets pushback

If passed, the change could raise billions of dollars for counties, including LA, but assessors say it would be difficult to implement

Los Angeles /
Apr.April 01, 2019 08:00 AM
Changes to Prop 13 could raise billions

California voters in 2020 will have a chance to revise a decades-old tax measure, which if passed would reassess the value of commercial properties every three years. That could raise up to $12 billion in its first few years for counties around the state.

While the change to the 1970s-era tax measure, Proposition 13, would be a radical shift, tax assessors say it could be extremely difficult to implement in a reasonable time-frame, according to the Los Angeles Times.

Still the potential impact is big, experts say. Los Angeles County alone could see an additional $3.8 billion a year in commercial property tax collection, according to the Times.

Proposition 13 made it so commercial and residential properties are only assessed for taxes when they change hands. That has allowed property owners who have not sold for decades to pay low, 1970s-level taxes.

The ballot measure proposes creating a split roll tax scheme. Residential taxes would remain under the same rules, but commercial buildings would be reassessed on the three-year schedule.

L.A. County Assessor Jeffrey Prang maintains the work needed to change the tax scheme can’t be done in the three-year transition period implied in the ballot measure.

“It’s physically not possible,” Prang told the Times.

On top of that, the cost of implementation could be as much as $470 million each year for 10 years, possibly more than the tax revenue it generates. [LAT]Dennis Lynch 


Related Articles

arrow_forward_ios
Deborah La Franchi and render of 10400 S. San Pedro (Tim Berger c/o SDS Capital, Getty)
Private equity takes on the supporting housing sector
Private equity takes on the supporting housing sector
Jose Huizar (Getty)
Former LA city councilman José Huizar to plead guilty to bribery and tax evasion
Former LA city councilman José Huizar to plead guilty to bribery and tax evasion
CAA's Thomas K. Bannon with Pasadena (CAA, Getty)
Court to hear challenge to Pasadena rent control measure
Court to hear challenge to Pasadena rent control measure
From left: Lexington Apartments, 1221 Ocean, Thea at Metropolis, and Vue Los Feliz
$500M sale tops list of LA multifamily deals in 2022
$500M sale tops list of LA multifamily deals in 2022
Skanska USA's Clare De Briere and renderings of the project at 8633 Wilshire Boulevard in Beverly Hills (LinkedIn, Skidmore, Owings & Merrill)
Skanska USA redesigns office building in Beverly Hills
Skanska USA redesigns office building in Beverly Hills
Pasadena Councilwoman Jess Rivas (City of Pasadena, Getty)
Pasadena to implement city’s first rent control measure
Pasadena to implement city’s first rent control measure
Anaheim Mayor Ashleigh Aitken and Angel Stadium at 2000 E Gene Autry Way, Anaheim (Wikipedia, Anaheim.net)
New Anaheim mayor and council “hit the reset button” on Angels Stadium
New Anaheim mayor and council “hit the reset button” on Angels Stadium
From left: UCLA Ziman Center for Real Estate's Eric Sussman; The Keystone Team's Cyrus Mohseni; WEA's Stephen Shapiro; Amalfi Estates' Anthony Marguleas (Getty, WEA, The Keystone Team, Amalfi Estates, UCLA Ziman Center for Real Estate)
With mansion tax looming, LA agents advise clients to sell luxury homes
With mansion tax looming, LA agents advise clients to sell luxury homes
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...