Proposition 13-- Jersey Style

by: tabbycat31

Sun Mar 14, 2010 at 05:22:20 PM EDT

On Tuesday, Governor Christie will propose a constitutional amendment that would limit property tax increases to 2.5% per year. http://www.nj.com/news/index.ssf/2010/03/christie_will_propose_constitu.html While on paper this seems like a good idea, it immediately reminded me of another good idea at the time that is backfiring today—California’s Proposition 13. http://en.wikipedia.org/wiki/California_Proposition_13_(1978)

California, a state notorious for ballot initiatives, passed Proposition 13 in 1978 in order to help people stay in their long-term homes that they could no longer afford due to rising property taxes. Proposition 13 limits taxes to 1% of a property’s assessed value, which under the proposition is only allowed to increase a maximum of 2% per year. Under this proposition, long time homeowners pay a lower property tax bill than their new neighbors. On paper it is a good idea, but the long-term effects are devastating. Proposition 13 also treats businesses and commercial properties the same as homeowners.

Of course with Christie’s proposal, the devil is in the details. Unlike Proposition 13, Christie’s proposal does not address the fluctuation in real estate prices (that I know about). What would a housing bubble and burst such as the recent one do to Christie’s proposal? This leaves me with more questions than answers. Services such as public schools, police, fire, public libraries, and infrastructure have been cut because of decreasing revenue. Especially after the recent storms that New Jersey had this winter, do we really want to gut first responders and infrastructure repair?

Of course now issues like Proposition 13 are not new. California’s financial problems make New Jersey look like a fiscal genius. The budget problems that California faces today can be linked back to Proposition 13. http://www.time.com/time/nation/article/0,8599,1904938,00.html The proposition also dramatically impacted the state’s per pupil educational spending, which is currently 48th in the nation and California’s public schools have suffered. http://www.time.com/time/nation/article/0,8599,1907504,00.html?iid=sphere-inline-sidebar

Now that there is a case study for how Proposition 13 affects the government over the long term, it makes no sense that yet another state would adapt this model. This proposed constitutional amendment is not fiscally responsibl. When the budget is debated between Christie and the Democrats in the legislature, I hope that the Democrats bring up the long-term effects of Proposition 13 on California. This is not a time for the Democrats to act like spineless wimps and they should fight this every step of the way. I’m a recent transplant to New Jersey and I see it as a perfect fit for me. However if Chris Christie has his way, I may have to reconsider in the long-term, as will many New Jerseyans.