BILL NUMBER: SB 803 INTRODUCED
BILL TEXT
INTRODUCED BY Committee on Governance and Finance (Senators
Hertzberg (Chair), Bates, Beall, Hernandez, Lara, Nguyen, and Pavley)
MARCH 24, 2015
An act to amend Section 7510 of the Government Code, and to amend
Sections 63.1, 68, 401.10, 423.3, 2609, and 3726 of the Revenue and
Taxation Code, relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
SB 803, as introduced, Committee on Governance and Finance.
Property taxation.
(1) Existing law requires the state or any local government
entity, when entering into a written contract with a private party
whereby a possessory interest subject to property taxation may be
created, to include, or cause to be included, in that contract a
statement that the property interest may be subject to property
taxation if created, and that the party in whom the possessory
interest is vested may be subject to the payment of property taxes
levied on the interest.
Existing law requires a lease of real property that is owned by a
state retirement system to provide, for purposes of property
taxation, that the full cash value of the possessory interest created
by the lease shall be the greater of either the full cash value of
the possessory interest or, if the lease covers less than the entire
real property, the lessee's allocable share of the full cash value
that would be determined for that real property if it were subject to
tax.
This bill would delete those provisions relating to the full cash
value of the possessory interest created by the aforementioned lease
and would instead specify that the lease be valued in accordance with
regulations adopted by the State Board of Equalization for the
valuation of taxable possessory interests.
(2) The California Constitution generally limits ad valorem taxes
on real property to 1% of the full cash value of that property. For
purposes of this limitation, "full cash value" is defined as, among
other things, the appraised value of that real property when a change
in ownership has occurred. Existing property tax law provides that
specified transfers are not deemed a change in ownership for which a
claim is filed, as provided.
The California Constitution and existing property tax law exclude
from a "change in ownership" real property transfers of a principal
residence and the first $1,000,000 of the value of other real
property between parents and their children, as defined by the
Legislature. For the purposes of these provisions, existing property
tax law defines "real property" to include, among other things, an
interest in a unit or lot within a cooperative housing cooperation,
as defined. Existing property tax law requires the parties to a
parent-child transfer of real property under these provisions to make
specified written certifications under penalty of perjury.
This bill would specify that, for the purposes of the parent-child
principal residence exclusion, "real property" also includes a pro
rata ownership interest in a mobilehome park and a pro rata interest
in a floating home marina, as those terms are defined.
By changing the manner in which local assessors assess property
for purposes of the parent-child principal residence exclusion, and
by expanding the crime of perjury by requiring that certain
information required be verified under oath, this bill would impose a
state-mandated local program.
(3) The California Constitution and existing property tax law
exclude from a "change in ownership" the acquisition of real property
as a replacement for property from which the person has been
displaced by eminent domain proceedings, acquisition by a public
entity, or judgment of inverse condemnation. Existing property tax
law requires the person acquiring replacement property on and after
January 1, 1983, to request assessment within 4 years of the date
that the property was acquired by these means.
This bill would specify that an above-described request for
assessment made following this 4 year period applies commencing with
the lien date of an assessment year in which the request is made. The
bill would prohibit the refund or cancellation of taxes prior to the
date the request is made. The bill would also require the assessor,
in granting an assessment under these provisions, to adjust the base
year value of the replacement property and make adjustments, as
specified.
By adding to the duties of county assessors with respect to
assessing these replacement properties, this bill would impose a
state-mandated local program.
(4) Existing law requires the county assessor to assess all
property that is subject to taxation at its full value. Existing law
establishes, for any of the 1984-85 to 2015-16 tax years, a
rebuttable presumption in favor of a full cash value assessment for
an intercounty pipeline right-of-way, inclusive, provided that
certain specified valuation standards are met in determining that
assessed value. Existing law prohibits the county from imposing any
late payment penalty or interest if payment of any taxes due upon the
valuation of intercounty pipeline rights-of-way is made within 45
days of demand by the tax collector for payment. Existing law
requires taxes not paid within 45 days of demand by the tax collector
to become delinquent at that time, and requires delinquent penalty,
redemption penalty, or other collection procedures to apply.
This bill would instead require, if the tax remains unpaid at the
time set for the declaration of default for delinquent taxes, the tax
together with any penalty and costs as may have accrued on the
secured roll to be transferred to the unsecured roll. This bill would
also extend the application of this rebuttable presumption through
the 2020-21 fiscal year.
By imposing new duties upon local tax officials with respect to
the collection of unpaid taxes for intercounty pipeline
rights-of-way, this bill would impose a state-mandated local program.
(5) Existing law establishes the California Land Conservation Act
of 1965, otherwise known as the Williamson Act, and authorizes a city
or county to enter into a contract with an owner of land devoted to
agricultural use, whereby the owner agrees to continue using the
property for that purpose, and the city or county agrees to value the
land accordingly for purposes of property taxation, as specified.
Existing law authorizes a city or county to allow land subject to a
Williamson Act contract to be assessed pursuant to specified formulas
consistent with the restrictions on the land.
This bill would modify these provisions to clarify or correct
cross-references relating to the valuation of prime agricultural land
and land that is devoted to open-space uses of statewide
significance.
