Decline in Value
Proposition 8, passed by voters in November 1978, amended Proposition 13 in order to recognize declines in value of real property for property tax purposes. Prop 8 requires the Assessor to annually enroll either the property’s factored base year value or the current market value as of January 1st of each year, whichever is less. The lower, January 1st current market value is referred to as a “Prop 8 Value”. Prop 8 Value adjustments are TEMPORARY reductions made to recognize that the current market value of a property has fallen below its factored base year value. Unlike Prop 13 base year values, properties enrolled under Prop 8 provisions are not subject to the annual 2% increase limitation. Once Prop 8 values are enrolled, the property value must be annually reviewed and adjusted to reflect either the current January 1 market value or the original factored base year value, whichever is less. Although the market values of all properties may decline during a recession, not all will qualify for a Prop 8 reduction. The current market value must fall below the factored base year value before the decline can be recognized and the enrolled value adjusted. If you feel that your property is assessed higher than the current market please complete and return the Application for Decline in Value for review.