Will Taxpayers Win Against the Governor and Legislature?
The clock is ticking. Taxpayers all around California gathered 1.4 Million signatures to qualify a measure for the November 2024 ballot to give voters an opportunity to set reasonable standards when their property is taxed in our state. The submission of the petitions was a bold statement by taxpayers throughout California that the system is broken and needs accountability. Something must be done about the constant tax measures that voters in California face in our state and local communities.
At the same time that taxpayers are standing up and submitting a reasonable tax accountability measure that is being challenged by the Governor and Legislature, the state legislature has successfully placed a direct attack measure on the November ballot that will open the floodgates to higher taxes by cutting the vote threshold needed to pass special taxes from two-thirds to 55%.
The measure called the Taxpayers Protection and Government Accountability Act, or TPA, favors taxpayers while the other measure does not. After TPA qualified on September 26, 2023, Governor Newsom and the Legislature filed suit in the California Supreme Court to cancel the TPA ordering that it be erased from the November 2024 ballot. Not so their measure to cut the voting threshold for special taxes.
What are the features of the TPA that are so objectionable?
1. It would correct the unsatisfactory published court decisions.
It is a common practice to challenge court decisions with which we disagree. There is a loophole in tax assessment cases for special taxes and the TPA would close it to correct the injustice to taxpayers. It states “No local government, whether proposed by the governing body or by an elector, may impose a new tax without two-thirds voter approval”.
Measure B for Grass Valley, presented to voters in the March 2024 Primary is a prime example. If it had to pass with two-thirds voter approval, it would have failed. Winning with the two-thirds majority, some would argue, more closely reflects the desire of the broader community.
When the most recent tax assessment by Nevada Union High School in 2016 passed, it barely achieved the required votes, but if two-thirds voter approval was required, it would have failed.
2. It would establish new rules for taxes and fees designed to increase accountability to the public.
If the process is “above board” there should be no objection to accountability.
Opponents to the TPA have railed against the measure claiming it will reduce local tax revenues. But, the fact is that local tax revenues weren’t supposed to be raised in this manner in the first place. Mistaken appellate court decisions starting about four years ago gave rise to numerous local tax measures requiring only the minimum number of votes to pass. It’s time to correct this error in favor of the taxpayer.
3. TPA clarifies how to pass taxes and fees.
Government will be responsible to designate their government-created charges as either taxes or fees which will answer whether voter approval is required.
This could stop the use of companion advisory measures regarding how a general tax in a separate measure will be spent. This would clarify that what are truly intended as special taxes need two-thirds voter approval.
If you are annexed into a new governing area, another correction would give you a right to vote on the new taxes you will be compelled to pay.
TPA’s rules for taxes and fees would create transparency and further inform voters about imposition through collection and so that they can decide on whether to give their consent.
An example is the unwanted 2017 gas tax hike. With TPA the Legislature would have to refer state tax increases for majority voter approval. Other states have similar voter requirements.
And, to protect voters from rogue and possibly hidden unruly administrative fees, the Legislature would have to approve them and declare the approved rates in the legislation.
Passing the TPA Will Protect Taxpayers
We are often the victims of decisions made in our local area in the form of special taxes or assessments. When we open our annual property tax bill we see an endless list of “special taxes” that have long repayment periods and are based on our property value. Fortunately our property taxes are protected by Proposition 13 limits. As property increases in value, so do the special taxes.
The TPA will not only set state requirements, it can have a positive effect on local taxes. Have you looked at your property tax bill? Reviewing mine, I have two Nevada Joint Union High School assessments, one Sierra College Assessment, a road maintenance charge, a fire district charge, another different road maintenance charge and a solid waste charge or seven additional taxes, direct charges or special assessments that add up to about 10% of my overall tax bill. Some of these taxes required voter approval, while others were imposed by a vote of our elected officials.
Bottom line, the Legislature has never had exclusive authority over taxation law and the California Supreme Court should not be the last arbiter. Passing the TPA will give us some protection and set guidelines that are reasonable and will possibly reign in local politicians who are adding special taxes far too often. But, beware of the Legislature-placed measure to cut the vote threshold needed to pass special taxes from two-thirds to 55% that has not been challenged and has an easy pathway to the voters.
In their countersuit, proponents of the measure including the Howard Jarvis Taxpayers Association asked for a decision by June 27. That is the date that the Secretary of State should be putting the measure on the ballot. Let’s hope that the Governor and Legislature’s petition will be denied and We the People will be given our lawful power.