patrick.net

Zetabeos,

Wait a second -- the link you sent points to pdf documents that show explicitly the depreciation tables for computers , copiers and what have you..

So what do you mean that you have to contest valuations in order to get depreciation?

It certainly requires plenty of bookkeeping, but should a business not keep track of the book value of its equipment in any case? It seems like good business practice in any event.

Big picture : Many small businesses are not all that capital intensive, Maybe 10-20-50k per employee. Keep track of your assets properly, and then pay 100-200-500 bucks per employee the first year, and less thereafter.

Regular (real estate) property tax seems much more onerous than this relatively minor stuff, especially considering the current housing prices.

In SV typical small corporation have 20-30M in Fixed Assets costs.
They will include leasehold improvements, IT infrast, like ERP and CRM systems, and pulled inventory as test beds, these can go into millions.

In the larger companies, before Mfg was outsourced from SV full scale production and testing machinery was also included which went into Billions. You can image how much capital was used in clean room Semiconductor fabrication plants which once littered this valley.

"The assessed value also depreciates (for non-real property) every year, which means that the taxes will decrease as the property ages."

Every corporation buy more each year in new capital. Its seems to never end and only grows. And so does the tax bill.

Zetabeos,

Every corporation buy more each year in new capital. Its seems to never end and only grows. And so does the tax bill.

Sure, but your claim (below) was that people kept paying taxes on old and worthless equipment unless they actively *contest* the valuations. That is simply not the case. Just applying the tabulated depreciation is sufficient.

>>If you contest the valuations by the county else its flat for its full life span.

NOT to ZetaBeos or anyone in particular:

There is a long-standing tradition in this country of tax exaggeration. People make exaggerated claims about how much the gubbermint is taxing them, and then the claims become part of the folklore and the "conventional wisdom".

Only one thing is amiss: Many of the claims are quite inaccurate or just plain wrong. I specifically don't have any particular bone to pick with ZetaBeos about this. I just want people to realize that taxes are often not as high or bad as the conventional wisdom claims. There is a lot of anti-tax propaganda echoing around out there!

Capture a greater part of property values and you'll also collect a part of the uplift in property values provided by public infrastructure. On the other hand if you tax doers, you'll have less economic activity and a decaying public infrastructure.

Big statement? Then list the highest property-taxing states, from New Hampshire downwards. Coincidentally (?), your list will prove to be a list of the best economic performers, down to the basket case into which California has turned itself by means of Proposition 13. - QED.

Prop 13 is the reason property is so expensive in California. That is when prices decoupled with reality. Prices would never be so high if people were forced to pay high property tax too.

I suppose that is how the early nineties real~estate collapse was averted in California: Prop 13 kept prices going up and up from 89 through 96. LOL, of course, IT DIDN'T DO ANY SUCH THING. If you don't want prices to be so high why not just tax every property 100%, that way almost NO ONE will be able to buy a house. Would that make you happy?

Prop Tax assesment are available on zillow for free.

IF the fools overpaid for RE and are overpaying for Prop Tax, I shed no tear. They were fools to begin with. The only group interested in doing away with Prop 13 is the Teacher Unions… Its been true since 1978.

TrueDat!

;
I suppose that is how the early nineties real~estate collapse was averted in California: Prop 13 kept prices going up and up from 89 through 96. LOL, of course, IT DIDN’T DO ANY SUCH THING. If you don’t want prices to be so high why not just tax every property 100%, that way almost NO ONE will be able to buy a house. Would that make you happy?

You silly boy. Take a high-school level course in mathematical logic and you will know that your argument is complete fabrication.

Nobody claimed that (A) Prop 13 would prevent prices from falling. What was claimed was that (B) Prop 13 was a driving force behind rapidly *rising* property prices in bubble and boom times.

You are claiming that B implies A. It doesn't. I (and others) were specifically not claiming A, nor that B implies A. We were simply claiming "B".

yep, it aint gonna happen. The old geezers would be out on the streets.