(6) Existing property tax law requires the tax collector to
publish a notice on or before the day when taxes are payable
including specified information related to the payment of the
property tax on the secured roll.
This bill would clarify that the notice should be published on or
before November 1 of each year, the day upon which half the taxes on
real property, and all taxes on personal property, on the secured
roll, are due and payable.
(7) Existing property tax law generally authorizes a county tax
collector to sell tax-defaulted property 5 years or more, or 3 years
or more, as applicable, after that property has become tax defaulted.
Existing property tax law provides that a defense based on the
alleged invalidity or irregularity of any sale of tax-defaulted
property can be maintained only in a proceeding commenced within one
year after the date of execution of the tax collector's deed.
This bill would instead provide that a defense, as described
above, can be maintained only in a proceeding commenced within one
year after the date of execution of the tax collector's deed or
within one year of the date the board of supervisors determines that
a tax deed that was sold should not be rescinded, whichever is later.
(8) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that with regard to certain mandates no
reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that,
if the Commission on State Mandates determines that the bill contains
costs so mandated by the state, reimbursement for those costs shall
be made pursuant to the statutory provisions noted above.
(9) Section 2229 of the Revenue and Taxation Code requires the
Legislature to reimburse local agencies annually for certain property
tax revenues lost as a result of any exemption or classification of
property for purposes of ad valorem property taxation.
This bill would provide that, notwithstanding Section 2229 of the
Revenue and Taxation Code, no appropriation is made and the state
shall not reimburse local agencies for property tax revenues lost by
them pursuant to the bill.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 7510 of the Government Code is amended to read:
7510. (a) (1) Except as provided in subdivision (b), a public
retirement system, which has invested assets in real property and
improvements thereon for business or residential purposes for the
production of income, shall pay annually to the city or county, in
whose jurisdiction the real property is located and has been removed
from the secured roll, a fee for general governmental services equal
to the difference between the amount that would have accrued as real
property secured taxes and the amount of possessory interest
unsecured taxes paid for that property. The governing bodies of local
entities may adopt ordinances and regulations authorizing retirement
systems to invest assets in real property subject to the foregoing
requirements.
(2) This subdivision shall not apply to any retirement system
which is established by a local governmental entity if that entity is
presently authorized by statute or ordinance to invest retirement
assets in real property.
(3) This subdivision shall not apply to property owned by any
state public retirement system.
(b) (1) Whenever a state public retirement system, which has
invested assets in real property and improvements thereon for
business or residential purposes for the production of income, leases
the property, the lease shall provide, pursuant to Section 107.6 of
the Revenue and Taxation Code, that the lessee's possessory interest
may be subject to property taxation and that the party in whom the
possessory interest is vested may be subject to the payment of
property taxes levied on that interest. The lease shall also
provide that the full cash value, as defined in Sections 110 and
110.1 of the Revenue and Taxation Code, of the possessory interest
upon which property taxes will be based shall equal the greater of
(A) the full cash value of the possessory interest, or (B), if the
lessee has leased less than all of the property, the lessee's
allocable share of the full cash value of the property that would
have been enrolled if the property had been subject to property tax
upon acquisition by the state public retirement system. The full cash
value as provided for pursuant to either (A) or (B) of the preceding
sentence shall reflect the anticipated term of possession if, on the
lien date described in Section 2192 of the Revenue and Taxation
Code, that term is expected to terminate prior to the end of the next
succeeding fiscal year. The lessee's allocable share shall, subject
to the preceding sentence, be the lessee's leasable square feet
divided by the total leasable square feet of the property.
The lease shall be valued in accordance with regulations adopted
by the State Board of Equalization for the valuation of taxable
possessory interests.
(2) Except as provided in this subdivision, the property shall be
assessed and its taxes computed and collected in the same manner as
privately owned property. The lessee's possessory interest shall be
placed on the unsecured roll and the tax on the possessory interest
shall be subject to the collection procedures for unsecured property
taxes.
(3) An investment by a state public retirement system in a legal
entity that invests assets in real property and improvements thereon
shall not constitute an investment by the state public retirement
system of assets in real property and improvements thereon. For
purposes of this paragraph, "legal entity" includes, but is not
limited to, partnership, joint venture, corporation, trust, or
association. When a state public retirement system invests in a legal
entity, the state public retirement system shall be deemed to be a
person for the purpose of determining a change in ownership under
Section 64 of the Revenue and Taxation Code.
(4) Notwithstanding any other provision of law, fees charged
pursuant to this section and collected prior to July 1, 1992, shall
be deemed valid and not refundable under any circumstance.
Notwithstanding any other provision of law, fees, interest and
penalties, if any, asserted to be due pursuant to this section that
were not charged or collected prior to July 1, 1992, shall be deemed
invalid and not collectable under any circumstance.
(5) This subdivision shall apply to the assessment, computation,
and collection of taxes for the fiscal year beginning on July 1,
1992, and each fiscal year thereafter. For the 1992-93 and 1993-94
fiscal years, in the case where a lessee's possessory interest
existed for less than the full fiscal year for which the tax was
levied, the amount of tax shall be prorated in accordance with the
number of months for which the lessee's interest existed.
