CA FINALLY starts fixing budget

[J]

And now a wrench is tossed into the works...

Reuters link

California counties, cities to fight budget deal
Tue Jul 21, 2009 5:31pm EDT

LOS ANGELES, July 21 (Reuters) - The day-old pact among California leaders to close the state's $26.3 billion budget gap came under fire on Tuesday as county and city governments threatened to sue to block a plan to seize local tax revenues as part of the deal.

City and council officials vowed to seek a court order barring the proposed diversion of $2 billion from local redevelopment agencies and $1.7 billion in highway tax collections into state coffers to help close the budget deficit.

Opponents argue that such moves are illegal because the state is prohibited under its constitution from grabbing revenues raised at the local level or earmarked specifically for county and municipal purposes.

They cited a recent state appeals court ruling that a similar diversion of $740 million in local public transit funds last year was unconstitutional.

The Board of Supervisors for Los Angeles County, the state's most populous county, voted to file suit against both moves if the budget deal is enacted as agreed to on Monday by Governor Arnold Schwarzenegger, a Republican, and leaders of both parties in the state Legislature.

"For the state to balance its budget on the backs of state residents most in need of help, and the counties that serve them, is fiscally reckless and morally bankrupt," the supervisors' motion said.

The executive directors of the California State Association of Counties, which lobbies on behalf of all 58 counties in the state, and the League of California Cities, which represents 480 municipalities statewide, reiterated their intention to challenge the highway tax proposal in court.

A separate group, the California Redevelopment Association, has said it would sue to block the seizure of redevelopment funds, which are raised through local property tax levies.

Chris McKenzie, executive director of the league of cities, said the threat of a court battle could prompt lawmakers to rethink the budget accord. Votes by the Democratic-controlled state Assembly and Senate were expected on Thursday.

"It could threaten to unravel the whole deal," McKenzie said. "It remains to be seen ... how many legislators want to vote on something that's blatantly unconstitutional and which they know they're going to lose when they get to court."

California's constitution requires that all budget and tax measures be approved by a two-thirds majority in both houses of the Legislature to win enactment.

The state has asked the California Supreme Court to overturn the appellate court decision on the transit fund diversion, McKenzie said. In a separate case under appeal, a lower court has found an earlier diversion of local redevelopment funds by the state to be unconstitutional.

County officials say the proposal to take $1.7 billion in Highway User Tax Account funds over two years would force the layoff of 4,000 county employees and leave local jurisdictions without money to repair or maintain their roads. Cities and counties are allotted 6 cents of every 18 cents per gallon collected on the sale of gasoline.

"They've decided that state highways are more important than local streets and roads, even though 81 percent of the state's road miles are maintained by cities and counties," McKenzie said. (Reporting by Steve Gorman and Gina Keating; Editing by Leslie Adler)

And now the fun begins in earnest.

[aerius]

Did someone say "marijuana tax"?

LA Times link

Oakland voters approve a tax on medical marijuana
Shops selling pot in the cash-strapped city will pay $18 on each $1,000 in sales. The city administrator estimates that it could raise $300,000 in annual revenue.
By Julie Strack
July 22, 2009

Reporting from San Francisco -- Oakland voters resoundingly approved a tax increase on medical marijuana Tuesday evening, the first such tax of its kind in the nation.

The measure will levy an $18 tax for every $1,000 in gross marijuana sales. Firms in the city now pay a $1.20 business tax on each $1,000 in sales. Other cities may soon follow suit. Voters approved the measure by a margin of 80%, according to preliminary results released by the Alameda County Registrar of Voters.


Oakland City Councilwoman Rebecca Kaplan, who co-sponsored the measure, said it could generate $1 million in annual revenue.

The city administrator places the estimate at about $300,000.

The Los Angeles City Council proposed a medical marijuana tax July 15, and Kaplan said Berkeley and San Francisco may consider similar legislation.


"Oakland will show that this can work if it's done right," said Keith Stephenson, executive director of the Purple Heart Patient Center.

"There will be some cash-strapped areas that will use this to balance their budgets."

The legislation was backed by Oakland's four medical marijuana dispensaries. There was no organized opposition.

The city's four dispensaries reported revenue of $19.7 million in the last fiscal year. Kaplan said budget gaps and a pledge by the Obama administration to stop prosecution of dispensaries that adhere to state laws have spurred officials to consider marijuana as a revenue source. The legislation was one of four mail-in ballot measures passed to help close the city's $83-million shortfall.

