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The Pleasanton School board is backing an initiative that could bring more money to schools by raising taxes for corporate property owners.
On a unanimous vote, with Board Member Valerie Arkin absent, the board approved a resolution that would close a loophole in Proposition 13 regarding commercial property reassessment.
The resolution was brought to the board by Ian Fregosi of Evolve, a Bay Area activist group that’s fighting to reform Prop. 13.
“Since 1978, we’ve seen as huge drop in education funding, and what’s worse is that we’re not only underfunding our schools, but the tax burden is being passed on to working families,” Fregosi told the school board Tuesday night.
He explained that unless a firm owns more than 50% of its property in its own name, the property is not reassessed. Fregosi said many large companies, such as Chevron, divide ownership using shell companies so no single entity owns a majority share.
“For the last 35 years, companies have been unfairly benefiting from Prop. 13 in ways that voters didn’t know about,” Fregosi said, adding businesses with property in the state “are still paying taxes at 1975 levels.”
Chevron alone saves about a billion dollars every year from the loophole, he said, noting that Evolve used a conservative estimate to come up with the figure.
The group’s website used estimates from the state Legislative Analyst’s Office that said requiring corporations to pay taxes based on the current value of their properties would generate $4.5 billion a year in additional income for the state.
Although they approved the resolution in support of closing the loophole, school board members were not entirely convinced the change would actually bring more money for education.
“We might get increased allotments, because the state has more money,” Board Member Joan Laursen said, “but it doesn’t necessarily flow to us unless the legislation is rewritten.”
Deputy Superintendent Luz Cazares said the legislation in question is Proposition 98.
“How that money gets divvied up, I don’t know. I’d have to ask some more questions,” Cazares told the board.
Board members said the loophole should be closed regardless of whether it would mean more cash to the district. Board Member Jamie Hintzke said Prop. 13 has been a problem for a long time.
“I guess we have to hope that if the state gets more money, it’s good for everybody,” Hintzke said. “It stimulates the economy, no matter how you look at it.”
The board also approved an agreement with Pleasanton Gateway LLC for nearly $2.9 million in school impact fees.
Pleasanton Gateway plans to develop a 26-acre site along Valley Avenue just south of Bernal Avenue and the Pleasanton Gateway shopping center. The Gateway project recently received approvals for its project from the Pleasanton City Council to build 210 multifamily rental units, 62 single-family row houses and 35 single-family, two-story homes.
Presumably, although not spelled out in the agreement, the money would help offset the extra cost to the district as families with children move in. The school district would receive the money in phases as each part of the project is built.
The school board voted on the agreement without discussion as part of its consent agenda, in which items not requiring a public hearing are voted on in one package.
Board Member Jamie Hintzke said “I guess we have to hope that if the state gets more money, it’s good for everybody. It stimulates the economy, no matter how you look at it.”
What?! “We have to hope” that it’ll be good for everybody? If the state gets more money, where does it come from? The private sector. It’s never “good for everybody” when the government takes more money from the private sector. Also, how does this stimulate the economy? If that were true, then why don’t we just send ALL our money to the government. Where do we get these people?
They are the ones who went to the public schools about the time that New math was in vogue.
Same ones who cannot add or subtract.
The article doesn’t mention that all taxes go up with inflation, I think it is about 2% max per year.
But Prop 13 did allow ownership of corporations to change, without the property that was part of the sale being re-assessed.
“These People” wrote: “The article doesn’t mention that all taxes go up with inflation, I think it is about 2% max per year.”
The problem is that 2% is less than the long-term inflation rate, which explains why many long-term homeowners pay such low property taxes. It probably would have been better to cap property taxes not at 2% but at 3% or some inflation-adjusted index.
As for the current topic of Prop 13 and corporations, I don’t know why it was ever decided to address corporate real estate taxes by Prop 13. I thought the purpose of Prop 13 was to protect homeowners and residential real estate from excessive year-to-year property tax increases..
It was all political- what they thought they could pass.
By exempting business, they thought (correctly) businesses would not fight it.
But allowing older people to keep their home after they retired is a worthy goal.
Just before Prop 13 I bought a house from a couple who sold mostly because their taxes were so outrageous.
They took the money, and built a much cheaper house away from the Bay Area.
This Fregosi guy is an idiot. I’ve never even heard of this evolve company
Prop. 13 has destroyed California. It’s a corporate giveaway that is taking money from schools, roads, public safety, and important infrastructure. CA is the only state with something like this.
