Will Federal Assistance to California Be Affected by Proposition 13?, with Colorado Funding Data

In June 1978, California taxpayers overwhelmingly approved a constitutional amendment to limit state and local taxation. Proposition 13 limits realty taxes to 1 percent of market value after July 1, 1978, limits assessment increases to 2-percent annually, and bases current property values on assessments as of March 1, 1975. Proposition 13 also requires that any state tax increases be approved by a two-thirds vote of the State Legislature and that new local taxes be approved by a two-thirds vote of the electorate. Passage of Proposition 13 aroused concern that California may lose federal grant funds due to the effect of state and local spending reductions on compliance with matching and maintenance of effort requirements.