SB 246: Property tax: base year value transfers.
- Session Year: 2017-2018
- House: Senate
- Latest Version Date: 2017-07-10
The California Constitution authorizes the Legislature to provide that a person who is either severely disabled or over 55 years of age may transfer the base year value, as defined, of property that is eligible for the homeowners property tax exemption to a replacement dwelling that is of equal or lesser value located within the same county as the property from which the base year value is transferred, provided the replacement dwelling is purchased or newly constructed within 2 years of the sale of the original property, subject to certain conditions. Among those conditions is the requirement that the claimant has not previously been granted, as a claimant, this property tax relief. Under existing law, that limitation does not apply to any person who becomes severely and permanently disabled subsequent to being granted, as a claimant, the property tax relief provided by this section for any person over the age of 55 years.
This bill would additionally provide that the limitation does not apply to any person who turned 55 years of age subsequent to being granted, as a claimant, the property tax relief provided by this section for any person who is severely and permanently disabled.
The California Constitution authorizes the Legislature to provide that a person who is either severely disabled or over 55 years of age may transfer the base year value, as defined, of property that is eligible for the homeowners property tax exemption to a replacement dwelling that is of equal or lesser value located within the same county as the property from which the base year value is transferred, provided the replacement dwelling is purchased or newly constructed within 2 years of the sale of the original property, subject to certain conditions. Among those conditions is the requirement that the claimant has not previously been granted, as a claimant, this property tax relief. Under existing law, that limitation does not apply to any person who becomes severely and permanently disabled subsequent to being granted, as a claimant, the property tax relief provided by this section for any person over the age of 55 years.
This bill would additionally provide that the limitation does not apply to any person who turned 55 years of age subsequent to being granted, as a claimant, the property tax relief provided by this section for any person who is severely and permanently disabled.
(a)(1)Notwithstanding any other provision of law, pursuant to subdivision (a) of Section 2 of Article XIIIA of the California Constitution, any person over the age of 55 years, or any severely and permanently disabled person, who resides in property that is eligible for the homeowners exemption under subdivision (k) of Section 3 of Article XIII of the California Constitution and Section 218 may transfer, subject to the conditions and limitations provided in this section, the base year value of that property to any replacement dwelling of equal or lesser value that is located within the same county and is purchased or newly constructed by that person as his or her principal residence within two years of the sale by that person of the original property, provided that the base year value of the original property shall not be transferred to the replacement dwelling until the original property is sold.
(2)Notwithstanding the limitation in paragraph (1) requiring that the original property and the replacement dwelling be located in the same county, this limitation shall not apply in any county in which the county board of supervisors, after consultation with local affected agencies within the boundaries of the county, adopts an ordinance making the provisions of paragraph (1) also applicable to situations in which replacement dwellings are located in that county and the original properties are located in another county within this state. The authorization contained in this paragraph shall be applicable in a county only if the ordinance adopted by the board of supervisors complies with all of the following requirements:
(A)It is adopted only after consultation between the board of supervisors and all other local affected agencies within the countys boundaries.
(B)It requires that all claims for transfers of base year value from original property located in another county be granted if the claims meet the applicable requirements of both subdivision (a) of Section 2 of Article XIIIA of the California Constitution and this section.
(C)It requires that all base year valuations of original property located in another county and determined by its assessor be accepted in connection with the granting of claims for transfers of base year value.
(D)It provides that its provisions are operative for a period of not less than five years.
(E)The ordinance specifies the date on and after which its provisions shall be applicable. However, the date specified shall not be earlier than November 9, 1988. The specified applicable date may be a date earlier than the date the county adopts the ordinance.
(b)In addition to meeting the requirements of subdivision (a), any person claiming the property tax relief provided by this section shall be eligible for that relief only if the following conditions are met:
(1)The claimant is an owner and a resident of the original property either at the time of its sale, or at the time when the original property was substantially damaged or destroyed by misfortune or calamity, or within two years of the purchase or new construction of the replacement dwelling.
(2)The original property is eligible for the homeowners exemption, as the result of the claimants ownership and occupation of the property as his or her principal residence, either at the time of its sale, or at the time when the original property was substantially damaged or destroyed by misfortune or calamity, or within two years of the purchase or new construction of the replacement dwelling.
(3)At the time of the sale of the original property, the claimant or the claimants spouse who resides with the claimant is at least 55 years of age, or is severely and permanently disabled.
(4)At the time of claiming the property tax relief provided by subdivision (a), the claimant is an owner of a replacement dwelling and occupies it as his or her principal place of residence and, as a result thereof, the property is currently eligible for the homeowners exemption or would be eligible for the exemption except that the property is already receiving the exemption because of an exemption claim filed by the previous owner.
(5)The original property of the claimant is sold by him or her within two years of the purchase or new construction of the replacement dwelling. For purposes of this paragraph, the purchase or new construction of the replacement dwelling includes the purchase of that portion of land on which the replacement building, structure, or other shelter constituting a place of abode of the claimant will be situated and that, pursuant to paragraph (3) of subdivision (g), constitutes a part of the replacement dwelling.
(6)Except as otherwise provided in paragraph (2) of subdivision (a), the replacement dwelling, including that portion of land on which it is situated that is specified in paragraph (5), is located entirely within the same county as the claimants original property.
(7)The claimant has not previously been granted, as a claimant, the property tax relief provided by this section, except that this paragraph shall not apply to any person who becomes severely and permanently disabled subsequent to being granted, as a claimant, the property tax relief provided by this section for any person over the age of 55 years, and nor shall this paragraph apply to any person who turned 55 years of age subsequent to being granted, as a claimant, the property tax relief provided by this section for any person who is severely and permanently disabled. In order to prevent duplication of claims under this section within this state, county assessors shall report quarterly to the State Board of Equalization that information from claims filed in accordance with subdivision (f) and from county records as is specified by the board necessary to identify fully all claims under this section allowed by assessors and all claimants who have thereby received relief. The board may specify that the information include all or a part of the names and social security numbers of claimants and their spouses and the identity and location of the replacement dwelling to which the claim applies. The information may be required in the form of data processing media or other media and in a format that is compatible with the recordkeeping processes of the counties and the auditing procedures of the state.