Sam do you really think :” The problem is that 2% is less than the long-term inflation rate, which explains why many long-term homeowners pay such low property taxes.”???
Were you a resident of this state when prop 13 was passed and do you understand it’s intent? It was to help prevent older ‘long-term’ homeowners from being taxed out of their properties. Why is that now a bad thing?
You, of course did not address the real problem, which is not that we need additional confiscation of residents earnings. It’s always easier for these math and logic challenged appointees and politicians to keep going back to the well instead of reining in spending and controlling waste. It’s a lazy way to operate and it’s long downward spiral.
If the Unions would get out of the way, schools could operate more efficiently, waste is the problem, keep out of my business, you take more money from me I have less to spend, that’s the way it works, more taxes will hurt the economy even more, higher taxes are not not the answer.
right wrote: “Were you a resident of this state when prop 13 was passed and do you understand it’s intent? It was to help prevent older ‘long-term’ homeowners from being taxed out of their properties. Why is that now a bad thing?”
I was not a resident of this state when Prop 13 was passed but do understand its intent and support it. I don’t want to see homeowners (including myself) taxed out of their properties due to the boom-and-bust nature of California real estate. All I’m saying is that annual property increase should be capped at some maximum which is a more accurate reflection of the long-term average rate of inflation.
grow up victor, you slam the union whenever somebody says hello…
Prop 13 has saved many cities and counties in California. During the time of the boom, if there was no prop 13, the tax revenue would have increased significantly. Cities would be spending the money, and then when the bust happened revenue would be down significantly causing havoc; must more than happened already. The 2% growth on the same ownership has given some stability and the revenue does keep increasing, even more than 2% because of sales and new properties.
One could question the commercial part of prop 13 but as for homes, I think prop 13 has been real positive for California.
If you look at other state comparisons, California has one of the highest taxes but their school financing is among the bottom end. That means that we are collecting enough in tax revenue but we are not spending it in the correct places. It is a spending problem and not a revenue problem.
Victor is SO right. Check the 30+ year date of Gov Moonbeam starting PUBLIC unions !! That’s the REAL story, so let us have a little HONESTY !! ! Those 30 year retirements are JUST NOW coming due, and just NOW even the worst math dummies should be able to get the BIG picture….they are NOT sustainable !!!! Our schools will tank without something, so the union members are desperate to start survival ideas…their ONLY solution ever is MORE MONEY….never dump the unions !!
The timing of new unions and prop 13 was rather interesting timing.
However dumping that shortfall (under the guise of prop 13 will insure much MORE massive Unemployment in CA. Many businesses and ALL NEW business ‘state shopping’ would definitely setup in Texas or one of the selections of ‘business FRIENDLY’ states. Don’t forget anyone wanting to do business in CA is already BURDENED with a list of obscenely costly and idiotic ‘green’ costs and restricted behaviors compared to other states.
So we would build the wall higher to drive away NEW business…you know, what we MUST have IF people are to stay in CA. Already people are considering other options when most CA 2 full job couples have now become 1 part-timers or 1 full and 1 part…. CAlifornians are NOT fully employed!!!!!!
PUSD publishes a chart that show the relative SHARE of the tax burden that residential and non-residential parcels contribute to rationalize a claim that businesses are not contributing their fair share. What PUSD chooses NOT to show, is that in the last 10 years, the number of non-residential parcels DECLINED yet had a $10 billion increase in assessed value. While the number of residential parcels INCREASED by 10%. Naturally, the share of the tax burden that falls on residential property will increase.
Either the superintendent was duped into championing this resolution, or she knew exactly what she was doing. I suspect the latter.
And yes, Trustee Hintzke is lacking understanding of basic economics, taxation and how to stimulate an economy.
And to have Luz and others questioning one of the claims of the resolution, yet still passing it 4-0 is a farce.
“All I’m saying is that annual property increase should be capped at some maximum which is a more accurate reflection of the long-term average rate of inflation.”
To some people any change to prop 13 is bad. Your proposal sounds reasonable to me.
“Prop 13 saved California from certain ruin. Per capita property tax collections in CA sit about at the national average and rank 19th amongst the states. Seems we got it about right. ”
Not really. That is an average number. People who stay in their houses longer pay lower housing taxes than those who move more frequently. That distorts the market and discourages move-up buyers which, in turn, slows the economy.
“I guess we have to hope that if the state gets more money, it’s good for everybody,” Hintzke said. “It stimulates the economy, no matter how you look at it.”
