November initiative to change Prop 13 spells trouble for small, minority-owned businesses, says Willie Brown

California Proposition 13 has long been a safety net for small businesses against large property tax hikes.  However, recent initiatives to Prop. 13 in queue for the state’s November ballot will force property taxes for both commercial and industrial properties to be reevaluated at market value, including those that house small businesses. Ex-S.F. Mayor Willie Brown explores in Cal Matters.

“For homeowners, small business owners and employers – large and small – Prop. 13 has provided stability, predictability and certainty.  This certainty is even more important for the 46 percent of California businesses that are owned by racial minorities including African Americans. 

“This November, many of the same groups that opposed Prop. 13 four decades ago are pushing the largest property tax increase in California history – a shortsighted act made even more myopic given the walloping we’re experiencing with the COVID-19 crisis. Today, tens of thousands of small businesses across California have shuttered their stores. Still, proponents are proceeding full speed ahead with a proposal that will remove business properties from Prop. 13’s protections and require them to be reassessed at current market value at least every three years.

“This unprecedented property tax increase will raise costs to businesses by up to $12.5 billion annually or, if they lease, lead to significant rent increases. Businesses, in turn, will pass these higher costs on to consumers – families and other small businesses – ultimately making everything we buy more expensive.

“Even before the unpredictable, tumultuous events of COVID-19, this massive property tax increase demonstrates an insensitivity and lack of awareness about the struggles that small businesses, particularly minority small businesses, face.”

Read the whole thing here. 

Willie Brown is a former San Francisco mayor and the longest serving Speaker of the California Assembly, Wlb@williebrowninc.com.

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