As the news media blares the latest headlines, ballots are flooding the ballot boxes as a rate that we as a state and as a county have not experienced. The last day to officially register for the November election was this past Monday. Although numbers are still being worked out, Merced County has an active voter base of just over 116,000 individuals. Our organization has worked hard throughout the state and locally to educate the public on the impacts that Proposition 15 will bring to our community should it pass. We have put up signs, done social media blasts and have now spoken in front of the Merced County Board of Supervisors, and councils of the City of Merced and City of Dos Palos.
Unless we have members in attendance for these types of meetings, it rare that you are able to see the work we do. For this reason, I wanted to share with you our oral comments that we have made to the above elected bodies this week.
“Commonly known as the “split-roll” tax, Prop 15 is the single largest threat to small businesses appearing on the November ballot. It threatens to increase property taxes by $11.5 billion even as the state struggles with the impacts of COVID-19 and record unemployment. Should a small business rent their storefront, they most likely operate on an agreement called a “triple net lease” where the small business owner is responsible for maintenance costs, insurance, and property taxes. Many of these small business owners include restaurants, barbershops, day care centers, dry cleaners and all those that lease storefront property. Simply put, the revenue sought from Prop 15 will come largely from small businesses who will either raise costs on consumers, lay off employees, or close their doors.
From an agricultural perspective, Prop 15 will expose farms and ranches to steep property tax increases despite false assurances from its proponents. This will have a devastating effect on our farmers and ranchers, leading to more job losses and higher prices for consumers. Prop 15 only exempts agricultural land from reassessment, failing to exempt agricultural fixtures and improvements including fences, irrigation systems, barns, and even fruit and nut bearing trees.
The California Assessors Association has also opposed the proposition. In their white paper issued last year, they state, “The cost to complete the annual assessment roll would increase between $380 million to $470 million annually, statewide, during the first five to ten years. This does not include the cost to upgrade existing technology systems to accommodate the split roll assessment.”
Even more troubling, the non-partisan Legislative Analyst’s Office projects that some rural counties could even lose tax revenue while getting hit with higher property taxes. A cash flow estimate analysis has been done with two scenarios – one assuming $12.5 billion in additional revenues and the other assuming the low end of $8 billion. Los Angeles County would receive $1.4 billion on the low end and $2.3 billion on the high. Monterey County would receive $59 million to $93 million. In contrast, net revenues to our county, cities and special districts would be approximately $8.7 million for the high and $1.6 million on the low. Funding will first go to assessors for their costs, then on to local governments and finally to education.
This proposition does not impact homeowners, yet the Yes on Prop 15 has showed signs of this in the future. If approved, this will begin the process of entirely rewriting Prop 13 for all.
Agriculture organizations are not the only groups opposing the proposition as the California State Conference of the NAACP, California Chamber of Commerce, California Black Chamber of Commerce and the California Hispanic Chamber of Commerce are all opposed.
This funding will not come from large, corporate Bay Area interests, but our local small businesses who have been impacted by the pandemic. Locally, I am proud to say that the Merced Boosters and Merced County NAACP are standing with Merced County Farm Bureau in opposing Proposition 15.”
The cash flow estimates referenced in my comments is based on “existing property tax allocation formulas, the fund allocations and timing in the measure, and a study published by the measure’s proponents, USC Dornslife, Getting Real about Reform II: Estimating Revenue Gains from Changes to California’s System of Assessing Commercial Real Estate, February 2020” from the No on Prop 15 Campaign.
If small businesses are to survive in California, Prop 15 must be defeated by voters in November. If not, I envision a dim outlook for our business landscape. I am incredibly proud to say that we are joining with organizations that we have not worked with in the past but Prop 15 has provided us the opportunity to get to know one another.
If you are one that does not want to mail your ballot, there are a number of sanctioned locations throughout the county and can be dropped off during regular business hours.
City of Atwater, 750 Bellevue Road, Atwater
City of Dos Palos, 2174 Blossom Street, Dos Palos
City of Gustine, 352 Fifth Street, Gustine
City of Livingston, 1416 C Street, Livingston
City of Los Banos, 520 J Street, Los Banos
City of Merced, 678 West 18th, Merced
*County Administration Building, 2222 M Street, Merced
**Los Banos Community Center, 645 7th Street, Los Banos
*The County Administration Building has 24-hour drop boxes.
**Los Banos Community Center is available for drop off starting October 31 through November 3.
I expect all our members to do their civic duty. I would kindly ask that you reach out to your family and friends and encourage them to get out and vote! If you have the conversation, encourage a No on Prop 15 while you are at it! There are several large votes on the ballot, but for Merced County agriculture, Prop 15 is the largest.