> What's hard is that a fair solution to Prop 13 is difficult.
I don't think its that hard.
> You can't just shut it off suddenly or even gradually over a decade because people will lose their homes en masse
Eliminate the 2% per annum assessment increase limit entirely for properties transferred after the date of the change. In
Phase it out gradually for other properties but, for owner-occupied primary residences (covered or not) apply the original 2% limit formula as a limit on nondeferrable property tax, allowing deferment of the excess with the state acquiring, in lieu of payment, an interest in the property in proportion to the ratio of the deferred amount to the assessed value (the full tax should decrease as the state acquires interest, but the limit on the non-deferrable amount should not), which the owner can repurchase on the same bases any time before or at transfer.
You could even add an additional limit so that the nondeferrable amount increases at the lowest of 2% or the rate of inflation or (and this is the new bit the owners average annual rate of increase in taxable income over the preceding three year period.)
Seniors don't get forced out of their homes (and not just during a transitional period), and taxes are assessed at full value, and commercial, industrial, and vacation real estate stops getting taxpayer subsidies “justified” by stories about fixed-income senior homowners being forced out of their home.
Some things in policy are hard, but lots of time “its too hard” is really “I don't want to do it, but can't argue against it directly.”