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Proposition 13

Proposition 13 was passed by the California voters on June 6, 1978 amending the California Constitution to limit the assessment and taxation of property in California. Except in certain instances, real property is assessed at its 1975-76 base year level and cannot be increased by more than 2 percent annually. Real property is reassessed however, at its current fair market value at the time a change in ownership occurs, establishing a new base year. Similarly, the market value of any new construction is also added to assessments as of its completion date, changing the base year. With the passage of Proposition 8, also in 1978, the Assessor is required to assess real property at the lesser of its Proposition 13 level, indexed by no more than 2 percent per year, or its current market value as of January 1st. If a property is assessed at its lower market value, the Assessor is required to restore the Proposition 13 assessment in subsequent years if the market value increases to that level or above. (Business personal property is assessed at its fair market value as of January 1st each year.)

Proposition 13 also limits the amount of taxes that can be charged to an owner of locally assessed property to 1 percent of the property’s taxable value, plus any voter approved bonded indebtedness, service fees, improvement bonds, and special assessments.

    For more information on the history of Proposition 13 and an overview of property tax assessment, see this brochure that is published by the State Board of Equalization: 

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