California Proposition 15, Tax on Commercial and Industrial Properties for Education and Local Government Funding Initiative (2020)

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California Proposition 15
Flag of California.png
Election date
November 3, 2020
Topic
Taxes and Property
Status
Defeatedd Defeated
Type
Constitutional amendment		Origin
Citizens

California Proposition 15, the Tax on Commercial and Industrial Properties for Education and Local Government Funding Initiative, was on the ballot in California as an initiated constitutional amendment on November 3, 2020. Proposition 15 was defeated.

A "yes" vote supported this constitutional amendment to require commercial and industrial properties, except those zoned as commercial agriculture, to be taxed based on their market value, rather than their purchase price.

A "no" vote opposed this constitutional amendment, thus continuing to tax commercial and industrial properties based on a property's purchase price, with annual increases equal to the rate of inflation or 2 percent, whichever is lower.


Election results

California Proposition 15

Result Votes Percentage
Yes 8,213,054 48.03%

Defeated No

8,885,569 51.97%
Results are officially certified.
Source


Overview

What would Proposition 15 have changed about how properties are taxed in California?

Proposition 15 would have amended the California State Constitution to require commercial and industrial properties, except those zoned as commercial agriculture, to be taxed based on their market value. In California, the proposal to assess taxes on commercial and industrial properties at market value, while continuing to assess taxes on residential properties based on the purchase price, was known as split roll. The change from the purchase price to market value would have been phased-in beginning in fiscal year 2022-2023. Properties, such as retail centers, whose occupants are 50 percent or more small businesses would have been taxed based on market value beginning in fiscal year 2025-2026 (or at a later date that the legislature decides on). Proposition 15 would have defined small businesses as those that that are independently owned and operated, own California property, and have 50 or fewer employees.

The ballot initiative would have made an exception for properties whose business owners have $3 million or less in holdings in California; these properties would have continued to be taxed based on their purchase price. The ballot initiative would have exempted a small business’s tangible personal property from taxes and $500,000 in value for a non-small business’s tangible personal property.[1]

The state fiscal analyst estimated that, upon full implementation, the ballot initiative was expected to generate between $8 billion and $12.5 billion in revenue per year.[2]

Proposition 15 would have made the California State Legislature responsible for passing laws for a phase-in of the market value-based tax on commercial and industrial properties, how often reassessments would occur (no less than three years between reassessments), and an appeals process for challenging reassessments.[1]

Where did the current tax assessment formula, based on purchase price, come from?

See also: California Proposition 13 (1978)

In 1978, Californians approved Proposition 13, which required that residential, commercial, and industrial properties are taxed based on their purchase price. The tax is limited to no more than 1 percent of the purchase price (at the time of purchase), with an annual adjustment equal to the rate of inflation or 2 percent, whichever is lower. According to the state Legislative Analyst's Office, market values in California tend to increase faster than 2 percent per year, meaning the taxable value of commercial and industrial properties is often lower than the market value.[2]

How would revenue from the change in taxation have been distributed?

Proposition 15 would have created a process in the state constitution for distributing revenue from the revised tax on commercial and industrial properties. The ballot initiative would have distributed the revenue to specific areas, rather than the General Fund. First, the revenue would have been distributed to (a) the state to supplement decreases in revenue from the state's personal income tax and corporation tax due to increased tax deductions and (b) counties to cover the costs of implementing the measure. Second, 60 percent of the remaining funds would have been distributed to local governments and special districts, and 40 percent would be distributed to school districts and community colleges (via a new Local School and Community College Property Tax Fund). Revenue appropriated for education would have been divided as follows: 11% for community colleges and 89% for public schools, charter schools, and county education offices. There would have also been a requirement that schools and colleges receive an annual minimum of $100 (adjusted each year) per full-time student.[1][2]

Text of measure

Ballot title

The ballot title was as follows:[3]

“ Increases Funding for Public Schools, Community Colleges, and Local Government Services by Changing Tax Assessment of Commercial and Industrial Property. Initiative Constitutional Amendment.[4] ”

Ballot summary

The ballot summary was as follows:[3]

“
  • Increases funding for K-12 public schools, community colleges, and local governments by requiring that commercial and industrial real property be taxed based on current market value, instead of purchase price.
  • Exempts from taxation changes: residential properties; agricultural land; and owners of commercial and industrial properties with combined value of $3 million or less.
  • Any additional educational funding will supplement existing school funding guarantees.
  • Exempts small businesses from personal property tax; for other businesses, provides $500,000 exemption.[4]
 ”

Fiscal impact statement

The fiscal impact statement was as follows:[3]

“

Increased property taxes on commercial properties worth more than $3 million providing $6.5 billion to $11.5 billion in new funding to local governments and schools.[4]

”

Constitutional changes

See also: California Constitution

The ballot initiative would have added Section 8.7 to Article XVI, Section 8.6 to Article XVI, Section 2.5 to Article XIII A, Section 3.1 to Article XIII, and Section 15 to Article XIII B of the California Constitution.[1]

Full text

The full text of the ballot initiative is below:[1]

Readability score

See also: Ballot measure readability scores, 2020
Using the Flesch-Kincaid Grade Level (FKGL and Flesch Reading Ease (FRE) formulas, Ballotpedia scored the readability of the ballot title and summary for this measure. Readability scores are designed to indicate the reading difficulty of text. The Flesch-Kincaid formulas account for the number of words, syllables, and sentences in a text; they do not account for the difficulty of the ideas in the text. The attorney general wrote the ballot language for this measure.


The FKGL for the ballot title is grade level 18, and the FRE is -11. The word count for the ballot title is 23, and the estimated reading time is 6 seconds. The FKGL for the ballot summary is grade level 14, and the FRE is 16. The word count for the ballot summary is 74, and the estimated reading time is 19 seconds.