SEC. 2. Section 63.1 of the Revenue and Taxation Code is amended
to read:
63.1. (a) Notwithstanding any other provision of this chapter, a
change in ownership shall not include the following purchases or
transfers for which a claim is filed pursuant to this section:
(1) (A) The purchase or transfer of real property which is the
principal residence of an eligible transferor in the case of a
purchase or transfer between parents and their children.
(B) A purchase or transfer of a principal residence from a foster
child to the child's biological parent shall not be excluded under
subparagraph (A) if the transferor child received that principal
residence, or interest therein, from a foster parent through a
purchase or transfer that was excluded under subparagraph (A).
(2) The purchase or transfer of the first one million dollars
($1,000,000) of full cash value of all other real property of an
eligible transferor in the case of a purchase or transfer between
parents and their children.
(3) (A) Subject to subparagraph (B), the purchase or transfer of
real property described in paragraphs (1) and (2) of subdivision (a)
occurring on or after March 27, 1996, between grandparents and their
grandchild or grandchildren, if all of the parents of that grandchild
or those grandchildren, who qualify as the children of the
grandparents, are deceased as of the date of purchase or transfer.
Notwithstanding any other provision of law, for the lien date for the
2006-07 fiscal year and each fiscal year thereafter, in determining
whether "all of the parents of that grandchild or those
grandchildren, who qualify as the children of the grandparents, are
deceased as of the date of purchase or transfer," a son-in-law or
daughter-in-law of the grandparent that is a stepparent to the
grandchild need not be deceased on the date of the transfer.
(B) A purchase or transfer of a principal residence shall not be
excluded pursuant to subparagraph (A) if the transferee grandchild or
grandchildren also received a principal residence, or interest
therein, through another purchase or transfer that was excludable
pursuant to paragraph (1) of subdivision (a). The full cash value of
any real property, other than a principal residence, that was
transferred to the grandchild or grandchildren pursuant to a purchase
or transfer that was excludable pursuant to paragraph (2) of
subdivision (a) and the full cash value of a principal residence that
fails to qualify for exclusion as a result of the preceding sentence
shall be included in applying, for purposes of paragraph (2) of
subdivision (a), the one million dollar ($1,000,000) full cash value
limit specified in paragraph (2) of subdivision (a).
(b) (1) For purposes of paragraph (1) of subdivision (a),
"principal residence" means a dwelling that is eligible for a
homeowners' exemption or a disabled veterans' exemption as a result
of the transferor's ownership and occupation of the dwelling.
"Principal residence" includes only that portion of the land
underlying the residence that consists of an area of reasonable size
that is used as a site for the residence.
(2) For purposes of paragraph (2) of subdivision (a), the
one-million-dollar ($1,000,000) exclusion shall apply separately to
each eligible transferor with respect to all purchases by and
transfers to eligible transferees on and after November 6, 1986, of
real property, other than the principal residence, of that eligible
transferor. The exclusion shall not apply to any property in which
the eligible transferor's interest was received through a transfer,
or transfers, excluded from change in ownership by the provisions of
either subdivision (f) of Section 62 or subdivision (b) of Section
65, unless the transferor qualifies as an original transferor under
subdivision (b) of Section 65. In the case of any purchase or
transfer subject to this paragraph involving two or more eligible
transferors, the transferors may elect to combine their separate
one-million-dollar ($1,000,000) exclusions and, upon making that
election, the combined amount of their separate exclusions shall
apply to any property jointly sold or transferred by the electing
transferors, provided that in no case shall the amount of full cash
value of real property of any one eligible transferor excluded under
this election exceed the amount of the transferor's separate unused
exclusion on the date of the joint sale or transfer.
(c) As used in this section:
(1) "Purchase or transfer between parents and their children"
means either a transfer from a parent or parents to a child or
children of the parent or parents or a transfer from a child or
children to a parent or parents of the child or children. For
purposes of this section, the date of any transfer between parents
and their children under a will or intestate succession shall be the
date of the decedent's death, if the decedent died on or after
November 6, 1986.
(2) "Purchase or transfer of real property between grandparents
and their grandchild or grandchildren" means a purchase or transfer
on or after March 27, 1996, from a grandparent or grandparents to a
grandchild or grandchildren if all of the parents of that grandchild
or those grandchildren who qualify as the children of the
grandparents are deceased as of the date of the transfer. For
purposes of this section, the date of any transfer between
grandparents and their grandchildren under a will or by intestate
succession shall be the date of the decedent's death. Notwithstanding
any other provision of law, for the lien date for the 2006-07 fiscal
year and each fiscal year thereafter, in determining whether "all of
the parents of that grandchild or those grandchildren, who qualify
as the children of the grandparents, are deceased as of the date of
purchase or transfer," a son-in-law or daughter-in-law of the
grandparent that is a stepparent to the grandchild need not be
deceased on the date of the transfer.
(3) "Children" means any of the following:
(A) Any child born of the parent or parents, except a child, as
defined in subparagraph (D), who has been adopted by another person
or persons.