"It was the perfect moment," Kaplan said. "We had a horrible budget crisis in the city, and we were looking for revenue. . . . But it would hardly make sense for us to tax a business that might be shut down by the federal government."

Legislation is also being considered on a statewide level. Assemblyman Tom Ammiano (D-San Francisco) introduced a bill earlier this year to legalize and tax marijuana.

julie.strack@latimes.com

[Erik von Nein]

If you had read the post, instead of skimming it and thinking you know what I was saying, I was referring to the state of California becoming the sole retail distributor for marijuana. Much in the same way as the states of Pennsylvania and Utah operate as the sole retail distributors of hard liquor.

Since the legalization idea has been tossed around in that state as a means of closing the gap, I thought it might be interesting to consider this as a more effective mechanism.

If you're done criticizing something totally unrelated to my post, perhaps that will make it more clear for you, jackass.

Wouldn't being a sole distributor also require marijuana to be legal on a federal level? Otherwise it will still be an issue that'll butt heads with the federal government. Medical marijuana is ostensibly legal in California, but distributors still are arrested by federal agencies. Granted, Obama's statement that they won't go after them anymore would change things.

Provided you could broader support and decriminalization for marijuana possession you could, as was mention before, decrease the strain placed on the justice system. That I can agree with, certainly.

I'm sorry that I misread your post, however. I'll try not to again.

Of course there would be a delay in the ability of this to close any budget gap, but it could be a major long term positive.

Yes, I can agree with that. Again, sorry for misreading your post.

[FireNexus]

Wouldn't being a sole distributor also require marijuana to be legal on a federal level? Otherwise it will still be an issue that'll butt heads with the federal government. Medical marijuana is ostensibly legal in California, but distributors still are arrested by federal agencies. Granted, Obama's statement that they won't go after them anymore would change things.

I don't think it would be a requirement, but I do think it would result in the Feds and California butting heads on the issue if new laws prohibiting federal prosecution in states that have legalized weren't enacted. Obama might be willing to look the other way in the name of fixing their budget, but who knows the reaction future administrations might have? I don't see the Holland model of non-enforcement working particularly well in America over the long term. It will be interesting to see the head-explodey among conservatives when the state itself is the one in breach of federal law. States rights vs. tough on drugs. Hmm...

Provided you could broader support and decriminalization for marijuana possession you could, as was mention before, decrease the strain placed on the justice system. That I can agree with, certainly.

Bingo. Drug-related crimes (and marijuana in particular, being the most used illegal drug) are an unnecessary burden placed on society, since we'll never prevent people from using drugs by criminalizing them. Violent or non-violent, it doesn't matter. Drug crime is almost entirely due to prohibition. A junkie robbing a convenience store to get his fix might still happen if drugs were legal, but the incidence would likely be much, much less.

Anyway, there is already wide support for decriminalization. There's even wider support for the Feds letting the states decide one way or the other.

I'm sorry that I misread your post, however. I'll try not to again.

No worries.

[Erik von Nein]

I don't think it would be a requirement, but I do think it would result in the Feds and California butting heads on the issue if new laws prohibiting federal prosecution in states that have legalized weren't enacted. Obama might be willing to look the other way in the name of fixing their budget, but who knows the reaction future administrations might have? I don't see the Holland model of non-enforcement working particularly well in America over the long term. It will be interesting to see the head-explodey among conservatives when the state itself is the one in breach of federal law. States rights vs. tough on drugs. Hmm...

It's already happened with medical marijuana and dispensaries. There was a local case of man who (while kind of an ass himself) was arrested by the federal government for operating one, despite having a license issued to do so. I believe it was somewhat after Obama was inaugurated that his justice department said they weren't going to try hard to prosecute anyone with a proper license. Kind of too late for the person I was talking about, though. He's still waiting to be sentence last I heard.

Bingo. Drug-related crimes (and marijuana in particular, being the most used illegal drug) are an unnecessary burden placed on society, since we'll never prevent people from using drugs by criminalizing them. Violent or non-violent, it doesn't matter. Drug crime is almost entirely due to prohibition. A junkie robbing a convenience store to get his fix might still happen if drugs were legal, but the incidence would likely be much, much less.

Anyway, there is already wide support for decriminalization. There's even wider support for the Feds letting the states decide one way or the other.

