Ever Have One of Those Days?

Friday, April 16, 2004

Page 7

CALIFORNIA COMMENTARY (Column)

Ever Have One of Those Days?

By JON COUPAL

(The writer is an attorney and president of the Howard Jarvis Taxpayers Association.)

There is an amusing airline commercial that shows a man who has just flown into town for a job interview, looking down and seeing that he is wearing one black and one brown shoe. The leadership of one of California’s largest unions has just had one of those days. Only in their case the equivalent is more like looking down and realizing you’ve forgotten your trousers.

The 350,000 member California Teachers Association and its partner, actor/director Rob Reiner— “Meathead” from “All in the Family”—have just spent several months and a few million dollars gathering signatures to qualify a November ballot initiative that would “split” the property tax roll and target businesses for property tax increases of nearly $7 billion. The measure would raise property taxes 55 percent on businesses large and small as well as owners of residential rental property, resulting in upward pressure on rents. The only group that the union and Reiner claim to be exempt would be single-family homeowners.

However, last week the CTA split roll initiative promoters were stunned when representatives of the Howard Jarvis Taxpayers Association and the California Taxpayers Association revealed that the poorly written language of the measure would result in the land underneath an owner’s primary residence being taxed at the higher rate.

With the deadline rapidly approaching for submitting signatures for measures that will qualify for the November ballot, the CTA was forced to make a choice. They could submit the signatures for the current measure, deny they have a problem, and try to bluff their way through, or they could accept the embarrassment, scrap the current effort and start all over, meaning that a split roll proposal would not be voted on until 2006, if ever.

The teachers union has decided to cut its losses and abandon the current effort to raise taxes on millions of California property owners. This is great news for taxpayers, who just fought a strenuous but successful battle against Proposition 56, the other major ballot attack on Proposition 13 this year.

But the tax-and-spend lobby is persistent and has deep pockets. They would still like to divide homeowners and businesses so they can build a majority of voters to approve taxes by using the strategy expressed best by the late Senator Russell Long, as “Don’t tax you, don◊t tax me, tax that man behind the tree.”

Even without the major drafting flaw the split role was a venomous proposal. By raising business property taxes we would just further erode the business climate that many judge the worst of all 50 states. Had the split roll plan gone forward and passed, the viability of many small businesses would be in question, while those able to move would be planning an exit strategy. Renters would be another victim of the CTA’s split role scheme as landlords would be certain to raise rents to meet their higher tax bills.

The proposed change would be a break with tradition. California has always taxed commercial and residential property at the same rate. But if backers of a split role are successful, instead of raising revenue they will force more businesses and taxpayers to flee the state, leaving fewer of us behind to pay the taxes.

The tax raisers may have defeated their own measure through sloppy work, but they can be counted on to be back with another more carefully crafted measure to separate the taxpayers from their hard-earned dollars.