It’s a letter from Larry Stone or Ron Thomsen or Gus Kramer or another Bay Area county assessor.
You open it up and your eyes pop. Steam starts coming out of your ears like a little cartoon character.
Your property taxes are going up by a hefty amount for the 2013-14 tax year.
What happened? What about California’s Proposition 13, which guarantees a 2% annual cap on property tax increases?
Think back to 2009, when a similar missive arrived. Remember what a relief it was that your property taxes were slashed by about a third? Your house had plunged in value due to the real estate downturn. Under Proposition 8* — a companion to Prop 13, also passed in 1976 — assessors are supposed to cut your property taxes temporarily when your home’s market value goes below your previous assessed value. That went on extensively throughout the state over the brutal downturn; it’s one reason cities, counties and California itself had to tighten their belts so much.
But the key word is “temporarily.” That same Prop 8 requires assessors to bring the values back up when the market recovers. It can go up by a big chunk. There is still a ceiling. The maximum you can be assessed is what’s called your “factored base value.” That’s you original base value (what you paid for the house) plus 2% a year increases (or even less; if the California consumer price index is lower than 2%, that gets used instead).
Thousands of people will be getting these notices in coming weeks. For instance, in Alameda County, 9,800 properties are being fully restored to their “factored base value” after having had a temporary tax cut. Another 69,000 are being partially restored in sync with the changing market. In San Francisco, 4,900 properties are being fully restored, and another 9,900 are being partially restored.
All the assessors have extensive explanations about Props 8 and 13 on their websites. The one on the Sonoma County Assessor’s website has a helpful graphic showing the interactions between Prop 13 values and Prop 8 market values.
Assessors are hopeful that homeowners will see the bright side.
“We are getting out of the market-value reductions and increasing our values,” said Ron Thomsen, Alameda County assessor. “It’s good for homeowners as they see increases in the equity of their homes.”
But many folks may not be jazzed about this.
Still, for the counties, cities, special districts and schools that depend on property-tax revenue, it’s definitely good news that the assessments are going up after several brutal years of steep declines. For a detailed look at what’s happening for Bay Area county assessments, click here. For more information about the impact on homeowners, click here.
Remember, you have the right to appeal your property-tax assessment — and you definitely do not need to pay anyone else to help you with this. Information on filing an appeal is available on each county assessor’s website.
*Not the Prop 8 about same-sex marriage that just went to the U.S. Supreme Court. California thriftily recycles proposition numbers; it wouldn’t be that catchy of a slogan to say: “Vote for Proposition 46,787?!
Carolyn Said is a San Francisco Chronicle staff writer. For news and insights on Bay Area real estate, follower her on Twitter: @csaid