(c)The property tax relief provided by this section shall be available if the original property or the replacement dwelling, or both, of the claimant includes, but is not limited to, either of the following:
(1)A unit or lot within a cooperative housing corporation, a community apartment project, a condominium project, or a planned unit development. If the unit or lot constitutes the original property of the claimant, the assessor shall transfer to the claimants replacement dwelling only the base year value of the claimants unit or lot and his or her share in any common area reserved as an appurtenance of that unit or lot. If the unit or lot constitutes the replacement dwelling of the claimant, the assessor shall transfer the base year value of the claimants original property only to the unit or lot of the claimant and any share of the claimant in any common area reserved as an appurtenance of that unit or lot.
(2)A manufactured home or a manufactured home and any land owned by the claimant on which the manufactured home is situated. For purposes of this paragraph, land owned by the claimant includes a pro rata interest in a resident-owned mobilehome park that is assessed pursuant to subdivision (b) of Section 62.1.
(A)If the manufactured home or the manufactured home and the land on which it is situated constitutes the claimants original property, the assessor shall transfer to the claimants replacement dwelling either the base year value of the manufactured home or the base year value of the manufactured home and the land on which it is situated, as appropriate. If the manufactured home dwelling that constitutes the original property of the claimant includes an interest in a resident-owned mobilehome park, the assessor shall transfer to the claimants replacement dwelling the base year value of the claimants manufactured home and his or her pro rata portion of the real property of the park. No transfer of base year value shall be made by the assessor of that portion of land that does not constitute a part of the original property, as provided in paragraph (4) of subdivision (g).
(B)If the manufactured home or the manufactured home and the land on which it is situated constitutes the claimants replacement dwelling, the assessor shall transfer the base year value of the claimants original property either to the manufactured home or the manufactured home and the land on which it is situated, as appropriate. If the manufactured home dwelling that constitutes the replacement dwelling of the claimant includes an interest in a resident-owned mobilehome park, the assessor shall transfer the base year value of the claimants original property to the manufactured home of the claimant and his or her pro rata portion of the park. No transfer of base year value shall be made by the assessor to that portion of land that does not constitute a part of the replacement dwelling, as provided in paragraph (3) of subdivision (g).
This subdivision shall be subject to the limitations specified in subdivision (d).
(d)The property tax relief provided by this section shall be available to a claimant who is the coowner of the original property, as a joint tenant, a tenant in common, a community property owner, or a present beneficiary of a trust subject to the following limitations:
(1)If a single replacement dwelling is purchased or newly constructed by all of the coowners and each coowner retains an interest in the replacement dwelling, the claimant shall be eligible under this section whether or not any or all of the remaining coowners would otherwise be eligible claimants.
(2)If two or more replacement dwellings are separately purchased or newly constructed by two or more coowners and more than one coowner would otherwise be an eligible claimant, only one coowner shall be eligible under this section. These coowners shall determine by mutual agreement which one of them shall be deemed eligible.
(3)If two or more replacement dwellings are separately purchased or newly constructed by two coowners who held the original property as community property, only the coowner who has attained the age of 55 years, or is severely and permanently disabled, shall be eligible under this section. If both spouses are over 55 years of age, they shall determine by mutual agreement which one of them is eligible.
In the case of coowners whose original property is a multiunit dwelling, the limitations imposed by paragraphs (2) and (3) shall only apply to coowners who occupied the same dwelling unit within the original property at the time specified in paragraph (2) of subdivision (b).
(e)Upon the sale of original property, the assessor shall determine a new base year value for that property in accordance with subdivision (a) of Section 2 of Article XIIIA of the California Constitution and Section 110.1, whether or not a replacement dwelling is subsequently purchased or newly constructed by the former owner or owners of the original property.
This section shall not apply unless the transfer of the original property is a change in ownership that either (1) subjects that property to reappraisal at its current fair market value in accordance with Section 110.1 or 5803 or (2) results in a base year value determined in accordance with this section, Section 69, or Section 69.3 because the property qualifies under this section, Section 69, or Section 69.3 as a replacement dwelling or property.
(f)(1)A claimant shall not be eligible for the property tax relief provided by this section unless the claimant provides to the assessor, on a form that shall be designed by the State Board of Equalization and that the assessor shall make available upon request, the following information:
(A)The name and social security number of each claimant and of any spouse of the claimant who is a record owner of the replacement dwelling.
(B)Proof that the claimant or the claimants spouse who resided on the original property with the claimant was, at the time of its sale, at least 55 years of age, or severely and permanently disabled. Proof of severe and permanent disability shall be considered a certification, signed by a licensed physician and surgeon of appropriate specialty, attesting to the claimants severely and permanently disabled condition. In the absence of available proof that a person is over 55 years of age, the claimant shall certify under penalty of perjury that the age requirement is met. In the case of a severely and permanently disabled claimant either of the following shall be submitted:
(i)A certification, signed by a licensed physician or surgeon of appropriate specialty that identifies specific reasons why the disability necessitates a move to the replacement dwelling and the disability-related requirements, including any locational requirements, of a replacement dwelling. The claimant shall substantiate that the replacement dwelling meets disability-related requirements so identified and that the primary reason for the move to the replacement dwelling is to satisfy those requirements. If the claimant, or the claimants spouse or guardian, so declares under penalty of perjury, it shall be rebuttably presumed that the primary purpose of the move to the replacement dwelling is to satisfy identified disability-related requirements.
(ii)The claimants substantiation that the primary purpose of the move to the replacement dwelling is to alleviate financial burdens caused by the disability. If the claimant, or the claimants spouse or guardian, so declares under penalty of perjury, it shall be rebuttably presumed that the primary purpose of the move is to alleviate the financial burdens caused by the disability.