(B) Any stepchild of the parent or parents and the spouse of that
stepchild while the relationship of stepparent and stepchild exists.
For purposes of this paragraph, the relationship of stepparent and
stepchild shall be deemed to exist until the marriage on which the
relationship is based is terminated by divorce, or, if the
relationship is terminated by death, until the remarriage of the
surviving stepparent.
(C) Any son-in-law or daughter-in-law of the parent or parents.
For the purposes of this paragraph, the relationship of parent and
son-in-law or daughter-in-law shall be deemed to exist until the
marriage on which the relationship is based is terminated by divorce,
or, if the relationship is terminated by death, until the remarriage
of the surviving son-in-law or daughter-in-law.
(D) Any child adopted by the parent or parents pursuant to
statute, other than an individual adopted after reaching the age of
18 years.
(E) Any foster child of a state-licensed foster parent, if that
child was not, because of a legal barrier, adopted by the foster
parent or foster parents before the child aged out of the foster care
system. For purposes of this paragraph, the relationship between a
foster child and foster parent shall be deemed to exist until
terminated by death. However, for purposes of a transfer that occurs
on the date of death, the relationship shall be deemed to exist on
the date of death.
(4) "Grandchild" or "grandchildren" means any child or children of
the child or children of the grandparent or grandparents.
(5) "Full cash value" means full cash value, as defined in Section
2 of Article XIII A of the California Constitution and Section
110.1, with any adjustments authorized by those sections, and the
full value of any new construction in progress, determined as of the
date immediately prior to the date of a purchase by or transfer to an
eligible transferee of real property subject to this section.
(6) "Eligible transferor" means a grandparent, parent, or child of
an eligible transferee.
(7) "Eligible transferee" means a parent, child, or grandchild of
an eligible transferor.
(8) "Real property" means real property as defined in Section 104.
Real property does not include any interest in a legal entity. For
purposes of this section, real property includes an
any of the following:
(A) An interest in a unit or lot
within a cooperative housing corporation, as defined in subdivision
(i) of Section 61.
(B) A pro rata ownership interest in a mobilehome park, as
provided in subdivision (b) of Section 62.1.
(C) A pro rata ownership in a floating home marina, as provided in
subdivision (b) of Section 62.5.
(9) "Transfer" includes, and is not limited to, any transfer of
the present beneficial ownership of property from an eligible
transferor to an eligible transferee through the medium of an inter
vivos or testamentary trust.
(10) "Social security number" also includes a taxpayer
identification number issued by the Internal Revenue Service in the
case in which the taxpayer is a foreign national who cannot obtain a
social security number.
(d) (1) The exclusions provided for in subdivision (a) shall not
be allowed unless the eligible transferee, the transferee's legal
representative, the trustee of the transferee's trust, or the
executor or administrator of the transferee's estate files a claim
with the assessor for the exclusion sought and furnishes to the
assessor each of the following:
(A) A written certification by the transferee, the transferee's
legal representative, the trustee of the transferee's trust, or the
executor or administrator of the transferee's estate, signed and made
under penalty of perjury that the transferee is a parent, child, or
grandchild of the transferor and that the transferor is his or her
parent, child, or grandparent. In the case of a
grandparent-grandchild transfer, the written certification shall also
include a certification that all the parents of the grandchild or
grandchildren who qualify as children of the grandparents were
deceased as of the date of the purchase or transfer and that the
grandchild or grandchildren did or did not receive a principal
residence excludable under paragraph (1) of subdivision (a) from the
deceased parents, and that the grandchild or grandchildren did or did
not receive real property other than a principal residence
excludable under paragraph (2) of subdivision (a) from the deceased
parents. The claimant shall provide legal substantiation of any
matter certified pursuant to this subparagraph at the request of the
county assessor.
(B) A written certification by the transferor, the transferor's
legal representative, the trustee of the transferor's trust, or the
executor or administrator of the transferor's estate, signed and made
under penalty of perjury that the transferor is a grandparent,
parent, or child of the transferee and that the transferor is seeking
the exclusion under this section and will not file a claim to
transfer the base year value of the property under Section 69.5.
(C) A written certification shall also include either or both of
the following:
(i) If the purchase or transfer of real property includes the
purchase or transfer of residential real property, a certification
that the residential real property is or is not the transferor's
principal residence.
(ii) If the purchase or transfer of real property includes the
purchase or transfer of real property other than the transferor's
principal residence, a certification that other real property of the
transferor that is subject to this section has or has not been
previously sold or transferred to an eligible transferee, the total
amount of full cash value, as defined in subdivision (c), of any real
property subject to this section that has been previously sold or
transferred by that transferor to eligible transferees, the location
of that real property, the social security number of each eligible
transferor, and the names of the eligible transferees of that
property.
(D) If there are multiple transferees, the certification and
signature may be made by any one of the transferees, if both of the
following conditions are met:
(i) The transferee has actual knowledge that, and the
certification signed by the transferee states that, all of the
transferees are eligible transferees within the meaning of this
section.
(ii) The certification is signed by the transferee as a true
statement made under penalty of perjury.