Support

CA Schools & Communities First logo 2018.jpg

Schools and Communities First, also known as Yes on 15, was leading the campaign in support of the ballot initiative.[5] The campaign named the ballot initiative the Schools and Local Communities Funding Act.[1]

Supporters

The following is a selection of individuals and organizations that endorsed the ballot initiative.[6] Schools and Communities First provided a list of supporters, which is available here.

Officials

Former Officials

Political Parties

Government Entities

  • Oakland Unified School District
  • Santa Clara County Board of Supervisors
  • Los Angeles Unified School District
  • Oakland City Council
  • Contra Costa County Board of Supervisors
  • San Francisco Board of Supervisors
  • Los Angeles County Board of Supervisors

Unions

Organizations

  • ACLU of Northern California
  • ACLU of Southern California
  • Alliance of Californians for Community Empowerment
  • Califoria Calls
  • California Alliance for Retired Americans
  • California League of Conservation Voters
  • Chan Zuckerberg Advocacy
  • Consumer Federation of California
  • Democracy for America
  • Democratic Socialists of America
  • Equality California
  • Indivisible California
  • League of Women Voters of California
  • Mi Familia Vota
  • New Approach PAC
  • PICO California
  • Parent Teachers Association of California
  • San Francisco Unified School District
  • Sierra Club California

Individuals

  • Dolores Huerta - Co-Founder of the United Farm Workers
  • Nicholas Pritzker - Businessman


Arguments

  • Ben Grieff, campaign director of Evolve California: "Chevron is getting the same deal as Grandma. That doesn’t make any sense."
  • Josh Pechthalt, president of the California Federation of Teachers: "We’re asking for companies like Disneyland or Universal Studios that make huge amounts of money to pay property taxes based on fair market value—the same thing that homeowners and, frankly, most businesses have to do."
  • Alex Stack, communications director for Schools and Communities First: "We're really talking about a fraction of top corporations in the state that have benefited for decades from egregiously low property tax rates, assessments from the 1970s"
  • Fred Blackwell, CEO of the San Francisco Foundation: "Closing the commercial property tax loophole is important to our state and to our Bay Area region. It is our opportunity to effect positive change by restoring more than $11 billion a year to our schools and vital community services without raising taxes on homeowners, renters and small businesses."
  • San Francisco Mayor London Breed (D): "When I look at our dire budget deficits over the next couple of years, and then I see these revenue estimates showing how much we can invest in our community without having to raise any taxes on residents, it makes it more important for me to give my full support on this initiative."
  • Dolores Huerta, co-founder of the United Farm Workers: "Most important, Schools and Communities First is designed specifically to help address inequities that poorer school districts face, which has significant implications for communities of color. Every single student in California will benefit from this measure, but particular importance is paid to underserved communities — additional funding will go toward low-income students, English-learners and foster youth. This, on top of the increased investments that local governments can make in their communities, will go a long way toward supporting our communities most in need."
  • Jacques Leslie, a contributing opinion writer for the Los Angeles Times: "Its creators could have had no advance knowledge of the coronavirus pandemic. But COVID-19’s crippling of the state’s economy has underlined the importance of the initiative. … This limited reform could generate proceeds as high as $12.4 billion a year, according to a February study by three USC researchers. … Because of COVID-19, California is facing a $54-billion budget deficit over the next year. State revenues are expected to drop by a staggering $41.2 billion compared with a pre-coronavirus projection in January."
  • Walter Wilson and Reginald Swilley, business owners in the Minority Business Consortium: "At the Minority Business Consortium, we have seen how COVID-19 has hit the small, local, minority- and women-owned businesses that are vital to the fabric of our communities. Eighty percent of all jobs come from small businesses. For these firms, Proposition 15 provides much-needed relief. It includes a $1 billion tax cut on business personal property taxes, which would primarily help small businesses. It would completely exempt small firms whose property is worth $3 million or less, which account for at least 90% of commercial properties in the entire state. And by closing loopholes used by big corporations, it would level the playing field for small companies."


Official arguments

The following is the argument in support of Proposition 15 found in the Official Voter Information Guide:[7]

  • Official Voter Information Guide: We are all better off when everyone pays their fair share. But California is giving away billions of dollars in property tax breaks to wealthy corporations. These billions could be used instead to deal with increasing inequality, persistent poverty, unemployment, unaffordable housing, homelessness and underfunded schools. While the wealthiest corporations avoid paying their fair share, our schools have the most crowded classrooms in the nation and our local communities are struggling to respond to the impact of COVID-19. Prop. 15 is a fair and balanced reform which:
    • closes property tax loopholes benefiting wealthy corporations
    • cuts small business taxes
    • reclaims billions of dollars to invest in our schools and local communities.
    Prop. 15 will: Close corporate loopholes: Wealthy corporations avoid reassessment by employing highly paid tax lawyers and accountants to exploit loopholes in the law. Prop. 15 closes these loopholes by requiring nonresidential commercial properties to be assessed based on their actual fair market value.
    • The top 10% of California's most valuable nonresidential commercial properties account for 92% of Prop. 15's new revenues.
    Does not impact homeowners and renters: Prop. 15 exempts all residential properties, maintaining FULL PROP. 13 PROTECTIONS for homeowners and renters. Cut taxes for small businesses: Prop. 15 protects small businesses and cuts their taxes by:
    • Exempting businesses operated out of a home and businesses owning $3,000,000 or less of nonresidential commercial property
    • Cutting business personal property taxes on equipment, computers and fixtures.
    Restore balance to the property tax: Since Prop. 13 passed, the residential share of property taxes has skyrocketed from 55% to 72% and the nonresidential commercial share has fallen. Meanwhile we're paying more in fees, fines and other taxes. Prop. 15 rebalances the scales. Increase funding for schools and community colleges: Every school district and community college will receive additional funding over and above existing funding guarantees. Prop. 15 funds go directly to education and state politicians can’t take it away. Invest in essential workers and local services: Prop. 15 gives local communities desperately needed resources so essential services and frontline workers can respond to current challenges and prepare for future crises, whether from a wildfire, pandemic, or earthquake. Support economic and racial equity: Prop. 15 makes sure schools with the greatest needs get the most help and gives local communities critically needed resources to deal with the unequal impacts of COVID-19, unemployment, and housing costs on communities of color. Prioritize full transparency and accountability by requiring schools and local governments to publicly disclose all new revenues they receive and how they are spent. Protect agricultural land: Prop. 15 makes no change to existing laws affecting the taxation or preservation of agricultural land. We can’t afford business as usual. Prop. 15 rebalances the scales by closing loopholes and supporting our schools, local communities and small businesses. Prop. 15 takes a big step forward toward a better future for all Californians. It was placed on the ballot by the signatures of over 1,700,000 voters who want wealthy corporations to pay their fair share. Please add your voice to theirs: Vote Yes on Prop. 15. TONY THURMOND, California Superintendent of Public Instruction JACQUELINE MARTINEZ, CEO Latino Community Foundation SASHA CUTTLER, Public Health Nurse San Francisco Department of Public Health