True. My girlfriend's parents are both in the justice system (both working at Pelican Bay, apparently) and they both received a 10% pay cut because of the state's woes (though they are lucky to still have jobs). It would be interesting to see how much more money could be saved not prosecuting non-violent drug offenses against the pay cut idea they went with.

[Terralthra]

The really outrageous thing is how much bullshit the "no new taxes" thing is. Yeah, there's no new taxes, but fees at community colleges went up 30%. Fees at CSU system schools will be going up too. So, the schools which serve the poorest communities, the people to whom every dollar matters, that's where the state is pulling money from to fix the budget. It's regressive, instead of progressive, or even equalized.

[Master of Ossus]

The really outrageous thing is how much bullshit the "no new taxes" thing is. Yeah, there's no new taxes, but fees at community colleges went up 30%. Fees at CSU system schools will be going up too. So, the schools which serve the poorest communities, the people to whom every dollar matters, that's where the state is pulling money from to fix the budget. It's regressive, instead of progressive, or even equalized.

Wah. Wah.

CSU students qualify for financial aid, but even if they turned down their financial aid for no reason it still costs them less than $5000/year to attend such an institution, which is dramatically less than their education is worth (I believe it's still significantly lower than comparable public institutions in other states). Actually, the middle class and upper-middle classes are hit the hardest by these fee increases, since they usually don't qualify for financial aid, which is hardly what I'd call a "regressive" change.

Edit: In fact, 80% of students will get grants that wholly cover the fee increase. So they're not even goign to have to pay it back later and take on increased debt-load.

[Terralthra]

The really outrageous thing is how much bullshit the "no new taxes" thing is. Yeah, there's no new taxes, but fees at community colleges went up 30%. Fees at CSU system schools will be going up too. So, the schools which serve the poorest communities, the people to whom every dollar matters, that's where the state is pulling money from to fix the budget. It's regressive, instead of progressive, or even equalized.

Wah. Wah.

CSU students qualify for financial aid, but even if they turned down their financial aid for no reason it still costs them less than $5000/year to attend such an institution, which is dramatically less than their education is worth (I believe it's still significantly lower than comparable public institutions in other states). Actually, the middle class and upper-middle classes are hit the hardest by these fee increases, since they usually don't qualify for financial aid, which is hardly what I'd call a "regressive" change.

Edit: In fact, 80% of students will get grants that wholly cover the fee increase. So they're not even goign to have to pay it back later and take on increased debt-load.

I like how you misrepresent the 80% figure. 80% of students who already receive financial aid will get grants to offset it. That's not 80% of all students. And that doesn't even begin to cover the community college fee increases.

Also, all students, regardless of family income, qualify for federally-subsidized Stafford loans, so I'm not sure where you get off saying they don't have financial aid. The idea that middle and upper-middle classes are harder hit by fee increases because they have so much money they don't qualify for as much educational welfare is a bit silly, don't you think?

[Durandal]

Perhaps it's a case of schadenfreude on the part of states that feel the pain of shitty state budgets more often and with more depth?

It's more than that. California is often held up as an object lesson for other states in what not to do. And yet, many other states are either in just as much trouble or they are actually worse off.

I can't help but wonder if it's due to a general dislike of California among so-called "heartland" Americans; they like the idea of California being held up and pilloried as an example of fiscal irresponsibility, because it fits into their notions of the fundamental nature of California vs the rest of America.

It's partially that, but California also has a fucked up ballot initiative system (the system that stripped gay people of their rights and made them second-class citizens in 2008) which would let us vote to make farts illegal and sunshine a valid form of currency if we really wanted to. California passed Prop 13 in 1978, which limited the annual real estate tax on a property to 1% of its assessed value. It also limited the growth of the assessed value of a property to 2% annually. (These limits are lifted when there is a change of ownership.)

As a result, it encouraged people to sit on their homes forever, much like rent control encourages people to sit in the same apartment forever. It also forces the state to squeeze more and more out of income taxes, since it can't raise property taxes, which are typically the first stop when states need extra money.

So while California does suffer from a reputation as a bunch of free-wheeling, liberal hippies, one of the things which presents our government from collecting the revenues it needs is a ballot measure that gives Republicans hard-ons. And the people voted directly on it, and the people would have to vote to repeal it. And they won't. So California's budget crisis is of its own making. It's just not for the reasons that "real America" thinks.

