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 Download
Request for Reassessment Form
Here.
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).
