I HAVE BEEN MULLING over the name of the group, "Alamedans for Fair Taxation." They're some of the folks challenging Measure H, the parcel tax for the city's public schools that passed in June with 66.9 percent of the vote.
It's the word "fair" that I'm stuck on.
In California, since Proposition 13, property owners pay tax based not on the actual value of a property, but on the price paid for it. For example, my husband and I bought our house in 2004. This year we'll pay $8,990 in property taxes, about $750 a month. Our bill includes several special assessments, including the Alameda hospital tax and the school taxes. (Property tax info, by the way, is public. You can search by address or parcel number at www.acgov.org.)
To be clear: Although it is sometimes painful, I am OK paying our taxes. I am grateful for all the things provided by government, from health services for the needy to tended trails in public parks, from oversight of pesticides on crops to a functioning judicial system.
But, taxes: Neighbors live in a house with a floor plan identical to ours. They pay just $1,740 a year, about $145 a month. Right now, their house is on the market. If it sells for the roughly $850,000 asking price, the new owners will pay about $11,000 in property taxes. Same house. Different owners, $9,000 more a year in taxes. I can't think of any standard by which this is fair.
The owners of Pauline's Antiques (I mention them because they're been vocal opponents of Measure H) will this year have a property tax bill of $5,450. (Theirs is a 5,600-square-foot commercial building on a 7,000-square-foot parcel on Park Street, according to public records.) The owners of Pillow Park Plaza, also outspoken Measure H opponents, are poised to pay a total of $10,750 in property taxes for their 8,300-square-foot Park Street building on a 10,190-square-foot lot.
By way of contrast, Park Street property owners who bought their buildings more recently pay significantly higher property taxes. For example, the owners of a 7,300-square-foot Park Street building south of Pillow Park and Pauline's have this year a property tax bill of $21,740. The owners of another recently-sold Park Street building (which is, at 4,300 square feet, considerably smaller than Pillow Park and Pauline's) has a property tax bill of $20,800. Are we still holding up "fair" as a standard?
A flat per parcel tax, one that is assessed without regard to property size or use or value, is of course not fair either. Should a shopping center pay the same price as a two-bedroom bungalow?
Outside of California, assessors evaluate the actual worth of a property, and taxes are billed accordingly. If you own a castle you pay annual property taxes on the value of the castle, not on the price you happened to buy the castle for some decades back. (Wouldn't it be fun to own a castle?)
What we have is a broken, alarmingly unfair system. Billionaire financier Warren Buffett (now our nation's richest man) said as much to Arnold S. back in 2003, when he was serving as Schwarzenegger's economic adviser. He said Caifornia property taxes are "wildly capricious, tied as they are to the date of purchase rather than the value of the property or financial circumstances of the owner."
In sum: As long as Proposition 13 controls our state, there is no such thing as fair taxation. Not even close. And going on as we are — millions paying taxes on yesterday's values — we're going to keep coming up sadly short in paying for vital services.
Eve Pearlman has two children in Alameda public schools. She is an active school volunteer and formerly served on the board of the Alameda Education Foundation. She also writes the Alameda Journal Blog. Look for news, impressions and opinion at www.ibabuzz.com/alamedajournal.