California Proposition 19 (2020), also referred to as Assembly Constitutional Amendment No. 11, is an amendment of the Constitution of California that was narrowly approved by voters in the general election on November 3, 2020, with just over 51% of the vote. The legislation increases the property tax burden on owners of inherited property to provide expanded property tax benefits to homeowners ages 55 years and older, disabled homeowners, and victims of natural disasters, and fund wildfire response. According to the California Legislative Analyst, Proposition 19 is a large net tax increase "of hundreds of millions of dollars per year."

According to the ballot summary, Proposition 19: Allows homeowners who are over 55 years of age (without regard to wealth), disabled, or victims of natural disasters to transfer their existing property tax assessed value under 1978 California Proposition 13 to a replacement home, including a more expensive home. Significantly limits the existing property tax benefits under Proposition 13 for certain real estate transfers between family members, such as the transfer of property from a parent to a child following the death of the parent. Expands property tax benefits for family farm transfers. Allocates net state (but not local) revenues and savings (if any) to wildfire response and for reimbursing local governments. However, because the COVID-19 pandemic has created significant uncertainty for the state budget, the Legislative Analyst believes that the vast majority of the wildfire funding will not be available until 2025 at the earliest.

The proposition was sponsored and heavily promoted by the California Association of Realtors, and became effective on February 16, 2021.

Background

The California Association of Realtors previously sponsored and financed an initiative measure known as 2018 California Proposition 5 on the November 2018 ballot that would have further expanded Proposition 13 property tax breaks for certain homeowners (primarily homeowners over age 55) by allowing them to transfer their lower property tax base to replacement property.Changes Requirements for Certain Property Owners to Transfer Their Property Tax Base to Replacement Property. Initiative Constitutional Amendment and Statute. California Initiative AG No. 17-0013 Am. 1 (2017). That ballot measure failed statewide with 40% support, and also failed to receive majority support in all 58 California counties.California Secretary of State, Statement of Vote November 6, 2018 General Election, pp. 95–97. Proposition 5 opponents successfully argued that the initiative measure was a "huge tax break to wealthy Californians" and a "huge windfall to the real estate industry."Ballot Pamphlet, California General Election (November 6, 2018), argument against Proposition 5, p. 39.

In 2019, the California Association of Realtors sponsored and financed another initiative measure that would have expanded Proposition 13 property tax breaks for certain homeowners like the 2018 California Proposition 5 ballot measure. However, to generate a net increase in property tax revenue, the initiative also significantly narrowed Proposition 13 property tax reassessment exclusion rules for inherited properties and expanded the scope of business entity ownership changes that would result in commercial property reassessment under Proposition 13.Changes Requirements For Transferring Property Tax Base To Replacement Property. Expands Business Property Reassessment. Initiative Constitutional Amendment. California Initiative AG No. 19-0003 (2019). Initiative 19-0003 was withdrawn and replaced by ACA11 which did not receive legislative approval before the deadline on June 25, 2020 and an exemption was made by State Legislature through SB300 to place it on the November 3, 2020 ballot.

Assembly Constitutional Amendment No. 11 (ACA 11)

As allowed under California law,Cal. Elec. Code, § 9604. the California Association of Realtors negotiated with various special interests to secure legislative approval of an alternative constitutional amendment known as Assembly Constitutional Amendment No. 11 (ACA 11).Assem. Const. Amend. No. 11, Stats. 2020, res. ch. 31. Proposition 19 was added to the ballot via ACA 11 which was authored by San Mateo Assemblymember Kevin Mullin.

Significant controversy arose because the legislative approval of ACA 11 missed the regular legal deadline for placing measures on the November 2020 ballot, and the Legislature also had to enact a separate statute calling a special election for ACA 11 that was consolidated with the regular November 2020 election.Cal. Stats. 2020, Ch. 26, effective June 30, 2020. In response to the approval and qualification of ACA 11 for the November 2020 ballot, the California Association of Realtors withdrew its 2019 initiative measure that was previously eligible to appear on the November 2020 ballot.California Secretary of State, Chief Counsel Letter Re Conditional Acceptance of Conditional Withdrawal of Initiative AG No. 19-0003, June 25, 2020. The primary differences between Proposition 19 and the 2019 initiative measure withdrawn by the California Association of Realtors are that Proposition 19 excluded the expanded business entity ownership provisions that would have resulted in commercial property reassessment under Proposition 13 (to appease major business interests who did not like the business tax increase component of the 2019 initiative) and that Proposition 19 added the partial firefighting revenue provisions as a political sweetener (to appease firefighting organizations that previously opposed 2018 California Proposition 5).Ballot Pamphlet, California General Election (November 6, 2018), argument against Proposition 5, p. 39.

Thus, compared to the 2019 initiative measure, Proposition 19 retained the expanded Proposition 13 property tax breaks for certain homeowners (primarily homeowners over age 55) like those contained in the defeated 2018 California Proposition 5 ballot measure, retained the property tax increase provisions by significantly narrowing Proposition 13 property tax reassessment exclusion rules for inherited properties, and added the partial firefighting revenue provisions as a political sweetener.Assem. Const. Amend. No. 11, Stats. 2020, res. ch. 31.

Legislative Votes on ACA 11

In California, constitutional amendments proposed by the Legislature require approval from two-thirds of the membership of each house.Cal. Const., art. XVIII, § 1.

