Inside Report (3)

Has the California Supreme Court poked a couple of loopholes in Proposition 13?

On April 30 the court ruled that the Los Angeles County Transit Commission could collect a 0.5 percent sales tax approved by 54 percent of voters. Prop. 13 says a two-thirds vote is necessary for tax increases.

But the justices ruled that local agencies without property-taxing authority can levy other taxes based on majority approval. On May 10 the court ruled that local governments can boost property taxes to finance public-employee retirement plans approved before voters ratified Prop. 13 in June 1978.

Prop. 13's strict property tax ceiling -- 1 percent of assessed property values -- remains intact. Several recent attempts by local governments to win two-thirds approval to exceed the 1 percent limit have failed.

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