What you need to know about Proposition 5: Property tax break for seniors
Preying on Californians’ anxieties about rising housing prices and their compassion for seniors, people with disabilities and even victims of wildfires, proponents of Proposition 5 are betting that voters won’t notice that they’re being sold a deceptive bill of goods.
But after a long line of scams exploiting seniors, we have learned to question false promises and root out the hidden consequences. That’s why the California Congress of Seniors urges Californians to vote “no” on Nov. 6.
Proposition 5 would do nothing to help with California’s housing crisis. To make matters worse, it comes with an unacceptable price — draining $1 billion from local school funding and another $1 billion from crucial local services such as health care and emergency response.
The real estate interests hawking Proposition 5 claim their proposal would help seniors by allowing them to sell their existing homes, buy a new one and transfer their Proposition 13 property tax benefit to their new home. If it sounds like a familiar idea, it is. In fact, California voters added it to the state Constitution in 1986.
There is a common-sense rationale for this policy. It allows a couple to sell the home in which they raised their kids, buy a smaller place that better meets their current needs or retire on their home equity, and not have to pay higher property taxes. This tax protection was later expanded by voters to include severely disabled homeowners, and to allow victims of natural disasters to rebuild their homes without a tax increase.
Proposition 5 is something different. Instead of helping seniors downsize, it aims to spur sales of larger, more expensive homes. It would allow the wealthiest property owners older than 55 to transfer a new tax break an unlimited number of times to buy more expensive homes anywhere in the state. The more expensive the new home, the bigger the tax benefit.
When you see the real intent of Proposition 5, it comes as no surprise that it was written by the California Association of Realtors. So far, deep-pocketed real estate interests have written more than $7 million in checks to pass the measure.
If struggling seniors truly benefited from Proposition 5, our organization would be the first to support it. But it doesn’t do anything to help those on a limited income find an affordable apartment or hold onto their home against rising food, transportation or utility costs.
The revenue loss to local governments under Proposition 5 puts services that serve seniors — food and transportation assistance, ambulance services and emergency rooms — at risk. And the hit to local schools targets our grandchildren’s education.
California’s seniors won’t be used as pawns in a scheme to put more money in realtors’ pockets. We urge voters to say “no” to this deceptive measure.