I just got my San Diego County property tax bill for this fiscal year (2019-20). It’s instructive — in a bad way.
Many Californians think that property taxes are limited to 1% of assessed value. That “assessed value” is allow to increase annually by the cost of living — or 2%, whichever is less.
But the 1% is just the BASE property tax. Added to that are miscellaneous other taxes. By going online, I got a full list of what items my property tax payment is for. Oh my!
When a school or water bond is passed, that is a tax to pay for a SERIES of bond issues. In our case, we are paying taxes for FORTY-FOUR bonds issued by various school districts. Your bill in the mail gives you a summary of those bonds, but not the details.
Then there are the special districts — street lighting, mosquito control, “MWD water standby charge,” etc., etc. We have six such charges on our bill.
Because of a new voter-approved school bond, my overall property tax bill is 6.9% higher than last year — not “2% or less” as most people think it is. Apparently passing all these school bonds for a flat-line student population has a cost. Who knew?
Totaling up all the property taxes above the 1% base, and I find that I am paying not 1%, but 1.28%. Moreover, this percentage is growing, and more and more property tax-funded bonds are issued annually. That 0.28% may sound like a pittance, but in our case that’s an extra $1,396 a year — itself more than the median homeowner property tax bill in a dozen states.
Fortunately my wife and I are “rich,” thanks to a lifetime of disciplined investing coupled with frugal spending habits. We are not sure how well others are dealing with the high CA property tax BILLS. Our state PT rates are fairly low, but our high cost housing makes our PT bills much higher than the rest of the nation.
For more on this topic, check out my recent article comparing the CA homeowner property tax with the homeowners in other states. For my veteran readers, the results will be no surprise.