Phoenix-area residents are banding together to gather signatures in an effort to place a citizen-driven initiative on the November 2020 ballot seeking relief of property taxes levied against homeowners over 65 years of age.
Proponents of the effort say seniors throughout Maricopa County --- and Arizona --- are losing homes and being forced to downsize away from familiar neighborhoods and some find themselves in dire straits.
Phoenix resident Lynne Weaver, chairperson of Proposition 13 Arizona, says property taxes levied by various taxing districts throughout the county --- unified school districts, municipalities and fire districts, for example --- are having detrimental effects on local seniors.
“The way this really ties in with people is we are starting to really talk about a wealth tax,” she said. “Property tax, is really just a wealth tax, but there is just no correlation between reality and valuations.”
Ms. Weaver points out the effort here in Arizona is similar to one launched in California decades ago to curtail rising living costs affecting the vulnerable: the senior community.
“This initiative, it is the Prop. 13 Arizona Committee that is running the American Dream Act Arizona initiative,” she points out. “We have been a standing committee for some time because we are trying to change our property tax law. We have the most complex property tax system in the nation --- it serves very well the lobbyists of the state, but for us property owners, not so much. Seniors are losing their homes to tax collections.”
The American Dream Act Arizona initiative seeks to accomplish one goal: eliminate property taxes on the Arizona primary legal residence of United States citizens over the age of 65.
Ms. Weaver, a California transplant, admits Prop. 13 in California is one of the few things that state got right.
“I was used to Prop. 13 that when you bought your home you knew what your property taxes were going to be a maximum of 2% a year in increases and you would never be taxed out of your home,” she said. “In no time flat, my property taxes here in Arizona went from $2,200 a year to $5,600. My property tax went up 245%. Wow.”
Ms. Weaver says today, she can afford the tax bill, but in years to come, it may be a different story.
“What if I am too old or too sick to move and not know what to do or where to go?” she asked of a scenario becoming reality for some. “You don’t know if it will be your home or not because you are at the whim of a taxing district. We have been working on this for 13 years now. We did decide to strike this year, but really to protect seniors.”
But to force that question on a November 2020 ballot a total of 356,467 signatures of qualified Arizona voters need to be obtained and delivered to the Office of the Arizona Secretary of State by July 2.
“We need more volunteers. We are an all-volunteer organization,” she said. “It really is an economic growth package. I just think it is the right thing to do.”
In order to end property tax for those 65 years or better an amendment to the Arizona Constitution would have to occur, in particular, Article IX.
If approved, property owners 65 years or better would be exempt from federal, state, county and municipal levies of property tax.
For Arcadia resident, Randy Pullen who serves as treasurer of Prop. 13 Arizona, the level of taxation is not based on what a person paid for it originally --- but it should be, he says.
“I understand how government works, I have seen it all,” he said recalling his time installing accounting systems for both Maricopa County and the State of Arizona in the early 1980s.
“We updated and computerized financial systems for both. I have been involved in these tax issues for a decade or more. Essentially, think of it this way: if you had a savings account and you’re being paid interest every month that is income. If you bought a house, 30 years ago, and you paid at that time, say you paid $250,000 for that house, it is now worth $1 million. You are being taxed on that valuation, not what you originally paid.”
Mr. Pullen points out, you are being taxed on a fictional assessment of your property value.
“You are being charged by what the current market value is,” he said pointing out the assessment valuation devised by, in Maricopa County, the Assessor’s Office.
“Over time your taxes have gone up because your value has gone up immensely. Older people can’t afford the taxes that are being assessed. A lot of Baby Boomers are finding themselves in this situation.”
Mr. Pullen has seen this scenario play out in his own life, he says.
“They call it downsizing, but what you are really doing is moving, so you can reduce the amount you are paying in taxes. I can say that because I did it myself,” he said. “I just sold mine last year and I sold it for over $1 million. I don’t have to pay property taxes anymore. It is all about being taxed, taxed, taxed.”
--- Randy Pullen
Mr. Pullen, however, admits getting the question of the amendment to the Arizona Constitution requires a significant signature-gathering effort. But people are responding favorably to their efforts, he contends.
“Even younger people are receptive to it because they see what their parents are going through,” he explained.
“There is a lot of support for this. Where we get a lot of push back is from municipal governments because that is a lot of tax money. That means they will need to raise their tax rates, which is something municipal government doesn’t want to do. What this really means is they have to get their out-of-control spending under control.”
Surprise resident Karen Thomas says she knows too many seniors who are worried about finding funds to pay for property tax levies.
“I know there are a lot of people in Arizona senior communities who are having a difficult time paying property taxes,” she said. “For me, I can certainly use the extra $2,000.”
For Ms. Thomas, she calls the effort a win-win situation.
“Those who are a little hesitant, once I explain the benefits and the fact that everyone will still be paying state income tax, most everyone is supportive of the effort,” she said of her experience seeking signatures.
“Those people moving in will be buying and selling houses and, quite frankly, the money we save on property taxes we will be reinvesting in our homes and spending on other items.”
But the truth is, Ms. Thomas says, more volunteers are needed.
“That is what Lynne is working on and I think once the weather warms up a bit, we will see more volunteers come forth,” she said.
“There are people that are having difficulty staying in their homes because of their property taxes. Some of the people selling their homes are having a hard time buying smaller homes. It is also important for people to realize that other people will not see their property taxes increase. It is a win-win situation for everybody.”
--- Karen Thomas
Ms. Thomas says, on Fridays, she is at the Sun City West Republican Office, 10050 W. Bell Road, Suite 50, seeking signatures.
Ms. Weaver, who is spearheading the petition drive, says the effort is one to fix a bad system that is taking advantage of financially vulnerable seniors in all Arizona communities.
“It is a bad system, and in this case, we are going to work it to our advantage for our seniors,” she said of the pursuit. “Most people have not saved any money. We have a great reckoning of people who have not saved for retirement and you simply cannot just rely on Social Security. What do you do from there?”