Property Tax Transfers
Reject expanded Prop 13 tax transfers. Would cost local governments $1B/year and worsen regressive property tax system.
Proposition 5 would allow homeowners over 55 (and some others) to transfer their low property tax assessments to any new home they purchase anywhere in California.
Expands the regressive Prop 13 system
California’s Proposition 13 (1978) capped property tax rates and locked in assessments, creating a system where longtime homeowners pay far less than newer owners for comparable homes. This has been disastrously regressive, benefiting older, wealthier homeowners at the expense of younger families and renters.
Prop 5 would expand this unfair system by allowing more people to carry their low assessments to new properties. Currently, this benefit is limited; Prop 5 would dramatically expand eligibility.
Costs local governments $1 billion per year
The Legislative Analyst estimates Prop 5 would cost local governments approximately $1 billion annually in reduced property tax revenue. This would hit schools, cities, and counties that depend on property taxes for essential services.
Doesn’t address mobility concerns effectively
Proponents argue seniors shouldn’t be “trapped” in homes that no longer suit their needs. But the solution to this problem created by Prop 13 is to reform Prop 13, not expand its distortions further.
Benefits flow to wealthy homeowners
Those with the lowest locked-in assessments — who benefit most from transferability — are often those who purchased expensive homes decades ago and have seen enormous appreciation. This is not a group that needs additional tax benefits.
Vote no on Prop 5 to avoid expanding California’s broken property tax system.
These recommendations are my own, and do not reflect positions of organizations I’m associated with.