In a surprising move, the proponents of a measure to add a multi-billion dollar property tax on the 2016 ballot for social programs, have stopped collecting signatures and shut down the effort, vowing, however, that they will try again “another year.”  Proponents said the tax would raise almost $8 billion, with a majority coming from commercial properties.

At last report, the “Lifting Children and Families out of Poverty Act,” had collected a quarter of the signatures needed to make the ballot and was successfully raising money from Hollywood activists.

The reason given, by former BOE member Conway Collis:  “The 2016 ballot has become too crowded with too many revenue raising measures on it.” “Consequently it makes more sense to qualify early for a later ballot.”

Political insiders believe, however, the abandonment of the proposition was due to a combination of factors, including the fact that the business community in the state were taking the threat seriously and vowing to push back on the measure.  Combined with the fact that the electorate still shows strong support for Proposition 13, the success of the measure was not assured and a long expensive battle loomed.  Finally, it is assumed that other powerful groups pushing for tax increases – such as extension of income taxes and more tobacco taxes – on the ballot pressured the proponents to move out of the way.

This is the second property tax initiative that was planned for the 2016 ballot that has been dropped.  The first was a split roll property tax that was walked away from shortly after Governor Brown expressed concern about it.

CBPA has strongly been arguing that such a tax increase would hurt the economy by raising rents, evaporating jobs, and have a negative impact on small businesses.

Although there are many factors to the political calculus that goes into these decisions, the fact that the commercial real estate industry has had an ongoing education effort through the Californians to Stop Higher Property Taxes should not be underestimated.  Read more here.

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