NAIOP San Francisco Bay Area Chapter: Latest News

CBPA's California Legislative Update 10/16/2020

October 16, 2020 Filed under: Legislative News: California

19 DAYS TO GO! DONATE TO DEFEAT SPLIT ROLL PROPERTY TAX
LATEST NO ON PROPOSITION 15 AD
TOM STEYER JOINS FACEBOOK TO PUSH PROP 15
LA TIMES SHREDS PROP 15
WSJ: A BALLOT MEASURE WOULD REPEAL THE BUSINESS HALF OF LEGENDARY PROP. 13
REX HIME: FUTURE IS BRIGHTER WITHOUT PROP 15
PROPOSITIONS IN NOVEMBER
CBPA 2020/2021 CALENDARS

19 DAYS TO GO! DONATE TO DEFEAT SPLIT ROLL PROPERTY TAX

Just over two weeks to go until 2020 Election Day. The numbers on Proposition 15, the measure to create a split roll property tax and increase taxes to our industry by a whopping $11B, remain too close to call. It will all depend on who turns out to vote.

CBPA continues to get the word out about what an economic disaster this proposition would create. We are working with other groups to raise funds to help pay for the statewide effort.

Your contribution to No on Prop 15 – Stop Higher Property Taxes and Save Prop 13 is greatly needed. We must defeat Prop 15 in November 2020 and protect Prop 13.

If you are worried about this, and you should be, but haven’t chipped into the effort, there is still time.

Click here to help defeat Prop. 15 – defeat split roll property tax!

LATEST NO ON PROPOSITION 15 AD

Here is the latest advertisement, released just today, advocating against Prop. 15. This is the type of activity your donations support, researching, creating, and buying airtime to assure we get the message out about how bad Prop. 15 is for the state’s economy and small businesses:

TOM STEYER JOINS FACEBOOK TO PUSH PROP 15

Tom Steyer just contributed $500,000 to the Yes on 15 efforts, joining Facebook Billionaire Mark Zuckerberg’s $11M.

If you are worried about billionaires trying to raise your taxes, click here to help defeat Prop. 15 – defeat split roll property tax!

LA TIMES SHREDS PROP 15

Respected L.A. Times John Meyers takes a look at Prop. 15 and ends up shredding many of the proponent’s argument, including the so-called “Small Business Exemption:”

“But the $3-million threshold could be met by the size of a business property owner’s portfolio. A low-value property would be reassessed for higher taxes if its owner — even a partial owner — owns commercial property in California with a total value of $3 million or more.”

Not much of an “exemption.”

Additionally, the so-called “tax cut for business” is also shown to be a myth:

“Nor is there agreement on a component of Proposition 15 advertised as a tax cut for smaller businesses: a reduction or elimination of taxes owed on equipment and inventory. Those lost tax revenues are likely to be made up by the higher property taxes in large California counties. But the California Assessors’ Assn., which opposes the ballot measure, believes rural counties — where few or no properties are worth $3 million — will end up losing money because of the tax cut on business equipment.”

Finally, if you think Ag land is not included, think again:

“Opponents question why the measure focuses on land, given that California property taxes are paid also on the value of any structures, listed as ‘improvements’ on an annual tax bill. Farmers, in particular, believe the ballot measure’s silence on land improvements could mean higher property tax assessments for barns, offices — and even fruit trees planted as part of new farming operations.

“‘This affects agriculture,’ Jamie Johansson, president of the California Farm Bureau Federation and an Oroville farmer, said during the Sacramento Press Club debate. ‘And multiple-generation farmers, as well as first-time farmers like myself, are vulnerable.’”

Click here to read the whole article and share it with all your friends, family, and colleagues.

WSJ: A BALLOT MEASURE WOULD REPEAL THE BUSINESS HALF OF LEGENDARY PROP. 13

The Wall Street Journal has joined more than two dozen newspapers who are expressing their opposition to increased property taxes proposed by Proposition 15, the largest property tax increase in California’s history.

The Editorial Board points out that fast food franchises, small dairies, wineries, orchards, manufacturers and small businesses will pay for Prop 15’s higher taxes while tech companies like Mark Zuckerberg’s Facebook will be less affected as their employees are allowed to work remotely.

Read excerpts from the Wall Street Journal’s Editorial: California’s Next Big Tax Gulp below:

“On Nov. 3, Californians will vote on a “split roll” ballot initiative (Prop. 15) that seeks to enact the biggest tax hike in state history. In 1978 voters enshrined protections against runaway property taxes in the state Constitution (Prop 13). Prop. 15 would abolish those protections for businesses while maintaining limitations—at least for now—on homes…

“This (Prop 13) is the only balm in California’s oppressive tax climate and acts as a modest restraint on the government spending ratchet. Unions know that attempting to repeal this entirely would spur a homeowner revolt, so they are targeting businesses...