(C)The address and, if known, the assessors parcel number of the original property.
(D)The date of the claimants sale of the original property and the date of the claimants purchase or new construction of a replacement dwelling.
(E)A statement by the claimant that he or she occupied the replacement dwelling as his or her principal place of residence on the date of the filing of his or her claim.
(F)Any claim under this section shall be filed within three years of the date the replacement dwelling was purchased or the new construction of the replacement dwelling was completed subject to subdivision (k) or (m).
(2)A claim for transfer of base year value under this section that is filed after the expiration of the filing period set forth in subparagraph (F) of paragraph (1) shall be considered by the assessor, subject to all of the following conditions:
(A)Any base year value transfer granted pursuant to that claim shall apply commencing with the lien date of the assessment year in which the claim is filed.
(B)The full cash value of the replacement property in the assessment year described in subparagraph (A) shall be the base year value of the real property in the assessment year in which the base year value was transferred, 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 that does not qualify for property tax relief pursuant to the criteria set forth in subparagraphs (A) and (B) of paragraph (4) of subdivision (h).
(g)For purposes of this section:
(1)Person over the age of 55 years means any person or the spouse of any person who has attained the age of 55 years or older at the time of the sale of the original property.
(2)Base year value of the original property means its base year value, as determined in accordance with Section 110.1, with the adjustments permitted by subdivision (b) of Section 2 of Article XIIIA of the California Constitution and subdivision (f) of Section 110.1, determined as of the date immediately prior to the date that the original property is sold by the claimant, or in the case where the original property has been substantially damaged or destroyed by misfortune or calamity and the owner does not rebuild on the original property, determined as of the date immediately prior to the misfortune or calamity.
If the replacement dwelling is purchased or newly constructed after the transfer of the original property, base year value of the original property also includes any inflation factor adjustments permitted by subdivision (f) of Section 110.1 for the period subsequent to the sale of the original property. The base year or years used to compute the base year value of the original property shall be deemed to be the base year or years of any property to which that base year value is transferred pursuant to this section.
(3)Replacement dwelling means a building, structure, or other shelter constituting a place of abode, whether real property or personal property, that is owned and occupied by a claimant as his or her principal place of residence, and any land owned by the claimant on which the building, structure, or other shelter is situated. For purposes of this paragraph, land constituting a part of a replacement dwelling includes only that area of reasonable size that is used as a site for a residence, and land owned by the claimant includes land for which the claimant either holds a leasehold interest described in subdivision (c) of Section 61 or a land purchase contract. Each unit of a multiunit dwelling shall be considered a separate replacement dwelling. For purposes of this paragraph, area of reasonable size that is used as a site for a residence includes all land if any nonresidential uses of the property are only incidental to the use of the property as a residential site. For purposes of this paragraph, land owned by the claimant includes an ownership interest in a resident-owned mobilehome park that is assessed pursuant to subdivision (b) of Section 62.1.
(4)Original property means a building, structure, or other shelter constituting a place of abode, whether real property or personal property, that is owned and occupied by a claimant as his or her principal place of residence, and any land owned by the claimant on which the building, structure, or other shelter is situated. For purposes of this paragraph, land constituting a part of the original property includes only that area of reasonable size that is used as a site for a residence, and land owned by the claimant includes land for which the claimant either holds a leasehold interest described in subdivision (c) of Section 61 or a land purchase contract. Each unit of a multiunit dwelling shall be considered a separate original property. For purposes of this paragraph, area of reasonable size that is used as a site for a residence includes all land if any nonresidential uses of the property are only incidental to the use of the property as a residential site. For purposes of this paragraph, land owned by the claimant includes an ownership interest in a resident-owned mobilehome park that is assessed pursuant to subdivision (b) of Section 62.1.
(5)Equal or lesser value means that the amount of the full cash value of a replacement dwelling does not exceed one of the following:
(A)One hundred percent of the amount of the full cash value of the original property if the replacement dwelling is purchased or newly constructed prior to the date of the sale of the original property.
(B)One hundred and five percent of the amount of the full cash value of the original property if the replacement dwelling is purchased or newly constructed within the first year following the date of the sale of the original property.
(C)One hundred and ten percent of the amount of the full cash value of the original property if the replacement dwelling is purchased or newly constructed within the second year following the date of the sale of the original property.
For the purposes of this paragraph, except as otherwise provided in paragraph (4) of subdivision (h), if the replacement dwelling is, in part, purchased and, in part, newly constructed, the date the replacement dwelling is purchased or newly constructed is the date of purchase or the date of completion of construction, whichever is later.
(6)Full cash value of the replacement dwelling means its full cash value, determined in accordance with Section 110.1, as of the date on which it was purchased or new construction was completed, and after the purchase or the completion of new construction.
(7)Full cash value of the original property means, either:
(A)Its new base year value, determined in accordance with subdivision (e), without the application of subdivision (h) of Section 2 of Article XIIIA of the California Constitution, plus the adjustments permitted by subdivision (b) of Section 2 of Article XIIIA and subdivision (f) of Section 110.1 for the period from the date of its sale by the claimant to the date on which the replacement property was purchased or new construction was completed.
(B)In the case where the original property has been substantially damaged or destroyed by misfortune or calamity and the owner does not rebuild on the original property, its full cash value, as determined in accordance with Section 110, immediately prior to its substantial damage or destruction by misfortune or calamity, as determined by the county assessor of the county in which the property is located, without the application of subdivision (h) of Section 2 of Article XIIIA of the California Constitution, plus the adjustments permitted by subdivision (b) of Section 2 of Article XIIIA of the California Constitution and subdivision (f) of Section 110.1, for the period from the date of its sale by the claimant to the date on which the replacement property was purchased or new construction was completed.
(8)Sale means any change in ownership of the original property for consideration.
