NEW TV AD: Prop. 15 Will Cut Taxes for Homeowners
Analysis shows that, by closing corporate tax loopholes, Prop. 15 will expand the tax base and result in tax cuts for homeowners
According to a report from Blue Sky Consulting Group, Prop. 15 will result in a tax cut for homeowners. The analysis shows that Prop. 15 expands the tax base by requiring commercial and industrial property worth more than $3 million to pay fair market value taxes, which would lower debt override tax rates that pay for debt service on local, voter-approved bonds.
Based on this report, the Yes on 15 coalition released a new ad ensuring voters know how beneficial Prop. 15 will be for their tax bills, in addition to the benefits for their local communities and schools:
Here is what Tim Gage, the report’s author, stated about the report and TV ad:
"If Proposition 15 passes, homeowners across California stand to save hundreds of millions of dollars on their property tax bills every year due to the measure’s change to the treatment of commercial and industrial property,” said Tim Gage, former Director of the California Department of Finance and Principal & Co-Founder of Blue Sky Consulting Group. “By expanding the tax base – reassessing commercial and industrial property worth more than $3 million – the tax rate that pays for voter-approved bonds will decline, resulting in savings worth hundreds of millions of dollars for homeowners every year. In some locations, homeowners could see as much as $400 savings per year on their property tax bills."
Jesse Rothstein, an economist at the University of California Berkeley, also weighed in on the report’s findings:
“By eliminating the corporate loopholes that result in tax avoidance, Proposition 15 will expand the tax base – resulting in lower taxes for homeowners. This is reflected in Blue Sky Consulting Group’s analysis of voter-approved bonds and Prop. 15,” said Jesse Rothstein, Professor of Public Policy, Economics at University of California, Berkeley. “The return on investment for funding schools is without question, and the last thing California can afford to do is let students fall behind. Prop. 15 will invest in schools while providing relief for homeowners and small businesses.”
The table below shows the average amounts homeowners in different regions of the state will save on their tax bill every year:
Here are example property tax bills that show the voter approved debt service that homeowners currently pay for, which would be reduced by Prop. 15:
This benefit to homeowners comes as the property tax burden has shifted onto homeowners, away from corporations. In 1978, according to the Legislative Analyst’s Office, residential properties accounted for 55% of assessed value, while commercial, industrial and agricultural properties accounted for the remaining 45%. By 2018, residential properties accounted for more than 72% of assessed value, while the share for commercial, industrial and agricultural properties had declined to just under 28%, according to data collected by the Board of Equalization.
Prop. 15 is a November ballot measure that will close corporate property tax loopholes to reclaim nearly $12 billion every year for schools and critical local services – all while protecting homeowners and renters, small businesses, and agriculture. Prop. 15 will also cut business personal property taxes for small businesses. An analysis of Prop. 15 showed that only the top 10% of commercial and industrial properties will generate 92% of the revenue.