Possible Prop 13 Changes Topic of Public Forum at Santa Monica College

February 21, 2013 -- Are Prop 13 protections for businesses a “corporate tax giveaway” or are they helping to keep California’s small businesses in the black?

Those questions are at the center of a panel and audience discussion presented by the Santa Monica College Public Policy Institute next Thursday at 7 p.m. at the college’s Bundy Campus.

The proposed changes to Prop 13 -- which limited residential and business property taxes after it was approved by voters in 1978 -- would focus on limiting exemptions for businesses and lowering the two-thirds vote requirement for raising taxes.

“Discussions are just getting underway, all over the state, on whether and how to change any of the provisions of Prop. 13,” said former State Sen. Sheila Kuehl, the founding director of SMC’s Public Policy Institute.

“No one wants to change the residential property tax limit,” she said, “but there are serious discussions in many of the state’s think tanks, non-profit institutions, legislative committees and foundations about whether something should be done about the commercial business property exemptions and the two-thirds vote requirement.”

Last year, Los Angeles Mayor Antonio Villaraigosa told lawmakers that businesses were exploiting the tax breaks and called the exemptions a “corporate tax giveaway.”

Prop 13 keeps property taxes from increasing sharply unless the property changes hands. Intended to protect homeowners, businesses have used it to avoid costly reassessments, according to a report by the California Tax Reform Assn.

Some lawmakers would like to strengthen protections for homeowners, who according to the report are paying an increasing share of the tax burden, while limiting exemptions for businesses.

But a report released by Californians Against Higher Property Taxes countered that limiting the business exemptions would slash the state’s economic output by $71.8 billion over five years, while generating only $6 billion in taxes.

Authors of the study said it would place the greatest burden on small businesses, not large corporations.

The experts on the panel are currently involved in designing proposed changes to be placed on the state ballot, institute officials said.

The panelists include Lenny Goldberg, executive director of the California Tax Reform Association; Michele Prichard, director of Common Agenda at the Liberty Hill Foundation and senior advisor to California Calls, a voter education and organizing nonprofit; and Jennifer Ito, a project manager at USC’s program for Environmental and Regional Equity.

The panel will present from 7 p.m. to 8 p.m. and Kuehl will lead an audience discussion with the panelists from 8 p.m. to 9 p.m.

The ongoing mission of the institute is “to engage the community in analyzing issues of public policy, especially those that affect local jurisdictions like cities and counties, and to provide forums such as this for civic engagement,” institute officials said.                                                           

The event will be held at SMC’s Bundy Campus, Room 123, 3171 S. Bundy Drive, Los Angeles. The event is free, as is parking, but seating is limited and reservations are required. To RSVP, email ppi.rsvp@smc.edu with the number of guests attending. For questions, call (310) 434-3429.

For more information about the institute and its activities, please call (310) 434-3429 or email Kuehl.website@gmail.com.