(9)Claimant means any person claiming the property tax relief provided by this section. If a spouse of that person is a record owner of the replacement dwelling, the spouse is also a claimant for purposes of determining whether in any future claim filed by the spouse under this section the condition of eligibility specified in paragraph (7) of subdivision (b) has been met.
(10)Property that is eligible for the homeowners exemption includes property that is the principal place of residence of its owner and is entitled to exemption pursuant to Section 205.5.
(11)Person means any individual, but does not include any firm, partnership, association, corporation, company, or other legal entity or organization of any kind. Person includes an individual who is the present beneficiary of a trust.
(12)Severely and permanently disabled means any person described in subdivision (b) of Section 74.3.
(13)For the purposes of this section, property is substantially damaged or destroyed by misfortune or calamity if either the land or the improvements sustain physical damage amounting to more than 50 percent of either the lands or the improvements full cash value immediately prior to the misfortune or calamity. Damage includes a diminution in the value of property as a result of restricted access to the property where the restricted access was caused by the misfortune or calamity and is permanent in nature.
(h)(1)Upon the timely filing of a claim described in subparagraph (F) of paragraph (1) of subdivision (f), the assessor shall adjust the new base year value of the replacement dwelling in conformity with this section. This adjustment shall be made as of the latest of the following dates:
(A)The date the original property is sold.
(B)The date the replacement dwelling is purchased.
(C)The date the new construction of the replacement dwelling is completed.
(2)Any taxes that were levied on the replacement dwelling prior to the filing of the claim on the basis of the replacement dwellings new base year value, and any allowable annual adjustments thereto, shall be canceled or refunded to the claimant to the extent that the taxes exceed the amount that would be due when determined on the basis of the adjusted new base year value.
(3)Notwithstanding Section 75.10, Chapter 3.5 (commencing with Section 75) shall be utilized for purposes of implementing this subdivision, including adjustments of the new base year value of replacement dwellings acquired prior to the sale of the original property.
(4)In the case where a claim under this section has been timely filed and granted, and new construction is performed upon the replacement dwelling subsequent to the transfer of base year value, the property tax relief provided by this section also shall apply to the replacement dwelling, as improved, and thus there shall be no reassessment upon completion of the new construction if both of the following conditions are met:
(A)The new construction is completed within two years of the date of the sale of the original property and the owner notifies the assessor in writing of completion of the new construction within six months after completion.
(B)The fair market value of the new construction on the date of completion, plus the full cash value of the replacement dwelling on the date of acquisition, is not more than the full cash value of the original property as determined pursuant to paragraph (7) of subdivision (g) for purposes of granting the original claim.
(i)Any claimant may rescind a claim for the property tax relief provided by this section and shall not be considered to have received that relief for purposes of paragraph (7) of subdivision (b), and the assessor shall grant the rescission, if a written notice of rescission is delivered to the office of the assessor as follows:
(1)A written notice of rescission signed by the original filing claimant or claimants is delivered to the office of the assessor in which the original claim was filed.
(2)(A)Except as otherwise provided in this paragraph, the notice of rescission is delivered to the office of the assessor before the date that the county first issues, as a result of relief granted under this section, a refund check for property taxes imposed upon the replacement dwelling. If granting relief will not result in a refund of property taxes, then the notice shall be delivered before payment is first made of any property taxes, or any portion thereof, imposed upon the replacement dwelling consistent with relief granted under this section. If payment of the taxes is not made, then notice shall be delivered before the first date that those property taxes, or any portion thereof, imposed upon the replacement dwelling, consistent with relief granted under this section, are delinquent.
(B)Notwithstanding any other provision in this division, any time the notice of rescission is delivered to the office of the assessor within six years after relief was granted, provided that the replacement property has been vacated as the claimants principal place of residence within 90 days after the original claim was filed, regardless of whether the property continues to receive the homeowners exemption. If the rescission increases the base year value of a property, or the homeowners exemption has been incorrectly allowed, appropriate escape assessments or supplemental assessments, including interest as provided in Section 506, shall be imposed. The limitations periods for any escape assessments or supplemental assessments shall not commence until July 1 of the assessment year in which the notice of rescission is delivered to the office of the assessor.
(3)The notice is accompanied by the payment of a fee as the assessor may require, provided that the fee shall not exceed an amount reasonably related to the estimated cost of processing a rescission claim, including both direct costs and developmental and indirect costs, such as costs for overhead, personnel, supplies, materials, office space, and computers.
(j)(1)With respect to the transfer of base year value of original properties to replacement dwellings located in the same county, this section, except as provided in paragraph (3) or (4), shall apply to any replacement dwelling that is purchased or newly constructed on or after November 6, 1986.
(2)With respect to the transfer of base year value of original properties to replacement dwellings located in different counties, except as provided in paragraph (4), this section shall apply to any replacement dwelling that is purchased or newly constructed on or after the date specified in accordance with subparagraph (E) of paragraph (2) of subdivision (a) in the ordinance of the county in which the replacement dwelling is located, but shall not apply to any replacement dwelling which was purchased or newly constructed before November 9, 1988.
(3)With respect to the transfer of base year value by a severely and permanently disabled person, this section shall apply only to replacement dwellings that are purchased or newly constructed on or after June 6, 1990.
(4)The amendments made to subdivision (e) by the act adding this paragraph shall apply only to replacement dwellings under Section 69 that are acquired or newly constructed on or after October 20, 1991, and shall apply commencing with the 199192 fiscal year.
(k)(1)In the case in which a county adopts an ordinance pursuant to paragraph (2) of subdivision (a) that establishes an applicable date which is more than three years prior to the date of adoption of the ordinance, those potential claimants who purchased or constructed replacement dwellings more than three years prior to the date of adoption of the ordinance and who would, therefore, be precluded from filing a timely claim, shall be deemed to have timely filed a claim if the claim is filed within three years after the date that the ordinance is adopted. This paragraph may not be construed as a waiver of any other requirement of this section.
