What Didn’t They Understand About the Definition of “Uniform?”

California law requires parcel taxes to be uniform for every parcel. That means a parcel of 0.1 acres and a parcel of 10 acres must be charged the same tax. It seems simple, right?

Well, back in 2008 voters in the Alameda Unified School District (near Oakland in the East San Francisco Bay region) approved Measure H. That allowed a parcel tax, of $120 on residential property. However, commercial properties were charged a sliding scale. Smaller properties were charged $120; however, some larger properties owed $9,500 per year.

A property owner filed a lawsuit claiming the tax on larger commercial properties should be limited to the $120 per year. He lost at trial but appealed the decision. The appellate court reversed the decision, so for now uniform is back to its original meaning. Unless the decision is overturned on appeal (I do expect the Alameda Unified School District to appeal to the California Supreme Court), the school district will have to refund most of the $18 million it collected.

Unfortunately, there’s a dark cloud on the horizon. As the court noted,

We are well aware that we are being called on to interpret statutory language enacted in a different economic era and in the wake of two of the most far-reaching tax constraining measures ever passed by the state electorate (Propositions 13 and 62), that the state has since faced crippling economic conditions, and that school districts and other local governmental entities are more dependent than ever on the revenues from special taxes. The courts, however, cannot recalibrate the taxing power statutorily delegated to local entities; any adjustment in that regard must be made by the state Legislature.

Given that Democrats now have a super-majority in the California legislature, I expect uniform to be a thing of the past in the near future.

News Story: San Francisco Chronicle
Hat Tip: Tax Foundation

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