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This past month the Office of the Assessor sponsored two informative virtual workshops, including:Assessor’s Accessory Dwelling Unit (ADU) Resource SeminarBusiness Property Statements workshops (Business Personal Property 571-L, BPP)

Over 1,500 people registered for our Assessor’s ADU Resource Webinar, a well-attended seminar where the Office of the Assessor offered updated information on this fast-growing new construction on a homeowner’s property as well as a webinar that provided answers to the most commonly asked questions regarding the sometimes confusing and challenging Business Personal Property Statements. The workshops were spread over three days and featured break-out sessions with specific languages (English, Spanish, Chinese, Armenian, and Persian) – a first for the Office of the Assessor.

The Office of the Assessor is planning more of these types of informative seminars – yes, even in-person – as we move throughout the year. Stay tuned by visiting www.assessor.lacounty.gov/events
Now for a closer look at both these seminars:
The Assessor ADU Resource Seminar was a joint presentation with the Los Angeles County Departments of Regional Planning, Public Works, and Southern California Edison. The webinar provided information regarding how ADUs get assessed or reassessed, along with permitting, construction, and energy information from participating agencies. The Departments of Regional Planning and Public Works, as well as Southern California Edison, explained the permitting process and highlighted the pitfalls of encroachments and easements with regard to utilities.

Assessor’s Role:A quick summary of the Assessor’s role in the ADU process:
The building or alteration of an existing structure (in some cases) to be used as an ADU is considered new construction for property assessment purposes. When adding new construction, such as the addition of new residential units or additional square footage, the new construction will be assessed.A reassessment due to new construction does not mean your entire property will be reassessed. Rather, the cost to construct the ADU is used to establish its value. That value is then added to the existing assessed value of the land and other structures on the property.  The result is a new base year value for the entire property upon which future property taxes will be based.

Generally, new construction is assessed using the cost methodology. The costs used by the Office of the Assessor may not necessarily be your costs, but rather standardized regional costs that are typical of materials used for that quality of construction.In general, replacing what is already there is not considered new construction, such as a kitchen remodel. However, when altering a garage by adding the features necessary to convert it into a living space, such as a kitchen or bathroom, there will be an upward reassessment.

The value of the property is assessed annually on the Lien Date, January 1st. New construction, either completed or in progress will be assessed at that time. Partially complete construction with be assessed at the percentage of the completed project.

ADU Example:If the cost of an ADU is valued at $250,000, your property taxes will increase by approximately $2,500 per year – 1% of the value added to the property by the ADU. This increase does not take into account additional voter-approved taxes or direct assessments that appear on your tax bill that may be affected by the increase in your property’s value. These figures are not intended to alarm you, but rather alert you to some of the possible implications of building an ADU that should be considered beforehand.

Basic ADU Process:Generally, if a project checks all the boxes on a list of objective standards, it has to be approved by the city or county government. Owners of single-family homes can add one ADU and a junior ADU no matter how small the lot — provided certain conditions are met — even if they don’t live there.

Local governments retain some authority to set objective standards for height limits, setbacks, parking requirements, and landscaping. However, if the ADU is no more than 800 square feet and 16 feet high, and is set back at least 4 feet from the property line, it’s eligible for a permit in any residential or mixed-use zone.

An ADU can be built despite prohibitions placed by historic preservation districts or homeowners’ associations, as long as it meets certain conditions. Local officials must act on a completed ADU application within 60 days, or else it’s automatically approved.

An ADU can be a complicated, costly project no matter how small. It requires a kitchen, a bathroom, a sewer connection, and permits.
There are a lot of caveats and details to everything discussed above. For more information please watch the ADU Seminar HERE, and visit our ADU Page at https://assessor.lacounty.gov/adu, a central repository for all your ADU questions and needs.

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