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SLO County Farm Bureau, assessor win inheritance tax battle

October 19, 2021

San Luis Obispo County Farm Bureau Executive Director Brent Burchett

OPINION by BRENT BURCHETT

Farm and ranch families can once again pass along their land to the next generation, thanks to work by Farm Bureau and our very own San Luis Obispo County Assessor Tom Bordonaro.

For those who don’t know, our agriculture community doesn’t get many wins out of Sacramento these days. Our elected officials are further removed from the farm than at any time in our state’s history, and farmers must face each legislative session like they’re entering a fresh gauntlet of regulations, red tape and fee hikes, but we got a big win this session with the signing of Senate Bill 539 into law by Governor Newsom in October.

SB 539 clarifies a confusing, narrowly-passed Nov. 2020 initiative, Proposition 19, which limits tax protections for a parent or grandparent passing down their land to their kids. The three key provisions for property tax assessments under Prop. 19 as it was passed were:

If you don’t live in the property that was also your parent’s primary residence, the low Prop. 13 assessment will be stripped away and replaced with a new, much higher market value.

This new approach also would have limited the transfer of the old tax base to the first $1 million of market value over the old tax base for an entire farm or ranch.

It would have raised the taxes on the difference between the old tax base and the market value above $1 million plus the old tax base on the entire ranch or farm.

Since Prop. 19’s passage, Farm Bureau and Assessor Bordonaro have negotiated with state leaders to minimize the property tax implications for agriculture, and I am proud to report that SB 539 actually strengthens the tax protections that existed prior to Prop. 19 for family farmers and ranchers.

SB 539 now clarifies that each legal parcel, rather than the farm or ranch as a whole, will be assessed as a “family farm” under Prop. 19. The bill also clarifies that a “family home” and a “family farm” legal parcel upon which the family home is located are eligible for individual exclusions from property tax reassessment under Prop. 19.

Bordonaro represented the California Assessors Association in SB 539 negotiations, and our Farm Bureau was a voice for our 700 San Luis Obispo County Farm Bureau member families, and the more than 34,000 Farm Bureau members across California. We also want to thank our State Senator John Laird and Assemblyman Jordan Cunningham for voting for these changes.

It is a time-honored tradition that family farms are passed from parents and grandparents to their children and grandchildren. This should happen without a “death tax” being passed to the next generation. After all, we are talking about the land and farm infrastructure that produces the food and fiber we all rely upon. We should all hope that family farms survive.

Unnecessary and excessive property taxes do nothing more than discourage food production and result in higher prices at the grocery store. Thank goodness Tom Bordonaro and our Farm Bureau stepped up to straighten out the mess of Proposition 19 and assure that the family farm survives in our community and throughout California.

If you are interested in learning more about the specifics of SB 539 and how this affects your property, please contact me at bburchett@slofarmbureau.org or call our office at 805-543-3654. SLO County Farm Bureau will be hosting an informational forum in coming weeks on Prop 19. and the new law under SB 539.

San Luis Obispo County Farm Bureau has been advocating for farmers and ranchers since 1922. Brent Burchett serves as Executive Director. Learn more at slofarmbureau.org.


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I do not understand why my Republican family did not oppose prop 19, that which was promoted by the Real-Estate industry (let’s make make money on property changing hands). Prop 19 was advertised to benefit those who lost their retirement homes in wildfires so that they could relocate their Prop 13 tax schedule elsewhere in California. What was not advertised was that the hard earned legacy for your successor family will no longer get the benefit of the trust and will now be reassessed for everything outside of the home they inherit and live in (undermining prop 13). Now everyone who wants to preserve their Prop 13 protection for the next generation will now have to create slime ball LLC’s and feed lawyers inorder to protect affordable legacy ownership or raise rents to cover the new taxes, develop their ranch lands, etc., all of which feeds the parasites in co-hoots with government. Oh, the pot belly cowboys will still have their large ranch and ag welfare CRP income (big money to not graze their pasture) but they too will get hit when they find our that their other (not adjacent) locations will get the new taxes and that will price them out. Oh crap, no time to ride horsies cuz you need to do a real job and protecting “that way of life stuff” has been replaced by communisms. Just like Khrushchev said, “we’ll do it to ourselves”.


0

A monumental effort that saves many ranch and farm families from facing the punishing escalation of taxes on properties highly inflated in value already. So many parents today would have long ago lost their homes if Prop. 13 didn’t step in and put the brakes on this revenue stream. Our legislature has been captured by the Democratic Party , shifting further in their direction as they pander to the Latino demographic shift , now the majority ethnic group in Calif. No longer can the schools cry out for funding when enrollments are so far down as Americans have fewer children .

A case is made for closing many more schools that can be paired with others and we should return the savings to the homeowners . Thank you for writing this piece Mr. Burchett on tightening language that is sloppy and reflects laziness within this abysmal legislature . We must demand better from both parties who continue to fail us.


6

There is one purpose for taxes at the state level. That is… you tax to stimulate people to behave as the government wants. Example: If we want more solar, we give tax breaks for solar. If we think the rich are too rich, we tax them more. The feds don’t need the money. They can print it. Essentially, they take our tax money and put in a big pile and burn it. And when they need some, they print it.


At the state level, because they cannot print money, they tax for the reason above, but also tax to gain income to pay for their programs.


So.. capital gains taxes are lower than income, because the government thinks it is wise to invest in businesses, as this makes the economy grow. If nobody invested in businesses, there would be a shortage of jobs.


