Quote:
Originally Posted by Kingfish
So many people here are off the mark here as to what caused the problem. California is the victim of a wacky conservative economic experiment called Proposition 13. It forever hampered the state?s ability to raise revenue the way most other states do. That is why there are so many high fees and other things in California because they simply can?t generate revenue the way most of the other states in the country do through property taxes.
There are people that have multi-million dollar homes that get taxed on what the property was valued at 30-35 years ago. For example if you purchased a home that was valued at 100k in the mid 70s that is worth 10 million today you would only pays taxes on the 100k value even though you now rent the home out based on the 10 million dollar value. The same goes for commercial real-estate if a developer built an apartment complex for a million dollars in 1975, but because of location and inflation the complex is now worth 30 million dollars the developer still only pays taxes on the original value of 1 million dollars even though the rents he collects in 2010 reflect the 30 million dollar value.
The free riders are the long term residential and commercial real estate owners.
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So what happens to the person who buys a home and eventually retires with a modest income at 70. If they live in a nice neighborhood that went up in value over the years you're advocating they need to hike up the property tax to the point where the retired 70 yr old would have to sell the home and downgrade. all became the neighborhood went up in value over time . The home may be worth more but that doesn't change what the owners income level . Once the home is sold they would need to pay capital gains on the profit but as long as they live there they shouldn't get fleeced on property tax.
Rental/Commercial property I can understand your point to an extent but when applied to a regular residential owner I don't agree.