Belated Gift May Spell Trouble For California Cities Like Elk Grove

A weekly inspection of my email spam folder revealed a most welcome belated Christmas gift for my pocketbook. This same gift has to be paid...


A weekly inspection of my email spam folder revealed a most welcome belated Christmas gift for my pocketbook. This same gift has to be paid by someone and that is something that will not be so pleasing for California counties, cities, school districts and the myriad of special districts that rely on property taxes.

The email was from the Sacramento County Tax Assessor's office informing me that yes, the property tax assessment appeal I filed earlier this month was granted. Specifically, the assessed value of my house would be lowered by slightly more that 11 percent.

For me it means a savings of a few hundred dollars this year and for many years to come given the anemic state of California's real estate market and the annual limits on increases compliments of Prop. 13. In fact if property values stagnate, much less continue their free fall, it would take a minimum of five years before the assessments to be back to this year's levels.

The implications for municipalities are pretty clear. It is not known how many people have exercised this right to have their assessment lowered, not to mention properties that have been sold at amounts far lower than their previous assessments. One must suspect that it is a significant number.

So while the national economy is showing minor signs of recovery, the effects of the real estate collapse will continue to linger particularly when it comes to government receipts from property taxes for years to come. Cities like Elk Grove ought to brace for several more years of tightening budgets.  

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