Companies 'laughing at us' over property tax loopholes, says lawmaker
California homeowners are paying a growing share of state’s property taxes, while corporations’ property tax bills have shrunk, according to a report issued Thursday by advocates of raising commercial property taxes.
In 1978, voters approved the landmark Proposition 13, which capped property taxes, for businesses and residents alike, and said land values would only be reassessed when property changed hands.
Assemblyman Tom Ammiano, a San Francisco Democrat who is carrying legislation to beef up property tax collections on businesses, said California companies today engage in a game of “three-card Monte” to skirt reassessment.
“The big boys and girls are laughing at us,” Ammiano said.
In Los Angeles, residential property accounted for 53% of the property taxes paid in 1975. In 2009, that figure had mushroomed to 69%, according to the report.
Lenny Goldberg, executive director of the California Tax Reform Assn., which wrote the study, said a broken property tax system has allowed companies like Chase, which purchased Washington Mutual in 2008, to avoid paying higher property taxes on all the bank branches’ land.
“We’re leaving tens of millions, if not hundreds of millions, on the table,” Goldberg said, as the state faces an estimated $18.6-billion budget deficit.
Ammiano's AB 2492 will be heard in committee next week. Read the hefty 124-page report here.
-- Shane Goldmacher in Sacramento