Local cities and schools are getting a bit of holiday gift with
a state announcement that property tax collections will be padded
with a small inflationary adjustment next year.
Local cities and schools are getting a bit of holiday gift with a state announcement that property tax collections will be padded with a small inflationary adjustment next year.
While that may seem like obscure policy detail, the recommended 0.75 percent increase to property tax bills will translate into more funds for governments, schools and special districts. Most have seen their tax revenues slip drastically in recent years.
The inflationary bump announced for the 2011-12 tax year, which normally doesn’t make headlines, is noteworthy because the property tax rate this year was adjusted downward to account for a lack of inflation. That only exacerbated the huge revenue losses local governments have seen with dips in property values.
Next year’s gains for government come at the expense of property owners. For every $100,000 of assessed value, property tax bills will go up by $7.53. The increase does not apply to homes that are reassessed for the billing.
Proposition 13, while capping property taxes at 1 percent of assessed value, allows the state Board of Equalization to adjust taxes by an inflation factor, not to exceed 2 percent.
Property taxes are one of the most important sources of revenue for local government.
How much property tax public agencies will actually see next year depends on the value of real estate.