This is BS. Every other state has figured this out. My parents live in Oklahoma and once you turn 65 your taxes are frozen unless you move. "kicking out granny" is propaganda brought about by the REAL benefactors of Prop 13, Commercial RE owners.

How to attack the problem? Start with attacking the smaller, individual homeowners first. The easiest one to start is, attack the inheritance of tax base under prop 13, because it is simply morally WRONG. The inheritance of tax base, as far as I understand it, is only between direct descendants, but not applicable to corporations if a transaction takes place.

Your info about corps is wrong. The tax base only changes if one entity takes 51% ownership. Read this article:
http://www.signonsandiego.com/news/state/20080702-1315-ca-statebudget-corporatetaxes.html

THIS is the real travesty of Prop 13. It's the commercial RE owners screwing the system. At this point I'd be happy if they simply deleted the CRE portion of Prop 13.

Oakland, CA is on the brink of bankruptcy:

Consider the city's cash position: Out of next year's general fund of approximately $415 million, police costs are estimated at $212 million, fire protection service $103 million and $41 million in debt service payments. That leaves about $60 million to pay for everything else, from library services to recreation centers to public works.

Wow. I knew it was bad, but not THAT bad. Police and Fire Departments constitute *** 76 % **** of Oakland's general fund.
Double-wow.. Talk about living in a police state.

I like the new feature that says when all the members joined:

It reveals that OO, Eliza. empty_houses and myself (justme) joined on the same day: June 16th, 2007. Probably a few others, too, I did not search very far.

What are the odds? There must have been something in the air that day.

And Headset joined on June 20th, 2007, shortly thereafter.

I added icons too. You should have a link at top that says "Add Icon".

Icons? I'll have to think about that one :-) Is there going to be an arms-race in icons now?

justme,

nothing was in the air that day except that Patrick made it compulsory for one to join in order to post. I remember myself posting way earlier than that date.

OO,

Aha, I did not know that. Perhaps that is why I signed up as well. I do not recall exactly.

OO,
Aha, I did not know that. Perhaps that is why I signed up as well. I do not recall exactly.

@Just Me

Why am I not surprised? A moron, such as yourself, must have trouble remembering his/her lunch money if your mother didn't tuck it into your shoe.

Thanks, WIlly. Coming from you, that means a lot.

Why not revise Prop. 13 to "owner-occupied PRIMARY residence"?

That should neatly take care of all the Grannies on teacher pension that they trumpet the thing for. And neatly hose all the parasites and cheats who are the ones really behind it.

Why not revise Prop. 13 to “owner-occupied PRIMARY residence”?
That should neatly take care of all the Grannies on teacher pension that they trumpet the thing for. And neatly hose all the parasites and cheats who are the ones really behind it.

On top of it, they can add the tax lien on primary residence. As long as the primary residence is not sold, you still pay the old tax. When the house is sold, Govt should get their accumulated tax first.

Why not revise Prop. 13 to “owner-occupied PRIMARY residence”?
That should neatly take care of all the Grannies on teacher pension that they trumpet the thing for. And neatly hose all the parasites and cheats who are the ones really behind it.

Agreed 100%

Can agree with all of the 3 above -- but keep in mind that supporters of prop.13 often cannot be bothered with facts or rational discourse. To them, the above can only be met with a sh*tstorm of lies an misrepresentation.

They want prop. 13 to be exactly the way it is, and no amount of rational thinking is going to change that.

Why not revise Prop. 13 to “owner-occupied PRIMARY residence”?
That should neatly take care of all the Grannies on teacher pension that they trumpet the thing for. And neatly hose all the parasites and cheats who are the ones really behind it.

Careful w/ that. My landlord keeps his name and this home's address on the tax rolls and his wife's name and their real primary residence address on the tax rolls for their house. I'm sure there has to be a tax or insurance reason for doing this. Idk if the FTB can catch such behavior.

grywlfbg,

Agree that any laws must be carefully examined for intended or unintended loopholes.