Opposition

California No on Prop 15 2020.png

Stop Higher Property Taxes and Save Prop 13, also known as No on Prop 15, was leading the campaign in opposition to the ballot initiative.[8]

Opponents

Stop Higher Property Taxes and Save Prop 13 provided a list of opponents, which is available here.

Officials

Former Officials

Political Parties

Corporations

  • AMERCO
  • Boston Properties
  • Columbia Property Trust
  • NextEra Energy
  • Paramount Group, Inc.

Organizations

  • AMVETS, Department of California
  • American Legion, Department of California
  • Americans for Tax Reform
  • California Beer & Beverage Distributors
  • California Black Chamber of Commerce
  • California Business Properties Association
  • California Business Roundtable
  • California Chamber of Commerce
  • California Farm Bureau Federation
  • California Fuels & Convenience Alliance
  • California Grocers Association
  • California Hispanic Chambers of Commerce
  • California NAACP State Conference
  • California New Car Dealers Association
  • California Restaurant Association
  • California Restaurant Association
  • California Small Business Association
  • California State National Action Network
  • California Taxpayers Association
  • Howard Jarvis Taxpayers Association
  • National Federation of Independent Business - California
  • New Majority PAC
  • Southern California Leadership Council
  • Western Manufactured Housing Communities Association


Arguments

  • Jon Coupal, president of the Howard Jarvis Taxpayers Association: "This is yet another attack on the longstanding taxpayer protections in Prop. 13. Special interests continue to push for new and higher taxes to pay for their out-of-control pensions, which have already directed existing tax revenue away from classrooms and other state priorities."
  • Rob Lapsley, president of the California Business Roundtable: "We are going to have the largest tax increase in California history at exactly the wrong time in our economy to be able to afford it."
  • Rex Hime, president of the California Business Properties Association: "California already has the worst climate for business and job creation in the country. A split-roll property tax will just increase pressure on many businesses that are already finding it hard to make ends meet."
  • Tom Campbell, state Director of Finance from 2005 to 2006: "From the point of view of attracting and retaining businesses and jobs, the power of Prop. 13, rather, was in allowing California to tell a business: go ahead and sink that concrete into Texas if you want, but you’re taking a big risk that Texas won’t revisit that building a few years later and double your tax assessment. With California, you’re safe. ... In repealing Proposition 13 for businesses, California will be forfeiting our best argument to attract new jobs – a long-term sacrifice that will hollow-out California’s economy, costing us far more $10 billion in a very short time."
  • Ted Gaines (R), a member of the California State Board of Equalization Member: "Agriculture is a $50 billion industry in California that supports hundreds of thousands of jobs. Around 90 percent of California farms are still family owned. The industry, as with so many others, is straining from the shocking and unforeseen effects of coronavirus. This massive jolt in tax costs could be the blow that leads to mass sales and closures of family farms and destroy legacies that stretch back more than a century. California is blessed with some of the world’s best farmland but it’s cursed by some of the worst public policy. Prop. 15 would only make it harder and more expensive for agriculture to flourish in our state."


Official arguments

The following is the argument in opposition to Proposition 15 found in the Official Voter Information Guide:[9]

