Tax-capping initiatives seek signatures to get on ballot

By Howard Fischer
Capitol Media Services
Published: November 6,2007

PHOENIX — Arizona voters may get the chance to put an absolute limit on their property taxes, even for special items they already voted to approve.

A new initiative launched Monday would reset the value of all homes in the state to what they were at the end of 2003. Then, year-to-year increases would be limited to just 2 percent.

But the real hammer of the measure would be to constitutionally cap all residential property taxes at one-half of 1 percent of the home's value. So total annual taxes of all types for a $200,000 home could not exceed $1,000.

Lynn Weaver, who chairs what's been dubbed Proposition 13 Arizona, said that limit would apply even to bonds and overrides voters already approved and agreed to pay off.

The total tax would apply to every type of property tax, whether levied by counties, cities, school districts, fire districts or other special districts.

If that doesn't provide enough money for each of those governments, Weaver said, it will be up to the Legislature to parcel out the revenues and decide who gets what. Governments will have to learn to prioritize, she said.

"Why should the government get to tax you out of your home because somebody wants better parks?" Weaver said.

The new initiative comes amid increased complaints that property values are increasing sharply solely because speculators have driven up overall prices. The result, Weaver said, is people paying higher taxes for a supposed capital gain even though they have not seen a cent and won't until the property is sold.

"We're setting things back to how things would have been if the speculators hadn't shown up," Weaver said, with properties valued at 2003 levels plus the 2 percent annual increase.

Voters actually may get to choose next year between two competing ways of capping property taxes, both of which claim to be modeled on California's Proposition 13, the 1978 measure that was the first in a series of voter-approved limits on government spending.

Another group, the Arizona Tax Revolt, has been gathering signatures since August on its plan. It caps tax collections as well as resetting property taxes to a figure from prior years — the exact year depends on some factors — with the 2 percent year-to-year increase.

But Weaver's measure resets a property's value each time it is sold; this one keeps it the same, no matter what the selling price. In fact, it even has a provision for new homes to have their values calculated as if they had been in existence when the cap was set.

Marc Goldstone, chairman of the Arizona Tax Revolt, said it's not fair for two people in identical homes to pay different taxes based on when the property was purchased. But Weaver said she has no problem with disparate taxes. Goldstone's measure also allows voters to decide if they want to tax themselves more for additional services like improved fire protection. But his measure requires that such hikes be approved by a two-thirds majority, and only at a regularly scheduled election in November when voter turnout is likely to be its highest.

Both measures require 230,047 valid signatures by July 3 to get on the ballot. As their provisions seem to conflict, if both pass, the one with more votes would take effect.

Arizona Tax Revolt commentary – Though just a brief synopsis of the many taxpayer benefits provided by the Arizona Tax Revolt initiatives, the description of Weaver’s measure did not address the likelihood that her measure would be barred from the ballot due to pre election challenges and in the unlikely event it was voted upon and approved, post election challenges would likely bar its implementation. One of the many down sides to Weaver’s measure is that it repeals the mechanism that permitted developers to petition for and establish improvement districts to fund infrastructure (paid for by future residents of the development) another is that it precludes the ability of the taxpayer’s to vote and increase taxes for desirable programs like education, police protection and fire fighting. And perhaps the greatest problem is that Weaver claims to help senior citizens and those living on fixed incomes yet those seniors who had applied for the senior valuation option would have their full cash value frozen and would not be rolled back to 2003. They would see a much lesser tax reduction than those not in the senior valuation program. The courts will not look kindly on any plan that would preclude the public from increasing taxes. In short Weaver’s plan would be too disruptive severely impacting both the public and private sectors and the very senior citizens she claims are the justification for her measure. The second largest employer after government, the real estate, mortgage banking, insurance, construction, development and related industries would be effectively shut down. What are Weaver’s real motivations? Does she understand the ramifications of her proposed changes? Has her measure been reviewed by an Arizona Atty. specializing in such matters?