$57 million.
That’s how much Proposition 19 supporters have spent to persuade voters to approve the ballot question. According to state records, over $51 million has come from the California Association of Realtors, while the National Association of Realtors pitched in nearly $5 million.
What have opponents spent? Zero.
Under existing state law, virtually all homes in California have their values reassessed after being purchased.
Prop 19 would allow anyone over 55, severely disabled, or the victim of wildfires to move into a new home but be taxed based on their old assessment.
Take a 57-year-old who bought a house in 2000 that was assessed then at $100,000. If she buys a house this year for $1 million, her tax bill will be the same as it was on the old home based on its 20-year-old assessment.
Despite such tax breaks, the measure’s supporters — including Gov. Gavin Newsom and other Democratic leaders — voice confidence that Prop 19 will yield a net gain in tax revenue, with the money going to address California’s wildfire crisis.
That’s because the initiative also “eliminates unfair tax loopholes used by East Coast investors, celebrities, wealthy non-California residents, and trust fund heirs.” Yes, that is the actual language of the ballot measure.
The “loophole” is that today, inherited homes are not reassessed. Under Prop 19, inherited homes that are not primary residences will be assessed anew.
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So, why does the state’s real estate agent lobby care?
The California Association of Realtors pitches Prop 19 as addressing the wildfire problem. But the measure’s primary impact would be incentivizing home purchases for anyone over age 55.
“This is a proposal being put forth by the real estate industry in order to gin up commissions by encouraging older Californians to sell their homes,” said Daniel Yukelson, executive director of the Apartment Association of Greater Los Angeles, although his group, like much of the real estate industry, has not taken a formal position on Prop 19.
A CAR spokesperson responded to questions by stating, “We do not discuss funding,” and added, “The ‘Yes on 19’ campaign is focused on educating voters who will be voting on many state and local initiatives.”
Despite no money being spent against it, Prop 19’s passage is no sure thing.
“This measure is so esoteric,” Sussman noted. “I don’t see enough understanding of what this means or unhappiness with the status quo.”
The ballot question is labeled as California Proposition 19, Property Tax Transfers, Exemptions, and Revenue for Wildfire Agencies and Counties Amendment (2020).