Voters Turn Down Proposition 5, but Some Local Bond Measures May Pass Anyway

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Proposition 5, which could have opened up local funding for affordable housing and public infrastructure projects, is trailing in early returns.

“I’m happy that voters are paying attention,” said Johnny Khamis, an opponent of the ballot measure and former San José City Council member. “Prop. 5 would have caused huge problems with the cost of living and future generations being able to afford to live in California. We don’t want to reduce the voter threshold for passing new taxes.”

Proposition 5 would make it easier for local governments to pass bond measures that specifically fund affordable housing and public infrastructure projects by lowering the percentage of votes required to pass from 66.67% to 55%.

While several bond measures on county and city ballots could be impacted if the proposition passes, a few bonds appear to have the support needed to pass anyway, including San Francisco’s Proposition B, which would pass a $390 million bond to fund repairs and retrofits to health care centers and hospitals, as well as build homeless shelters. San Bruno’s Measure Q and Santa Clara’s Measure I also have more than a supermajority of voters favoring the bonds. Both measures pass money to fix or renovate local infrastructure. Measures in Fairfax and Sunnyvale do not have appear to have enough votes to surpass the existing voter threshold.

Proposition 5 was designed to change some of the provisions Proposition 13 has held in place for decades. That initiative, which was overwhelmingly approved by voters in 1978, tied property taxes to the property’s value when it was purchased. To further ensure property taxes remained low, a two-thirds supermajority (66.67%) vote was required for any local bond measures to pass.

This incentivized people who bought homes in the 1970s and earlier to hold onto those properties instead of putting them back on the market. Because local governments were receiving less in property taxes than before, many municipalities had to rely on state funding to pay for schools, affordable housing and public infrastructure.

Under Proposition 13’s two-thirds supermajority rule, many affordable housing and public infrastructure bonds have failed despite receiving more than 55% of votes in favor. Affordable housing advocates argue that Proposition 5 could have opened the door for more local funding, which could address the unique needs of each city.

But opponents worry the deluge of new property taxes could impact homeowners, particularly elderly ones or those living on fixed incomes. Since the voter threshold was lowered for school bonds by Proposition 39 in 2000, Californians have voted on almost 1,150 local school bond measures and have approved 911 of them, according to the California Policy Center, a libertarian-conservative think-tank.

Most Bay Area residents will have encountered a bond measure on their ballot, which could have passed more easily if Proposition 5 was approved.