(2)In the case in which a county assessor corrects a base year value to reflect a pro rata change in ownership of a resident-owned mobilehome park that occurred between January 1, 1989, and January 1, 2002, pursuant to paragraph (4) of subdivision (b) of Section 62.1, those claimants who purchased or constructed replacement dwellings more than three years prior to the correction and who would, therefore, be precluded from filing a timely claim, shall be deemed to have timely filed a claim if the claim is filed within three years of the date of notice of the correction of the base year value to reflect the pro rata change in ownership. This paragraph may not be construed as a waiver of any other requirement of this section.
(3)This subdivision does not apply to a claimant who has transferred his or her replacement dwelling prior to filing a claim.
(4)The property tax relief provided by this section, but filed under this subdivision, shall apply prospectively only, commencing with the lien date of the assessment year in which the claim is filed. There shall be no refund or cancellation of taxes prior to the date that the claim is filed.
(l)No escape assessment may be levied if a transfer of base year value under this section has been erroneously granted by the assessor pursuant to an expired ordinance authorizing intercounty transfers of base year value.
(m)(1)The amendments made to subdivisions (b) and (g) of this section by Chapter 613 of the Statutes of 2001 shall apply:
(A)With respect to the transfer of base year value of original properties to replacement dwellings located in the same county, to any replacement dwelling that is purchased or newly constructed on or after November 6, 1986.
(B)With respect to the transfer of base year value of original properties to replacement dwellings located in different counties, to any replacement dwelling that is purchased or newly constructed on or after the date specified in accordance with subparagraph (E) of paragraph (2) of subdivision (a) in the ordinance of the county in which the replacement dwelling is located, but not to any replacement dwelling that was purchased or newly constructed before November 9, 1988.
(C)With respect to the transfer of base year value by a severely and permanently disabled person, to replacement dwellings that are purchased or newly constructed on or after June 6, 1990.
(2)The property tax relief provided by this section in accordance with this subdivision shall apply prospectively only commencing with the lien date of the assessment year in which the claim is filed. There shall be no refund or cancellation of taxes prior to the date that the claim is filed.
(n)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 claimant or the claimants spouse, the claimants or the claimants spouses legal representative, the trustee of a trust in which the claimant or the claimants spouse is a present beneficiary, and the executor or administrator of the claimants or the claimants spouses estate.
(o)The amendments made to this section by the act adding this subdivision shall apply commencing with the lien date for the 201213 fiscal year.
(a)(1)Notwithstanding any other provision of law, pursuant to subdivision (a) of Section 2 of Article XIIIA of the California Constitution, any person over the age of 55 years, or any severely and permanently disabled person, who resides in property that is eligible for the homeowners exemption under subdivision (k) of Section 3 of Article XIII of the California Constitution and Section 218 may transfer, subject to the conditions and limitations provided in this section, the base year value of that property to any replacement dwelling of equal or lesser value that is located within the same county and is purchased or newly constructed by that person as his or her principal residence within two years of the sale by that person of the original property, provided that the base year value of the original property shall not be transferred to the replacement dwelling until the original property is sold.
(2)Notwithstanding the limitation in paragraph (1) requiring that the original property and the replacement dwelling be located in the same county, this limitation shall not apply in any county in which the county board of supervisors, after consultation with local affected agencies within the boundaries of the county, adopts an ordinance making the provisions of paragraph (1) also applicable to situations in which replacement dwellings are located in that county and the original properties are located in another county within this state. The authorization contained in this paragraph shall be applicable in a county only if the ordinance adopted by the board of supervisors complies with all of the following requirements:
(A)It is adopted only after consultation between the board of supervisors and all other local affected agencies within the countys boundaries.
(B)It requires that all claims for transfers of base year value from original property located in another county be granted if the claims meet the applicable requirements of both subdivision (a) of Section 2 of Article XIIIA of the California Constitution and this section.
(C)It requires that all base year valuations of original property located in another county and determined by its assessor be accepted in connection with the granting of claims for transfers of base year value.
(D)It provides that its provisions are operative for a period of not less than five years.
(E)The ordinance specifies the date on and after which its provisions shall be applicable. However, the date specified shall not be earlier than November 9, 1988. The specified applicable date may be a date earlier than the date the county adopts the ordinance.
(b)In addition to meeting the requirements of subdivision (a), any person claiming the property tax relief provided by this section shall be eligible for that relief only if the following conditions are met:
(1)The claimant is an owner and a resident of the original property either at the time of its sale, or at the time when the original property was substantially damaged or destroyed by misfortune or calamity, or within two years of the purchase or new construction of the replacement dwelling.
(2)The original property is eligible for the homeowners exemption, as the result of the claimants ownership and occupation of the property as his or her principal residence, either at the time of its sale, or at the time when the original property was substantially damaged or destroyed by misfortune or calamity, or within two years of the purchase or new construction of the replacement dwelling.
(3)At the time of the sale of the original property, the claimant or the claimants spouse who resides with the claimant is at least 55 years of age, or is severely and permanently disabled.
(4)At the time of claiming the property tax relief provided by subdivision (a), the claimant is an owner of a replacement dwelling and occupies it as his or her principal place of residence and, as a result thereof, the property is currently eligible for the homeowners exemption or would be eligible for the exemption except that the property is already receiving the exemption because of an exemption claim filed by the previous owner.
(5)The original property of the claimant is sold by him or her within two years of the purchase or new construction of the replacement dwelling. For purposes of this paragraph, the purchase or new construction of the replacement dwelling includes the purchase of that portion of land on which the replacement building, structure, or other shelter constituting a place of abode of the claimant will be situated and that, pursuant to paragraph (3) of subdivision (g), constitutes a part of the replacement dwelling.
(6)Except as otherwise provided in paragraph (2) of subdivision (a), the replacement dwelling, including that portion of land on which it is situated that is specified in paragraph (5), is located entirely within the same county as the claimants original property.
