Proposition 13

Proposition 13 (officially named the People's Initiative to Limit Property Taxation) was an amendment of the Constitution of California enacted during 1978, by means of the initiative power. It was approved by California voters on June 6, 1978. It was declared constitutional under federal law by the United States Supreme Court in the case of Nordlinger v. Hahn, 505 U.S. 1 (1992). Proposition 13 is embodied in Article XIII A of the California Constitution. Proposition 13 has been part of the California Constitution for 39 years, 1 month, and 24 days.

Limit the tax rate for properties:

Section 1. (a) The maximum amount of any ad valorem tax on real property shall not exceed one percent (1%) of the full cash value of such property. The one percent (1%) tax to be collected by the counties and apportioned according to law to the districts within the counties.

Proposition 13 declared property taxes were to be assessed their 1975 value and restricted annual increases of the tax to an inflation factor, not to exceed 2% per year. A reassessment of the property tax can only be made a) when the property ownership changes or b) there is construction done.

State Responsibility:

The state has been given the responsibility of distributing the property tax revenues to local agencies.

Voting Requirements:

In addition to decreasing property taxes and changing the role of the state, the initiative also contained language requiring a two-thirds (2/3) majority in both legislative houses for future increases of any state tax rates or amounts of revenue collected, including income tax rates and sales tax rates.

It also requires a two-thirds (2/3) vote majority in local elections for most local governments proposing to increase special taxes. Proposition 13 received an enormous amount of publicity, not only in California, but throughout the United States.

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