Proposition 13: The 'Sacred Cow' That Won't Go Away

The Laws That Shaped L.A. spotlights regulations that have played a significant role in the development of contemporary Los Angeles. These laws -- as nominated and explained each week by a locally-based expert -- may be civil or criminal, and they may have been put into practice by city, county, state, federal or even international authority.

This Week's Law That Shaped L.A."¨
Law: Proposition 13 (Article XIII-A, California Constitution)
Year: 1978
Jurisdiction: California
Nominated by: Dawn Nakagawa

Approved by voters in 1978 back when Governor Jerry Brown was serving his first term, Article XIII-A of the California Constitution -- known far and wide as Proposition 13 after the ballot imitative that sired the amendment -- has proved since its advent to be a polarizing, catalyzing, significant and particularly stubborn piece of legislation.

Prop 13 was, as Time magazine put it, "the anti-tax measure that ignited the Reagan Revolution and the conservative era." The resulting amendment cut, capped and rolled back property taxes, among other clauses.

"Prop 13 is a sacred cow," Dawn Nakagawa says. "I don't think it is ever going to be changed."

Nakagawa is the executive director of the Nicolas Berggruen Institute, a relatively new and ambitious policy think tank that is, according to the organization's website, "engaged in the comparative study and design of systems of governance suited to the new and complex challenges of the 21st century."

Nakagawa nominated Prop 13 as a Law That Shaped L.A. Her and her colleagues' understanding of the law as a sacred cow or a 'third rail' of state politics contributed greatly to an approach taken last year by the NBI-organized Think Long Committee for California.

The Think Long group released a policy white paper titled, "A Blueprint To Restore California." The proposal focused less on any changes to the property tax system and instead more on levies for services. [Download a .pdf of the "Blueprint" and see a list of Think Long members here.]

"Tax the economy we have," Nakagawa says in what should be considered a straightforward and non-controversial statement, given the transformation of the economy from manufacturing- to information-based.

Nakagawa continues: "The tax code [is] broken," she says. "We have this huge volatility in our tax system. It's really boom and bust and it's because we are highly, highly dependent on income tax."

Nakagawa greeted a visitor a few months ago to the NBI's local headquarters. During a far-ranging conversation, she laid out some of the pros of Prop 13, and then at greater length, many of the cons.

"Obviously, Prop 13 has had some benefits," Nakagawa says. "The little old lady living in Manhattan Beach whose house is now worth $2.6 million -- but when she bought it was twenty grand -- there is no way, shape or form that she could keep that house without Prop 13 being what it is."

Preserving neighborhood economic diversity and protecting senior citizens are of course pluses to the NBI executive director -- but they are far from the only Prop 13 results meriting mention.

"There is a richness to the community that you get," Nakagawa says, "but you also see failing infrastructures. You see schools that are in real trouble. You see health care being cut. All of these things are happening that impact Los Angeles in important ways."

Nakagawa stresses that Prop 13 alone isn't to blame for all the city's -- and state's -- litany of woes. She cites a long list of other problems and prescriptions for issues that range from the way legislative term limits have been structured to the teacher tenure rule to the Tolstoy novel that is California's governing document. "The only constitution in the world that is longer is India's," Nakagawa says.

Nakagawa also says that if Prop 13 had been crafted in a manner that it was closely linked to inflation -- perhaps via the Consumer Price Index -- the amendment would have been more preferable. Instead, she says: "This rigid tax policy has really tied hands at the municipal level."

Nakagawa also says that she understands where the impulse came from those three-plus decades ago to pass a bill such as Prop 13. "People [were] getting kicked out of their house because they couldn't afford the tax lien," she says.

And Nakagawa discusses the effects on the city and state of Prop. 98 -- which this column will address in the future -- and CEQA -- which this column addressed once here and will soon again, but this time from an environmental attorney's perspective.

But all those many caveats aside, Nakagawa is down on Prop 13 because of another, non-tax-related reason altogether.

"Prop 13 set a precedent for how the electorate could get around the legislature," Nakagawa says, referring to this genesis of the initiative movement. "It was I think the first example where the electorate sort of took the bull by the horns and said, 'We are going to make this right.'"

This may sound appealing enough on the surface, but Nakagawa says: "It has in some ways launched an adversarial culture."

That culture is evident in the way initiatives as a concept are often characterized. Depending on who is doing the explaining, they are either a grand glory of direct democracy; an anti-democratic tool of wealthy initiative backers who buy ballot placement through paid signature gatherings and then buy votes through ceaseless advertising; a triumph of amateur inexpertise over trained technocrats; or some variation of the above.

So, given rumblings such as this, has Prop 13's time now passed? If so, its political and policy obit would be on front and home pages worldwide.

But again, Nakagawa cautions, never count Prop 13 out -- or for that matter, any of its brethren. "We pass about 1,000 laws in California a year, which is mind-boggling," she says. "And none of them ever get sunset."

Coming soon in the Laws That Shaped L.A.: Architect, writer and professor Orhan Ayyuce on how Prop 13 Effects the Built Environment

Top Photo: California Taxpayers Association, 1958. Photograph by Wyman. Photo courtesy University of Southern California Digital Archives

**Jeremy Rosenberg worked on a project for the Pacific Council on International Policy when Dawn Nakagawa was an Executive Vice President there.