  • Official Voter Information Guide: PROP. 15 WILL BE THE LARGEST ANNUAL PROPERTY TAX INCREASE IN CALIFORNIA HISTORY—UP TO $12.5 BILLION PER YEAR! Prop. 15's massive increase in annual property taxes will have disastrous economic impacts for every Californian—from small businesses and consumers to farmers and homeowners. PROP. 15 REPEALS TAXPAYER PROTECTIONS IN PROP. 13 Prop. 13's taxpayer protections have kept property taxes affordable by capping property taxes and limiting increases annually, providing taxpayers certainty they can afford their property taxes now and into the future. Prop. 15 eliminates that certainty for millions of taxpayers.
    • "Prop. 15 is a direct threat to homeowners. Supporters of the tax hike openly admitted that this is merely the first step in completely dismantling Prop. 13 which voters approved to stop skyrocketing property taxes." —Jon Coupal, President, Howard Jarvis Taxpayers Association
    PROP. 15 RAISES OUR COST OF LIVING Prop. 15's tax hike will increase costs on everything people buy, including groceries, fuel, utilities, day care and health care.
    • "Too many families have been priced out of their neighborhoods because of the rising cost of living. Prop. 15 will raise the cost of living for California families by up to $960 and will especially hurt lower–income communities." —Alice Huffman, President, California State Conference of the NAACP
    PROP. 15 DESTROYS JOBS AND SMALL BUSINESSES Seven million Californians work for a small business. Millions of Californians are filing for unemployment and are at risk of losing everything. NOTHING in Prop. 15 stops the tax from being passed on to small business tenants. Prop. 15 will make the economic crisis worse by devastating small businesses—including our neighborhood restaurants, barbershops, and dry cleaners.
    • "Most small businesses rent the property on which they operate. Prop. 15's higher property taxes will mean skyrocketing rents at a time we can least afford it." —Jot Condie, President, California Restaurant Association
    PROP. 15 RAISES TAXES FOR FAMILY FARMERS, RESULTING IN HIGHER COSTS FOR FOOD Prop. 15 will raise property taxes on farming—including barns, dairies, processing plants and even fruit and nut trees.
    • "Prop. 15 hurts family farmers and we all will end up paying higher costs for groceries including milk, eggs and meat." —Jamie Johansson, President, California Farm Bureau Federation
    PROP. 15 LACKS ACCOUNTABILITY Prop. 15 will cost taxpayers $1 billion each year in bureaucratic expenses, and politicians can spend the higher property tax revenue on anything they want, including administrative costs, outside consultants and pay raises.
    • "Prop. 15 allows politicians to divert its tax hike revenue to anything the special interests want, just like they’re doing with the gas tax." —Marilyn Markham, Board Member, California Senior Advocates League
    INDEPENDENTS, DEMOCRATS AND REPUBLICANS AGREE—NO ON PROP. 15. NOW IS NOT THE TIME TO RAISE PROPERTY TAXES IN CALIFORNIA. ROBERT GUTIERREZ, President California Taxpayers Association ALICE HUFFMAN, President California State Conference of the NAACP BETTY JO TOCCOLI, President California Small Business Association

Campaign finance

See also: Campaign finance requirements for California ballot measures

The Schools and Communities First PAC and allied committees registered to support the ballot initiative. Together, the committees raised $69.21 million, including $19.81 million from the California Teachers Association Issues PAC.[10]

Eight PACs, including Californians to Stop Higher Property Taxes, were registered to oppose the ballot initiative. Together, the committees had raised $74.74 million, including $39.30 million from the California Business Roundtable Issues PAC.[10]

Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Support $66,835,107.03 $2,373,802.43 $69,208,909.46 $66,151,591.66 $68,525,394.09
Oppose $74,223,557.95 $573,614.21 $74,797,172.16 $73,577,129.74 $74,150,743.95

Support

The following table includes contribution and expenditure totals for the committees in support of the initiative.[10]

Committees in support of Proposition 15
Committee Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Yes on 15 - Schools and Communities First $61,338,254.95 $2,362,907.43 $63,701,162.38 $60,694,769.25 $63,057,676.68
Million Voter Project Action Fund - Yes on 15 $5,063,908.08 $0.00 $5,063,908.08 $5,005,356.58 $5,005,356.58
Pico California Action Supporting Schools and Communities First - Yes on 15, No on 20 $256,100.00 $10,000.00 $266,100.00 $300,055.46 $310,055.46
Silicon Valley Rising Action Issues Committee, Yes on 15 $165,000.00 $895.00 $165,895.00 $149,348.45 $150,243.45
California Democratic Socialists of America (DSA) Political Action Committee in Support of Prop 15 $11,844.00 $0.00 $11,844.00 $2,061.92 $2,061.92
Total $66,835,107.03 $2,373,802.43 $69,208,909.46 $66,151,591.66 $68,525,394.09

Donors

The following were the top five donors who contributed to the support committees.[10]

Donor Cash Contributions In-Kind Contributions Total Contributions
California Teachers Association Issues PAC $19,050,000.00 $761,409.78 $19,811,409.78
Chan Zuckerberg Advocacy $11,615,000.00 $0.00 $11,615,000.00
SEIU California State Council $6,250,000.00 $52,493.95 $6,302,493.95
SEIU Local 2015 Issues PAC $3,087,880.87 $324,375.83 $3,412,256.70
SEIU 1021 Issues PAC $2,285,000.00 $21,232.36 $2,306,232.36

Opposition

The following table includes contribution and expenditure totals for the committees in opposition to the initiative.[10]

Committees in opposition to Proposition 15
Committee Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
No on Prop 15 - Stop Higher Property Taxes and Save Prop 13 $68,694,068.00 $496,424.77 $69,190,492.77 $68,694,313.00 $69,190,737.77
Protect Prop. 13, No on 15 $2,795,301.44 $0.00 $2,795,301.44 $2,349,980.83 $2,349,980.83
Family Farmers Against Prop 15 - Stop Higher Food Taxes $2,404,763.07 $77,139.44 $2,481,902.51 $2,398,770.78 $2,475,910.22
Stop the Tax Hikes, No on 15 and 19 $238,471.02 $50.00 $238,521.02 $68,958.32 $69,008.32
CalCIMA Issues Pac, No on Proposition 15 $61,550.00 $0.00 $61,550.00 $57,706.95 $57,706.95
Stop Higher Taxes Committee $10,900.00 $0.00 $10,900.00 $114.25 $114.25
California State Club Association Against Prop 15: No to Higher Property Taxes $9,288.33 $0.00 $9,288.33 $0.00 $0.00
Agricultural Council of California Committee in Opposition to Prop. 15 $9,216.09 $0.00 $9,216.09 $7,285.61 $7,285.61
Total $74,223,557.95 $573,614.21 $74,797,172.16 $73,577,129.74 $74,150,743.95

Donors

The following were the top five donors who contributed to the opposition committees.[10]

Donor Cash Contributions In-Kind Contributions Total Contributions
California Business Roundtable Issues PAC $39,140,000.00 $163,990.19 $39,303,990.19
California Business Properties Association Issues PAC $2,305,000.00 $0.00 $2,305,000.00
Nextera Energy, Inc. $1,295,000.00 $0.00 $1,295,000.00
California Taxpayers Association - Protect Taxpayer Rights $1,210,000.00 $0.00 $1,210,000.00
AMERCO $896,000.00 $0.00 $896,000.00

Media editorials

Ballotpedia identified the following media editorial boards as taking positions on the ballot initiative. If you are aware of a media editorial board position that is not listed below, please email the editorial link to editor@ballotpedia.org.

