Proposition 13 and the Budget Crisis

Daniel Weintraub of the Sacramento Bee has an interesting article, available here, on the impact of property tax reassessments on local finance. If you bought at the height of the housing bubble and the value of your house is now less than what you paid, you can get your property reassessed for property tax purposes. Similarly, foreclosure on a house will usually result in a sale price that is below the last purchase price, thus triggering reassessment at a lower value. All this translates into less money for local governments. And since the state is already in a giant financial hole itself, it won't come to the aid of cash-strapped local governments. It's hard to be a government that doesn't have a printing press.