RECLAIM BILLIONS TO INVEST IN OUR SCHOOLS AND LOCAL COMMUNITIES
WHAT IS PROP 15
The November ballot measure known as “Schools and Communities First” (SCF) would reform commercial property taxes and raise approximately $12 billion annually, 40% of which would be allocated to public K-12 schools and the remaining 60% would be distributed to California’s communities. Prop 15 won't impact residential property at all and will reclaim funds for schools and services that will make your neighborhood better while helping local small businesses.
THE BENEFITS OF PROP 15
Prop 15 will address the root of many of the problems plaguing the State of California, from our housing crunch to our unfair tax code that stifles growth and fair business practices.
More for Californians
Protect Homeowners & Renters
Prop 15 will not affect residential property taxes, ONLY commercial. This will have a direct benefit as commercial properties can be made useful instead of taxless burdens on local communities.
Reclaiming Billions in Tax Dollars
In California, property tax changes are triggered by a sale. But the rule that a sale triggers reassessment only applies if more than 50% of the property changes hands, a loophole commercial property owners take advantage of when they sell their property.
Investing More in Our Communities
Increasing per-pupil spending by 10% in all 12 school-age years increases probability of high school graduation by 7% points for all students and by 10% points for non-poor children.
A FAIR AND BALANCED REFORM
Approximately one in five commercial properties, including many notable ones (Disneyland, movie studios, golf courses), have not changed hands since 1978 and are still assessed at their 1975 values. Moreover, the rule that a sale triggers a reassessment to the purchase price only applies if more than 50% of the property changes hands. That happens in virtually every residential transaction, but in commercial sales, various methods are used to ensure less than 50% of a property changes hands in any given transaction. As a result, nearly 60% of commercial properties have not been reassessed since 1999 and commercial property owners now pay approximately only 30% of property taxes statewide.
The Measure will not apply to commercial property owners who own less than a combined $3 million in commercial property. The increased assessments and taxes will be phased in over time to reduce disruption, and properties that lease primarily to small businesses are granted an extra deferral for the effects of the Measure, with the idea of protecting lessees with “triple net” leases from incurring large cost increases. Current estimates indicate that upwards of 70% of the increased property tax revenues will be paid by a handful of large commercial property owners. Finally, SCF would eliminate the business tangible personal property tax on equipment and fixtures on small businesses and provide an annual exemption of $500,000 on this tax for all other businesses.