Emily's Musings

Tax Issues

The tax we passed is still up in the air according to an editorial in today's paper:

Attorney's claims tie up a host of vital valley projects
SJ Mercury News, Oct. 10, 2005

Parcel taxes collected by the Santa Clara County library district and schools in Campbell and Mountain View are under a cloud.

All this uncertainty is the work of attorney Aaron Katz, who owns properties in these districts. In pursuit of a dubious theory of tax fairness, he has filed five lawsuits to invalidate bond and parcel-tax elections in which voters approved millions of dollars in public projects.

These are not frivolous lawsuits. Katz has plausible, though radical, arguments, and is spending a lot of time and money making them. Although the cases may eventually be thrown out on a technicality, so far the courts have not dismissed them based on merits.

Katz claims the method of raising property taxes violates the equal-protection clause of the Constitution. Property owners -- the ones directly affected by the tax -- can't vote on the tax if if they don't live in the district. If property owners do live in the district, their votes are diluted by the votes of other residents who don't own properties and don't pay the tax.

While not frivolous, Katz's legal case does appear weak. The outcome, if he wins, would be bad law and bad policy. It would not only invalidate these local elections, but also turn voting in California on its head. Only property owners, regardless of where they live, would get to vote in parcel-tax and property-assessment elections.
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At their peril, the library district is collecting and spending the tax increase voted last summer, and the Mountain View-Whisman School District is proceeding with its parcel tax, confident it won't be overturned. The Campbell Union High School District is collecting, but not spending, the $4.9 million parcel tax approved in November 2004.
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But schools, libraries and hospitals benefit everyone, property owners as well as their tenants. Voting to support these institutions should, like other elections, be for all registered voters, without interference from non-resident property owners who have little stake in the community's quality of life. And tenants do pay property taxes indirectly, through their rents, even though owners can't always immediately pass on every increase.

The burden of taxes and user fees is not always equally shared. The decision to raise them generally should be in the hands of all voters, not a few.