(E) In the case of a transfer between a foster parent and foster
child, the claim filed with the assessor shall include a certified
copy of the court decision regarding the foster child status of the
individual and a certified statement from the appropriate county
agency stating that the foster child was not, because of a legal
barrier, adopted by the foster parent or foster parents. Upon a
request by the county assessor, the claimant also shall provide to
the assessor legal substantiation of any matter certified under this
subparagraph.
(2) If the full cash value of the real property purchased by or
transferred to the transferee exceeds the permissible exclusion of
the transferor or the combined permissible exclusion of the
transferors, in the case of a purchase or transfer from two or more
joint transferors, taking into account any previous purchases by or
transfers to an eligible transferee from the same transferor or
transferors, the transferee shall specify in his or her claim the
amount and the allocation of the exclusion he or she is seeking.
Within any appraisal unit, as determined in accordance with
subdivision (d) of Section 51 by the assessor of the county in which
the real property is located, the exclusion shall be applied only on
a pro rata basis, however, and shall not be applied to a selected
portion or portions of the appraisal unit.
(e) (1) The State Board of Equalization shall design the form for
claiming eligibility. Except as provided in paragraph (2), any claim
under this section shall be filed:
(A) For transfers of real property between parents and their
children occurring prior to September 30, 1990, within three years
after the date of the purchase or transfer of real property for which
the claim is filed.
(B) For transfers of real property between parents and their
children occurring on or after September 30, 1990, and for the
purchase or transfer of real property between grandparents and their
grandchildren occurring on or after March 27, 1996, within three
years after the date of the purchase or transfer of real property for
which the claim is filed, or prior to transfer of the real property
to a third party, whichever is earlier.
(C) Notwithstanding subparagraphs (A) and (B), a claim shall be
deemed to be timely filed if it is filed within six months after the
date of mailing of a notice of supplemental or escape assessment,
issued as a result of the purchase or transfer of real property for
which the claim is filed.
(2) In the case in which the real property subject to purchase or
transfer has not been transferred to a third party, a claim for
exclusion under this section that is filed subsequent to the
expiration of the filing periods set forth in paragraph (1) shall be
considered by the assessor, subject to all of the following
conditions:
(A) Any exclusion granted pursuant to that claim shall apply
commencing with the lien date of the assessment year in which the
claim is filed.
(B) Under any exclusion granted pursuant to that claim, the
adjusted full cash value of the subject real property in the
assessment year described in subparagraph (A) shall be the adjusted
base year value of the subject real property in the assessment year
in which the excluded purchase or transfer took place, factored to
the assessment year described in subparagraph (A) for both of the
following:
(i) Inflation as annually determined in accordance with paragraph
(1) of subdivision (a) of Section 51.
(ii) Any subsequent new construction occurring with respect to the
subject real property.
(3) (A) Unless otherwise expressly provided, the provisions of
this subdivision shall apply to any purchase or transfer of real
property that occurred on or after November 6, 1986.
(B) Paragraph (2) shall apply to purchases or transfers between
parents and their children that occurred on or after November 6,
1986, and to purchases or transfers between grandparents and their
grandchildren that occurred on or after March 27, 1996.
(4) For purposes of this subdivision, a transfer of real property
to a parent or child of the transferor shall not be considered a
transfer to a third party.
(f) The assessor may report quarterly to the State Board of
Equalization all purchases or transfers, other than purchases or
transfers involving a principal residence, for which a claim for
exclusion is made pursuant to subdivision (d). Each report shall
contain the assessor's parcel number for each parcel for which the
exclusion is claimed, the amount of each exclusion claimed, the
social security number of each eligible transferor, and any other
information the board may require in order to monitor the
one-million-dollar ($1,000,000) limitation in paragraph (2) of
subdivision (a). In recognition of the state and local interests
served by the action made optional in this subdivision, the
Legislature encourages the assessor to continue taking the action
formerly mandated by this subdivision.
(g) This section shall apply to both voluntary transfers and
transfers resulting from a court order or judicial decree. Nothing in
this subdivision shall be construed as conflicting with paragraph
(1) of subdivision (c) or the general principle that transfers by
reason of death occur at the time of death.
(h) (1) Except as provided in paragraph (2), this section shall
apply to purchases and transfers of real property completed on or
after November 6, 1986, and shall not be effective for any change in
ownership, including a change in ownership arising on the date of a
decedent's death, that occurred prior to that date.
(2) This section shall apply to purchases or transfers of real
property between grandparents and their grandchildren occurring on or
after March 27, 1996, and, with respect to purchases or transfers of
real property between grandparents and their grandchildren, shall
not be effective for any change in ownership, including a change in
ownership arising on the date of a decedent's death, that occurred
prior to that date.
(i) A claim filed under this section is not a public document and
is not subject to public inspection, except that a claim shall be
available for inspection by the transferee and the transferor or
their respective spouse, the transferee's legal representative, the
transferor's legal representative, the trustee of the transferee's
trust, the trustee of the transferor's trust, and the executor or
administrator of the transferee's or transferor's estate.