In one of his "New Rules" segments, Bill Maher summed it up nicely.

This is why America’s founders wanted a representative democracy, because they knew if you gave the average guy the chance, he’d vote for a fantasy world with no taxes, free beer and vagina trees.

The sad part of all this is that there's a gigantic market that's currently not being taxed and whose consumers are practically begging for the government to tax it, and instead the government wastes money enforcing ridiculous laws against this industry. It's the marijuana industry. It's the state's largest crop, and it's legal for medicinal use. But the "medicinal" part is pretty much a state-wide joke.

[Master of Ossus]

I like how you misrepresent the 80% figure. 80% of students who already receive financial aid will get grants to offset it. That's not 80% of all students. And that doesn't even begin to cover the community college fee increases.

Also, all students, regardless of family income, qualify for federally-subsidized Stafford loans, so I'm not sure where you get off saying they don't have financial aid. The idea that middle and upper-middle classes are harder hit by fee increases because they have so much money they don't qualify for as much educational welfare is a bit silly, don't you think?

Can you try to maintain self-consistency throughout an entire post?

80% of students who already receive financial aid will get grants to offset it. That's not 80% of all students.

Also, all students, regardless of family income, qualify for federally-subsidized Stafford loans, so I'm not sure where you get off saying they don't have financial aid.

(I recognize this can be difficult).

[Terralthra]

You know, MoO, not everyone who qualifies for aid actually applies and accepts it. I realize that the concept that not everyone wants to go thousands of dollars into debt may seem strange to you.

[Master of Ossus]

You know, MoO, not everyone who qualifies for aid actually applies and accepts it.

Well, now I feel DRAMATICALLY more sorry for them. They're given a choice to get grant money, and they decide not to. How evil of the State of California to offer the most affordable public tertiary education system in the country.

I realize that the concept that not everyone wants to go thousands of dollars into debt may seem strange to you.

You do understand how these loans and grants work, don't you? Where you get money to... pay for college... and then you are indebted to the person who pays your way? That's clearly dramatically worse than the alternative that you've cooked up for them (aka. not going to college). Moreover, with the subsidized loans you were talking about, they bear a ZERO PERCENT INTEREST RATE for 6 months after the kid graduates, which means that it's literally free money. If they don't accept it, then they're obviously too stupid to be going to college, anyway.

Moreover, if these people are so impoverished and desperate that they can't spend $5 grand to go to college (although, somehow, they could afford to pay 75% of that, as before), then why are they turning down financial aid?

[Starglider]

Moreover, with the subsidized loans you were talking about, they bear a ZERO PERCENT INTEREST RATE for 6 months after the kid graduates, which means that it's literally free money.

That is no more useful than the teaser rates on credit cards (which often used to be 0% in the credit boom). Since these loans take many years to pay off, the relevant value is the ongoing interest rate after the grace period. In the UK, it is fixed at the rate of inflation (RPI, specifically), which in combination with the moderate salary threshold for repayment I find eminently sensible. What is the equivalent interest rate and repayment threshold for these loans?

[Master of Ossus]

That is no more useful than the teaser rates on credit cards (which often used to be 0% in the credit boom). Since these loans take many years to pay off, the relevant value is the ongoing interest rate after the grace period.

It's extremely valuable. It's like, "Let me give you $10k now, and if you pay me $10k within 6 months of graduating then that's the end of it." Clearly the $10k now is worth a lot more than the $10k within six months of graduation. If you're going to make the money (or if you have the money, already) while you're in school, then you can pocket the interest you make on the $10k. If you don't make the money while you're in college, you're in much better position than you would have been had you taken out a private loan because you benefit from the subsidized interest rate and the fact that there was no interest while you were in school. In either case, you're much better off if you take the loan.

In the UK, it is fixed at the rate of inflation (RPI, specifically), which in combination with the moderate salary threshold for repayment I find eminently sensible. What is the equivalent interest rate and repayment threshold for these loans?

I'm not sure what it is, now, but it's significantly less than getting a private loan. A couple years ago it was something like 5.2%, and you didn't have to pay it off if you entered a field like teaching or worked for a public interest group.

Edit: According to this website, the fixed rate is "as low as" 5.6%.

[Shinova]

Dunno about you guys, but practically no one is getting any Cal Grants this year. At least what I've heard.

