Proposition 8 – What is It?
In 1978, California voters
passed Proposition 8, a constitutional amendment that
allows a temporary reduction in assessed value when a
property suffers a “decline-in-value.” A
decline-in-value occurs when the current market value of
your property is less than the current assessed value as
of January 1.1
Eligibility Requirements
1) You must demonstrate that on January 1,
the market value of your property was less than its
current assessed value.
Review Your Property
Assessment Value
Note: if you do not live in Alameda
County, click
here for links to county assessor
offices throughout California.
2) You must file a claim form for a
Decline-in- Value Reassessment Application (Prop.8) with
the Assessor between January 1 and December 31 for the
fiscal year beginning on July 1. You can get Claim forms
from your County Assessor’s office
or http://www.acgov.org/assessor/reassessments.htm
The Process
On your claim form, provide the Assessor
with any information that supports your opinion that the
market value for your property is less than the assessed
value. The best supporting documentation is information
on sales of comparable properties. You should select two
comparable sales that sold as close to January 1 as
possible, but no later than March 31. You may query the
Assessor’s database for sales in your neighborhood as
well. While the submission of comparable sales is
helpful for the Assessor in determining the market value
of your property, applications submitted without
comparable sales will be accepted and
processed.
An appraiser
will review your claim form and the information you
provide. Other sales information available to the
Assessor may also be considered. If the market value as
of January 1 is less than the trended base value2, your
assessed value will be lowered to the market value for
the fiscal year beginning on July 1. The adjusted value
will be reflected on your annual tax bill. If the
current market value is higher than the trended base
value, no change in assessed value will be made. If you
disagree with the Assessor’s findings, you may file an
appeal with your local Assessment Appeals Board. You
must file your appeal between July 2 and November 30 for
your annual tax bill.
Example
A property
was purchased for $500,000. During a three-year period,
the real estate market declined and recovered. The
property owner filed for a decline-in-value
reassessment. The following table shows the trended base
value of the property, the market value of the property,
and the assessed value of the property. Assumimg a 2%
Annual C.P.I.:
Base Value Trended
Market Value
Assessed Value
Year 1
$500,000
$500,000
$500,000
Year 2
$510,000
$480,000
$480,000
Year 3
$520,200
$510,000
$510,000
Year 4
$530,604
$550,000
$530,604
1 To read the law associated with
Proposition 8, see Revenue and Taxation Code, Section
51. It is availableonline at www.boetaxes.ca.gov/property.
2
Property is
assessed at the time of sale or transfer (base value) or
new construction. That base value increases a maximum of
2% (trend) each year (i.e. trended base
value).