(j) (1) If the assessor notifies the transferee in writing of
potential eligibility for exclusion from change in ownership under
this section, a certified claim for exclusion shall be filed with the
assessor within 45 days of the date of the notice of potential
eligibility. If a certified claim for exclusion is not filed within
45 days, the assessor may send a second notice of potential
eligibility for exclusion, notifying the transferee that a certified
claim for exclusion has not been received and that reassessment of
the property will commence unless a certified claim for exclusion is
filed within 60 days of the date of the second notice of potential
eligibility. The second notice of potential eligibility shall
indicate whether a certified claim for exclusion that is not filed
within 60 days will be subject to a processing fee as provided in
paragraph (2).
(2) If a certified claim for exclusion is not filed within 60 days
of the date of the second notice of potential eligibility and an
eligible transferee subsequently files a claim and qualifies for the
exclusion, the assessor may, upon authorization by a county board of
supervisors, require an eligible transferee to pay a one-time
processing fee, collected at the time the claim is submitted, and
reimbursed by the assessor if the claim is ineligible. The fee shall
be subject to the provisions of Chapter 12.5 (commencing with Section
54985) of Part 1 of Division 2 of Title 5 of the Government Code and
shall not exceed the amount of the actual and reasonable costs
incurred by the assessor for reassessment work done due to failure to
file the claim for exclusion or one hundred seventy-five dollars
($175), whichever is less.
(3) The failure to file a certified claim for exclusion within the
filing periods specified by this subdivision shall not be construed
to limit any exclusion from being granted pursuant to a claim filed
within the filing periods specified by subdivision (e).
SEC. 3. Section 68 of the Revenue and Taxation Code is amended to
read:
68. (a) For purposes of Section 2 of
Article XIII A of the Constitution, the term "change in ownership"
shall not include the acquisition of real property as a replacement
for comparable property if the person acquiring the real property has
been displaced from property in this state by eminent domain
proceedings, by acquisition by a public entity, or by governmental
action which has resulted in a judgment of inverse condemnation.
The adjusted base year value of the property acquired shall be the
lower of the fair market value of the property acquired or the value
which is the sum of the following:
(a)
(1) The adjusted base year value of the property from
which the person was displaced.
(b)
(2) The amount, if any, by which the full cash value of
the property acquired exceeds 120 percent of the amount received by
the person for the property from which the person was displaced.
The provisions of this section shall apply to eminent domain
proceedings, acquisitions, or judgments of inverse condemnation after
March 1, 1975, and shall affect only those assessments of that
property which occur after June 8, 1982.
Persons acquiring replacement property between March 1, 1975, and
January 1, 1983, shall request assessment under this section with the
assessor on or before January 1, 1987. Persons
(b) (1) A person
acquiring replacement property on and after January 1,
1983, shall request assessment within four years
of the date the property was acquired by eminent domain or purchase
or the date the judgment of inverse condemnation becomes final.
under this section. A request made after four years
following the date the property was acquired by eminent domain or
purchase, or the date the judgment of inverse condemnation becomes
final, shall be subject to subdivision (c).
Any
(2) A change in the adjusted base
year value of the replacement property acquired, resulting from the
application of the provisions of this section, shall be deemed to be
effective on the first day of the month following the month in which
the property is acquired. The change in value shall be treated as a
change in ownership for the purpose of placing supplemental
assessments on the supplemental roll pursuant to Chapter 3.5
(commencing with Section 75). The assessor shall, however, appraise
the replacement property acquired in accordance with the provisions
of this section rather than the provisions of Section 75.10. The
provisions of Chapter 3.5 shall be liberally construed in order to
provide the benefits of this section and Section 2 of Article XIII A
of the California Constitution to affected property owners at the
earliest possible date.
(c) A request for assessment under this section that is made after
four years following the date the property was acquired by eminent
domain or purchase, or the date the judgment of inverse condemnation
becomes final, shall apply commencing with the lien date of
assessment year in which the request is made. There shall be no
refund or cancellation of taxes prior to the date that the request is
made. Under an assessment granted pursuant to that request, the
assessor shall adjust the base year value of the replacement property
acquired in accordance with this section and make adjustments for
both of the following:
(1) Inflation, as annually determined in accordance with paragraph
(1) of subdivision (a) of Section 51.
(2) Any subsequent new construction occurring with respect to the
subject real property.
SEC. 4. Section 401.10 of the Revenue and Taxation Code is amended
to read:
401.10. (a) Notwithstanding any other provision of
law relating to the determination of the values upon which
property taxes are based, values for each tax year from the 1984-85
tax year to the 2015-16 2020- 21
tax year, inclusive, for intercounty pipeline rights-of-way on
publicly or privately owned property, including those rights-of-way
that are the subject of a change in ownership, new construction, or
any other reappraisable event during the period from March 1, 1975,
to June 30, 2016, 2021, inclusive,
shall be rebuttably presumed to be at full cash value for that year,
if all of the following conditions are met:
(1) (A) The full cash value is determined to equal a 1975-76 base
year value, annually adjusted for inflation in accordance with
subdivision (b) of Section 2 of Article XIII A of the California
Constitution, and the 1975-76 base year value was determined in
accordance with the following schedule:
(i) Twenty thousand dollars ($20,000) per mile for a high density
property.
