11-10-2010, 03:51 PM
Glenn--
Prop 13 has two major components:
(1) restrictions on property tax increases: the assessed value of a property can only increase by a maximum of 2% per year, and the property can only be reassessed on transfer of ownership and/or major construction (which has led to a lot of issues about what constitutes major construction). Â It also rolled assessed values back from their current level (1978 at time of passage) to 1975.
(2) Enshrining the 2/3 majority rule for any increase in pretty much every state-level tax, as well as municipal special taxes.
One of the things about Prop 13 that is not well understood is that it applies to commercial properties as well, and of course there has been all sorts of legal maneuvering to prevent an official "change of ownership" for commercial properties (for example, large real-estate owners often set up a shell company to own a large property, then sell the company rather than the property. Â Ownership therefore never officially changes, as the property is still owned by the shell company). Â
VG
Prop 13 has two major components:
(1) restrictions on property tax increases: the assessed value of a property can only increase by a maximum of 2% per year, and the property can only be reassessed on transfer of ownership and/or major construction (which has led to a lot of issues about what constitutes major construction). Â It also rolled assessed values back from their current level (1978 at time of passage) to 1975.
(2) Enshrining the 2/3 majority rule for any increase in pretty much every state-level tax, as well as municipal special taxes.
One of the things about Prop 13 that is not well understood is that it applies to commercial properties as well, and of course there has been all sorts of legal maneuvering to prevent an official "change of ownership" for commercial properties (for example, large real-estate owners often set up a shell company to own a large property, then sell the company rather than the property. Â Ownership therefore never officially changes, as the property is still owned by the shell company). Â
VG