There's a LIMIT to how far you can carry that scheme, and I view that as acceptable risk for SIMPLE revision. By "on the rolls" do you mean the wife is the owner in deed and all other paperwork? That would make things simpler during divorce eh?

It would slice out a large chunk of slumlords who rent out family houses they inherited. I know of plenty of examples here in Davis where original owners died long ago, and the children haven't been here in decades. They get some Realtor (TM) to be their property manager and rent them to students. Instead of putting these houses back on the market as would happen in other states, the low taxes they inherited form a subsidy that makes it profitable for them to continue renting them forever.

The real elephant in the room is Commercial Real Estate as previously stated by many. The Disney folks and strip mall owners who inherited a windfall will squeal like stuck pigs.

A husband & wife playing ownership shell games to beat the tax system hardly seems worth the extra effort to chase down.

The problem is not revenue generation. It is spending. Got to starve the beast.

jgreer8024: The problem is not revenue generation. It is spending. Got to starve the beast.

UG!! For the 14 BILLIONTH TIME: Repealing Prop 13 isn't so much about raising taxes, it's about *FAIR* taxes. Equalize all taxation for property so that it's revenue neutral. My landlord, who got put on the title of his mothers house, then inherited it w/o reassessment, would see a big increase. Recent homeowners would see a big *decrease*. How the #$@% is it fair for me to pay 10X the taxes my landlord pays if I bought the house from him?

What's important is getting rid of the incentive to just squat on land even for non-economic uses, just because the tax is almost nil.

Sometimes I think these pro Prop 13 people are just willfully ignorant.

Just because the State has a spending problem does not justify brain dead tax policy.

You are more than welcome, Justme. An *sshole such as yourself merits everything sh*tty thing you get. Get well soon.

Agree with MarkInSF completely.

You can eliminate the the unfair aspects of Prop 13 without giving an extra dime (in total) to Sacramento. Sure, the taxes for some would go up, but you could equalize that by lowering taxes for others. The point is to make the system *fair* for all landowners.

Unfortunately, we have too many people who have climbed the ladder, and now they want to kick it down.

Anyone who tries to organize a repeal of prop 13 will have a very difficult time as Prop 13 protects many specific groups due to the way that it was written:

1. Any owner of a home (just a guess, but the idea is pre-bubble, below inflation rate) pre-1999 who is paying way less tax than the current, inflation adjusted through 1980 rate.
2. Any renter can care less about repealing prop 13 as the proposition do not affect renters directly (and probably benefits them as most rentals are paying less tax than comparable current market home rates)
3. Any commercial property owner would not want Prop 13 repealed for reasons already stated in this thread
4. Anyone who does not want to see their taxes raised (let's not argue whether this is good or bad, but the fact is most people would prefer to pay less tax if asked) will not want to remove the 2/3rd requirement of both houses to passing new property tax

So to repeal prop 13 in one swoop would pit you against all of these groups, which appears to be way more than the majority of Californians.

Unless you can break this down (most likely into some sort of "reform" prop 13 campaign) or find a very compelling reason to get people on board despite their stake in keeping prop 13 in place (i.e., "See, if you repeal prop 13, then we'll get more revenue and the 2009 CA budget crisis will be resolved!), then I do not see how this law is going to be repealed.

Ah, all these compliments just for calling you a silly boy ....

I live in an area that has taxes for a $200k home at about $1,000 per year. So I've been shocked to find out about Calif taxes, and Mello Roos. I wiki'd it to find out more - and according to what I read, it's a way to get more dollars without increasing taxes. These are extra charges that aren't tax deductible, and some cost upwards of $1000 per month. So I don't understand what the difference between Mello Roos and Taxes are - other than semantics.

I'm very anti-semantic.

I think Mello-Roos is just another case of making the (relative) newcomers pay for what the old-timers used to get for free.

It is sort a prop.13 on steroids. Not only do the newcomers pay higher regular property taxes, but they also get additional assessments for infrastructure (there's that popular word again) through Mello-Roos.

just another case of making the (relative) newcomers pay for what the old-timers used to get for free.

