By Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily
Sometimes following action on a bill in the California legislature feels like you are watching a high stakes poker game. This week such a hand was played in which the gambling house (think the ruling majority) risked $269 million hoping to cash in a much larger prize in a few months. …
Senator Pat Bates dealt the hand as she put up SB 1319, a bill to alter the change in ownership provisions which a long-ago legislature passed to implement a section of Proposition 13, the property tax reform law overwhelming passed by voters in 1978.
Bates’ bill would establish new rules to determine when commercial property changes hands. The bill provided that when 90 percent of ownership interest changed hands within a three-year period, a change in ownership of the property is established and the property is reassessed at full market value, increasing property tax revenue for a local county. …
… If Bates’ bill cleared the Senate Finance and Governance Committee earlier this week, it would be on its way to help government budget shortfalls in California to the tune of $269 million a year, according to the Board of Equalization. …
But Bates bill failed on a party line 3 to 2 vote.
Legislators are desperately looking for revenue sources to offset the government budget problems. Why turn down more than a quarter-of-a-billion dollars?
Here’s where the big gamble came in.
A much larger property tax increase is set for the November ballot. The measure commonly referred to as a “split roll” will reassess business property on a regular schedule and potentially bring in $12 billion a year. …
So, at the Sacramento casino on Wednesday, the bet was made. Cast aside $269 million in hopes of cashing in on $12 billion.
Given the economic condition of the state and voters’ concerns with jobs and the economy, there’s a good chance the split roll will fail, and the Capitol gamblers will come out flat busted. …
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