The following are the votes by the Members of the California Legislature on ACA 11, along with how the voters within the corresponding legislative district subsequently voted on Proposition 19:

California Assembly

Assembly votes are from the California Assembly Daily JournalCalifornia Legislature (2019-20 Regular Session), Assembly Daily Journal, June 26, 2020, p. 4978. and Proposition 19 outcomes are from the California Secretary of State.California Secretary of State, Supplement to the Statement of Vote November 3, 2020, pp. 185-192. The vote designation of "Abstain" is for those Legislators present on the day of the vote,California Legislature (2019-20 Regular Session), Assembly Daily Journal, June 26, 2020, p. 4950. but who did not record a vote for or against ACA 11. The vote designation of "Absent" is for those Legislators who were absent on the day of the vote. Assembly districts are based on the applicable 2011 district. ACA11 was a "gut and amend" introduced by Phil Ting who Abstained. Final Chaptered Author Kevin Mullin said it was drafted for wildfire but no monies have gone to wildfire to date even though forced sales of family homes continue due to unaffordable property tax reassessments.

District Last Name First Name Party ACA 11 Vote Prop 19 Outcome 04 Aguiar-Curry Cecilia Dem Yes Pass 31 Arambula Joaquin Dem Yes Pass 16 Bauer-Kahan Rebecca Dem Yes Pass 24 Berman Marc Dem Yes Pass 05 Bigelow Frank Rep Yes Fail 50 Bloom Richard Dem Abstain Fail 76 Boerner-Horvath Tasha Dem Abstain Pass 18 Bonta Rob Dem Yes Pass 73 Brough Bill Rep No Fail 62 Burke Autumn Dem Yes Pass 57 Calderon Ian Dem Yes Fail 51 Carrillo Wendy Dem Yes Fail 60 Cervantes Sabrina Dem Abstain Fail 49 Chau Ed Dem Yes Fail 55 Chen Phillip Rep Abstain Fail 17 Chiu David Dem Abstain Pass 68 Choi Steven Rep Abstain Fail 25 Chu Kansen Dem Yes Pass 08 Cooley Ken Dem No Fail 09 Cooper Jim Dem Yes Pass 35 Cunningham Jordan Rep Abstain Fail 01 Dahle Megan Rep Yes Fail 69 Daly Tom Dem Yes Pass 72 Diep Tyler Rep Absent Fail 13 Eggman Susan Dem Yes Pass 12 Flora Heath Rep Yes Fail 34 Fong Vince Rep No Fail 11 Frazier Jim Dem Absent Pass 43 Friedman Laura Dem Yes Fail 45 Gabriel Jesse Dem Yes Fail 03 Gallagher James Rep Yes Fail 58 Garcia Cristina Dem Yes Pass 56 Garcia Eduardo Dem Yes Pass 64 Gipson Mike Dem Yes Pass 78 Gloria Todd Dem Yes Pass 80 Gonzalez Lorena Dem Absent Pass 21 Gray Adam Dem Yes Pass 14 Grayson Tim Dem Yes Pass 41 Holden Chris Dem Yes Fail 44 Irwin Jacqui Dem Yes Pass 59 Jones-Sawyer Reggie Dem Yes Pass 27 Kalra Ash Dem Yes Pass 54 Kamlager-Dove Sydney Dem Yes Pass 06 Kiley Kevin Rep No Fail 36 Lackey Tom Rep Yes Fail 10 Levine Marc Dem No Pass 37 Limón Monique Dem Yes Fail 28 Low Evan Dem Yes Pass 77 Maienschein Brian Dem Yes Pass 26 Mathis Devon Rep Yes Fail 42 Mayes Chad Ind Yes Fail 07 McCarty Kevin Dem Yes Pass 61 Medina Jose Dem Yes Pass 22 Mullin Kevin Dem Yes Pass 66 Muratsuchi Al Dem Yes Fail 46 Nazarian Adrin Dem Abstain Pass 70 O'Donnell Patrick Dem Yes Fail 33 Obernolte Jay Rep Yes Fail 23 Patterson Jim Rep Abstain Fail 74 Petrie-Norris Cottie Dem Abstain Fail 20 Quirk Bill Dem Yes Pass 65 Quirk-Silva Sharon Dem Abstain Fail 40 Ramos James Dem Absent Pass 63 Rendon Anthony Dem Yes Pass 47 Reyes Eloise Dem Yes Pass 39 Rivas Luz Dem Yes Pass 30 Rivas Robert Dem Yes Pass 52 Rodriguez Freddie Dem Yes Pass 48 Rubio Blanca Dem Yes Fail 32 Salas Rudy Dem Abstain Fail 53 Santiago Miguel Dem Yes Pass 38 Smith Christy Dem Yes Fail 29 Stone Mark Dem Yes Pass 19 Ting Phil Dem Abstain Pass 67 Vacant Vacant Vac Vacant Fail 71 Voepel Randy Rep Yes Fail 75 Waldron Marie Rep Yes Fail 79 Weber Shirley Dem Yes Pass 15 Wicks Buffy Dem Yes Pass 02 Wood Jim Dem Abstain Pass

California Senate

Senate votes are from the California Senate Daily JournalCalifornia Legislature (2019-20 Regular Session), Senate Daily Journal, June 25, 2020, p. 3847. and Proposition 19 outcomes are from the California Secretary of State.California Secretary of State, Supplement to the Statement of Vote November 3, 2020, pp. 167-171. The vote designation of "Abstain" is for those Legislators present on the day of the vote,California Legislature (2019-20 Regular Session), Senate Daily Journal, June 25, 2020, p. 3833. but who did not record a vote for or against ACA 11. Senate districts are based on the applicable 2011 district.