Transfer of Property, 8% of the examination
Proposition 13
California's system generally limiting the base property-tax levy to 1% and annual growth in factored base-year value to the applicable inflation factor, capped at 2%.
The annual factor is not automatically 2%. It is the California Consumer Price Index change, limited to 2%, and can be lower. A change in ownership or new construction generally creates a new base-year value for the affected interest, subject to exclusions. Voter-approved debt and direct assessments sit outside the 1% base rate, so an actual bill can exceed 1%. A temporary Proposition 8 decline-in-value assessment can rise by more than 2% as market value recovers, up to the applicable factored base-year value.
See also
Test the distinction
A relevant question from Transfer of Property, selected because its facts or explanation use this concept.
Under Proposition 13, what is the general base rate and annual inflation rule for a factored base-year value?
Written to DRE's published topic list. Not a real examination question, since reproducing those is a misdemeanor under B&P Code section 123.
Primary sources
Use these authorities when a course summary, forum answer, or older flashcard conflicts with the current California rule.