2025 Property Tax Highlights Publication Press Release

For Immediate Release
January 15, 2025
Contact: Kristie Silva, Assistant Controller
(650) 363-4777
[email protected]

County Controller Publishes Property Tax Highlights for FY 2024-25

Countywide property taxes totaled $4.1 billion.

Redwood City - In San Mateo County, combined property taxes totaled $4.1 billion in fiscal year 2024-25, an increase of 6 percent, or $238 million, in revenue that helps fund local cities, school districts, special districts and the County.

The breakdown of where the property taxes went and historical trends are detailed in the San Mateo County's Property Tax Highlights publication for fiscal year (FY) 2024-25.

San Mateo County is one of three California counties that prepares this type of annual report. "It's important that we provide taxpayers and residents visibility into the local tax dollars they pay and where those local dollars go," said County Controller Juan Raigoza.

The $4.1 billion consists of the countywide 1 percent General Tax totaling $3.3 billion, $438 million for special charges and $399 million for debt service.

The countywide 1 percent General Tax is central to funding public services provided by local governments to residents throughout the county. About 51 percent of General Taxes collected are distributed to school districts, 25 percent to the County, 16 percent to cities, 7 percent to special districts and 1 percent to successor agencies of former redevelopment agencies.

The annual growth in the amount of taxes attributed to the 1 percent General Tax has declined in recent years as the growth rate of assessed property values has fallen. For context, assessed property values and General Taxes collected grew by 6.7 percent in FY 2023-24 and 5.8 percent in FY 2024-25. More recently, they grew by 4.9 percent for FY 2025-26, and by 4.3 percent for FY 2026-27 based on assessed values as of the lien date of January 1, 2026.

Special charges totaling $438 million received primarily by cities and special districts are included in property tax bills for services such as sewer maintenance, mosquito abatement and flood control. Additional levies accounted for $399 million which are mostly used to pay for debt service on voter-approved bonds of local school districts.

Aside from property taxes, another primary source of revenue for public services is the "Vehicle License Fee Adjustment Amount" (VLFAA).

For the eighth year, there is a shortfall between the funds available for VLFAA and the amounts due to the County and its cities. As a result, there is a countywide VLFAA shortfall of $119 million for FY 2024-25, an estimated $163 million shortfall for the current year (FY 2025-26), and a balance of $38 million still due from the state for FY 2023-24. While these annual sums are very significant to the County and its cities, they represent a small fraction -1 percent- of the total $12 billion that was ultimately funded by the state for VLFAA across all counties and cities in FY 2024-25.

In the first three years that a shortfall occurred the governor and California Department of Finance included funding for VLFAA shortfalls in the governor's proposed budgets. In the three subsequent years, the governor's proposed budgets did not include appropriations for the shortfalls, but the state Legislature funded the shortfalls via the state's annual budgets, including a partial payment of $76.6 million received this fiscal year for the FY 2023-24 shortfall.

Last fall, three counties (San Mateo, Alpine and Mono) and their cities, which were not paid in full by the state for the VLFAA obligation amounts owed to them for FY 2023-24, initiated court proceedings to compel the state to pay the outstanding amounts owed.

While the governor and Legislature have acknowledged the state's obligations by including VLFAA shortfall amounts in prior state budgets, obtaining payment through the appropriations process delays receipt of the funds to the detriment of local agencies. Receiving these expected funds two budget years later causes significant disruptions to providing public services.

The governor's initial proposed budget for FY 2026-27 released earlier this month did not include funding to cover last year's FY 2024-25 shortfall of $119 million or the remaining amount owed for FY 2023-24.

"The County, cities, and their local state representatives should not have to fight, year after year, for this critical revenue source that 55 other California counties and their cities receive in full and timely, every year," Raigoza said.

He added that updating state law so that VLFAA obligations are fully funded in the year owed would eliminate the need to annually address shortfalls, two years later, through the state's budget process. Local agencies are simply asking the state to provide full VLFAA funding when due - no new or additional funds that are not already due are being requested.

Visit http://controller.smcgov.org/to learn more about property taxes and the County's finances. In addition to the Property Tax Highlights publication, the site hosts the Tax Rate Book which shows assessed property values by taxing agency and property tax rates by tax rate area, and the County's annual financial reports.

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