Revenue and Taxation Code Section 51 requires the assessor to enroll the lower of either the property's Factored-Base-Year Value (established under Proposition 13) or its market value as of the lien date (January 1).
This reduction is temporary and the assessor is required to review the market value of the property each lien date after the reduction until such time as the Factored-Base-Year Value is less than or equal to the market value.
When the Factored-Base-Year Value is again enrolled, the property is no longer subject to the annual review, and will receive indexing not to exceed 2% per year.
We understand property owners have concerns regarding the assessed value of their property and the impact it may have on their property taxes. Property tax law provides certain protections for taxpayers when property values decline. Under Proposition 8, qualifying properties will be given a temporary reduction in their taxable value which translates into a lower property tax.
A reduced or "decline-in-value" assessment (also called "Prop 8") occurs when the current market value of your property is less than the assessed value as of January 1. The Assessor will review thousands of properties this year to ensure that fair and equitable assessments are provided for Riverside County taxpayers. This review encompasses all properties that received a decline in value reassessment last year. We encourage property owners who have already received a decline in value reassessment to await the results of our review before filing a Decline in Value Reassessment Application. If your property is included in our review, no application is necessary.
The review applies to the assessed value as of January 1, 2020, for Fiscal Year 2020-21. If your property does not meet the review criteria above and you believe the value should be lowered, you may file a Decline-in-Value Reassessment Application (Prop. 8). The filing deadline for a Decline-in Value Application is November 2, 2020. Our staff will review your request and provide written notification regarding their findings for all applications received after July 1, 2020.
The graph below represents a comparison of Prop 8 and Prop 13.
California’s Proposition 13 caps the growth of a property’s assessed value at no more than 2 percent a year unless the market value of a property falls lower. When that happens, Proposition 8, which also passed in 1978, allows the property to be temporarily reassessed at the lower value. However, as the value of the property rises, the assessed value and resulting property taxes may increase more than 2 percent a year up to the annually adjusted Proposition 13 cap.
Do properties other than single-family residences qualify?
Yes, all real property qualify.
My property has gone down in value, why did I not receive a reduction?
Properties that have an established Proposition 13 base year value that is still below current market value are not reduced. The assessed value reflects the lower value of either the current market value, as of January 1, or the Prop 13 base year value.
How can the assessed value of my property be changed after you reduced it?
The assessor is required to review the temporary Prop 8 value each lien date following the initial reduction. The Prop 8 value can be further reduced or increased depending on the property's market value as of the lien date. Just as there is no limit on the amount of reduction, there is no limit to the amount being restored up to the Factored-Base-Year Value.
I received a decline in value reduction last year, do I need to file an application again this year?
No, once your property has been reduced, it will be reviewed annually each January 1. If current market values have risen then your property assessment will be adjusted up to the current market value or the Proposition 13 base year value, which ever is lower. Once your property value returns to the Prop 13 value, the annual reviews will end.
What will happen to my assessment if values start to rise?
Your taxable value reduction to market value is temporary and the assessor is required to review the market value of the property each lien date after the reduction, until such time as the Factored-Base-Year Value is less than or equal to the market value.
Unless there is a change in ownership or new construction, this increase in value cannot exceed the original assessed value plus the annual inflationary factor not to exceed 2% per year.
What is the process if I do not agree with the value?
First, please contact the Assessor for an explanation of the value. There are two separate processes available:
1) Filing a Decline in Value Reassessment Application will allow our office to conduct a review of your property value. Applications received before July 1, 2020, will have the assessed value posted on our website after July 2020. Owners filing applications received after July 1, 2020, will be sent written notification.
2) Filing an Assessment Appeal Application (BOE 305) is the formal process to dispute your value. Appeal applications are to be submitted to the Clerk of the Board. The annual filing period for this year is July 1 through November 30. To obtain a formal appeal application, please see the Clerk of the Board's website here.