Garcetti Endorses 2020 Ballot Measure to Reform Prop. 13
It has been one week since the six day UTLA strike and the protestors have prompted a serious discussion about funding for our public schools and local communities. Los Angeles Unified School District and Mayor Eric Garcetti has endorsed a ballot measure titled, Schools and Communities First, that's headed for the November 2020 ballot that would repeal protections on property taxes on commercial and industrial properties. The infamous 1978 property tax-cutting measure sliced revenue for public schools by one-third. A recent study by the University of Southern California has found that commercial and industrial property owners avoid over $11 billion in local property taxes. Garcetti has poised the statewide ballot measure as "absolutely critical."
Commercial real estate owners and developers have warned that if the Schools and Communities First measure is passes in 2020, hundreds of companies could leave California to avoid paying higher state taxes. This could drive up commercial vacancy rates and discourage real estate development in the state.
There's another move set forth by Assemblywoman Cecilia Aguiar-Curry; she has introduced ACA 1, a state constitutional amendment changing the voter majority required to pass local bond measures for affordable housing construction from two-thirds to 55%. This is another attempt to erode Prop 13.
Gov. Gavin Newsom has not yet endorsed the Schools and Communities First act.
Dave Bragg, of Green Street Advisors who provide research services regarding commercial property, describes the reform as an "imminent threat" to commercial real estate owners and tenants. Both would be feel the ramifications if the Schools and Communities First Act passes in 2020.