Support

The following media editorial boards published an editorial supporting the ballot measure:

  • San Francisco Chronicle Editorial Board: "For more than 40 years, California has endured a contorted property tax system that punishes home buyers, chills housing construction and rewards businesses who skate by when assessments are set. Proposition 15 would ease the worst of these abuses while protecting homeowners and small businesses. It sets a path that should continue in overhauling an out-of-whack tax code. … Prop. 15 offers a solution to this unfairness. It calls for splitting the rolls, with residential property staying within the present protections while it sets more timely assessments for large business holdings. The heart of the original law that protects homeowners from sharp tax boosts will be saved. Businesses won’t get an undue break."
  • Los Angeles Times Editorial Board: "The other way that one could, and we argue should, view Proposition 15 is through a lens of hope. At long last there is a tangible fix in sight for one of California’s most intractable problems: a wildly unfair and lopsided property tax system that for four decades has starved local governments of the revenue they need to provide services and that has distorted the cost of buying a house and starting a business, to the detriment of young families and entrepreneurs. ... Indeed, much of what ails California — crumbling roads, under-resourced schools and inadequate social services — can be traced to Proposition 13 and related anti-tax measures. Proposition 13 also shifted the local tax burden, as cities, counties and school districts increasingly turned to other levies, such as sales, hotel and utility taxes, to make up the lost revenue."
  • The Sacramento Bee Editorial Board: "Proposition 15 gives Californians a chance to fix one of the most glaring errors of the past four decades: a massive tax break for wealthy commercial property owners who can afford to pay their fair share of taxes. ... Prop. 15, known as “split roll,” won’t affect property taxes on residential properties, regardless of what its opponents like to claim. It will, however, remedy the historic injustice that has allowed large corporate property owners to avoid paying their fair share of property taxes. The inclusion of non-residential properties in Prop. 13’s reform has starved local governments of billions of dollars in revenue for long enough."


Opposition

The following media editorial boards published an editorial opposing the ballot measure:

  • The Bakersfield Californian Editorial Board: "But as all businesses – including Chevron – are reeling from the economic impacts of the coronavirus pandemic that are expected to drag into the next decade, making such a fundamental change in the property tax system at the ballot box during these chaotic times will have unexpected and possibly dire consequences. Proposition 15 is a far-reaching reform presented at the wrong time. The Legislature should look for ways to close loopholes – such as the corporate loophole – rather than asking voters to approve a massive change to a popular property tax law during the chaos of a pandemic."
  • The Orange County Register Editorial Board: "Proposition 15 does not raise residential property taxes, but if voters signal that Proposition 13 no longer is sacrosanct, it might not be long before tax-hike supporters come after those protections, too. The measure’s supporters dismiss that possibility, but the foundation of their argument is that Proposition 13 is fundamentally unfair in the way that it assesses a higher rate on newer owners than older ones. Consider yourself warned."
  • The San Diego Union-Tribune Editorial Board: "This is a horrible idea for reasons that go beyond the insanity of imposing the largest property tax hike in state history on employers during a deep recession — and beyond the fact that the cost of the tax hikes would be largely passed on to consumers during a deep recession. Approving Proposition 15 is not about preserving essential government services, as advocates assert. It is about preserving generous government pensions that threaten to bankrupt government agencies across the state."
  • Mercury News & East Bay Times Editorial Board: "In short, the big problem is not the disparity between residential and other types of property. It’s the disparity between the taxes paid by long-time property owners and those who purchased recently — an inequity that’s found for both residential and commercial properties. That’s the problem tax reformers should address. And they should be doing it in a way that’s revenue neutral instead of trying to use reform as a vehicle to raise more taxes. There are serious inequities in California’s property tax system that should be addressed. But Prop. 15 misses the mark. Vote no."
  • The Desert Sun Editorial Board: "We agree California taxation needs restructuring, and Proposition 13 most likely must be part of that rewrite — but when the time is right. A clearer vision on how 'split roll' might be phased in over a longer period of time to smooth out potential shocks would help, as would clearer language that ensures promised protections won’t magically vanish or be undone by needed additional legislative action. For now, the vote should be “no” on Proposition 15."
  • San Mateo Daily Journal Editorial Board: "Many suggest there should be changes to Proposition 13 but don’t have the will to replace the current system with one that works best for all. This measure ostensibly would not raise taxes on small businesses but there would be pass-through taxes and those businesses with triple net leases would be seriously affected. It is better to reform the entire system through the Legislature and have the voters decide on that."
  • The Press Democrat Editorial Board: "Unions have stubbornly fought efforts to control those costs, even opposing restrictions on abusive practices like pension spiking. Their solution is raising taxes. Voters should say no until the unions, and public employers, get serious about real pension reform. [...] California’s tax system is overdue for an overhaul, but these measures make piecemeal changes that are as likely to create new problems as solve old ones. The Press Democrat recommends no votes on Propositions 15 and 19."


