After all, it is for the children. The city of LA Canada did it. The city of South Pasadena did it. It passed in San Marino as well. A lead pipe cinch.

In these days of declining revenues and the California State budget well past the stage of life support, local communities are looking for ways to provide much needed monetary relief to the school systems. A parcel tax seems to be the weapon of choice.

Seemingly innocuous in its inexpensive amount of $120 and the indiscriminate application in which it is applied, proponents argue that the .33 cents per day (as reported in the Pasadena Star News) is much less than a cup of coffee at Starbucks or McDonalds. Have you noticed every time someone wants you to pay more, Starbucks is the whipping boy of choice?

I’m not here to express an opinion on this tax, pro or con. Every property owner will be assessed this fee if it were to pass. Across the board, everyone pays the same. Imagine, fairness in taxation. This is not supposed to happen in California. If only the rest of the taxes were as simple and as fair.

The California Tax System is Broken

Who wouldn’t pay an additional $120 in hopes of providing quality schools and good education. Maybe anyone who has to pay property taxes two times a year and before they write the check they stop to think about what they are receiving for their tax money. If you consider for a moment the two sets of rules we as citizens and taxpayers operate under it has to give you cause for concern. The private sector who cannot arbitrarily raise prices to create revenue shortfalls has to continually redefine itself and create value for the consumer. If not, they find that business declines before they may eventually close the doors. The public sector on the other hand receives annual revenue adjustments from automatic tax increases, no need to worry if consumers receive any additional value for their contribution.

Prop 13, Lucky or Not?

There is no better evidence in the lack of value or disproportionate transfer of payments than in our own property tax system in California. Thanks to Prop 13, the taxed based on seniority, here is the situation we face in California:

I looked at four houses next door to each other and all about the same size and market price. They pay $6500, $4800, $827 and $864 in annual property taxes. All based upon the duration of how long the present owner has owned the property. This is a neighborhood in Pasadena, but it has to be like this all across California.

Maybe the ones who pay $827 and $864 think an additional tax of $120 is no big deal and gladly pay it. While the two paying $6500 and $4800 think they pay more than their fare share and vote no. This is a great example of the inequity that is pervasive in our tax system and needs to be addressed.

We are seeing evidence of home buyers in the last few years who were placed into home loans that charged more expensive rates and fees, but the loan brokers received more money. Now we call them predatory lenders because they profited at consumers expense. Couldn’t we apply the same example to property taxes?

The good news about a parcel tax is that it is put to the voters, you get to decide if it passes or fails. Unlike property taxes which are put to the voters in a different way.

Tags: California's unfair Prop 13, Pasadena Parcel Tax