[MKSheppard]

California passed Prop 13 in 1978, which limited the annual real estate tax on a property to 1% of its assessed value. It also limited the growth of the assessed value of a property to 2% annually. (These limits are lifted when there is a change of ownership.)

Wah Wah Wah. I love how Prop 13 is always held up as an evil evil thing; when in reality; it's more expensive than in MD:

0.112 Per $100 Assessment - MD State
0.683 Per $100 Assessment - Montgomery County
0.795 Per $100 Assessment

$250,000 under MD Taxes = $1,987.5
$250,000 under CA Prop 13 (1%) = $2,500

The real issue is that until very recently, the median home price in CA was like $400k; which meant that CA made on average of $4,000 per home. When the entire economy crashed; median housing prices went down to about $280~k, which is more inline with the rest of the US; and means that CA only took in about $2,800.

Of course, I suspect that the California Tax Department is trying to find any way to avoid re-evaluation of property taxes that take into account the home slump.

[MKSheppard]

I do like the fact that instead of cutting their budget even further to at least make things balance a bit -- if the state runs a deficit of a hundred million or so for this year; it won't be that bad; you can pay it off later as revenues recover when the economy does -- the state government has taken to raiding the coffers of local municipalities to balance their books; and trying whole bunches of accounting tricks.

[Darth Yoshi]

Dunno about you guys, but practically no one is getting any Cal Grants this year. At least what I've heard.

I haven't heard any specifics about grants, but I know that SF State got hit hard by cuts, and had to raise fees and cut courses as a result. If I didn't have the new GI Bill covering for me, I'd definitely be hurting.

[Pint0 Xtreme]

Shep, regardless of whatever inefficiencies exist in the Californian bureaucratic system, comparing state taxes doesn't even remotely address the problem that the need of a 2/3rd majority vote in the legislature to pass a budget was also a contributing factor to the current state budget crisis. This monster was the result of a number of systematic problems with the Californian government and pointing out disparate state tax rates doesn't solve the problems prop 13 was responsible for.

[MKSheppard]

*snip irrevelant babble from PintO*

In fact, Proposition 13 may actually be helping california out here; by denying the State Legislator's the obvious solution to their problem of median CA Home Value Asssessments plunging by nearly 50% from 400k to 250k~ in less than a year -- by doubling property taxes -- which would kill the economy of CA off even more:

"Why am I paying the same taxes as last tax assessment season, despite the fact that the value of my home has plunged 50%?"

[Starglider]

That is no more useful than the teaser rates on credit cards (which often used to be 0% in the credit boom)

It's extremely valuable. It's like, "Let me give you $10k now, and if you pay me $10k within 6 months of graduating then that's the end of it."

So exactly as valuable as 0% teaser rates on credit, which is to say somewhat but not hugely. If you are in a position to repay $10k over just six months, the interest saved by having it a 0% APR instead of ~5% APR ($125 ish) is negligible compared to your income. However the average annual cost of tuition at public universities in the US is $6585, so you are looking at an average of $26K for a four-year degree, plus costs of textbooks etc, plus living expenses, minus whatever the student earns from part-time jobs. Median starting salary for public university graduates is about $39K. If the entire tuition was paid for with loans, it's going to take about three years to pay off even with a third of the after-tax income going to loan repayments.

If you're going to make the money (or if you have the money, already) while you're in school, then you can pocket the interest you make on the $10k.

Fortunately, at current interest and inflation rates, this is not significant for either the US or UK loans. That said I do know at least 2 UK students who took the maximum student loan and used the surplus as a significant part of the deposit for their first house, which I would consider a reasonable outcome from the state's point of view.

Edit: According to this website, the fixed rate is "as low as" 5.6%.

There is of course a fairly sharp distinction in the US between the people who forgo the luxuries/huge house/SUV/getting sick/child/unemployment and get it paid off, and the people who either don't pay or can't pay and get stuck with the student loan as a big part of their generally crippling debt load. Income thresholds and flat interest avoid that problem in the UK. That said, UK student loans persist through bankruptcy, whereas I don't know if state-sponsored US student loans have that protection. Certainly fully private ones wouldn't.

[Master of Ossus]

So exactly as valuable as 0% teaser rates on credit, which is to say somewhat but not hugely. If you are in a position to repay $10k over just six months, the interest saved by having it a 0% APR instead of ~5% APR ($125 ish) is negligible compared to your income.

Except that, for a four-year institution, you're looking at that savings over the period during which you attend school plus the six months. It is valuable for everyone.