Polls

See also: 2020 ballot measure polls
California Proposition 15, Tax on Commercial and Industrial Properties for Education and Local Government Funding Initiative (2020)
Poll Support OpposeUndecidedMargin of errorSample size
Berkeley IGS Poll (likely voters)
10/16/2020 - 10/21/2020		 49.0%42.0%9.0%+/-2.05,352
PPIC Statewide Survey (likely voters)
10/9/2020 - 10/18/2020		 49.0%45.0%6.0%+/-4.31,185
SurveyUSA (likely voters)
9/26/2020 - 9/28/2020		 49.0%21.0%30.0%+/-5.4588
Berkeley IGS Poll (likely voters)
9/9/2020 - 9/15/2020		 49.0%34.0%17.0%+/-2.05,942
PPIC (likely voters)
9/4/2020 - 9/13/2020		 51.0%40.0%9.0%+/-4.31,168
Probolsky Research (likely voters)
8/27/2020 - 9/2/2020		 40.9%48.8%10.3%+/-3.3900
PPIC (likely voters)
4/1/2020 - 4/9/2020		 53.0%47.0%1.0%+/-3.71,091
PPIC (likely voters)
11/3/2019 - 11/12/2019		 46.0%45.0%9.0%+/-4.31,008
PPIC (likely voters)
9/16/2019 - 9/25/2019		 47.0%45.0%8.0%+/-4.21,031
PPIC (likely voters)
4/5/2019 - 4/15/2019		 54.0%45.0%1.0%+/-4.01,035
PPIC (likely voters)
1/20/2019 - 1/29/2019		 49.0%43.0%8.0%+/-4.01,154
PPIC (likely voters)
10/27/2018 - 11/5/2018		 56.0%40.0%4.0%+/-4.41,095
USC Dornsife/Los Angeles Times (eligible voters)
9/17/2018 - 10/14/2018		 46.0%22.0%31.0%+/-4.0794
PPIC (likely voters)
3/25/2018 - 4/03/2018		 53.0%42.0%5.0%+/-4.4867
AVERAGES 49.42% 39.99% 10.59% +/-3.88 1,657.86
Note: The polls above may not reflect all polls that have been conducted in this race. Those displayed are a random sampling chosen by Ballotpedia staff. If you would like to nominate another poll for inclusion in the table, send an email to editor@ballotpedia.org.

Background

California Proposition 13 (1978)

Cover of Time on June 19, 1978, featuring Howard Jarvis
See also: California Proposition 13, Tax Limitations Initiative (June 1978)

California Proposition 13, the Tax Limitations Initiative, was on the ballot for the election on June 6, 1978. Voters approved Proposition 13, with 65 percent voting for passage.[11][12] Howard Jarvis, who founded the Howard Jarvis Taxpayers Association, developed Proposition 13. He also worked with Paul Gann on writing the ballot initiative.[13][14]

Proposition 13 required that properties be taxed at no more than 1 percent of their full cash value shown on the 1975-1976 assessment rolls and limited annual increases of assessed (taxable) value to the inflation rate or 2 percent, whichever was less. When a property is sold to new owners, however, the property is reassessed at 1 percent of its full cash value at the time of purchase and the limit on increases to assessed value resets.[11]

Proposition 13 was the beginning of a period in state politics referred to as the tax revolt.[15][16][17] Joel Fox, editor of Fox & Hounds, said Proposition 13 was the "Holy Grail of the tax revolt."[18] The Howard Jarvis Taxpayers Association described Proposition 13 as "a California tax cut with a national identity," stating, "The tax cut message rolled across the country after Proposition 13 passed. Some say it was the spark that ignited a conflagration, which culminated in the election of Ronald Reagan to the presidency."[19]

In 2014, Gov. Jerry Brown stated that he would not seek to change Proposition 13, saying that the initiative was "sacred doctrine that should never be questioned." Gov. Brown, who was also governor in 1978, said that he should have funded a campaign for an alternative to Proposition 13.[20] In 2017, Jennifer Ito, a research director at the University of Southern California, said, "It’s been an issue that no politician wants to touch. Until recently."[21] In October 2018, Howard Jarvis Taxpayers Association president Jon Coupal said, "This is not the California of 1978. It has become more progressive." However, he added, Proposition 13 "[is] withstanding the test of time, no matter what anyone says."[22]

Tax policies on the ballot in 2020

See also: Taxes on the ballot

In 2020, voters in 14 states voted on 21 ballot measures addressing tax-related policies. Ten of the measures addressed taxes on properties, three were related to income tax rates, two addressed tobacco taxes, one addressed business-related taxes, one addressed sales tax rates, one addressed fees and surcharges, and one was related to tax-increment financing (TIF).

Click Show to read details about the tax-related measures on statewide ballots in 2020.

Path to the ballot

See also: California signature requirements and Laws governing the initiative process in California

Process in California

In California, the number of signatures required for an initiated constitutional amendment is equal to 8 percent of the votes cast in the preceding gubernatorial election. Petitions are allowed to circulate for 180 days from the date the attorney general prepares the petition language. Signatures need to be certified at least 131 days before the general election. As the verification process can take multiple months, the secretary of state provides suggested deadlines for ballot initiatives.

The requirements to get initiated constitutional amendments certified for the 2020 ballot:

  • Signatures: 997,139 valid signatures were required.
  • Deadline: The deadline for signature verification was June 25, 2020. However, the process of verifying signatures can take multiple months. The recommended deadlines were March 3, 2020, for an initiative requiring a full check of signatures and April 21, 2020, for an initiative requring a random sample of signatures.

Signatures are first filed with local election officials, who determine the total number of signatures submitted. If the total number is equal to at least 100 percent of the required signatures, then local election officials perform a random check of signatures submitted in their counties. If the random sample estimates that more than 110 percent of the required number of signatures are valid, the initiative is eligible for the ballot. If the random sample estimates that between 95 and 110 percent of the required number of signatures are valid, a full check of signatures is done to determine the total number of valid signatures. If less than 95 percent are estimated to be valid, the initiative does not make the ballot.

Certification of two versions

The first version of the ballot initiative (17-0055) qualified for the ballot on October 15, 2018. On August 13, 2019, the campaign Schools and Communities First, which is behind the proposal, announced that signatures would be collected for a revised version of the ballot initiative (19-0008).[42] Tyler Law, a campaign spokesperson, said that the campaign would not withdraw the qualified initiative from the ballot until the revised initiative qualifies. Law said, “The committee’s got the money. We’re going to get it on the ballot.”[43] On April 2, 2020, the campaign Schools and Communities First reported filing 1.75 million signatures.[44] At least 997,139 (57.02 percent) of the signatures needed to be valid. On May 22, 2020, the office of Secretary of State Alex Padilla announced that a random sample of signatures projected that 74.60 percent were valid. Therefore, the second version of the ballot initiative (19-0008) qualified to appear on the ballot at the general election. On June 23, the state department announced that the first version (17-0055) was withdrawn.

