More Laws of Unintended Consequences

[Miles Ignatius]

8-{} Is it just me? Or does anyone else make a "connect the dots" relationship between California's current budget debacle ($37 Billion short) and the fact that the much heralded Prop. 13 (circa 1978) enables companies such as Disney to pay as little as 5 cents @ square foot in property taxes?

Okay, nobody likes them but property taxes are based on the value of a property, (e.g. "ad valorem") which indicates that the higher the value, the more likely ownership is able to pay for the services rendered to the property. That understanding reached its climax during the Prop 13 hiatus, when homeowners on fixed incomes who bought the VA ranch in Reseda saw their tax bills head out of the skylight as the result of California's hyperactive real estate market.. So, Prop 13 built some protections for those folks, but Disney?

Did I miss something? I'm pissed and I don't even live in the Golden State. Sounds like there ought to be a Prop. 13GD
(Get Disney) to mitigate this travesty.


http://www.planetizen.com/news/item.php?id=9923

 

[Rem]

The system in New South Wales (Australia) provides for diferent 'Rates' (a property tax that goes to Local Government) to apply to different categories of land use. The list of land use types are limited by legislation to Residential, Business, Farmland and Mining (limited sub-categories are also available). Rates are then levied based either fully on ad valorem or with a base amount (equal flat paymen for all ratepayers in the category) up to 50% of the total rate receipt from that category divided by the number of ratepayers plus an ad valorem component.

What this means is that you can charge a much higher rate in the dollar for business uses than for residential uses.

I don't know what Prop13 is about but based on the gist of the story, maybe a similar system could remove some of the hairs from the problem.

 

[Rem]

Also land revaluations occur every 4 years on a whole of Local Government Area basis. This would also seem to assist in avoiding the Disney problem.

 

[Miles Ignatius]

I Think They Missed The Boat

Rem:

Your comment hits it on the head...

"Also land revaluations occur every 4 years on a whole of Local Government Area basis. This would also seem to assist in avoiding the Disney problem."

I think that California really missed out in not doing what's been done in your country. I do know that business property is assessed at a higher ratio than residential but in California's case, to keep those values artifically low hurts all taxpayers who have to make up the difference in either higher taxes or reduced levels of service.

 

[donk]

Our tax system is similar to rem's. Market value assessment based on ownership and use.

Owner Occupied Residential properties one rate
Second homes and multiple dwelling units another rate
commercial properties another rate
farm land has tax deferal/relief depending on ownership and use of land.

Having just returned from toronto and seeing a property tax bill of about $450 /month for a "normal' house I would be scared to live there. maybe some type of tax relief is needed, but holding the rate to the mid 70's rates seems really foolish.

 

[Tranplanner]

Having just returned from toronto and seeing a property tax bill of about $450 /month for a "normal' house I would be scared to live there.

Residential tax rates in "the city" are actually lower than what you would find in the outer suburbs...$450/mo. though - wow. I'm looking at $2200/year right now - 'bout $180/mo.