It does basically work this way. The change in actual dollar amount of taxes levied on you depends on: 1) change in the value of your home relative to average change in value in the taxing area, and 2) how much the taxing entity chooses to raise (or lower hahaha who am I kidding) the overall amount of taxes levied. Annual increase is limited to 8% without an election by voters to approve it.

(This ignores the effect of new development, the revenue from which isn’t counted towards the 8% cap.)

In other words, if your home value change is the same as average home value change, your taxes will go up 8% if the taxing entity elects the full 8% increase.

Interesting. Good to know there is a limit. I guess my house has been going up faster than average or something.