Stages of Initiative #17-0055

On December 15, 2017, Helen Hutchison, Benjamin McBride, and Anthony Thigpenn filed the ballot initiative with the attorney general's office. On February 20, 2018, Attorney General Xavier Becerra (D) issued ballot language for the initiative, allowing proponents to collect signatures. Proponents had until August 20, 2018, to file 585,407 valid signatures.

Sponsors filed the ballot initiative with the intent to get the initiative on the ballot for the election on November 6, 2018. On April 6, 2018, however, sponsors announced that the initiative would be delayed until 2020. Melissa Breach, executive director of the League of Women Voters of California, said, "In moving it we have the benefit to spend a little less because the cost to qualify will be significantly less. And then the benefit is we get this additional two years to do the work with the voters."[45]

On August 14, the campaign backing the ballot initiative filed 855,623 signatures.[46] On October 15, 2018, counties concluded a random sample of signatures, projecting that 661,306 signatures (77.29 percent) were valid, and the initiative was certified to appear on the ballot.[47] On June 23, 2020, the state department announced that this version (17-0055) of the initiative was withdrawn.

The campaign hired Kimball Petition Management, Inc. to collect signatures for Initiative #17-0055 to qualify the measure for the ballot. A total of $3,490,600.39 was spent to collect the 585,407 valid signatures required to put this measure before voters, resulting in a total cost per required signature (CPRS) of $5.96.

Stages of Initiative #19-0008

Anthony Thigpenn, Benjamin Mcbride, and Carol Moon Goldberg filed this initiative on August 13, 2019.[48] On October 17, 2019, Attorney General Xavier Becerra (D) released ballot language for the initiative, allowing the campaign to begin gathering signatures. The deadline to file signatures for the initiative was April 14, 2020.

On December 6, 2019, proponents announced that the number of collected signatures surpassed the 25-percent threshold (249,285 signatures) to require legislative hearings on the ballot initiative. In 2014, Senate Bill 1253 was enacted into law, which required the legislature to assign ballot initiatives that meet the 25-percent threshold to committees to hold joint public hearings on the initiatives not later than 131 days before the election.

On April 2, 2020, the campaign Schools and Communities First filed 1,748,647 signatures. At least 997,139 (57.02 percent) of the signatures needed to be valid. On May 22, 2020, the office of Secretary of State Alex Padilla announced that a random sample of signatures projected that 74.60 percent were valid. Therefore, the ballot initiative qualified to appear on the ballot at the general election.[49]

Cost of signature collection:
Sponsors of the measure hired 2020 Ballcamp to collect signatures for the petition to qualify this measure for the ballot. A total of $5,986,312.94 was spent to collect the 997,139 valid signatures required to put this measure before voters, resulting in a total cost per required signature (CPRS) of $6.00.

Comparisons of Initiatives #17-0055 and #19-0008

Language

The following is a comparison of the petition titles, petition summaries, and fiscal analyses for both versions of the ballot initiative.[3]

Click Show to expand the table.

Provisions

The following is a comparison of some of the proposals' differing provisions:[1][50]

Click Show to expand the table.

Coupal v. Padilla

Lawsuit overview
Issue: Is the ballot title for Proposition 15 false, misleading, and prejudice?
Court: California Third District Court of Appeal (Appealed from the Sacramento County Superior Court)
Ruling: Sacramento County Superior Court ruled in favor of Padilla and Becerra, stating that the ballot title is not false, misleading, or inaccurate
Plaintiff(s): Jon CoupalDefendant(s): Secretary of State Alex Padilla and Attorney General Xavier Becerra

  Source: Sacramento County Superior Court

On July 29, 2020, Jon Coupal, president of the Howard Jarvis Taxpayers Association, sued Secretary of State Alex Padilla in the Sacramento County Superior Court. Coupal argued that the ballot language for Proposition 15, as drafted by Attorney General Xavier Becerra (D), was false, misleading, and prejudice. Coupal stated, "This blatant manipulation of the ballot label, as well as the title and summary, is in direct contravention of the Attorney General’s fiduciary duty to prepare impartial ballot material."[51]

On August 6, 2020, Judge Laurie M. Earl issued a tentative ruling in favor of Padilla and Becerra, writing, "... the Court is not convinced that the current title is false or misleading."[52]

On August 6, 2020, the Howard Jarvis Taxpayers Association announced that the superior court's ruling would be appealed to the California Third District Court of Appeal.[53]

How to cast a vote

See also: Voting in California

Click "Show" to learn more about voter registration, identification requirements, and poll times in California.

