California Proposition 36, the "Close Prop 13 Loopholes" Initiative (1984)
Proposition 36's sponsors saw it as necessary to save Proposition 13; in their main argument for a "yes" vote on Proposition 36, they said, "Proposition 13 is in serious trouble. Since it became law the courts have created many loopholes which undermine the clear intent of Proposition 13 by allowing politicians to increase many taxes without a vote of the people."
If Proposition 36 had been approved, it would have:
- Eliminated some existing property taxes and benefit assessments by making them subject to a 1% tax rate limit
- Invalidated the inflation adjustments made to assessed values for the three years following 1975-76, requiring payment of tax refunds to some taxpayers
- Revised the procedures for reappraising new construction and property which changes ownership
- Limited the ability of the state and local agencies to impose new, or increase existing, taxes and fees.
| I • II • III • IV • V • VI|
VII • VIII • IX • X • XA
XB • XI • XII • XIII • XIII A
XIII B • XIII C • XIII D • XIV • XV • XVI • XVIII • XIX • XIX A • XIX B • XIX C
XX • XXI • XXII
XXXIV • XXXV
Proposition 36, if successful, would have amended:
- Subdivision (a) of Section 1 of Article XIII A
- Subdivision (a) of Section 2 of Article XIII A
- Subdivision (b) of Section 2 of Article XIII A
- Section 5 of Article XIII A
- Section 6 of Article XIII A
- Section 3 of Article XIII A
Proposition 36 also would have added three new parts to the state's constitution:
- A new subdivision (e) of Section 2 of Article XIII A
- A new Section 4 of Article XIII A
- A new Section 4.5 of Article XIII A
Proposition 36 also would have repealed an existing section of the state's constitution, namely:
Proposition 36's official ballot summary said, "Amends Article XIII A, enacted as Proposition 13 in 1978, adding restrictions on real property taxation, enactment of new tax measures, and charging fees. Prohibits imposition of new taxes based upon real property ownership, sale, or lease. Prohibits increasing other taxes except upon two-thirds vote of Legislature for state taxes, and two-thirds vote of electorate for local governmental taxes. Restricts imposition of fees exceeding direct costs of services provided. Provides specified refunds including taxes attributable to assessed value inflation adjustments in assessment years 1976-77 through 1978-79. Makes other changes. Operative date for specified provisions -- August 15, 1983. Summary of Legislative Analyst's estimate of net state and local government fiscal impact: (1) state government revenues reduced by at least $100 million, net, over two-year period 1984-85 to 1985-86; (2) state costs increased up to $750 million over two-year period 1984-85 to 1985-86, and by about $150 million annually in subsequent years, to replace revenue losses experienced by K-12 school districts; (3) local agencies other than schools identifiable property tax and other revenue losses of approximately $2.8 billion, net, over two-year period 1984-85 to 1985-86, and revenue losses of about $1.1 billion annually in subsequent years."
The California Legislative Analyst's Office provided a lengthy overview of the predicted fiscal impact of Proposition 36, as well as a much shorter summary of their prediction, which said:
- 1. State government revenues would be reduced by at least $100 million, net, over the two-year period 1984-85 to 1985-86.
- 2. The state would incur increased costs of up to $750 million over the two-year period 1984-85 to 1985-86, as a result of the requirement in current law that the state replace any revenue losses experienced by K-12 school districts. The increased cost to compensate for any school district's revenue losses in subsequent years would be about $150 million.
- 3. Local agencies other than schools would experience an identifiable net loss of property tax and other revenues of approximately $2.8 billion over the two-year period 1984-85 to 1985-86. The revenue losses experienced by these agencies would be about $1.1 billion in 1986-87 and subsequent years.
Path to the ballot
As an initiated constitutional amendment, Proposition 36 earned a spot on the ballot through the collection of signatures on petitions.
- California Law Library, November 6, 1984 ballot propositions
- Hastings California I&R database on Proposition 36