Under Proposition 8, qualifying properties are given a temporary reduction in their taxable assessed value when the market value of those properties decline. Revenue and Taxation Code Section 51 requires the assessor to enroll the lower of either the property's Factored-Base-Year Value (established under Prop 13) or its market value as of the lien date (January 1).
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, Prop 8, which also passed in 1978, allows the property to be temporarily reassessed at the lower value. This reduction is temporary and the assessor is required to review the market value of the property each year after the reduction until such time as the Prop 13 value is less than or equal to the market value. As the market value of the property rises, the assessed value and resulting property taxes may increase in proportion to the annual increase in market value. This increase can be more than the annual 2 percent allowed under Prop 13 until the market value climbs back up to the annually adjusted Prop 13 cap. Once the Prop 13 cap is reached, then the assessment cannot be increased more than 2% annually.
For more information and to apply for a Proposition 8 adjustment, please contact the County Assessor at www.asrclkrec.com or (951) 955-6200.