Two homes that have gone pending in Manteca illustrate how the city is unable to rely on property taxes alone to support municipal services.
One home — built in 2008 on Miel Street south of the 120 Bypass — had a property tax bill in 2023 of $8,625.
The other home — built in 1947 on Pine Street to the east of downtown — had a property tax bill in 2023 of $397.
Roughly 15 to 18 percent of what is paid in property taxes on a home ends up in the City of Manteca’s general fund.
That’s because there are 10 or so government agencies depending upon a home’s location that gets a cut of the basic 1 percent property tax that is paid annually.
That means the Miel Street home that was assessed at $664,762 under Proposition 13 rules paid a basic property tax of $6,647. The remaining $1,978 collected from the homeowner was for everything from a landscape maintenance district, community facilities district for schools, as well as school bonds for Manteca Unified and Delta College.
The bottom line for the city was just over $1,100 in property taxes to help fund municipal services from the property taxes paid.
The Pine Street home had a property tax bill in 2023 of $397 based on an assessment of $41,322.
The fact the tax bill isn’t $413 — the 1 percent basic property tax and a bit higher for the homeowner’s share of bonds given there were no community facilities districts in 1949 — is likely due to a $75 senior homeowner exemption.
It’s deducted from the property tax owed.
That means the city collected roughly $55 from the homeowner in 2023.
The vast difference in terms of property taxes the city collects annually — $1,100 for the Miel Street home and $55 for the Pine Street home — underscores the city’s revenue challenges.
The Miel Street home is clearly newer and larger.
It has four bedrooms and 3.5 bathrooms with 3,387 square feet of living space on 0.29 acres. It has all the bells and whistles.
The Pine Street home has 2 bedrooms and one bathroom with 796 square feet of living space on a 5,149 square-foot. It is a fixer upper with a wall furnace and window air conditioning.
It’s important to note because a central heating and colling system can easily be a $20,000 improvement that is collapsed into the initial assessment value of a home.
As such, the Miel Street homeowner’s property tax liability of just the central air and heat system is roughly half of what the Pine Street homeowner was paying overall in property taxes.
Proposition 13 passed in 1978, capped annual assessment increases on homes that haven’t exchanged hands or had assessable improvements made at 2 percent.
That means unless a property sells, the city wouldn’t see additional tax revenue that would be adequate to cover inflation over the long haul.
The Miel Street home that sold for $421,134 in 2009 has more than doubled in market value given it has a pending offer of $869,000.
Meanwhile, the Proposition 13 assessment had only gone up roughly 55 percent.
The new owners will be paying property taxes of right around $10,000 a year. The city should see about $1,600 of that amount.
The Pine Street home, that has gone pending for $298,000, will have an initial property tax bill about five times higher than what the current owner pays.
The way property is taxed is why the city opted to place a 20 year, three-quarter of a cent sales tax on the Nov. 5 ballot to help address funding shortfalls.
The tax is based on consumption on taxable goods.
A parcel tax, or a citywide community facilities district which would be highly unplausible politically at the ballot box, would add significant burdens to long-established households that tend to have smaller, and more limited incomes.
A flat parcel tax to raise the money needed would likely have almost doubled the tax burden of the owner of the Pine Street property that has gone pending while increasing that on the Miel Street property by less than 2 percent.
A sales tax is paid by everyone including those from out-of-town that shop, dine, stay, or buy gas in Manteca.
To contact Dennis Wyatt, email dwyatt@mantecabulletin.com
