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Last updateMon, 25 May 2015 2pm

LOS ANGELES Tuesday, May 26th 2015 8:41

WAGE RAISE RAGE

  • WHO WE ARE-Nearly half of Los Angeles just gave itself a raise. Following a wave of state and local minimum-wage bills and initiatives, Los Angeles became one of the largest cities to dramatically raise its hourly base pay and join Seattle to hit the magic $15-an-hour demand pushed by labor and community groups nationwide. The City Council…
  • ​City Snookered by Westfield Billionaires

    Jack Humphreville
    LA WATCHDOG-In March of 2014, the Herb Wesson led City Council and Mayor Eric Garcetti approved a 25 year, $48 million giveaway to help the $28.5 billion Westfield Corporation finance its $250 million development, The Village at Westfield Topanga. (Photo) But this subsidy championed by Councilman Bob Blumenfield was hardly necessary as The Village…
  • Slick With Denial: ‘Self-Regulation’ and the Latest Oil Spill

    Judith Lewis Mernit
    HISTORY LESSONS IGNORED-On Wednesday, May 20, the day after a Santa Barbara County fire inspector discovered a stream of contaminated crude oil flowing onto a pristine segment of the Southern California coast, a group of researchers published a study linking the 2010 Deepwater Horizon oil spill to a mass die-off of bottlenose dolphins. The 46…
  • Scaremongering about the Patriot Act Sunset

    Jameel Jaffer
    FALSE CLAIMS EXPOSED-In a last-ditch effort to scare lawmakers into preserving unpopular and much-abused surveillance authorities, the Senate Republican leadership and some intelligence officials are warning that allowing Section 215 of the Patriot Act to sunset would compromise national security. (One particularly crass example from Senator…
  • Still the Land of the Free, and the Home of the Brave

    Ken Alpern
    ALPERN AT LARGE-It's been another year and another successful Flag Placement at the West Los Angeles National Cemetery. Crawling out of bed in the morning on a holiday weekend to show up bright and early for a show of American patriotism and respect to our veterans and fallen heroes, the region and nation saw yet again how the Boy Scouts, Girl…
  • Retaliation: VA Police Target Veterans

    Robert L. Rosebrock
    LOS ANGELES – Recently, I was interviewed by John Ismay, an Iraqi War Veteran who is the “Veterans and Military Issues Reporter” for Southern California Public Radio. We met at the Los Angeles VA to discuss the never-ending misappropriation of land at this largest VA in the nation, within our nation’s capital for homeless Veterans. We were…
  • City Controller’s Grandstanding DWP Audit is the Real Waste of Ratepayer Dollars

    Dennis Zine
    JUST THE FACTS-City Controller Ron Galperin’s Grandstanding DWP Audit results were finally released. Unfortunately, the conclusion and political spin that came afterwards from the controller was misleading. Here are the FACTS: The DWP’s Joint Training Institute and Joint Safety Institute are administered by DWP managers and representatives of the…
  • A Place Where ‘Special Interest’ is NOT a Dirty Word

    Denyse Selesnick
    MY TURN-We need to have a new word to differentiate the villainous “Special Interest” that everyone is always complaining about and the “Special Interest” that almost all of politicians and civic and social activists have adopted as a cause. It is impossible to have passion about multiple issues. I know I have mentioned this before, but it seems…
  • Alert! America’s Small Businesses are Being Screwed by Big Business

    Robert Reich
    THE ECONOMY-Can it be that America’s small businesses are finally waking up to the fact they’re being screwed by big businesses? For years, small-business groups such as the National Federation of Independent Businesses have lined up behind big businesses lobbies. (Photo: small businesses in Studio City) They’ve contributed to the same Republican…

 

  • Can Strawberries Help Fight Cancer?

    Christian Cristiano
    WELLNESS-There have been a number of studies over the years that could show evidence of strawberries fighting off cancer. Tong Chen lead a study…
  • Study: The Best Way to Quit Smoking … Bet On It

    Francie Diep
    WELLNESS-Oftentimes, money speaks louder than words. Apparently, that aphorism applies to cigarettes too. A new study finds that money incentives…
  • Exercise Can Help Anxiety … Here’s How

    Christian Cristiano
    WELLNESS-Statistics show that over 3 million American adults suffer from anxiety and there is no evidence that number will be declining any time…




ICYMI-Amy Schumer shows Dave her vagina

Remembering Ann Meara: 1929-2015

The Star Spangled Banner … like you’ve never heard it before

 

 

 

 

  

 

 

 

‘Bring Back the Crooked Assessor’

VOICES FROM THE SQUARE - The ongoing criminal investigation of Los Angeles County Assessor John Noguez, on allegations that he lowered tax assessments on property owners in return for campaign contributions, divides Californians into two camps.

The first, and larger, is made up of all those who, having come of age since the 1978 passage of Proposition 13, will greet the news by asking, “What is an assessor?” The second camp, the graying and dwindling cohort of Californians who predate that famous property tax initiative, will nod sagely and muse, “Ah, yes, the Crooked Assessor. That’s how it all began.” Before Prop 13, county tax assessors mattered. Before a previous generation of voters locked tax policy into constitutional amber, the property tax was set community by community, in decisions of local officials elected through the ordinary tug and pull of democratic politics.

If you owned a house or business property, your property tax bill was the product of two factors: 1) the tax rates set by your city, county, and school district; and 2) the value the assessor put on your property. Even if the city council or school board raised the tax rate, your tax bill might not go up as fast if the assessor, using his discretion, held down the assessed value of your house or factory.

