Parcel tax

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The parcel tax is a form of tax used primarily in California for the funding of public education.[1] It originated in response to California's Proposition 13, a state constitutional amendment approved by the voters in 1978. Proposition 13 limited taxation based on the assessed value of real estate to 1% per year; however, the parcel tax is a flat tax on each parcel of real estate, and does not vary according to the value of the property. Proposition 13 allowed government entities to levy "special taxes" if approved by 2/3 of the voters. Because of the requirement that 2/3 of the voters approve such a measure, it has been described as a "somewhat cumbersome funding mechanism".[2]

Research has shown that districts able to pass parcel tax measures tend to be more prosperous and to have lower percentages of minority students than those where parcel tax measures failed, or were never proposed.[3] For example, in Oakland, California, where 68.5% of students qualify for free lunches, property owners pay a $195 parcel tax while in its enclave Piedmont, where 0.3% of students qualify for free lunches, owners pay at minimum a $1,200 parcel tax.[4] Over 80% of school districts with parcel taxes are in the relatively wealthy San Francisco Bay Area.[5]

Parcel taxes are distributed regressively because they require owners of smaller or lower valued property to pay the same total amount as owners of larger or higher valued property.[6] When the Alameda Unified School District attempted to mitigate this by imposing a parcel tax that would require very large commercial properties to pay a larger amount than residential home owners, a California appeals court declared the tax invalid.[7][8] In response the California State Senate passed a bill by Governance and Finance Chair Lois Wolk to allow school district voters to levy a higher parcel tax on commercial property,[9][10] but the bill then failed in Assembly committee.[11]

References[edit]

  1. ^ Sonstelie, Jon; Richardson, Peter (2001). School Finance and California's Master Plan for Education. San Francisco: Public Policy Institute of California. pp. 187–190. ISBN 9781582130347. 
  2. ^ Kemerer,, Frank R.; Sansom, Peter Andrew (2009), California School Law, Stanford, California: Stanford University Press, p. 114, ISBN 9780804760386 
  3. ^ Rueben, Kim S.; Cerdán-Infantes, Pedro (2003), Fiscal Effects of Voter Approval Requirements on Local Governments, San Francisco: Public Policy Institute of California, pp. 42–45, ISBN 9781582130651 
  4. ^ "Local Revenues for Schools: Limits and Options in California". EdSource Report. September 2009. Retrieved 28 October 2014. 
  5. ^ "At Issue: Parcel Taxes for Education in California". Public Policy Institute of California. September 2013. Retrieved 28 October 2014. 
  6. ^ "Raising Revenues Locally: Parcel Taxes in California School Districts 1983-2012". EdSource Report. May 2013. Retrieved 28 October 2014. 
  7. ^ Borikas v. Alameda Unified School Dist., 214 Cal. App. 4th 135, 154 Cal. Rptr. 3d 186 (Ct. App. 2013).
  8. ^ Egelko, Bob (June 12, 2013). "Alameda Parcel Tax Shot Down by High Court". San Francisco Chronicle. Retrieved 28 October 2014. 
  9. ^ SB-1021 http://www.leginfo.ca.gov/pub/13-14/bill/sen/sb_1001-1050/sb_1021_cfa_20140403_133301_sen_comm.html
  10. ^ Californa State Senate Floor Session Item: SB-1021 School districts: parcel taxes. Wolk (May 5 2014) http://calchannel.granicus.com/MediaPlayer.php?view_id=&clip_id=2094&meta_id=20175
  11. ^ "Split Roll Bill Dies in Assembly Committee". California Chamber of Commerce. Retrieved 28 October 2014.