Basically, Prop 19 would allow homeowners to move into a nicer place without their tax bill ballooning.
Property taxes have been a hot-button issue in California since Prop 13 passed in 1978. It says that the amount of tax that is owed on a piece of property is one percent of its sale price, and the most that bill can grow is two percent a year. This means that the taxable value of most properties is less than their market value.
So here’s the deal: qualifying homeowners can currently transfer their tax assessment from one piece of real estate to another of equal or lesser market value one time. But if Prop 19 passes, they’ll be able to transfer an assessment to a more expensive property by taking the difference in market value between the two and adding it to the taxable value of the old property.
But there’s more: Prop 19 would allow some folks to transfer their assessments three times instead of just once. And it would also require people who inherit a home to pay more taxes unless they move in.
The Legislature voted to put Prop 19 on the ballot. If it passes, any increased revenue would mostly go to the California Fire Response Fund, so firefighters like it. It also has support from California realtors, who might see a lot more movement in the housing market if it passes.
But there are opponents. A couple years ago the California Association of Realtors introduced different legislation that would have made it easier to transfer property tax assessments. That bill failed after opposition from local governments and school districts, who stood to lose $2 billion in tax revenue.
So, a vote for Prop 19 is a vote to keep tax bills lower when homeowners move, and it would require kids to pay more when they inherit a place, unless they move in. New revenue would mostly go to firefighting efforts.
A no vote on Prop 19 means that homeowners can only transfer their tax assessment once, and only to a place of equal or lesser value. Kids inheriting property get to keep their tax bill.