(7)The claimant has not previously been granted, as a claimant, the property tax relief provided by this section, except that this paragraph shall not apply to any person who becomes severely and permanently disabled subsequent to being granted, as a claimant, the property tax relief provided by this section for any person over the age of 55 years. years, and nor shall this paragraph apply to any person who turned 55 years of age subsequent to being granted, as a claimant, the property tax relief provided by this section for any person who is severely and permanently disabled. In order to prevent duplication of claims under this section within this state, county assessors shall report quarterly to the State Board of Equalization that information from claims filed in accordance with subdivision (f) and from county records as is specified by the board necessary to identify fully all claims under this section allowed by assessors and all claimants who have thereby received relief. The board may specify that the information include all or a part of the names and social security numbers of claimants and their spouses and the identity and location of the replacement dwelling to which the claim applies. The information may be required in the form of data processing media or other media and in a format that is compatible with the recordkeeping processes of the counties and the auditing procedures of the state.
(c)The property tax relief provided by this section shall be available if the original property or the replacement dwelling, or both, of the claimant includes, but is not limited to, either of the following:
(1)A unit or lot within a cooperative housing corporation, a community apartment project, a condominium project, or a planned unit development. If the unit or lot constitutes the original property of the claimant, the assessor shall transfer to the claimants replacement dwelling only the base year value of the claimants unit or lot and his or her share in any common area reserved as an appurtenance of that unit or lot. If the unit or lot constitutes the replacement dwelling of the claimant, the assessor shall transfer the base year value of the claimants original property only to the unit or lot of the claimant and any share of the claimant in any common area reserved as an appurtenance of that unit or lot.
(2)A manufactured home or a manufactured home and any land owned by the claimant on which the manufactured home is situated. For purposes of this paragraph, land owned by the claimant includes a pro rata interest in a resident-owned mobilehome park that is assessed pursuant to subdivision (b) of Section 62.1.
(A)If the manufactured home or the manufactured home and the land on which it is situated constitutes the claimants original property, the assessor shall transfer to the claimants replacement dwelling either the base year value of the manufactured home or the base year value of the manufactured home and the land on which it is situated, as appropriate. If the manufactured home dwelling that constitutes the original property of the claimant includes an interest in a resident-owned mobilehome park, the assessor shall transfer to the claimants replacement dwelling the base year value of the claimants manufactured home and his or her pro rata portion of the real property of the park. No transfer of base year value shall be made by the assessor of that portion of land that does not constitute a part of the original property, as provided in paragraph (4) of subdivision (g).
(B)If the manufactured home or the manufactured home and the land on which it is situated constitutes the claimants replacement dwelling, the assessor shall transfer the base year value of the claimants original property either to the manufactured home or the manufactured home and the land on which it is situated, as appropriate. If the manufactured home dwelling that constitutes the replacement dwelling of the claimant includes an interest in a resident-owned mobilehome park, the assessor shall transfer the base year value of the claimants original property to the manufactured home of the claimant and his or her pro rata portion of the park. No transfer of base year value shall be made by the assessor to that portion of land that does not constitute a part of the replacement dwelling, as provided in paragraph (3) of subdivision (g).
This subdivision shall be subject to the limitations specified in subdivision (d).
(d)The property tax relief provided by this section shall be available to a claimant who is the coowner of the original property, as a joint tenant, a tenant in common, a community property owner, or a present beneficiary of a trust subject to the following limitations:
(1)If a single replacement dwelling is purchased or newly constructed by all of the coowners and each coowner retains an interest in the replacement dwelling, the claimant shall be eligible under this section whether or not any or all of the remaining coowners would otherwise be eligible claimants.
(2)If two or more replacement dwellings are separately purchased or newly constructed by two or more coowners and more than one coowner would otherwise be an eligible claimant, only one coowner shall be eligible under this section. These coowners shall determine by mutual agreement which one of them shall be deemed eligible.
(3)If two or more replacement dwellings are separately purchased or newly constructed by two coowners who held the original property as community property, only the coowner who has attained the age of 55 years, or is severely and permanently disabled, shall be eligible under this section. If both spouses are over 55 years of age, they shall determine by mutual agreement which one of them is eligible.
In the case of coowners whose original property is a multiunit dwelling, the limitations imposed by paragraphs (2) and (3) shall only apply to coowners who occupied the same dwelling unit within the original property at the time specified in paragraph (2) of subdivision (b).
(e)Upon the sale of original property, the assessor shall determine a new base year value for that property in accordance with subdivision (a) of Section 2 of Article XIIIA of the California Constitution and Section 110.1, whether or not a replacement dwelling is subsequently purchased or newly constructed by the former owner or owners of the original property.
This section shall not apply unless the transfer of the original property is a change in ownership that either (1) subjects that property to reappraisal at its current fair market value in accordance with Section 110.1 or 5803 or (2) results in a base year value determined in accordance with this section, Section 69, or Section 69.3 because the property qualifies under this section, Section 69, or Section 69.3 as a replacement dwelling or property.
(f)(1)A claimant shall not be eligible for the property tax relief provided by this section unless the claimant provides to the assessor, on a form that shall be designed by the State Board of Equalization and that the assessor shall make available upon request, the following information:
(A)The name and social security number of each claimant and of any spouse of the claimant who is a record owner of the replacement dwelling.
(B)Proof that the claimant or the claimants spouse who resided on the original property with the claimant was, at the time of its sale, at least 55 years of age, or severely and permanently disabled. Proof of severe and permanent disability shall be considered a certification, signed by a licensed physician and surgeon of appropriate specialty, attesting to the claimants severely and permanently disabled condition. In the absence of available proof that a person is over 55 years of age, the claimant shall certify under penalty of perjury that the age requirement is met. In the case of a severely and permanently disabled claimant either of the following shall be submitted:
(i)A certification, signed by a licensed physician or surgeon of appropriate specialty that identifies specific reasons why the disability necessitates a move to the replacement dwelling and the disability-related requirements, including any locational requirements, of a replacement dwelling. The claimant shall substantiate that the replacement dwelling meets disability-related requirements so identified and that the primary reason for the move to the replacement dwelling is to satisfy those requirements. If the claimant, or the claimants spouse or guardian, so declares under penalty of perjury, it shall be rebuttably presumed that the primary purpose of the move to the replacement dwelling is to satisfy identified disability-related requirements.
