[dragonwriter]

The tax basis value can only increase 2% per year, except when certain qualifying events (transfers of ownership, mostly, but IIRC some improvements qualify, at least as to the value added by the improvement, as well.)

So, given the prop 13 maximum tax rate of 1% and maximum increase in tax basis value of 2% per annum, a property that was fully taxed at a basis value of $200,000 in 1985($2,000 annual tax) that increases in value to $1 million -- or even $10 million -- in 2015 would have a tax basis value of $362,272 and a total annual property tax bill of about $3,623.