And that is what assessors did. In California’s great post-World War boom, assessors up and down the state used their discretion to shelter homeowners from a gale of rising home prices and property tax rates.

As 10 million Californians became 20 million, all those new people needed roads and police and parks and teachers and schools. “I don’t think that they’ve built a new schoolhouse in Brooklyn in the last 20 years,” the Los Angeles County assessor explained in 1957. “But we’ve got to build a new one every week.”

Local elected officials, needing property tax revenue to pay for those public goods, had to raise tax rates. They also pushed hard on assessors to produce higher assessments as homes and businesses climbed in value.

But assessors were elected officials, too. Their discretion to set assessments at less than full market value gave them clout. They understood they could not earn their tickets to re-election or promotion by rapidly raising assessments on voters.

So as thousands of working- and middle-class families in the late ’50s and early ’60s rallied in protest meetings and trooped off to berate their elected officials for rising property taxes, assessors held back on reassessing homes at higher values. And using their political clout, they pushed back against the efforts of local officials and technocratic reformers to take away their discretion and power to benefit homeowners and favored businesses.

When Russell Wolden, the tax assessor in San Francisco and statewide leader of county officials opposing reform, was asked by state legislators how he assessed businesses, he would say, “Well, let’s illustrate with a good example—the [San Francisco] Chronicle building at Fifth and Mission.”

Lawmakers did not need an interpreter to read the subtext: With discretion came the possibility of making powerful friends.

But Wolden had pushed his discretion too far. In 1965 a whistleblower revealed to the Chronicle that Wolden’s judgment was for sale. The whistleblower delivered stacks of files, stuffed with cancelled checks and bribery fee schedules, detailing how businesses that paid Wolden or his partners for “consulting” services got their assessments lowered. Investigations around the state turned up more cases of assessors handing out low-ball assessments to businesses that had contributed to their campaigns or stuffed dollars into their pockets.

Wolden, dubbed the “Crooked Assessor,” went to jail. So did several assessors in other counties. The San Diego assessor committed suicide. The Los Angeles assessor was indicted but found not guilty at trial.

The convictions cleared the way for reformers. Even before the Crooked Assessor became news, the Assembly’s tax committee had uncovered the assessment racket and put together a far-reaching plan, supported by Speaker Jesse Unruh and Assemblyman Nicholas Petris, a liberal Democrat from Oakland, to overhaul the whole state-local tax system to reduce reliance on the property tax. The plan called the system of property tax administration “outmoded, discriminatory, unfair, economically destructive, and regressive,” bad in both theory and practice.

But this comprehensive approach foundered. County tax assessors still fought to keep their power, and Gov. Edmund G. (Pat) Brown didn’t want to kick off his upcoming reelection campaign by raising state taxes to make up the lost revenue to schools and other local governments if the property tax were reduced and reformed.

Instead, in 1966, the Legislature and Brown enacted a narrower bill, AB 80. It required assessors to set assessments at a standard level of 25 percent of market value. The assessors’ discretion was quickly replaced by computers running regression analyses of real estate data to determine how much houses were worth. And those computers churned out something entirely unexpected and unintended: soaring property taxes for homeowners.

As it turned out, the newspaper reports about crooked assessors had left out a key piece of the story: homeowners had been the biggest beneficiaries of assessors’ discretion.

Before AB 80 passed, homeowners in San Francisco were paying taxes on 9 percent of market value while commercial property owners were assessed at 35 percent of market value. Los Angeles homeowners were assessed at 21 percent of value while commercial property was at 45 percent.

To protect homeowners (and their own careers), assessors had used their discretion to create an informal split roll, taxing business at a higher rate. By passing AB 80, the Legislature had inadvertently repealed that split roll and required local governments to lower taxes on business and shift the property tax burden to homeowners.

In San Francisco, cars carried bumper stickers with a plea: “Bring back the Crooked Assessor.” It was not to be.

With the economy booming and people still flocking to live in the sun, home prices by the mid-1970s were jumping by 2 or 3 percent a month. And because California had put assessment on auto-pilot, property taxes rode the same upward trajectory, with assessments more than doubling from 1975 to 1978—not just for new buyers but for people who had bought a cheap bungalow decades earlier and now found themselves owning, and paying huge taxes on, a house newly worth far more than they could ever afford to buy on their incomes.

No one ever intended for property taxes on homes to go so high. It happened inadvertently, the result of one of California’s spasms of reform, enacted in the modern faith that rules and experts were a better way to run California than politics and politicians’ discretion.

Instead of returning to the past and to democratic decision-making, with all its uncertainties and occasional frailties, as those bumper stickers in San Francisco urged, California would soon choose the path of even more rules. Prop 13 set property tax rates at a uniform 1 percent and set the assessed value at the purchase price, plus an inflation factor of no more than 2 percent a year.

It thereby removed not just the discretion of assessors (who now matter only in the rare instances, like the recent housing bust, when property prices decline, leaving houses worth less than their purchase price). It also took away or limited the taxing discretion of local elected officials and legislators—and even of majorities of voters.

This lack of discretion—and democracy—is at the heart of California’s present fiscal and governance turmoil.

The Crooked Assessor has a lot to answer for.

(Mark Paul, formerly deputy state treasurer of California, is co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It. Zocalo Public Square … where this article was first posted … is a living magazine that connects people to ideas and each other. A must visit.)
-cw

Tags:  Mark Paul, Zocalo Public Square, assessor, foreclosure, California, crooked assessor, property tax, Prop 13









CityWatch
Vol 10 Issue 47
Pub: June 12, 2012

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