By Steve Levy
Older Homeowners and Local Property TaxesUploaded: Apr 9, 2011
One of the main arguments in 1978 for passing Proposition 13 was that rising property taxes threatened older homeowners who were retired and living on a reduced income. While they might be "house rich", they were "cash poor" and thus might be forced out of their homes through rapidly rising property taxes.
But now we have reverse mortgages. I think the older argument no longer has merit for homeowners with substantial equity in homes bought 20 to 40 years ago.
These homeowners CAN access the cash value in their equity through a reverse mortgage.
I see no reason to give a break to homeowners who are both relatively affluent and sitting in a home worth 5 to 10 times what their original purchase price. We owned such a home in Palo Alto before we moved downtown.
Similarly, I see no reason to give tax breaks to affluent seniors like the ability to opt out of parcel taxes though, fortunately, many Palo Altans voluntarily pay these taxes.
This generational inequity will only get worse as more baby boomers retire and we have to fund services for children--who will determine our future--services that are currently under great stress.
If older residents are in difficult financial circumstances, I can, perhaps, see some merit in age-based tax breaks but not for more affluent older residents. We should be paying our fair share.
And soliciting the votes of older residents for taxes while telling them they don't have to pay or they won't pay much because they have Prop 13 protected assessed values doesn't seem quite fair either.