Steyer’s $20 Billion “Trump Tax Loophole” Is a Lie

Tom is just lying at this point.

June 6, 1978. Democratic Governor Jerry Brown. A Democratic Assembly. Sixty-five percent of California voters pass Proposition 13, capping property taxes statewide. Donald Trump was 32 years old, building condos in Manhattan, 37 years away from running for anything.

Now Steyer is standing at a podium in a $1,000-a-night San Francisco hotel, surrounded by union members, calling this same law “the Trump Tax Loophole” and pledging to “shut down this scam.”

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The “tax loophole” is Prop 13, which was passed by a majority of Democrat voters in 1978 when California had a Democratic Governor and Democratic Assembly. Tom is just lying at this point. https://t.co/zNsSxNcQMj

Kane 謝凱堯 @kane February 24, 2026

Renaming a 1978 Democratic law after Donald Trump is not a policy. It’s a costume.

The $20 Billion That Doesn’t Exist

Steyer’s pitch centers on 555 California Street, one of San Francisco’s best-performing office towers. The Trump Organization owns 30%. Vornado Realty Trust owns 70%. The building is worth roughly $2 billion, assessed at approximately $1.2 billion, with $14.4 million in annual property taxes. The gap between assessed and market value is real. What preserves it is Revenue and Taxation Code §64: ownership interest transfers below 50% don’t trigger reassessment. That’s California law voters chose in 1978. Not a Trump invention.

Steyer claims $20 billion per year is “trapped behind this loophole.” When California actually tried to fix commercial Prop 13 with Proposition 15 in 2020, the state’s own fiscal analyst estimated $8 billion to $12.5 billion per year upon full implementation. Steyer inflated the figure by 60 to 150%. That’s not rounding error. That’s campaign math.

Voters Already Said No

PPIC found 57% of Californians and 65% of likely voters still say Prop 13 was “mostly a good thing for the state.” Even 55% of Democrats agree. Support for split-roll was at its lowest since PPIC started tracking in 2012. That’s why Steyer needs Trump’s name on it. The policy is popular. The only way to sell repeal is to pin it on someone voters already hate.

Voters already weighed in on this exact proposal. Prop 15 lost 51.9% to 48.1% after the second most expensive ballot measure campaign of 2020 nationwide, $148 million total. The California Teachers Association spent $17.8 million. Chan Zuckerberg Advocacy added $11.6 million. SEIU put in $6.3 million. They still lost. In a year California voted overwhelmingly Democratic everywhere else on the ballot.

Steyer’s answer: rebrand it and try again.

The Reform Case Is Strong. Steyer Is Poisoning It.

Commercial Prop 13 genuinely creates terrible incentives. It has covered California with land banking, empty lots, and abandoned buildings. California commercial real estate policy today is pouring sugar on the floor for ants to come.

Take 3201 Divisadero in San Francisco’s Marina district, built in 1936 on a third of an acre of prime corner real estate. Its assessed value for property taxes: $1.2 million. Annual property tax bill: $13,657. The owner covers the entire year’s tax obligation with one week of rent. That’s not a functioning tax system. That’s a subsidy for sitting on land.

Henry George developed land value taxation in San Francisco in the 1870s. His insight: tax land values, not improvements, and you unlock development while crushing speculation. Prop 13 built the exact opposite, a system that rewards sitting on land and punishes building on it. Prop 13 didn’t just create a loophole. It manufactured an incentive to leave property dead.

Commercial Prop 13 needs reform. But a serious reform starts from Georgist principles, not from a billionaire’s vanity campaign. Prop 15 included a $3 million small-business exemption, the kind of targeted design that builds winning coalitions. Steyer’s vague “Trump loophole” framing drops all of that. He’s not trying to pass reform. He’s trying to win a primary.

Two Democrats, Two Instincts

California has a spending problem before it has a revenue problem. Matt Mahan is the rare Democrat willing to say it.

Mahan’s position: “California spends nearly $150 billion more per year than we did just six years ago without delivering better outcomes.” On taxes: “I don’t think increasing our already high state tax burden should be our first instinct. Instead, I think it should be our last resort.”

San Jose under Mahan: unsheltered homelessness down 23%, safest big city in America, 2,000+ housing units built in 2025. Without raising taxes.

Steyer’s instinct is the opposite. Split-roll referendum. Special election for higher corporate taxes. Yes on the wealth tax. His answer to every problem is a new tax and a bigger ad buy. He’s spent $28 million of his own money and polls at 9%. That is the most expensive per-polling-point campaign in recent California memory, and it is a data point worth sitting with.

Populism is performance art when you’re a billionaire.

California needs leaders who will level with voters about Prop 13. Acknowledge that it’s popular. Admit that the commercial side has real distortions. Then do the hard work of fixing schools, housing, and homelessness before cashing a bigger property-tax check. A well-structured 2027 ballot initiative could reassess commercial property at market value while leaving residential protections intact, with small-business exemptions that build the coalition Prop 15 never had. That’s the real path to reform.

Steyer is trying to skip that work and hope “Trump” on a mailer does the job. Mahan starts where voters are: stop making California more expensive, treat Prop 13 surgery as a last resort, not a campaign gimmick. If you want to build the coalition that actually passes commercial Prop 13 reform, start by telling the truth about what it is. When you have to lie about a policy’s origin to sell your fix, you’ve told voters everything they need to know about how you’ll govern.