(ii)The claimants substantiation that the primary purpose of the move to the replacement dwelling is to alleviate financial burdens caused by the disability. If the claimant, or the claimants spouse or guardian, so declares under penalty of perjury, it shall be rebuttably presumed that the primary purpose of the move is to alleviate the financial burdens caused by the disability.
(C)The address and, if known, the assessors parcel number of the original property.
(D)The date of the claimants sale of the original property and the date of the claimants purchase or new construction of a replacement dwelling.
(E)A statement by the claimant that he or she occupied the replacement dwelling as his or her principal place of residence on the date of the filing of his or her claim.
(F)Any claim under this section shall be filed within three years of the date the replacement dwelling was purchased or the new construction of the replacement dwelling was completed subject to subdivision (k) or (m).
(2)A claim for transfer of base year value under this section that is filed after the expiration of the filing period set forth in subparagraph (F) of paragraph (1) shall be considered by the assessor, subject to all of the following conditions:
(A)Any base year value transfer granted pursuant to that claim shall apply commencing with the lien date of the assessment year in which the claim is filed.
(B)The full cash value of the replacement property in the assessment year described in subparagraph (A) shall be the base year value of the real property in the assessment year in which the base year value was transferred, 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 that does not qualify for property tax relief pursuant to the criteria set forth in subparagraphs (A) and (B) of paragraph (4) of subdivision (h).
(g)For purposes of this section:
(1)Person over the age of 55 years means any person or the spouse of any person who has attained the age of 55 years or older at the time of the sale of the original property.
(2)Base year value of the original property means its base year value, as determined in accordance with Section 110.1, with the adjustments permitted by subdivision (b) of Section 2 of Article XIIIA of the California Constitution and subdivision (f) of Section 110.1, determined as of the date immediately prior to the date that the original property is sold by the claimant, or in the case where the original property has been substantially damaged or destroyed by misfortune or calamity and the owner does not rebuild on the original property, determined as of the date immediately prior to the misfortune or calamity.
If the replacement dwelling is purchased or newly constructed after the transfer of the original property, base year value of the original property also includes any inflation factor adjustments permitted by subdivision (f) of Section 110.1 for the period subsequent to the sale of the original property. The base year or years used to compute the base year value of the original property shall be deemed to be the base year or years of any property to which that base year value is transferred pursuant to this section.
(3)Replacement dwelling means a building, structure, or other shelter constituting a place of abode, whether real property or personal property, that is owned and occupied by a claimant as his or her principal place of residence, and any land owned by the claimant on which the building, structure, or other shelter is situated. For purposes of this paragraph, land constituting a part of a replacement dwelling includes only that area of reasonable size that is used as a site for a residence, and land owned by the claimant includes land for which the claimant either holds a leasehold interest described in subdivision (c) of Section 61 or a land purchase contract. Each unit of a multiunit dwelling shall be considered a separate replacement dwelling. For purposes of this paragraph, area of reasonable size that is used as a site for a residence includes all land if any nonresidential uses of the property are only incidental to the use of the property as a residential site. For purposes of this paragraph, land owned by the claimant includes an ownership interest in a resident-owned mobilehome park that is assessed pursuant to subdivision (b) of Section 62.1.
(4)Original property means a building, structure, or other shelter constituting a place of abode, whether real property or personal property, that is owned and occupied by a claimant as his or her principal place of residence, and any land owned by the claimant on which the building, structure, or other shelter is situated. For purposes of this paragraph, land constituting a part of the original property includes only that area of reasonable size that is used as a site for a residence, and land owned by the claimant includes land for which the claimant either holds a leasehold interest described in subdivision (c) of Section 61 or a land purchase contract. Each unit of a multiunit dwelling shall be considered a separate original property. For purposes of this paragraph, area of reasonable size that is used as a site for a residence includes all land if any nonresidential uses of the property are only incidental to the use of the property as a residential site. For purposes of this paragraph, land owned by the claimant includes an ownership interest in a resident-owned mobilehome park that is assessed pursuant to subdivision (b) of Section 62.1.
(5)Equal or lesser value means that the amount of the full cash value of a replacement dwelling does not exceed one of the following:
(A)One hundred percent of the amount of the full cash value of the original property if the replacement dwelling is purchased or newly constructed prior to the date of the sale of the original property.
(B)One hundred and five percent of the amount of the full cash value of the original property if the replacement dwelling is purchased or newly constructed within the first year following the date of the sale of the original property.
(C)One hundred and ten percent of the amount of the full cash value of the original property if the replacement dwelling is purchased or newly constructed within the second year following the date of the sale of the original property.
For the purposes of this paragraph, except as otherwise provided in paragraph (4) of subdivision (h), if the replacement dwelling is, in part, purchased and, in part, newly constructed, the date the replacement dwelling is purchased or newly constructed is the date of purchase or the date of completion of construction, whichever is later.
(6)Full cash value of the replacement dwelling means its full cash value, determined in accordance with Section 110.1, as of the date on which it was purchased or new construction was completed, and after the purchase or the completion of new construction.
(7)Full cash value of the original property means, either:
(A)Its new base year value, determined in accordance with subdivision (e), without the application of subdivision (h) of Section 2 of Article XIIIA of the California Constitution, plus the adjustments permitted by subdivision (b) of Section 2 of Article XIIIA and subdivision (f) of Section 110.1 for the period from the date of its sale by the claimant to the date on which the replacement property was purchased or new construction was completed.
