September 2020 Archives

How to select a Supreme Court Justice

            Before a Supreme Court Justice can be selected, it appears our political leaders must first engage in a contentious and disturbing battle over which president has the right to make an appointment.  Then, of course, there is the problem of whether the appointee has an agenda revealing a "liberal" or "conservative" treatment of the law.  The President has declared his selection will be a woman, thus reducing the qualified candidates by approximately 50%.

            Whatever happened to the idea that, because this selection is for life-time service, any nomination would be based upon a candidate's history of objective application of the law and legal decisions made without prejudice or personal agenda?

            It would appear the proper selection would be a jurist who limits legal decisions based on provisions of the Constitution without resorting to some sort of modification of the law based on his own personal views.  The Supreme Court is not required to create new law; that job is designated to the Legislative branch of government. 

Piper's Papers

Proposition 15 - Another assault on Prop 13.

            Proposition 15, is listed on the November ballot: "Increases Funding for Public Schools, Community Colleges and Local Government Services by Changing Tax Assessment of Commercial and Industrial Property."

This is one more assault on Proposition 13 which was passed in 1978 establishing property tax at one percent of purchase price and limiting tax increases to no more than two percent per year. 

Under Proposition 15, commercial properties valued at $3-million or more (including fixtures and equipment) would be deleted from provisions of Prop 13 and taxed at market value. 

Thousands of Californians depend of large business interests for not only their salary but the reporting and collection of Social Security, FUTA, SUTA, disability, health insurance and retirement programs.  Local businesses are often relied upon to offer financial assistance to some worthy local program.

            Our state places a huge burden on larger commercial enterprises with additional obligations such as sick leave, vacation leave, Crime Victim & Domestic Violence leave, emergency duty leave, retirement income , organ and bone marrow donor's leave, paid family leave, pregnancy disability leave, school activities leave, school appearances leave, and volunteer civil service leave just to name a few.  These continued legislated obligations have resulted in self-service counters and the use of independent contractors by many California businesses in a desperate attempt to cut down on employee expense.

            And now Prop 15 removes property tax rights granted under Prop 13 in favor of an unlimited tax burden. 

Ted Harris wrote a piece in the Nevada Journal entitled The Property Tax: The Unfairest Tax of All (Aug. 27, 2005).  He asked the question "What can a property owner do to defend against ever increasing assessed property values and tax rates?  The answer is "Not much."  He points out that Nevada law allows a tax system with virtually no limit as to what cities and counties can extract from the property owner each year.  "Property taxes," he goes on to say, " have become confiscatory."

But there was more to California's Prop 13 than limiting property taxes.  It set up certain rules requiring a public vote prior to any increase in taxes.  Bond issues and tax measures required a two-thirds "super-majority" vote by the public.  In November 2001, the two-thirds voter approval was amended by Proposition 39 to a 55% approval vote for local school bond measures and that was followed by Proposition 218 which allows local governments to impose a general tax by a simple majority vote. 

One wonders at what point big business in California will finally give up and move elsewhere. 

Piper's Papers

Proposition 19 - November 3, 2020 Ballot Measure

            California has 12 qualified Ballot Measures which will appear on the November 3, 2020 ballot.  Special attention to literature provided might be of particular interest prior to voting on this Proposition.

Proposition 19, is listed as: "The Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act."

The selling point of this measure allows homeowner's who are over 55, disabled or victims of natural disaster to take a portion of their property tax base with them when they sell their home and buy a new one - one has to ask "Why not take all of their property tax base with them?"

Part two of this measure deletes the Proposition 58 protections and opens the door to higher property taxes.  Some might recall that in 1986, to prevent families from getting hit with huge tax increases, voters overwhelmingly passed Proposition 58 changing the state constitution to ensure that transfers of certain property between parents and children, up to $1-million, could occur without triggering the sticker shock of reassessment.

Proposition 19 (2020) would repeal Proposition 58 and force the reassessment of inherited or transferred property within families. The only exception is if the property is used as the principal residence of the person to whom it was transferred, and even that exclusion is capped.

If you have assets you wish to pass on to your children, you might want to take a close look at this proposition.

Piper's Papers

Proposition 14 - November 3, 2020 Ballot Measure

Proposition 14 is one more California State bond issue which, according to the Secretary of State Alex Padilla, will cost taxpayers approximately $310 Million per year for 25 years (or $7.8 Billion total) to pay off.  If approved by voters, the first payment on this bond would be delayed for five years which adds to the pay-off cost.

California already has approximately $83 billion of General Fund-supported bonds on which it is paying $6 billion in annual principal and interest.  The voters and the Legislature have approved another $39 billion of General Fund-supported bonds that have not yet been sold.

            In addition to all this, California voters approved four bond measures which appeared on the November 6, 2018 Ballot.  Together, these measures would authorize the state to borrow an additional $14.4 billion.  It will cost approximately $26 billion (including interest over a period of 40 years) to pay off these new bond measures with annual general fund payments of $650 million.

Of the $5.5 Billion Prop 14 bond measure, only $1.5 billion is dedicated to research and therapy for Alzheimer's, Parkinson's, stroke, epilepsy, and other brain and central nervous system diseases and conditions.  The remaining funds provide grants to non-profit and private entities for stem cell, medical research, medical training and construction of research facilities - whatever that means.

The coronavirus epidemic has decimated California's economy resulting in a declared budget deficit of $54 billion - possibly, it is time to say "NO."

Piper's Papers