Property Tax

Property Tax Revenue Increasing Statewide, Assessment Roll Data Indicates

Property Tax

It is likely that local governments throughout the state will enjoy increases in their property tax revenue, based on assessment roll data released in recent days by assessors in several counties.

As of late July 9, assessors in 11 counties had reported their 2020 assessment rolls, and all noted significant increases from last year in the value of taxable property within their counties: Fresno (up 5.5 percent); Kern (2.82 percent); Marin (4.5 percent); Orange (4.72 percent); San Mateo (7.02 percent); Santa Clara (6.87 percent); Solano (4.94 percent); Stanislaus (4.93 percent); Tulare (4.96 percent percent); Ventura (3.9 percent); and Yolo (5.15 percent).

These increases in assessments are substantial, running only about 0.5 percent below the big increases of 2019. So far, all but two counties are well above the Department of Finance’s May projection of 3.5 percent growth statewide. (CalTax: With the massive Los Angeles County roll yet to be filed, the statewide growth in property tax could change; but as of now it would appear that the state budget deficit is less than projected when the budget was passed. This is because the formula for state school support depends on how much property tax is available to fund schools. The assessment roll increases illustrate Proposition 13’s anticyclical features that have a huge but under-appreciated role in stabilizing property tax revenue – and thus stabilizing government budgets.)

In light of the logistical problems caused by the COVID-19 pandemic, the State Board of Equalization granted extensions to the July 1 deadline for assessors to submit their rolls.

Assessors noted that the 2020 data is based on property values as they were on January 1, prior to the stay-at-home orders, mandatory business closures, rent deferrals and other pandemic-related impacts on property values.

Stanislaus County Assessor Don Gaekle, president of the California Assessors’ Association, said: “Real estate markets generally react over a longer period, and we expect that impacts to the commercial real estate market will become evident during the remainder of the 2020 year and early 2021 as changes in ownership occur and rental markets adjust.”

Gaekle said his office “will be monitoring data for all sectors in the coming months, including agricultural and residential properties, for market changes affecting the future January 1, 2021 lien date.” Where needed, he said, his staff will proactively review and adjust assessments to ensure that assessed values are at the lower of their Proposition 13 factored base value or current market value on the January 1, 2021, lien date.

“Since property assessments are based upon market value of property as of January 1, I fully expect this year will be a transition year,” Santa Clara County Assessor Larry Stone said. “Next year will not be as positive, as we will be considering the full economic impact of COVID-19 on real estate values.”

The 2020 roll, however, “captures the peak of the longest economic boom in Silicon Valley’s history,” Stone said.

Since the Great Recession, the Santa Clara County assessment roll has grown by $255.5 billion. “The major beneficiaries of property tax revenue are public schools, community colleges, cities, and the County,” a media release from Stone’s office noted. “Fifty percent of local property tax revenue generated in Santa Clara County goes to fund public education.”

Solano County Assessor-Recorder Marc Tonnesen announced that his county’s assessed value grew $2.9 billion over the past year.

“This is the eighth year in a row that the total assessed roll value increased countywide,” Tonnesen said. “The real estate market showed steady growth over the past year, while new construction continues to add value to the property tax roll.”