(ii) Twelve thousand dollars ($12,000) per mile for a transitional
density property.
(iii) Nine thousand dollars ($9,000) per mile for a low density
property.
(B) For purposes of this section, the density classifications
described in subparagraph (A) are defined as follows:
(i) "High density" means Category 1 (densely urban) as established
by the State Board of Equalization.
(ii) "Transitional density" means Category 2 (urban) as
established by the State Board of Equalization.
(iii) "Low density" means Category 3 (valley-agricultural),
Category 4 (grazing), and Category 5 (mountain and desert) as
established by the State Board of Equalization.
(2) The full cash value is determined utilizing the same property
density classifications that were assigned to the property by the
State Board of Equalization for the 1984-85 tax year or, if density
classifications were not so assigned to the property for the 1984-85
tax year, the density classifications that were first assigned to the
property by the board for a subsequent tax year.
(3) (A) If a taxpayer owns multiple pipelines in the same
right-of-way, an additional 50 percent of the value attributed to the
right-of-way for the presence of the first pipeline, as determined
under paragraphs (1) and (2), shall be added for the presence of each
additional pipeline up to a maximum of two additional pipelines. For
any particular taxpayer, the total valuation for a multiple pipeline
right-of-way shall not exceed 200 percent of the value determined
for the right-of-way of the first pipeline in the right-of-way in
accordance with paragraphs (1) and (2).
(B) If the State Board of Equalization has determined that an
intercounty pipeline, located within a multiple pipeline right-of-way
previously valued in accordance with subparagraph (A), has been
abandoned as a result of physical removal or blockage, the assessed
value of the right-of-way attributable to the last pipeline enrolled
in accordance with subparagraph (A) shall be reduced by not less than
75 percent of that increase in assessed value that resulted from the
application of subparagraph (A).
(4) If all pipelines of a taxpayer located within the same
pipeline right-of-way, previously valued in accordance with this
section, are determined by the State Board of Equalization to have
been abandoned as the result of physical removal or blockage, the
assessed value of that right-of-way to that taxpayer shall be
determined to be no more than 25 percent of the assessed value
otherwise determined for the right-of-way for a single pipeline of
that taxpayer pursuant to paragraphs (1) and (2).
(b) If the assessor assigns values for any tax year from the
1984-85 tax year to the 2015-16 2020-
21 tax year, inclusive, in accordance with the methodology
specified in subdivision (a), the taxpayer's right to assert any
challenge to the right to assess that property, whether in an
administrative or judicial proceeding, shall be deemed to have been
raised and resolved for that tax year and the values determined in
accordance with that methodology shall be rebuttably presumed to be
correct. If the assessor assigns values for any tax year from the
1984-85 tax year to the 2015-16 2020-
21 tax year, inclusive, in accordance with the methodology
specified in subdivision (a), any pending taxpayer lawsuit that
challenges the right to assess the property shall be dismissed by the
taxpayer with prejudice as it applies to intercounty pipeline
rights-of-way.
(c) Notwithstanding any change in ownership, new construction, or
decline in value occurring after March 1, 1975, if the assessor
assigns values for rights-of-way for any tax year from the 1984-85
tax year to the 2015-16 2020- 21
tax year, inclusive, in accordance with the methodology
specified in subdivision (a), the taxpayer may not challenge the
right to assess that property and the values determined in accordance
with that methodology shall be rebuttably presumed to be correct for
that property for that tax year.
(d) Notwithstanding any change in ownership, new construction, or
decline in value occurring after March 1, 1975, if the assessor does
not assign values for rights-of-way for any tax year from the 1984-85
tax year to the 2015-16 2020- 21
tax year, inclusive, at the 1975-76 base year values specified
in subdivision (a), any assessed value that is determined on the
basis of valuation standards that differ, in whole or in part, from
those valuation standards set forth in subdivision (a) shall not
benefit from any presumption of correctness, and the taxpayer may
challenge the right to assess that property or the values for that
property for that tax year. As used herein, a challenge to the right
to assess shall include any assessment appeal, claim for refund, or
lawsuit asserting any right, remedy, or cause of action relating to
or arising from, but not limited to, the following or similar
contentions:
(1) That the value of the right-of-way is included in the value of
the underlying fee or railroad right-of-way.
(2) That assessment of the value of the right-of-way to the owner
of the pipeline would result in double assessment.
(3) That the value of the right-of-way may not be assessed to the
owner of the pipeline separately from the assessment of the value of
the underlying fee.
(e) Notwithstanding any other provision of law, during a four-year
period commencing on January 1, 1996, the assessor may issue an
escape assessment in accordance with the specific valuation standards
set forth in subdivision (a) for the following taxpayers and tax
years:
(1) Any intercounty pipeline right-of-way taxpayer who was a
plaintiff in Southern Pacific Pipe Lines, Inc. v. State Board of
Equalization (1993) 14 Cal. App. 4th 42, for the tax years 1984-85 to
1996-97, inclusive.