Inheritance taxes are valuable because it is not good for democracies or republics if there is a huge divide between rich and poor. When there is, we get social and political instability. This leads to socialist, anarchist and communist type movements, as we have had a few times in our history. And it happens when the divide is largest between rich and poor. We had great progressive reforms after the robber baron era, and also after the 20s…during the depression when the radicals were getting louder. We are in a like era now. The divide is getting too huge, when guys like Gates and Soros can affect all of our lives with their kooky ideas. That is one reason we are seeing a resurgence of radicalism now that threatens our political and economic systems.


For the most part, Americans have bought into the idea of a meritocracy. You make it on your grit and intelligence. So, when the scions of the wealthy inherit millions, it goes against some basic American beliefs and it seems so unAmerican. Right? This is not an aristocracy. We believe you make it on your own. (Except for some radicals who insert race into it..)


Family farms and ranches should stay in the family. But what if they are a million acres? Then… I am not so sure. The policy really should have some nuance that deals with the really huge estates. It is not right that some are born rich, while the rest have to struggle.


If you were successful in life, and you have lots of resources. Congratulations. You played a good game. You are an inspiration to all of us. Your job is to prepare your children to be good players too. But don’t give them all the rewards so they don’t have to play. They should have to stand on their own two feet, and struggle like everyone else to succeed. Do not spoil your children.


-2

For better clarity, try cutting those 900 words in half , then suggest which ranch or farm parcel in SLO county would be a great location for a Magic Mountain Theme Park ? I trust your judgement.


0

Why do you want me to feel sorry for somebody inheriting millions of dollars of properties.Ranching is over in California. Just sell the land and go work for Trader Joe.Sorry people, face the reality.


-14

Do you think Trader Joe’s grows your food?


-1

Prop 19 should have been struck down, the people of Ca did not read the print on that ballot, lets say a property worth 2 million is passed on to your kids, unless one of them lives there they will pay roughly $20,000 a year in prop taxes, if they rent it, same thing, now that is highway robbery.


20

Great job to all involved getting this done. The more money we can deny these money grabbing government bureaucrats the better.


50

What, the evil Democratic governor did something good for farm families? Shocking.


No, not so much. The Democrats are all for whatever is good for California’s economy. It’s mostly why the state has gone from the sixth largest economy in the world to the fifth largest economy in the world in the last 10 years under Gov. Brown and Gov. Newsom.


-35

Cal Coast News has devolved into a cesspool of conservative stupidity. If you read this article and actually think of local ranching families as being victims, especially victims of California politics, well then I have to ask who ties your shoes and cleans all the windows you lick?


-84

Why should the Feds and local governments raise our property taxes and levee a death tax on properties upon someone’s death? Tax, Tax and Tax more, government at its worst!


49

You’re question is a good one. The short answer is, for the progressive left, anyone who has worked hard to pass on a financial legacy to their children, all while paying their taxes, somehow owes something to the government posthumously. After all, successful people are successful because of institutional racism and inequities in our system, not because of work and sacrifice. People who built an estate just just stole it from the “little people” and when you die the government needs to be paid back. Success, economic success, has little to do with hard work, talents, and sacrifice.


That is the view of our modern, progressive left of Sandy Cortez, Ilhan Omar, Nany Pelosi, Chuck Shumer, Karen Bass, Maxine Waters, and Governor Newsom, and a host of others.


Think about that in 2022.


27

See above


-11

Dumb wars in Iraq and Afghanistan, poor Covid handling, cause high taxes.


-13

Why should inheritances not be taxed the same as wage and salary income? Why should capital gains and dividends not be taxed the same as wage and salary income?


-26

Well, assets handed down in an inheritance have already been taxed, that’s why.


Why should anyone, or the government, profit from the hard work and success of someone who dies and wants to leave those assets to children, grandchildren, non profit, or whomever, what makes you think it’s OK to have government take from someone who worked hard all their life, paid their “fair share” in taxes, and then have the government come in a take a cut to distribute to perfect strangers who absolutely zero to do with that success? Why is that Ok?


However, I cannot say the same for capital gains


12

You’re correct about capital gains as well. If you have an asset you’ve invested in, you’ve paid taxes on it, whether it’s property or stocks or anything else..you’ve claimed assets on your taxes. You invested in the hopes of a return or gain. If you get one, capital gains would gain tax your wise decision-making.


5

I would say in my view it counters the cesspool of blind ignorance, deceit, lies and complete incompetence of the left-wing media across all spectrums. People who have a opposing idea from yours or left’s false narrative and rhetoric, don’t have a right to their opinion? Talk about stupidity wrapped with insanity.


I was raised on a working milk dairy in the north county. The most hard working and decent people you’ll ever meet are ranchers, farmers and their families. Our parents taught all us a tremendous work ethic through farm and ranch life. It’s a tough way to make a living, but the reward and values gained are worth it. When your a rancher or farmer you don’t play the “victim card” like all of the unthankful liberal/Progressives. We don’t blame other’s when we fail and hit rough times like the “snowflakes” on the left.


We don’t tie our shoes, we pull up our boots tight and kick the left in the ass until THEY get the windows clean.


25

Dairy Program Subsidies in the United States totaled $6.4 billion from 1995-2020.

There are a lot of lazy people, but me thinks you have never been authentically poor. With low wages, saving the first $10,000 is a struggle, raising kids difficult, let alone buying a home.


-10

Yup, even harder when the government takes and takes and takes. Also robbing people of incentive to work hard, invest, and risk capital.


12

I agree with ‘mazin’. CommensenseGuy, you may be hard working on YOUR ranch, but you get more than enough help from the same government you claim is (too) liberal/progressive. From a break on Dept. of Motor Vehicle annual registration fees to farm subsidies.


-1