It is the time of year when California’s 58 county assessors complete their assessment rolls and announce the total value of property subject to property tax – and Santa Clara County Assessor Larry Stone and Yolo County Assessor Jesse Salinas were first out of the box with announcements that their counties’ assessment rolls increased 4.6 percent and 4.45 percent this year, respectively, despite the pandemic.
Santa Clara County’s assessment roll, which reports the total net assessed value of all real and business property as of January 1, reached $576.9 billion, Stone said.
“This time last year the nation appeared to be on the precipice of the worst economic crisis since the Great Depression, triggered by the Covid-19 pandemic,” Stone said. “Medical and business regulations designed to bridge the fiscal gap until vaccines were available prevented a major collapse of the U.S. economy. Santa Clara County companies … benefitted as the nation turned almost overnight to a remote working economy.”
Changes in ownership accounted for 61 percent of the total increase in the county’s assessed values, and the $6.69 billion worth of new construction accounted for 29 percent, Stone reported. The assessment of business personal property (machinery, equipment, computers, and fixtures) declined 1 percent to $40.4 billion. The remainder of the county’s growth was attributable to the Proposition 13 inflation factor, which was 1 percent in 2020.
“Homeowners are major beneficiaries of the hot residential market, taking advantage of the stunning appreciation in market value of their homes, while their assessment increased only 1 percent,” Stone said.
Stone noted that his office has launched programs to help property owners impacted by the pandemic, and has requested data from businesses to determine the financial impact of declines in market value of commercial properties – information that will be used to make proactive assessment reductions where warranted.
“As assessor, my job is to get it right,” Stone said. “I am not a revenue agent for local government. When the market value of a property declines below the original purchase price, we lower the assessment.”
Yolo County’s assessment roll has grown for nine consecutive years, and this year reached $31.52 billion. Salinas said the latest growth is primarily attributable to new housing development and construction.
Although July 1 marked the official deadline for assessors to complete their rolls, the State Board of Equalization has granted time extensions to many counties – a routine part of the process – and there typically is a delay in the public release of the information in many counties. Traditionally, a more complete picture of the counties’ assessed values is available by the end of July.
Thanks to Proposition 13, which reformed California’s troubled property tax system in the late 1970s, property taxes are predictable for owners and property tax revenue remains very stable for the government. Tax is based on a property’s acquisition value – increased to account for any new construction and adjusted annually for inflation up to 2 percent – rather than the unpredictable and ever-changing market value.
The major beneficiaries of property tax revenue are public schools, community colleges, cities, and county governments.