(2) Any intercounty pipeline right-of-way taxpayer who was not a
plaintiff in Southern Pacific Pipe Lines, Inc. v. State Board of
Equalization (1993) 14 Cal. App. 4th 42, for the tax years 1989-90 to
1996-97, inclusive.
(f) Any escape assessment levied under subdivision (e) shall not
be subject to penalties or interest under the provisions of Section
532. If payment of any taxes due under this section is made within 45
days of demand by the tax collector for payment, the county shall
not impose any late payment penalty or interest. Taxes not paid
within 45 days of demand by the tax collector shall become delinquent
at that time, and the delinquent penalty, redemption
penalty, or other collection provisions of this code shall thereafter
apply. time. If the tax thereon remains unpaid at the
time set for declaration of default for delinquent taxes, the tax
together with any penalty and costs as may have accrued thereon while
on the secured roll shall be transferred to the unsecured roll.
(g) For purposes of this section, "intercounty pipeline
right-of-way" means, except as otherwise provided in this
subdivision, any interest in publicly or privately owned real
property through which or over which an intercounty pipeline is
placed. However, "intercounty pipeline right-of-way" does not include
any parcel or facility that the State Board of Equalization
originally separately assessed using a valuation method other than
the multiplication of pipeline length within a subject property by a
unit value determined in accordance with the density category of that
subject property.
(h) This section shall remain in effect only until January 1,
2016, 2022, and, as of that date is
repealed, unless a later enacted statute, that is enacted before
January 1, 2016, 2022, deletes or
extends that date.
SEC. 5. Section 423.3 of the Revenue and Taxation Code is amended
to read:
423.3. Any city or county may allow land subject to an
enforceable restriction under the Williamson Act or a migratory
waterfowl habitat contract to be assessed in accordance with one or
more of the following:
(a) Land specified in paragraph (1) of subdivision (a)
of Section 16142 of the Government Code shall be assessed at the
value determined as provided in Section 423, but not to exceed a
uniformly applied percentage of its base year value pursuant to
Section 110.1, adjusted to reflect the percentage change in the cost
of living not to exceed 2 percent per year. In no event shall that
percentage be less than 70 percent.
(b) Prime commercial rangeland shall be assessed at the value
determined as provided in Section 423, but not to exceed a uniformly
applied percentage of its base year value pursuant to Section 110.1,
adjusted to reflect the percentage change in the cost of living not
to exceed 2 percent per year. In no event shall that percentage be
less than 80 percent.
For purposes of this subdivision, "prime commercial rangeland"
means rangeland which meets all of the following physical-chemical
parameters:
(1) Soil depth of 12 inches or more.
(2) Soil texture of fine sandy loam to clay.
(3) Soil permeability of rapid to slow.
(4) Soil with at least 2.5 inches of available water holding
capacity in profile.
(5) A slope of less than 30 percent.
(6) A climate with 80 or more frost-free days per year.
(7) Ten inches or more average annual precipitation.
(8) When managed at potential, the land generally requires less
than 17 acres to support one animal unit per year.
Property owners of land specified in this subdivision, shall
demonstrate that their land falls within the above definition when
requested by the city or county.
(c) Land specified in paragraph (2) of subdivision
(b) (a) of Section 16142 of the
Government Code shall be assessed at the value determined as provided
in Section 423, but not to exceed a uniformly applied percentage of
its base year value pursuant to Section 110.1, adjusted to reflect
the percentage change in the cost of living not to exceed 2 percent
per year. In no event shall that percentage be less than 90 percent.
(d) Waterfowl habitat shall be assessed at the value determined as
provided in Section 423.7 but not to exceed a uniformly applied
percentage of its base year value pursuant to Section 110.1, adjusted
to reflect the percentage change in the cost of living not to exceed
2 percent per year. In no event shall that percentage be less than
90 percent.
SEC. 6. Section 2609 of the Revenue and Taxation Code is amended
to read:
2609. On or before the day when taxes are payable
November 1 of each year, the tax collector shall
publish a notice specifying:
(a) The dates when taxes on the secured roll will be due.
(b) The times when these taxes will be delinquent.
(c) The penalties and costs for delinquency.
(d) That all taxes may be paid when the first installment is due.
(e) The times and places at which payment of taxes may be made.
SEC. 7. Section 3726 of the Revenue and Taxation Code is amended
to read:
3726. A defense based on the alleged invalidity or irregularity
of any proceeding instituted under this chapter can be maintained
only in a proceeding commenced within one year after the date of
execution of the tax collector's deed or within one year of the
date the board of supervisors determines that a tax deed sold under
this part should not be rescinded pursuant to Section 3731, whichever
is later .
SEC. 8. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution for
certain costs that may be incurred by a local agency or school
district because, in that regard, this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.
However, if the Commission on State Mandates determines that this
act contains other costs mandated by the state, reimbursement to
local agencies and school districts for those costs shall be made
pursuant to Part 7 (commencing with Section 17500) of Division 4 of
Title 2 of the Government Code.
SEC. 9. Notwithstanding Section 2229 of the Revenue and Taxation
Code, no appropriation is made by this act and the state shall not
reimburse any local agency for any property tax revenues lost by it
pursuant to this act.