Lopez: TaxTaxTaxTaxTaxTaxTax

John Seiler:

L.A. Times columnist Steve Lopez continues his tax obsession with another attack on Proposition 13. His title is, “Speaking the unspeakable in California politics” — except that the “unspeakable” has been spoken continuously ever since voters passed Prop. 13 back in 1978, limiting increases in property taxes.

L.A. Mayor Antonio Villaraigosa, taking time out from letting Dodger Stadium devolve into a gang den, called Steve personally about gutting Prop. 13. Villaraigosa is interested in a “split roll” for property taxes that Lopez has been pushing. Under a “split roll,” homeowners would continue to operate under the Prop. 13 protections, but commercial property would be hit with higher tax rates. Lopez enthuses:

But [Villaraigosa] said he plans to go to Sacramento in August, and he’s thinking he might make a speech to the press club pitching Prop. 13 reform. He said he was surprised that Gov. Jerry Brown hasn’t done it himself, because at the age of 73, Brown doesn’t need to give much consideration to his political future.

“If he needs a guy like me to start it, then I’m going to do it,” said Villaraigosa, a former state Assembly speaker.

But neither the mayor nor Lopez cares about how a split roll would destroy California businesses and jobs.

First, increasing property taxes on businesses would mean they would have less money for jobs creation, increasing a state unemployment rate already second-highest in the nation at 11.7 percent in May. And after six years of Villaraigosa’s misrule, L.A.’s unemployment rate is even higher.

Second, businesses could avoid the tax by leaving the state, which they already are in record numbers.

Third, when other states have enacted split-roll property taxes, the action quickly leads not to just two tax rates (one for residential, the other for commercial properties), but a patch-quilt of rates from exemptions for special interests.

In California, first the environmental companies would say, “You’re killing green jobs and destroying the environment! Give us a tax break or Gaia will be polluted more.”

Then defense companies would say, “The higher property tax rate from the split roll is increasing the cost of producing weapons and equipment for our troops, meaning they have fewer of our products to defend themselves in the War on Terror. That means more of our brave young Americans will come home in body bags. Give us an exemption.”

And so on.

A split roll would be a full employment program for lawyers, lobbyists and politicians.

For the rest of us, it would be another California folly.

July 11, 2011