Get used to it. To deal with the deficits, look to see increased number of toll roads, more fees to visit parks, beaches or other public property, and maybe even partial tuition charges for public schools along with a charge for riding that yellow bus.

Well, yeah, I'm pretty used to it already. The only freebie I got in California was a bit of public education. Not that I didn't work rather for it.

"1. Any owner of a home (just a guess, but the idea is pre-bubble, below inflation rate) pre-1999 who is paying way less tax than the current, inflation adjusted through 1980 rate.
2. Any renter can care less about repealing prop 13 as the proposition do not affect renters directly (and probably benefits them as most rentals are paying less tax than comparable current market home rates)
3. Any commercial property owner would not want Prop 13 repealed for reasons already stated in this thread
4. Anyone who does not want to see their taxes raised (let’s not argue whether this is good or bad, but the fact is most people would prefer to pay less tax if asked) will not want to remove the 2/3rd requirement of both houses to passing new property tax"

Assuming people act in their economic self-interest:

Agree with #1.

Disagree with #2 to the extent that said renters are looking to buy their first home. (Me, for example.)

Disagree with #3 with regard to new commercial property owners. I.e., the analysis should theoretically be the same for commercial owners as it is for residential owners in #1.

Agree generally with #4, but I feel that many (at least I) who call for the repeal of Prop 13 due to its unfairness are referring to its property tax provisions and not the 2/3-majority provisions. Though it is true that a wholesale repeal would, by definition, capture both.

So much attention from you, justme, people will think we're in love.

See, I *knew* you could say something nice if you wanted to. Shall we call it even?

Disagree with #2 to the extent that said renters are looking to buy their first home. (Me, for example.)
Disagree with #3 with regard to new commercial property owners. I.e., the analysis should theoretically be the same for commercial owners as it is for residential owners in #1.
Agree generally with #4, but I feel that many (at least I) who call for the repeal of Prop 13 due to its unfairness are referring to its property tax provisions and not the 2/3-majority provisions. Though it is true that a wholesale repeal would, by definition, capture both.

I am happy that you disagree with me, but I am afraid that you are in the minority of your group.
Point 2 (renters): How many renters actually know anything about Prop 13? Even if you include those who are looking to buy, this is not their primary concern and many are not educated about real estate to the extent that they would consider anything other than what their real estate agent and friends are saying. Unfortunately, the general populace does not read forums like this one.
Point 3 (commercial owners): I was stating current commercial property owners have no incentive to repeal Prop 13. Obviously, any prospective commercial property buyers would (hopefully) know about Prop 13, but how many people is this? Many of these buyers are already commercial property owners, so we are really talking about first time (in CA) commercial property owners only. And if they get in at a good price, they will suddenly become pro-Prop 13 people to protect their own interests.
Point 4 (anti-tax crowd): I understand that most people point to the unfairness aspect of the proposition when discussing Prop 13. I think my first 3 points cover this aspect and my fourth point is really a culmination of why I think it is near impossible to ask for the repeal of Prop 13 as a whole - it has too many different provisions that help many segments of the populace in multiple ways. Even if you can find someone who agrees that the property tax portion is unfair, the pro-Prop 13 crowd will simply state that if you repeal Prop 13, you will get taxed more.
In short, any repeal Prop 13 measures must focus on a specific aspect at any one time in order to succeed. You simply cannot suggest a wholesale repeal of Prop 13 and think that it will ever pass in CA. Although, at this point in time (budget crisis, anti-CA government sentiments), you could make an argument that this is the perfect time to can not only Prop 13, but the entire CA budget process.

I'd be happy to just get rid of the Commercial property exemptions of Prop 13. To avoid the idiots, call it something else. The Fair Tax Proposition. Rt now people are angry at the establishment for "causing" the recession. I'm sure if you framed it correctly (stop bad, evil corporations from avoiding taxes) it would pass in a landslide.