Close Menu
Fund Focus News
    Facebook X (Twitter) Instagram
    Trending
    • Fundsmith star Terry Smith warns index funds are ‘laying foundations of a major investment disaster’
    • XRP News Today: XRP Holds $2 as ETFs Outshine Bitcoin Flows
    • Investor flight to safety in December 2025 market trends
    • Manufacturing Funds Stumble in 2025
    • Gift Mutual Fund Units To Children Without Capital Gains Tax: Online Step-By-Step Guide | Savings and Investments News
    • VNQI vs. HAUZ: These ETFs Offer Investors Exposure to Real Estate Around the World
    • Best Mid-Cap Mutual Funds for High Growth in 2026
    • What They Are, How They Work, and Their Categories
    Facebook X (Twitter) Instagram
    Fund Focus News
    • Home
    • Bonds
    • ETFs
    • Funds
    • Investments
    • Mutual Funds
    • Property Investments
    • SIP
    Fund Focus News
    Home»Bonds»Proposition 5 would turbo-charge tax hikes, increase local debt
    Bonds

    Proposition 5 would turbo-charge tax hikes, increase local debt

    October 12, 2024



    Click here for a complete list of our election recommendations.


    Before Proposition 13 was passed overwhelmingly by voters in 1978, property tax bills were fatal.

    Howard Jarvis, namesake of the taxpayer association he founded, witnessed a woman drop dead from a heart attack in a county office when told she would have to pay the new, higher property tax bill on her home in order to keep it.

    Let me tell you how property taxes were calculated before Prop. 13, but if you have a pacemaker, please stop reading now.

    Property taxes were assessed based on the current market value of the property, and the statewide average tax rate was 2.67%. Now imagine, but not if you have a pacemaker, having to pay 2.67% of the current market value of your home, every year, as a condition of keeping it.

    It’s okay, breathe. Proposition 13 cut the tax rate to 1% and capped the rise in assessed value at 2% per year for as long as you own your property, regardless of market value.

    But now there’s something on the ballot that could cause property taxes to go up after every election, forever. It’s Proposition 5, and if it passes, in just a few years people would again start losing their homes because of unaffordable, heart-stopping property taxes.

    Proposition 5 would raise everyone’s cost of housing and the cost of living, because apartment buildings and business properties pay these taxes, too. Rents and prices would go up. And watch this trick: Prop. 5 would take effect immediately, even lowering the vote threshold for local bond measures that are on the same upcoming Nov. 5 ballot.

    Proposition 5 would remove the taxpayer protection that has been on the books since the signing of the 1879 California Constitution: the requirement of a two-thirds vote of the electorate to approve local debt. Even in the handwritten 1849 Constitution, the Legislature was directed to restrict the ability of local governments to take on debt, in order “to prevent abuses.”

    Proposition 5 would throw that out and slash the vote needed to pass local bonds (the government’s method of borrowing money) from the current two-thirds down to just 55%.

    California voters agreed in 2000 that school bonds should pass with 55%, and now every local government entity wants the same deal — from cities and counties to transit districts and regional associations of governments. So the Legislature put Proposition 5 on the ballot, and if it receives a simple majority of the statewide vote, the taxpayer protection that has been in the Constitution since 1879 would be erased.

    Local bonds raise property taxes. With hundreds of government entities panting for more money, there would almost certainly be a local bond measure, maybe two, on every ballot in every election for the rest of time. Once the government consultants finish writing the sugar-coated ballot language that hides the true cost, many of these measures would reach the 55% vote threshold and raise property taxes for decades.

    Over and over again.

    Proposition 5 is a turbo engine to raise property taxes. The lower vote threshold would apply to bonds for “infrastructure,” broadly defined, and for government housing projects, including the kind that have cost around $800,000 per unit for homeless housing.

    Voter-approved local debt raises property taxes. It gets around Proposition 13. That’s why it’s so important to keep the two-thirds vote requirement to approve debt that would burden taxpayers for 30 years or more.

    The early Californians had the right idea. “To prevent abuses,” local governments should not too easily be able to drown us in debt.

    Jon Coupal is president of the Howard Jarvis Taxpayers Association.



    Source link

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email

    Related Posts

    What They Are, How They Work, and Their Categories

    January 10, 2026

    Key Risks Every Investor Should Know

    January 10, 2026

    When it comes to bond funds, which is better: passive or active?

    January 9, 2026
    Leave A Reply Cancel Reply

    Top Posts

    The Shifting Landscape of Art Investment and the Rise of Accessibility: The London Art Exchange

    September 11, 2023

    Charlie Cobham: The Art Broker Extraordinaire Maximizing Returns for High Net Worth Clients

    February 12, 2024

    The Unyielding Resilience of the Art Market: A Historical and Contemporary Perspective

    November 19, 2023

    Navigating Investments and Risk Factors

    January 10, 2026
    Don't Miss
    Funds

    Fundsmith star Terry Smith warns index funds are ‘laying foundations of a major investment disaster’

    January 11, 2026

    Star fund manager Terry Smith has said the massive shift to passive funds could trigger…

    XRP News Today: XRP Holds $2 as ETFs Outshine Bitcoin Flows

    January 10, 2026

    Investor flight to safety in December 2025 market trends

    January 10, 2026

    Manufacturing Funds Stumble in 2025

    January 10, 2026
    Stay In Touch
    • Facebook
    • Twitter
    • Pinterest
    • Instagram
    • YouTube
    • Vimeo
    EDITOR'S PICK

    The No. 1 enemy of your 401(k) plan may be you

    July 27, 2024

    PFI Asset Management launches 1st sponsored mutual fund PFI Cashi

    October 20, 2025

    sebi new asset class: Sebi mulls new asset class to fill gap between mutual fund, PMS

    July 16, 2024
    Our Picks

    Fundsmith star Terry Smith warns index funds are ‘laying foundations of a major investment disaster’

    January 11, 2026

    XRP News Today: XRP Holds $2 as ETFs Outshine Bitcoin Flows

    January 10, 2026

    Investor flight to safety in December 2025 market trends

    January 10, 2026
    Most Popular

    🔥Juve target Chukwuemeka, Inter raise funds, Elmas bid in play 🤑

    August 20, 2025

    💵 Libra responds after Flamengo takes legal action and ‘freezes’ funds

    September 26, 2025

    ₹10,000 monthly SIP in this mutual fund has grown to ₹1.52 crore in 22 years

    September 17, 2025
    © 2026 Fund Focus News
    • Get In Touch
    • Privacy Policy
    • Terms and Conditions

    Type above and press Enter to search. Press Esc to cancel.