See also

External links

Information

Support

Opposition

Footnotes

  1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 California Attorney General, "Initiative 19-0008," September 17, 2019
  2. ↑ 2.0 2.1 2.2 California the Legislative Analyst's Office, "A.G. File No. 2019-0008," February 5, 2018
  3. ↑ 3.0 3.1 3.2 3.3 California Secretary of State, "Ballot Title and Summary," accessed July 28, 2020 Cite error: Invalid <ref> tag; name "sos" defined multiple times with different content
  4. ↑ 4.0 4.1 4.2 4.3 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
  5. ↑ Schools and Communities First, "Homepage," accessed July 21, 2020
  6. ↑ Schools and Communities First, "Endorsers," accessed July 8, 2020
  7. ↑ California Secretary of State, "Official Voter Information Guide," accessed September 28, 2020
  8. ↑ Stop Higher Property Taxes and Save Prop 13, "Homepage," accessed July 21, 2020
  9. ↑ California Secretary of State, "Official Voter Information Guide," accessed September 28, 2020
  10. ↑ 10.0 10.1 10.2 10.3 10.4 10.5 Cal-Access, "Campaign Finance," accessed March 21, 2018
  11. ↑ 11.0 11.1 UC-Hastings, "Voter Information Guide for 1978, Primary," accessed December 21, 2017
  12. ↑ California Tax Data, "What is Proposition 13?" accessed December 21, 2017
  13. ↑ Time, "How California's Fiscal Woes Began: A Crisis 30 Years in the Making," July 1, 2009
  14. ↑ New York Times, "The California Ballot Measure That Inspired a Tax Revolt," October 16, 2018
  15. ↑ Hoover Institute, "The Tax Revolt Turns 20," July 1, 1998
  16. ↑ Wall Stree Journal, "The Terms of Surrender in California’s Tax Revolt," October 26, 2016
  17. ↑ Reuters, "California's anti-tax crusaders talk revolt," April 7, 2009
  18. ↑ Los Angeles Times, "Can Proposition 13 survive California's new appetite for taxes?" November 17, 2016
  19. ↑ Howard Jarvis Taxpayers Association, "Proposition 13: A Look Back," accessed December 3, 2018
  20. ↑ Los Angeles Times, "An experienced Jerry Brown vows to build on what he's already done," October 19, 2018
  21. ↑ International Business Times, "Activists Vow To Reform Anti-Tax Prop. 13 — The ‘Third Rail’ Of California Politics," October 5, 2017
  22. ↑ Los Angeles Times, "Proposition 13 has strictly limited property tax increases since 1978. Voters could get a chance to change that," October 17, 2018
  23. ↑ Arizona Secretary of State, "Initiative 31-2020," February 14, 2020
  24. ↑ Colorado Secretary of State, "2019-2020 Initiative Filings, Agendas & Results," accessed April 17, 2020
  25. ↑ Illinois State Legislature, "Senate Joint Resolution Constitutional Amendment 1," accessed May 2, 2019
  26. ↑ Illinois State Board of Elections,"Committee Search," accessed May 28, 2019
  27. ↑ Alaska Division of Elections, "Alaska's Fair Share Act," accessed January 13, 2020
  28. ↑ Anchorage Daily News, "Group says it has enough signatures to put Alaska oil tax initiative on ballot," January 14, 2020
  29. ↑ APOC, "Online Reports," accessed January 7, 2020
  30. ↑ Nebraska Secretary of State, "Initiative Petition text," accessed August 22, 2019
  31. ↑ California Attorney General, "Initiative 19-0008," September 17, 2019
  32. ↑ California the Legislative Analyst's Office, "A.G. File No. 2019-0008," February 5, 2018
  33. ↑ California State Legislature, "Assembly Concurrent Resolution 11," accessed May 8, 2019
  34. ↑ Colorado General Assembly, "SCR 20-001," accessed June 10, 2020
  35. ↑ Arkansas State Legislature, "House Joint Resolution 1018," accessed March 7, 2019
  36. ↑ UA Little Rock Public Radio, "Arkansas Governor Signs $95 Million Highway Funding Bill Into Law," accessed March 25, 2019
  37. ↑ Arkansas Ethics Commission, "Filings," accessed August 18, 2020
  38. ↑ Colorado State Legislature, "House Bill 20-1427," accessed June 15, 2020
  39. ↑ Oregon State Legislature, "HB 2270," accessed June 25, 2019
  40. ↑ Colorado Secretary of State, "2019-2020 Initiative Filings, Agendas & Results," accessed February 10, 2020
  41. ↑ Nebraska State Legislature, "LR14CA," accessed April 5, 2019
  42. ↑ Politico, "Split-roll' backers will refile tax initiative in expensive rewrite," August 13, 2019
  43. ↑ Ballotpedia staff writer Josh Altic, "Telephone communication with Tyler Law," accessed August 15, 2019
  44. ↑ Cite error: Invalid <ref> tag; no text was provided for refs named secondtime
  45. ↑ Silicon Valley Business Journal, "'Split roll' proponents delay Prop 13 referendum. Did they accidentally kill it?" April 16, 2018
  46. ↑ Times of San Diego, "Activists Seeking Partial Prop 13 Repeal to Submit Signatures," August 14, 2018
  47. ↑ California Secretary of State, "Ballot Measures," accessed September 28, 2017
  48. ↑ Cite error: Invalid <ref> tag; no text was provided for refs named Text
  49. ↑ California Secretary of State, "Final Random Sample," May 29, 2020
  50. ↑ California Attorney General, "Initiative 17-0055," January 22, 2018
  51. ↑ Howard Jarvis Taxpayers Association, "HJTA Files Suit Against Attorney General for Ballot Material Deception," July 29, 2020
  52. ↑ Sacramento County Superior Court, "Coupal v. Padilla," August 6, 2020
  53. ↑ Howard Jarvis Taxpayers Association, "HJTA Appeals Decision Allowing Deceptive Ballot Information to Remain on the Ballot," August 6, 2020
  54. ↑ California Secretary of State, "Section 3: Polling Place Hours," accessed April 4, 2023
  55. ↑ California Secretary of State, "Voter Registration," accessed April 4, 2023
  56. ↑ The Los Angeles Times, "Gov. Brown approves automatic voter registration for Californians," October 10, 2015
  57. ↑ The Sacramento Bee, "California voter law could register millions–for a start," October 20, 2015
  58. ↑ 58.0 58.1 California Secretary of State, "Registering to Vote," accessed April 4, 2023
  59. ↑ California Secretary of State, "What to Bring to Your Polling Place," accessed April 4, 2023
  60. ↑ BARCLAYS OFFICIAL CALIFORNIA CODE OF REGULATIONS, "Section 20107," accessed April 4, 2023
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