LOS ANGELES — California’s statewide property tax roll rose by 0.3% this year after experiencing two years of declining assessed values, according to a report released by a state agency.
Total assessed property values in the state’s 58 counties rose to $4.382 trillion, an increase of $11.6 billion from the previous year, said Jerome E. Horton, chairman of the Board of Equalization.
In 2010, the statewide roll dropped by $78.2 billion, or 1.8%.
Because California law specifies a base 1% tax rate, the $11.6 billion in increased value will translate into a minimum of $116 million increase in property tax revenue. That figure does not include any additional local voter-approved property taxes, such as those levied to repay general obligation bonds.
Horton partially attributed this year’s increase to the federal government’s efforts to stabilize the housing market and prevent a glut of foreclosed properties.
In the housing market, sales of higher-priced properties and remodeling projects by homeowners have increased values, according to Horton. On the corporate side, foreign investment and growth in bank branches has helped tilt the numbers upward, he said.
“The tricky part is that we still have the unemployment issue, but it has been stabilized because the unemployment rate has remained the same all year,” Horton said. “We lose 1,000 jobs in one industry, but gain 1,000 jobs in another industry. We are not losing as much as we are gaining.”
Year-to-year percentage changes ranged from a high of a 19.5% gain in Colusa County to a 5.3% decline in Plumas County.
The increase in Colusa County is largely related to utility assessments, which comprise more than one-third of the county’s assessment roll, and was driven by the construction of a new power plant.
In all, 20 counties posted year-to-year increases in assessed value, although most of the increases were modest. Excluding Colusa, only three counties—Kern, Madera and Trinity—grew by more than 2%.
Thirty-eight counties experienced year-to-year declines in value. For the third year in a row, declines in assessed values were concentrated in the state’s Central Valley.
Assessed values dropped by 2.9% in the greater Sacramento region, and declined 2.7% in the northern San Joaquin Valley.
The assessed valuation in California’s 15 coastal counties, which account for over 60% of total assessed valuation, gained 0.9%.
By contrast, valuations in the 43 inland counties fell 0.6%.
The slight peaks and valleys experienced by the 12 counties with rolls exceeding $100 billion produced a telling picture of the state’s stagnant economic growth.
While seven counties posted an increase in assessed value, the values in five counties fell.
Values increased in San Mateo County and Orange County by 1%, in Santa Clara County by 0.9%, in San Francisco by 0.5%, in San Diego County by 0.4%, and in Alameda County by 0.1%.
Los Angeles County, with the largest assessment roll at $1.079 trillion, increased by 1.4%, up $15.0 billion over 2010-11. Last year, Los Angeles County experienced the largest decline at $19.8 billion, a 1.8% drop.
The slight increase experienced by San Francisco County this year contrasts with the 4.3% increase last year.
The California counties that experienced declines this year included Sacramento County with a 3.7% decrease, Riverside County with a 1.2% decrease, San Bernardino County with a 0.5% decrease, Contra Costa County with a 0.4% decrease, and Ventura County, which was only down slightly and virtually unchanged by percentage.
The statewide tax rolls are affected by Proposition 13, adopted in 1978, which set a basic 1% property tax rate, and reduced the volatility of the overall tax roll.
“Proposition 13 prevented the bubble from having a huge influence on property taxes, but then again it has left vast parts of the California economy undertaxed,” said Christopher Thornberg, founding principal of Los Angeles-based Beacon Economics LLC.
Under Proposition 13, properties are only reassessed at market value when they are sold, with assessment growth otherwise capped at 2% annually.
Many properties that have not changed hands for years have assessed valuations well below their market values, Thornberg said.
Proposition 13 and the lack of new construction are the reasons for the sluggish increase in California’s tax roll, he added.
“The idea that foreclosures are dragging market values down is pretty overrated,” Thornberg said. “It is more falling prices that cause foreclosures here in California, because unlike Arizona, Nevada or Florida, we did not vastly overbuild. The result is that foreclosures in this state have been snapped up quickly.”