That’s nuts. I hope Hintzke doesn’t really believe that.
Whether prop 13 is a problem or not is a matter of opinion. Yes, some of us pay more than others and some of the older residents pay almost nothing in property taxes, but that was a voter approved initiative and if someone wants to challenge that, they will need to try to pass another proposition – good luck with that (I do not think it would pass)
The problem that everyone needs to look at is all these liabilities created by the public sector. We have so many public employees in positions that are simply not needed (the county of education comes to mind), so many retired public employees who are still quite young and receiving a fat lifetime pension that they contributed little to, etc.
I am not talking about just PUSD employees, the problem extends to the entire public sector (unions). Until we solve that problem, no amount of extra money (whatever the source of that money may be) will be enough, there is just so much burden you can pass on to the private sector. Companies need to do what they can to keep expenses down and be profitable, and we are already a state where the entire private sector, from big companies to small businesses to all private sector employees pay some of the highest taxes in the country, and yet each year we hear about budget problems…at some point it has to stop, reform the public sector/union issues, then let’s see where we truly are financially. Until then, you cannot blame companies and individuals for looking for ways/loopholes to reduce their taxes.
Prop. 13 was developed to stop the over taxation of properties so families could afford to stay in the home,and as the children move onto their own lives the property taxes would remain affordable for the family to afford to remain in. The home until death of the original owners. The school board needs to review the expensive and live within the budget.
Sam is a physicist, not an economist.
Sam, home prices in the Bay Area have increased far faster than the rate of inflation. It sounds like you, like most liberals, want others to pay more and when confronted with the following question, are silent:
Why don’t you send in more tax money if you’re so concerned about the schools/city/state/feds not getting enough?
The same liberals who say that proposition 13 is not fair have no problems with the unfairness we have with:
– public sector pensions with people retiring at 50 & 55 with 80% – 120% their working salaries,
– pension spiking,
– free medical insurance for public employee retirees,
– public employees not paying the full ’employee’ rate for pensions,
– granting pension increases retroactively,
– and if the pension fund does not make a guaranteed rate of 7.5% the taxpayer is responsible for the shortfall.
Just because someone says prop 13 isn’t flawless doesn’t make him a “liberal”. I think prop 13 has many benefits. I don’t think it is flawless. I don’t know about Sam, but I’m an independent, not a “liberal”.
Patty,
They aren’t proposing changing the rules for families. They are proposing changing the rules for business.
“UR” wrote: “Sam, home prices in the Bay Area have increased far faster than the rate of inflation. It sounds like you, like most liberals, want others to pay more and when confronted with the following question, are silent: Why don’t you send in more tax money if you’re so concerned about the schools/city/state/feds not getting enough?”
Actually, on an inflation-adjusted basis (which is really the only way to make valid dollar comparisons over time), Bay Area home prices have not increased “far faster” than inflation over the past 30 years. They’ve increased at an average rate of about a percent or two over the rate of inflation or at about the rate of increases in Bay Area income.
As for why I simply don’t send in more money myself if I think that property taxes should increase at a rate more reflective of the rate of inflation, the answer is because my lone contribution wouldn’t make any difference. In our society we make decisions on taxes collectively, and we contribute to our society collectively. Let me know if there are any other basic lessons or concepts that you missed in your junior high school civics class.
Given Sam’s involved discussion and poorly veiled use of condescending sarcasm, I think PW editors need to exercise their prerogative and shut this site down, pronto. For how can they judge the ‘appropriateness of Sam’s comment’ when the editors are most likely unable to understand what he is saying — especially the part about paying taxes “collectively.” Horror of horrors! Don’t you know, Sam, that we only pay taxes as individuals, because we’re all individuals and there’s no evidence of all of us holding hands while we mail in our tax forms.
C’mon PW editors, a shutting down of this site is waaaaaay overdue.
I have only seen democrats going after proposition 13. BTW: I am an independent myself. However, before trying to raise taxes I would want then to fix the post-retirement issues which are costing us a fortune and at a much larger expense then the amount of additional money we would bring in with changing proposition 13 for businesses.
There is some good news out there as there is a group working on getting a ballot measure to the ballot that would have the voters change the state constitution which would allow changing of public employee benefits/pensions for existing employees for future years worked, not years already worked. I think this is reasonable. If you have already earned a certain rate for pensions, that should not be taken away however I do not see the issue of future years worked. If this qualifies I would expect to see an amazing amount of money spent by the unions to try and defeat this.
