Historically low inflation rates are good news for property owners who will get a tax break because of smaller increases in their assessments, Mark Church announced Friday.
Church, the county assessor/county clerk/recorder, said the annual inflation factor announced by the California State Board of Equalization is .454 percent, which is one of the lowest in the last 38 years. The lower inflation factor means an estimated $1.84 billion off the factored base year value for properties that aren’t new construction or under new ownership. The factor is based on the California Consumer Price Index for the period from October of the prior fiscal year to October of the current fiscal year.
The base year value of a property is established with construction or change in ownership and Proposition 13 limits annual changes to no more than 2 percent. Historically, annual increases have been 2 percent in all but seven of the last 38 years.
However, Church said what is good for the property owners isn’t quite as rosy for the county.
“While most property owners will receive a tax break, the reduction in the annual inflation factor also reduces the anticipated property tax base that supports the county, all cities, school districts and special districts in San Mateo County,” Church said in a prepared statement.
Any reductions, though, will likely be compensated by the roll’s overall increasing value due to strong real estate sales, new construction and restoration of decline in values, according to Church.
The 2014-15 secured roll value is estimated to increase 4.77 percent over the 2013-14 roll for a total of $156.98 billion.