[thaumasiotes]

Under Proposition 13, you are not taxed on the land value or the property value. Instead, you're taxed on the land+property value at the time you bought the property.

If you make a "substantial change" to the property, the tax is reassessed. That's what generates the "empty lots, parking lots, single-family homes in the middle of downtown, etc." -- if you replace your empty lot with a useful building, your property taxes immediately spike.

Extending Prop 13 to cover property redevelopment would do as much to solve the undeveloped-land problem as repealing Prop 13 would. (Obviously, those two policies would differ in other ways.)

I think it's a mistake to focus too heavily on "should we tax land value" vs "should we tax property value". You're correct that taxing property value disincentivizes development, and that is bad. But we're talking here about cases like someone's small personal residence in the middle of downtown San Jose with $4,000,000 of land value and $200,000 of property value. (Numbers completely invented.) If they were taxed on assessed value, land+property, which is the default in most places, that immense land value would quickly make it prohibitive not to redevelop. The tiny property value is a rounding error.

[asokoloski]

Oh, yeah. Prop 13 is like an order of magnitude worse than just taxing property + land vs a higher rate on land.