Oh my gosh! Where are all the other topics? They’re being disappeared left and right! But lets keep this one up because it allows the right-wingers to vent and feel good about themselves! Good job editors! Better to have posts dominated by the ‘teachers are making too much money with outrageous pensions’ than anything that might smack of a challenge to Fox News common sense. More William Tell! Less Sam from Oak Hill! We want more mediocrity and repetition of viewpoints! Thank you editors!
As Bill O’Reilly’s new book tells us, Jesus came down to earth in order to free Jews from outrageous Roman taxes and high pensions for their officials. Ergo those who want to revise Prop 13 are antichristian. This of course is consistent with the ‘anything goes’ mentality of the liberal loon crowd. Make us pay higher taxes and let the kids do whatever they want. There it is in a nutshell. God Bless Everyone.
Thanks ‘local for summarizing the problem so well. The root of our financial shortages are PUBLIC union excesses, i.e. early and unrealistic retirements PAID BY TAXPAYERS !!! WE have our limits SO shuffle around all the various PUBLIC monies we spread around, and unions can figure what inter-shuffling of our dollars might ease PUBLIC problems. BART, city gardeners & secretaries, city, county, state, UCBerkeley, prisons, nurses & hosopitals, active SEIU destroying our system with unionizing every group they can create, on and on. Taxpayers didn’t have ANY, ANY of these union burdens in out golden days, when CA was a world leader. WE have met our limits.
I understand this conversation is about more business taxes….HUGE
‘ JOB – KILLER ‘, plus preventing NEW business from locating in CA. MORE Unemployed means greater EXODUS from the NO longer golden state that has become quite tarnished.
George, you are the first person to mention in this topic that teachers are making too much money.
Local, in case you didn’t realize it, teachers are unionized and they are public workers. (p.s. Pensions are part of workers’ salary structures.) Wake up. No, don’t, because if you do you’ll likely start getting censored by the editors. Keep up the good work.
Yes, teachers are in public employee unions. However, the pension abuses have been in CalSTRS; non-teachers, plus school administration. Why should a train cleaner on BART have a higher pension than a teacher, and not even have to pay into it?
We have a finite amount of money. It needs to be prioritized. We have one of the highest taxes in the country but are near the bottom of the scale of money for the schools. If the CTA wants better pay and pensions for teachers, they should go after the non-teachers public employee unions. All the money that goes to non-school benefits and pensions is money essentially taken away from schools. Like said before, it is a spending problem not a revenue problem.
Sam, thanks for confirming your hypocrisy. “my lone contribution wouldn’t make any difference”. Of course! Everyone else needs to pony up…not Sam. This is the standard hypocrite-liberal response. Your extra payments will make a difference, Sam but you expect others to do it. In this case, you’re OK with retirees who have paid for their homes and want to live out their golden years to LOSE their homes because they can’t afford skyrocketing property taxes. That’s what was happening here before you arrived in California and it’s the reason we have prop 13. So again, why don’t you make additional contributions through your taxes?
Since your standard procedure is to belittle anyone who disagrees with you, I’m comfortable calling you what you are.
Put up or shut up.
Before you past judgement or continue to post here, please watch the meeting where this discussion took place.
http://pleasantonusd.net/departments/board-of-trustees/meetings-agendas/
I am happy to meet with any community members to discuss my role and any specific issue.
Jamie Yee Hintzke
Trustee, Pleasanton Unified School District
Jamie, are you implying the PW misquoted you in their story? I don’t understand why we need to watch that portion of the meeting in order to comment (“past judgement”) on your remarks.
‘past judgement’? Is this what we should expect from a member of the school board? Public school education or English as a second language training? Why would anyone take financial advice from someone in a position of power on the school board who cannot differentiate ‘past’ from ‘passed’? Figure how to manage your own affairs before reaching into other people’s pockets to resolve issues related to your mismanagement.
I think this is the last time I post here. You people are mean. Haven’t you ever typed and made a typo? . Assume the worst about people is what seems to be the protocol here.
“Posted by Jamie, I think this is the last time I post here. You people are mean.”
You’re my favorite board member. Keep up the good work!
Our school board should pay attention to business and quit mucking in something they know nothing about and cannot influence anyway.
Prop 13 saved California from certain ruin. Per capita property tax collections in CA sit about at the national average and rank 19th amongst the states. Seems we got it about right.
The problem isn’t the property tax. It’s how we spend our state’s revenue. It’s a SPENDING problem.