At the Howard Jarvis Taxpayers Association, we receive thousands of calls each year from taxpayers with questions and concerns. Of all those, about two dozen stand out because they are complaints that HJTA is responsible for raising their taxes. The callers tell us that a local government agency wants to impose an assessment on their property and they have received notice and a mail in ballot. When they called the officials responsible for the assessment, they have been told “it is Jarvis’ fault because they passed Proposition 218.”
Now this may not be a whopper of the magnitude of “If you like your policy, you can keep it,” but it is almost as misleading. Here is what is going on.
Proposition 218, the Right to Vote on Taxes Act, placed on the ballot by HJTA and approved by the voters in 1996, requires that those who are to be assessed be sent notice by mail and provided a ballot so they can cast a protest vote. So, to the extent that the homeowner is being informed and being sent a ballot, this much is HJTA’s fault. The government agency is still completely responsible for efforts to impose an assessment.
Assessment districts in California go back over 100 years. Assessments are commonly used for services that add value to property, like sidewalks, sewer and water. Prior to the passage of Proposition 218, all the agency sponsoring the assessment had to do was provide “constructive notice,” which amounted to placing a notice in the classified section of the local newspaper. Since few, if any property owners saw the notification, the first time most folks became aware of the assessment was when it appeared on the next property tax bill.
Proposition 218 dragged the assessment process out into the open by requiring direct notification to property owners along with a simple ballot – under the old rules the homeowner had to compose a letter, provide a reason for the objection to the assessment, and look up and include their property parcel number. Even then, a majority of all property owners had to submit letters in order to defeat the assessment. No wonder assessments were always “approved” under the prior system.
But Proposition 218 did a lot more than just give property owners a say on assessments. It plugged court created loopholes in Proposition 13.
When Howard Jarvis and Paul Gann wrote Proposition 13 it was supposed to include the right of voters to approve new local taxes. Several court decisions whittled this right down to almost nothing, so Proposition 218 was written to correct these defects and guarantee that voters would have the final say on new local special and general taxes.
Finally, Proposition 218 made the initiative process more accessible to voters who want to make changes to local tax law.
By plugging loopholes in Proposition 13 and opening up the assessment process, Proposition 218 represents a significant advancement in taxpayer rights.
However, not everyone is happy with allowing voters and property owners to participate in their own taxation. Attorneys working for government agencies are constantly looking for ways to circumvent Proposition 218 and they are achieving some success.
Adverse decisions in two recent court cases, put taxpayers’ rights in jeopardy. In one, a water agency refused to place a duly qualified initiative that would have limited water rates, on the ballot and sued the sponsors of the measure with the intent of delaying the process until it was too late to place the initiative before the voters. The court allowed this blatant circumvention Proposition 218.
In the second case, a water agency is charging property owners who pump water from their own wells on their own property, a fee to build a pipeline and distribution system to provide piped water to others who will not be required to pay the fee. Proposition 218 requires that those charged a fee receive a service in return, but the court sided with the water agency saying that the fee provided a public benefit for the common good. HJTA is actively looking for legal and legislative solutions to these court created loopholes in Proposition 218.
These examples demonstrate how important it is that taxpayers remain vigilant and prepared to defend the taxpayer protections we have all fought so hard to establish. It is sad to say, but we can’t trust government to look after our interests.