As the number of ballots left to count in California has decreased, the vote margin against Proposition 15 has grown enough to declare defeat of the controversial property tax increase.
Over the weekend, the ‘No’ votes were winning by 4 percentage points (8,581,862 or 52 percent opposed, compared to 7,923,577 or 48 percent in favor) and only 746,000 ballots remained unprocessed.
Although many predicted a “blue wave” momentum up and down the ballot, dismantling Proposition 13 property tax protections amid the pandemic was not favored by voters.
“It would have been catastrophic for the California economy to raise taxes on businesses throughout the state,” Susan Shelley, VP, communications with the Howard Jarvis Taxpayers Association (HJTA), told the Northern California Record. “This was the election year [the proponents] chose – a presidential year with very high turnout – and they still could not overcome the resistance to raising taxes on businesses in California.”
There have been many attempts to change Proposition 13 since it was passed in 1978.
“People who want to raise taxes are certainly for it,” Shelley said.
The economic uncertainty caused by the COVID-19 pandemic solidified support against what would have been the largest tax hike ever seen in California.
The ‘Yes’ campaign garnered support from the California Teachers Association, Chan Zuckerberg Initiative Advocacy, and SEIU California State Council.
“Across California, regardless of where you live, people are seeing the impacts of Covid on small businesses,” Rachel Michelin, president of the California Retailers Association (CRA), told the Record. “A number counties just moved back to the purple [most restrictive] tier, they have limited resources, and I think that voters saw that taxing businesses, particularly small business, is not the way to get our economy moving again.”
“I am sure that the existing and future economic impacts of COVID-19 did not help the proponents in this election,” Don Gaekle, Stanislaus County Assessor and California Assessor’s Association (CAA) president, told the Record by email.
The CAA formally opposed Prop 15 due to logistics. There are not enough assessors or people training to become assessors or current technologies to manage a split-roll system that taxes commercial property differently from residential.
“It is now clear that Proposition 15 is defeated,” Gaekle added. “The existing provisions of Proposition 13 will continue to apply to Commercial and Industrial base values in California. Assessors will also continue to apply existing Constitutional and statutory provisions to address any future declines in value affecting properties in [the] state.”