Post by red on Jul 10, 2008 15:39:40 GMT -8
Several San Gabriel Valley cities saw sizeable increases in their property values, with Pasadena and San Gabriel leading the way.
Pasadena and San Gabriel ranked in the top five with increases of 10.2 percent each. Azusa ranked No. 6 with an increase of 9.9 percent.
Higher property values mean increased tax revenues, but since the bulk of it goes to the county, cities don't necessarily have a lot of incentive to make the top 10 list.
"While we are delighted with the news, the city is just getting a small share of the revenue," said P. Michael Pauls, San Gabriel's city manager. "The county is mainly reaping the benefit of this increase."
Pauls added that San Gabriel gets about 11 percent of the tax revenues raised by city property taxes.
The money still ends up benefitting individual communities, countered Jack Kyser, the chief economist of the Los Angeles Economic Development Corporation.
"Don't forget that those funds go to a lot of special districts," said Kyser. "School districts, water districts, mosquito abatement, all those services that cities need and don't pay for."
The county assessor's office, which released the report detailing the increases, calculated the increase in property values around the county at 6.9 percent. The total falls short of last year's 9.3 percent increase, but was enough to assuage concerns that home foreclosures would lead to a minimal increase or even a decrease in overall
property values.
"We saw some decreases in value in single-family homes and condos," said Rick Auerbach, the county assessor. "But we saw a lot of increase in multi-family buildings and commercial buildings, and that more than offset any decrease."
The county's total assessed property value topped $1.1 trillion.
Auerbach credited Proposition 13, the 1979 state ballot measure that limited property taxation, with keeping property assessments under control.
"Back before Proposition 13 the revenues were cyclical, with years of big increases, then stagnant revenues," said Auerbach. "Now you get at least a small increase even when the real estate market slows down."
With Proposition 13 limiting annual property tax increases to 2 percent, the assessor's office limits its reassessments only to when property is sold or improved. That means that homes that have remained under the same owners for a long time tend to keep lower property taxes, said Auerbach.
The increase in Pasadena was attributed to new residential buildings like the Archstone Pasadena apartment building at the Del Mar Gold Line station. Commercial real estate was also strong.
Steve Mermell, the city's acting-finance director, said the report has led the city to re-evaluate its expectations for property tax revenues. The city included $34.3 million in revenue for the last fiscal year.
"We generally try to run pretty conservative figures," said Mermell. "The report was definitely good news for the city."
Mermell added that it will help the city's ability to borrow money and issue bond debt.
San Gabriel's success has more to do with commercial real estate than residential real estate, according to Auerbach.
The city has several mixed-use developments, including new construction on Valley Boulevard, said Pauls.
Additionally, property values in the city, along with others in the western part of the San Gabriel Valley, have not been badly hurt by the real estate crisis, according to Arthur Shu, president of the Western San Gabriel Valley Association of Realtors.
"San Gabriel is not quite as in demand as some of its neighbors," said Shu. "But the demand is still pretty good as long as you ask for a fair price."
One of the big factors in Azusa's success, according to the assessor's office, has been the Rosedale housing development.
The developers sold several dozen new homes in a project that is slated to total about 1,250 homes. Construction on the project has stalled, however, leaving buyers in a semi-completed development.
James Makshanoff, the assistant city manager of Azusa, said he expected the project would continue at some point.
"The project will eventually gain traction," said Makshanoff. "It should help to keep property tax revenue stable in the city."
Several cities in the San Gabriel Valley recorded smaller increases, including Duarte at just 1.3 percent, and La Verne, at 3.8 percent.
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