However the average annual cost of tuition at public universities in the US is $6585, so you are looking at an average of $26K for a four-year degree, plus costs of textbooks etc, plus living expenses, minus whatever the student earns from part-time jobs. Median starting salary for public university graduates is about $39K. If the entire tuition was paid for with loans, it's going to take about three years to pay off even with a third of the after-tax income going to loan repayments.

Okay, the $10k quote I gave was merely an analogy to illustrate that the subsidized loan was valuable and that literally every graduate should take it. In reality I don't know how much people are allowed to borrow through this program, although it should be quite easy to look up. Moreover, while you have applied the zero percent interest rate only to six months (and to $10k--I'm not sure what it is) to come up with a low savings, in reality this is applying to their entire four years (more? less?) of college as well as to the six month grace period.

Fortunately, at current interest and inflation rates, this is not significant for either the US or UK loans. That said I do know at least 2 UK students who took the maximum student loan and used the surplus as a significant part of the deposit for their first house, which I would consider a reasonable outcome from the state's point of view.

Edit: According to this website, the fixed rate is "as low as" 5.6%.

There is of course a fairly sharp distinction in the US between the people who forgo the luxuries/huge house/SUV/getting sick/child/unemployment and get it paid off, and the people who either don't pay or can't pay and get stuck with the student loan as a big part of their generally crippling debt load. Income thresholds and flat interest avoid that problem in the UK. That said, UK student loans persist through bankruptcy, whereas I don't know if state-sponsored US student loans have that protection. Certainly fully private ones wouldn't.

I don't follow your argument, here. But these are the logical steps that I've been asked to buy in this thread:
1. CA is increasing the cost of attendance of various public colleges. They're now the least expensive in the country.
2. That's outrageous! These institutions serve some of the poorest people in the state (ignoring the fact that institutions in other parts of the country serving states with lower average, median, and 20% income brackets also charge more).
3. I should feel sorry for all those people who have been offered financial aid but not taken it (even though it is valuable to them no matter their individual circumstances) because they're not getting enough financial aid!

[The Yosemite Bear]

Hell were the bad guys from the depression, we ripped off all the folks who came to the Bear Republic looking for gold. The State has a rather sordid reputation for over a hundred and fifty years for the majority of the country. Hell one of our earlier military represenitives acerbated things in the split states so bad that some of them went to the Slavocrats.

[Pablo Sanchez]

Wah Wah Wah. I love how Prop 13 is always held up as an evil evil thing; when in reality; it's more expensive than in MD:

0.112 Per $100 Assessment - MD State
0.683 Per $100 Assessment - Montgomery County
0.795 Per $100 Assessment

$250,000 under MD Taxes = $1,987.5
$250,000 under CA Prop 13 (1%) = $2,500

Prop 13 doesn't set California's property tax rate at a flat 1%, it says that they can't exceed 1% of the assessed value of the property being taxed. It can, and apparently is, substantially less than that. The first Google result for "property taxes by state" takes data from the 2005 American Community Survey by the U.S. Census Bureau, and shows California's effective property tax as a percentage of value at .48%; Maryland's at .77%. Identical figures can be found at other locations via Google. There is also the possibly more important issue that Prop 13 also says that the assessed value of a property cannot rise by more than 2% annually, even if it's real value has skyrocketed in the meantime, unless it changes owners. This means that California is losing a ton of money on properties that have risen in value but have kept the same owner.

[Questor]

There is also the possibly more important issue that Prop 13 also says that the assessed value of a property cannot rise by more than 2% annually, even if it's real value has skyrocketed in the meantime, unless it changes owners. This means that California is losing a ton of money on properties that have risen in value but have kept the same owner.

Pablo's got it right here. The increase limit is what the opponents of Prop 13 generally start foaming at the mouth about.

I'm going to do a thought experiment here, assuming an average house purchased in Irvine, CA in 1988. I only have data up till mid-2007 from the same source, so that is where the thought experiment will end, but the principals will still stand.

http://www.irvinehousingblog.com/blog/c ... e-history/

Irvine Median Home price in 1988: $216,464
Assessed value in 1988: $216,464
Tax at 1% of assessed home value in 1988: $2,164.64
Assessed value in 2007: $399,936
Tax at 1% of assessed home value in 2007: $3,999.36
Irvine Median home price in 2007: $665,807
Actual tax rate on property: .6%