LA County Urged to Promptly Process Requests for Tax Relief
On Friday, State Senator Bob Hertzberg called on the Los Angeles County Assessor’s Office to immediately process thousands of property tax relief requests to end a backlog that has left some older homeowners face heavy tax bills.
Proposition 19, narrowly approved by California voters in 2020, offers homeowners a significant tax break when they move to a more expensive home. But a recent Times investigation found delays by the assessor’s office in reviewing claims under the law have left homeowners stuck with high tax bills that must be paid while waiting for their claims to be approved.
By early March, the assessor’s office had not completed any of the 1,271 requests it had received to recalculate property taxes for elderly and disabled homeowners under the law, according to the agency. And he hadn’t completed any of the roughly 3,700 parent-to-child and grandparent-to-grandchild inheritance applications, the other major piece of the tax measure.
Hertzberg (D-Van Nuys), who drafted a bill passed last year to clarify the law, said the processing delays identified by The Times are “what happens when the government puts bureaucracy on the over people”.
The purpose of the law was to “protect seniors from exorbitant property tax bills if they decide to move,” Hertzberg said. Referring to the delays, he added: “It’s 100% wrong.”
Hertzberg, 67, said he plans to run for the LA County Board of Supervisors to replace outgoing supervisor Sheila Kuehl, who represents the 3rd District.
He said the 2020 ballot measure requires assessors’ offices to immediately send claims to the county treasurer’s office so homeowners can get tax relief rather than waiting for their claims to be approved.
LA County Assessor Jeffrey Prang disagreed, saying a claim must be approved before a homeowner’s tax bill can be reduced. His office helped draft the clarifying language to improve Proposition 19 and is “now working urgently” to mitigate the financial impacts on property owners and move the hardest-hit taxpayers to the front line, he said. .
“But even now, well-meaning lawmakers are saying the law can do things it just can’t,” Prang said. “Simple statements do not solve a complex and sophisticated law that involves three different branches of the county’s property tax administration.”
LA County Treasurer and Tax Collector Keith Knox said his office cannot defer or reduce property taxes until the assessor’s office approves the transfers. Taxpayers will receive a refund once the assessor does, he said.
In a statement, the State Board of Equalization, which oversees tax collection, said Proposition 19 requires appraisers to adjust the value of the replacement home when a claim is filed. However, the assessor must determine that the qualifications are met before a homeowner can qualify for a tax reduction, agency spokesman Peter Kim said.
Additionally, if the replacement home is located in a different county than the original property, appraisers in each county should share and verify home information, Kim said.
Previously, Prang said his office needed at least a year to update its technology to implement the measure after it was passed, but the law only gave assessors several months to do so. Legislation clarifying the law was passed and signed by the governor last fall. In the meantime, without clear guidelines on how Proposition 19 should be administered for much of the past year, applications have piled up, Prang said.
It will likely take months more to clear the backlog, Prang said. Her office has recently received more emails and phone calls from frustrated landlords like Rose Liebermann of West Hills.
A clinical social worker, Liebermann owes the county nearly four times more than the taxes she paid on her previous home in Granada Hills where she had lived for more than 30 years. Liebermann, 71, said she called the assessor’s office to inquire about the status of her tax relief claim and was repeatedly told the office was understaffed.
“Seniors are penalized [the assessor’s] shortcomings,” Liebermann said. “If I pay my taxes late, I have to pay a fine. But is there no responsibility or consequence on their side? There should be something to allow people’s lives not to be so devastated financially.
The State Comptroller’s Office offers a tax deferral program that allows senior homeowners to defer paying property taxes if their household income is less than $45,810 per year and they have at least minus 40% equity in the house. But that wouldn’t help Liebermann.
Before Proposition 19 was approved, senior homeowners had a unique opportunity to keep their existing tax assessments if they moved to a home of equal or lesser value in the same county. They could do the same when moving between Los Angeles and nine other counties. If they did not meet these requirements or moved to a more expensive home, they would have had to pay the full amount in property taxes.
Under the new law, senior homeowners receive a tax benefit when buying a more expensive home anywhere in the state. Their new tax is calculated using a formula that mixes the assessed value of their old home with the value of their new home. Homeowners with disabilities can get the same break, as can victims of wildfires and other natural disasters when leaving damaged homes.
Proposition 19 also restricted an estate property tax relief that allowed children of homeowners to retain their parents’ low property tax assessments. A 2018 Times investigation found a large number of legacy homes along the coast that are being used as investment properties.
Under the measure, children who inherit their parents’ home will no longer receive property tax relief if they intend to keep it as a second home or rent it out.
Times writer Liam Dillon contributed to this report.