“Unions say their initiative will only hit wealthy corporations, but not even the Democratic-friendly NAACP believes that whopper, which is why it and minority business groups are campaigning against the initiative. Anyone who owns a couple of fast food franchises would get walloped. Ditto small dairies, wineries, orchards and manufacturers…

“Small businesses that rent space note that landlords would pass on the tax hike in lease agreements. Less affected will be tech titans that recently purchased properties or are planning to down-size office space as they allow more employees to work remotely. Facebook CEO Mark Zuckerberg is Prop. 15’s second biggest donor.

“Perhaps he’s trying to atone for his wealth, but as the NAACP and minority business groups explained in a letter to him in August: ‘Unlike Facebook, restaurants, dry cleaners, nail salons and other small businesses can’t operate right now and many may never open again. The last thing they need is a billionaire pushing higher taxes on them under the false flag of social justice.’”

Click here to read the full op/ed and share with all your friends, family, and colleagues!

Click here to help defeat Prop. 15 – defeat split roll property tax!

REX HIME: FUTURE IS BRIGHTER WITHOUT PROP 15

Since the Covid-19 pandemic began, Sacramento has already seen hundreds of community businesses close their doors forever. Landmarks like Biba Restaurant and Español Italian Restaurant are just a couple of the countless small businesses that have been unable to weather the economic crisis.

Sadly, these small-business closures could be the tip of the iceberg if voters do not defeat Proposition 15 this November.

A global pandemic and record economic crisis most definitely aren’t the right time for California to enact the largest property tax increase in state history, but that didn't stop special interests from spending millions to put Prop 15 on the ballot.

Now voters will decide the fate of this $11.5 billion-per-year property tax increase that threatens to roll back critical portions of Proposition 13. Prop 15 will raise taxes on commercial and industrial property by allowing reassessment at least every three years. This reassessment means a substantial overnight property tax increase for businesses that will ripple through our region’s entire economy.

Given the challenges local businesses face and with so many workers out of jobs, the stakes could not be higher for Prop 15. That’s why a broad, bipartisan coalition has formed to oppose Prop 15 made up of social justice groups, small-business organizations, farmers, taxpayer advocates and elected officials.

The special interests behind Prop 15 are doing their utmost to trick voters into believing consumers and small businesses will not be hurt by its $11.5 billion a year in higher taxes. As the saying goes, “You can put lipstick on a pig, but it’s still a pig.” Prop 15’s damage will be immense for hard-working families and farmers throughout California.

Prop 15's impact extends far beyond businesses. The cost of Prop 15’s higher taxes will ultimately be passed along to consumers through higher costs. Studies from Berkeley Research Group and Pepperdine University show that billions of dollars in higher taxes will raise families’ cost of living when they can least afford it. Some estimates show it could increase families' costs by $960 per year. Child care, groceries, clothing — pretty much everything — will get more expensive right when many families have already lost income or jobs.

Under Prop 15, many small businesses would be further hampered with a painful rent increase. My organization represents more than 10,000 commercial real estate professionals across the state, so it's safe to say we understand the impacts Prop 15 will have on small businesses. Most small businesses do not own property. They rent and the most common form of lease is what is known as a "triple net” lease. These leases make the tenants responsible for maintenance costs, insurance and property taxes, so if Prop 15 passes, these tenants will pay for the increase. Period.

Sacramento was home to thriving locally owned restaurants, entertainment options and many other small businesses before the pandemic. It’s difficult to envision a strong recovery when Prop 15 will hit these very same businesses with either higher rents or higher property taxes when they’re trying to get back on their feet.

This November, voters have a stark choice that will determine what their communities will look like. The right choice is to stand with small businesses and consumers by voting no on Prop 15.

Rex Hime is the president and CEO of the California Business Properties Association.

PROPOSITIONS IN NOVEMBER

There are a lot of propositions on the ballot, but here are the two we care about most:

Prop 15 – Split Roll Property Tax – VOTE NO!

Prop 21 – Statewide Rent Control – VOTE NO!

Please help us defeat split roll property tax and statewide rent control by voting NO on these measures. Encourage everyone you know to do the same!

CBPA 2020/2021 CALENDARS

NOTE DUE TO THE COVID-19 PANDEMIC EVENTS ARE BEING ADJUSTED TO TELECONFERENCE OR PENDING SHELTER-IN-PLACE ORDERS BEING LIFTED

2020

Thursday, November 5: CBPA Board Meeting – via Zoom

2021

Thursday, January 20