Proposed initiative would limit property taxes in Arizona - Ahwatukee Foothills News: Valley And State

Proposed initiative would limit property taxes in Arizona

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Posted: Monday, June 27, 2011 3:41 pm | Updated: 3:26 pm, Tue Jul 19, 2011.

Armed with a new fundraising tactic, proponents launched a new drive Monday to cap what homeowners and others can be forced to pay in property taxes.

Dubbed Prop 13 Arizona, the ballot measure would roll back the assessed value of homes and businesses to what they were in 2003, before speculators helped spike prices. Those rising sales prices, in turn, boosted the tax assessments of everyone else in the neighborhood.

Anyone who bought their home since then would have the value set on the actual purchase price.

And in both cases, the year-over-year increase would be limited to no more than 2 percent.

The initiative also has a provision designed to keep local governments from making up the difference by hiking the tax rate, the figure that, multiplied by assessed value, determines the actual taxes. It would limit annual taxes on all residential property to no more than one-half of 1 percent of their value.

So the owner of a house valued at $200,000, at 2003 prices, would pay no more than $1,000 a year.

Taxes for commercial, industrial and agricultural property would be capped at 1 percent of their 2003 values.

Lynne Weaver, who chairs the campaign, said she is targeting this levy because “it is the meanest and cruelest tax,’’ linked to the ability of people to be able to afford to keep a roof over their heads.

This is actually Weaver’s third bid to put the issue on the ballot. Prior efforts in 2008 and against last year failed because of lack of signatures.

What makes this time different, Weaver told Capitol Media Services, is she is going to have the funds necessary up front to gather all the 259,213 signatures necessary by July 5, 2012, even if she has to hire paid circulators. And the secret to that, she said, is secrecy.

Specifically, Weaver is forming a tax-exempt organization to solicit donations. That organization, in turn, will finance the campaign.

The difference is that donations to the organization, unlike those for the campaign, do not have to be publicly disclosed. And Weaver said she believes that some major donors would be willing to cough up the necessary cash if their names were not associated with the drive.

“Some of the people that would support Prop 13 Arizona may need a building permit or something of that sort,’’ she said, permits that would come from city or county governments that might be opposed to anything that could limit their taxes. Weaver said that, freed from the possibility of retaliation, those who would not contribute before might be willing to do so now.

Other groups supporting or opposing ballot measures have used something like this in the past, at least indirectly.

For example, virtually all the money that came for last year’s measure to allow medical use of marijuana came from the Marijuana Policy Project, a national group based in Washington, D.C. That organization, in turn, refused to provide a list of donors. And funding for a different measure to bar government from requiring people to purchase health insurance was funneled through the Benjamin Rush League, formed by the two Arizona doctors who crafted the measure, with the names of contributors to that never made public.

Weaver said she will not begin gathering signatures for the measure until she has enough in the bank to finance the campaign. She declined to say how much that might be, saying only it would be something less than $1 million.

Aside from changing the fundraising tactics, the latest version is different from the prior efforts in one other key respect: It contains a provision that allows those whose home values have dropped below what they paid for the house to petition to have its taxable value reset to the lower value.

A 1980 voter-approved constitutional provision already caps property taxes for homeowners at 1 percent of the home’s “full cash value,’’ a figure that is supposed to be close to the market value.

But that covers only basic taxes. Anything approved by voters, ranging from bond issues and school district overrides to assessments for special districts, falls outside that time.

This amendment would impose that new absolute cap — 0.5 percent for homes and 1 percent for others — on all taxes. Weaver said that limit is justified, even when a majority of voters approve something higher.

“They’re not just imposing higher taxes on themselves,’’ she said. “They’re imposing higher taxes on everyone else.’’

Weaver said many bond elections and overrides are scheduled not in November but at some other date when voter participation is likely to be low. And she said property taxes are different than other hikes that voters have approved for themselves, like the special election in May 2010 for a temporary 1-cent hike in sales taxes.

“If you’re not working, you don’t pay income tax,’’ she said. Similarly, anyone who is not shopping is not paying sales taxes.

“But if you want a roof over your head, whether you’re a renter or a homeowner, you’re going to have to pay property tax,’’ she said.

The proposal got its name because it is modeled in part on California’s Proposition 13. That 1978 initiative was the first of a series of voter-approved limits on government spending.

Weaver became a California resident in 1983, after that state’s Prop. 13 took effect, and said it worked well there. She moved to Arizona in 2001.

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