The Legislative Analysts Office has released a report on the impacts of Proposition 13. The property tax raised $55 billion in 2014-2015 making it the second largest source of government revenue behind personal income tax. With the passage of Proposition 13 in 1978, the property tax was capped at 1 percent annually (whereas before it was an average of 2.67 percent). The report seeks to answer a range of questions about Prop. 13, many of which are based on assumptions and received wisdom about the perceived fairness of the law. The LAO came to the following conclusions, among others: 1) Owners of properties that are similar but purchased at different times often pay vastly different amounts of property tax; 2) For homeowners at all income levels, tax relief from Prop.13 generally is proportionate to the market value of their homes; 3) Property turnover has slowed since voters approved Proposition 13; 4) Homeowners pay a slightly larger share of property taxes today than they did when Prop.13 passed; 5) There is little evidence that Prop. 13 significantly discourages creation of new businesses; 6) Local governments increasingly rely on other local taxes to make up for the revenue loses that resulted from Prop.13 and cities’ and counties’ tax revenue per person has declined since Prop.13; and 7) Proposition 13 created fiscal incentives for many communities to focus more on building retail stores, auto dealers, and hotels while focusing less on housing.
Los Angeles May Put Up Roadblock to High Speed Rail
Stakeholders in the northern portion of the City of Los Angeles are mounting increasingly intense opposition against at least one of the preferred alternatives for the proposed bullet train route along the topographically problematic segment from Palmdale to Burbank. L.A. Councilmember Paul Krekorian has filed a motion to oppose the route and instead to continue to fund the L.A. River revitalization efforts to protect the environment and residential communities in the Valley. Residents from Lake View Terrace to Shadow Hills say the foothill route would destroy the environment, kill horse-related businesses and put an end to an equestrian way of life. The California High Speed Rail Authority has already agreed to take certain routes out of the discussion: such as the one that would cut the Northeast Valley in half. The L.A. Unified School District is also considering opposition to the aboveground route.
Housing Shortage May Yet Impede Economic Growth, Reports Say
A pair of reports from UC Riverside’s Economic Forecast and UCLA’s Anderson Forecast both contend that California’s housing crisis may have long-term impacts on the state’s economy. The reports find that the state cannot continue to grow as it has in the past without growing the workforce; but California does not have the homes needed to accommodate these new workers. One reason for this slump is the state’s full employment, meaning nearly everyone that wants a job has one. The UC Riverside report equates economic growth with population growth. It notes that the shortage of housing all but ensures that the state’s population cannot grow significantly, in part because housing coasts are too high to attract migrants from other states. Without more people to recruit into the job market, residential construction has been down 2 percent for houses and 11 percent for multifamily permits from last year. A major reason for the lack in migration is the high cost of living in the state.
SGC Recommends Climate Funds for Los Angeles, Fresno
The Strategic Growth Council has recommended (pdf) that Transformative Climate Community Program funds, established by recently passed Assembly Bill 2722, be allocated in the cities of Los Angeles and Fresno, and a third location to be determined. Funds amount to up to $140 million, funded by the state’s greenhouse gas auction. A minimum of half of the funds shall be allocated in the City of Fresno. A minimum of one fourth of the funds shall be allocated in the City of Los Angeles. The third geographic location to receive priority will be determined in a separate, future, rulemaking. All program grants will be awarded pursuant to a competitive process. The Council will determine selection criteria for that process in a separate, future, rulemaking. SGC has identified the three initial locations because, it contends, the State must focus its initial investments on the communities that are most impacted by poverty and pollution where a substantial state investment can promote significant change.
San Diego Considers Scenarios for Mission Bay Restoration
Environmentalists from Rewild Mission Bay in San Diego have proposed eight possible ways to restore the Mission Bay Park’s marshland and boost recreational appeal. Some scenarios include eliminating a golf course, pouring landfill into De Anza Cove or creating a habitat island. The city will release its own set of draft alternatives next month. The main efforts are to restore environmentally crucial marshland to boost water quality and restore habitats. That is why three of the eight scenarios propose filling the polluted De Anza Cove swimming and boating area. By next May the scenarios will be down to four based on cost estimates, feasibility, and how successfully they meet the goals. The city will not finalize plans for at least three years, and the final proposal will need Coastal Commission approval.
SPUR Considers Impact of Sea Level Rise on Mission Bay
San Francisco Planning and Urban Research has released a study of San Francisco’s Mission Bay to assess the types of protection that will be required to withstand the impacts of sea level rise in the coming decades. The 80-page study has been called an “imaginative exercise” and consists of design concepts rather than formal recommendations. Other collaborators include the Bay Conservation and Development Commission. There are seven concepts, three focusing on Mission Creek, and four on the district’s southern shore; one major concept would turn Mission Creek into a lake. The goal of the project, which has been in the works since 2014, is to show ways to integrate flood protection into the urban area.
Updates & Quick Hits
The Oakland Planning Commission unanimously voted to move forward with implementing Senate Bill 743. The Bill replaces the out-dated LOS system of analysis and instead uses Vehicle Miles Traveled (VMT)s to look at transportation impacts under CEQA. (See prior CP&DR coverage.)
Developer SunCal has announced plans for a massive mixed-use development by Swiss architects Jacques Herzog and Pierre de Meuron in Los Angeles’ Arts District. The 14.5-acre development would include two 58-story towers, 1.96 million square feet of residential space, shops, offices, hotels, charter school, and underground parking for 3,400 cars.
The federal government has put a hold on transferring San Francisco’s Hunters Point land to the city for redevelopment because of concerns over radiation. Tetra Tech has been hired with the cleanup, but has been accused of falsifying soil samples. S.F. Mayor Ed Lee and Supervisor Malia Cohen sent a letter to the EPA explaining that the city “will not accept the transfer of any land until regulators are satisfied that the land is clean and safe.”
“Citizens for Ceres” must decide in less than 30 days whether they want to appeal the approval of a Walmart Supercenter to the California State Supreme Court. The Fifth District Court of Appeals in Fresno ruled against an appeal after the Stanislaus County Superior Court rejected the legal challenge of the shopping center. The opposition group is challenging the adequacy of the environmental studies of impacts on the community.
A group of investors has withdrawn a $167 million offer to purchase the Oakland Coliseum land from the city and county. Their reason was that Mayor Libby Schaaf had announced to East Bay Times that she would not recommend the proposal to be forwarded to the City Council for consideration.
Santa Barbara County Planning Commission approved an updated winery ordinance that allows a 300-square-foot, appointment-only tasting room for smaller Tier A wineries. The vote eliminates a previous requirement that a new winery’s production be at least 20 percent from grapes grown on the property.
Napa County Board of Supervisors unanimously opposed a proposed Indian casino in Vallejo. The Lake County-based Scotts Valley Band of Pomo Indians earlier applied this year to the federal government to find out if the Vallejo site qualifies for gaming.
The owner of the four dams on the Klamath River has filed applications with federal regulators to remove the dams. The decommissioning and removal could cost at least $290 million, but that work would be paid by ratepayers of PacifiCorp and Proposition 1 monies. The plan is to remove four of the five dams on the river, with work beginning in the next four years.
New proposed legislation in San Diego would crack down on “mini-dorms” near San Diego State, shut down illegal medical marijuana dispensaries, prevent illegal grading of land and many other code violations. The legislation was approved by City Council’s Rules Committee and must now be considered by the full council in the next few months.
