California clarifies valuation and appeal of construction in progress

On Feb. 25, 2016, the California Court of Appeal held that for property tax purposes a new base year is established every lien date (Jan. 1) for construction in progress, until such construction is complete. On Oct. 26, 2016, the California State Board of Equalization issued a memorandum to county assessors announcing that this decision supersedes guidance provided in California’s Assessors’ Handbook, which states that partially completed new construction does not acquire a base year value. The decision and memorandum also clarify the deadline for appealing a valuation of construction in progress.