(Getty)

The city of San Francisco predicts its property tax base will fall for the first time in more than a quarter of a century.

The city administrator’s office estimates the city’s commercial and residential tax base fell 0.46 percent last year, from $ 301.4 billion to $ 300 billion, according to Bloomberg. This would result in a loss of revenue of $ 7.6 million for the fiscal year beginning July.

It would be the first such decline since 1994 to 1996, when the tax base fell from about $ 57.1 billion to $ 56.2 billion. The worst year of growth since then was 2011 through 2012, when the tax base increased from $ 157.9 billion to $ 158.6 billion.

A decline is rare due to a 1978 election that severely restricted the valuation of real estate. Properties are typically only revalued in the event of a sale or refurbishment, so they stay low. This can cushion declines during downtime as market values ‚Äč‚Äčtypically do not fall below the estimated values.

Critics of this measure have repeatedly tried to overturn it, the last failure with Proposition 15 in November.

San Francisco can largely thank technology companies for the large property tax base, but now those companies are likely contributing to the tax base decline over the past year. Many tech companies have chosen to work remotely, and office space that is now largely empty has become less valuable.

Residents who can work remotely took this opportunity to buy or rent outside the notoriously expensive city, although perhaps not as many as was predicted at the start of the pandemic.

[Bloomberg] – Dennis Lynch