Eagleionline

This Time.com article details how California’s crisis, which will leave the state unable to meet its financial obligations next week without a balanced budget agreement, is rooted in Proposition 13.  That measure, now over 30 years old, limits property taxes in California (collected by counties) to 1% of the property’s value, annually.  As the article notes, Proposition 13 is extremely difficult to change and a political minefield in the state.

Massachusetts was one of the 13 states to follow suit, by way of a successful ballot measure.  Proposition 2 1/2 limits municipal property taxes to 2.5% of the taxable real property in the city or town, and caps yearly increases to 2.5% of the prior year’s tax rate.  Proposition 2 1/2 actually did not have much of an immediate impact on revenue, but with almost 30 years of inflation (which, unfortunately, is not limited by law to 2.5%), cities and towns in the state have felt the crunch and are increasingly dependent on the state and on overrides.  Unlike Proposition 13, Massachusetts included a viable override procedure in its ballot measure.  Because municipal budgets are hardly static (particularly in the smaller instances — a new school, for instance, is paid for within a few years, and not spread out nicely or indefinitely), overrides are necessarily and invaluable.  The Boston Globe tracks overrides in the state.  With the state’s own budget troubles well documented (one article here), Massachusetts cities and towns have a very limited ability to help themselves.