(B)In the case where the original property has been substantially damaged or destroyed by misfortune or calamity and the owner does not rebuild on the original property, its full cash value, as determined in accordance with Section 110, immediately prior to its substantial damage or destruction by misfortune or calamity, as determined by the county assessor of the county in which the property is located, without the application of subdivision (h) of Section 2 of Article XIIIA of the California Constitution, plus the adjustments permitted by subdivision (b) of Section 2 of Article XIIIA of the California Constitution and subdivision (f) of Section 110.1, for the period from the date of its sale by the claimant to the date on which the replacement property was purchased or new construction was completed.
(8)Sale means any change in ownership of the original property for consideration.
(9)Claimant means any person claiming the property tax relief provided by this section. If a spouse of that person is a record owner of the replacement dwelling, the spouse is also a claimant for purposes of determining whether in any future claim filed by the spouse under this section the condition of eligibility specified in paragraph (7) of subdivision (b) has been met.
(10)Property that is eligible for the homeowners exemption includes property that is the principal place of residence of its owner and is entitled to exemption pursuant to Section 205.5.
(11)Person means any individual, but does not include any firm, partnership, association, corporation, company, or other legal entity or organization of any kind. Person includes an individual who is the present beneficiary of a trust.
(12)Severely and permanently disabled means any person described in subdivision (b) of Section 74.3.
(13)For the purposes of this section, property is substantially damaged or destroyed by misfortune or calamity if either the land or the improvements sustain physical damage amounting to more than 50 percent of either the lands or the improvements full cash value immediately prior to the misfortune or calamity. Damage includes a diminution in the value of property as a result of restricted access to the property where the restricted access was caused by the misfortune or calamity and is permanent in nature.
(h)(1)Upon the timely filing of a claim described in subparagraph (F) of paragraph (1) of subdivision (f), the assessor shall adjust the new base year value of the replacement dwelling in conformity with this section. This adjustment shall be made as of the latest of the following dates:
(A)The date the original property is sold.
(B)The date the replacement dwelling is purchased.
(C)The date the new construction of the replacement dwelling is completed.
(2)Any taxes that were levied on the replacement dwelling prior to the filing of the claim on the basis of the replacement dwellings new base year value, and any allowable annual adjustments thereto, shall be canceled or refunded to the claimant to the extent that the taxes exceed the amount that would be due when determined on the basis of the adjusted new base year value.
(3)Notwithstanding Section 75.10, Chapter 3.5 (commencing with Section 75) shall be utilized for purposes of implementing this subdivision, including adjustments of the new base year value of replacement dwellings acquired prior to the sale of the original property.
(4)In the case where a claim under this section has been timely filed and granted, and new construction is performed upon the replacement dwelling subsequent to the transfer of base year value, the property tax relief provided by this section also shall apply to the replacement dwelling, as improved, and thus there shall be no reassessment upon completion of the new construction if both of the following conditions are met:
(A)The new construction is completed within two years of the date of the sale of the original property and the owner notifies the assessor in writing of completion of the new construction within six months after completion.
(B)The fair market value of the new construction on the date of completion, plus the full cash value of the replacement dwelling on the date of acquisition, is not more than the full cash value of the original property as determined pursuant to paragraph (7) of subdivision (g) for purposes of granting the original claim.
(i)Any claimant may rescind a claim for the property tax relief provided by this section and shall not be considered to have received that relief for purposes of paragraph (7) of subdivision (b), and the assessor shall grant the rescission, if a written notice of rescission is delivered to the office of the assessor as follows:
(1)A written notice of rescission signed by the original filing claimant or claimants is delivered to the office of the assessor in which the original claim was filed.
(2)(A)Except as otherwise provided in this paragraph, the notice of rescission is delivered to the office of the assessor before the date that the county first issues, as a result of relief granted under this section, a refund check for property taxes imposed upon the replacement dwelling. If granting relief will not result in a refund of property taxes, then the notice shall be delivered before payment is first made of any property taxes, or any portion thereof, imposed upon the replacement dwelling consistent with relief granted under this section. If payment of the taxes is not made, then notice shall be delivered before the first date that those property taxes, or any portion thereof, imposed upon the replacement dwelling, consistent with relief granted under this section, are delinquent.
(B)Notwithstanding any other provision in this division, any time the notice of rescission is delivered to the office of the assessor within six years after relief was granted, provided that the replacement property has been vacated as the claimants principal place of residence within 90 days after the original claim was filed, regardless of whether the property continues to receive the homeowners exemption. If the rescission increases the base year value of a property, or the homeowners exemption has been incorrectly allowed, appropriate escape assessments or supplemental assessments, including interest as provided in Section 506, shall be imposed. The limitations periods for any escape assessments or supplemental assessments shall not commence until July 1 of the assessment year in which the notice of rescission is delivered to the office of the assessor.
(3)The notice is accompanied by the payment of a fee as the assessor may require, provided that the fee shall not exceed an amount reasonably related to the estimated cost of processing a rescission claim, including both direct costs and developmental and indirect costs, such as costs for overhead, personnel, supplies, materials, office space, and computers.
(j)(1)With respect to the transfer of base year value of original properties to replacement dwellings located in the same county, this section, except as provided in paragraph (3) or (4), shall apply to any replacement dwelling that is purchased or newly constructed on or after November 6, 1986.
(2)With respect to the transfer of base year value of original properties to replacement dwellings located in different counties, except as provided in paragraph (4), this section shall apply to any replacement dwelling that is purchased or newly constructed on or after the date specified in accordance with subparagraph (E) of paragraph (2) of subdivision (a) in the ordinance of the county in which the replacement dwelling is located, but shall not apply to any replacement dwelling which was purchased or newly constructed before November 9, 1988.
(3)With respect to the transfer of base year value by a severely and permanently disabled person, this section shall apply only to replacement dwellings that are purchased or newly constructed on or after June 6, 1990.
(4)The amendments made to subdivision (e) by the act adding this paragraph shall apply only to replacement dwellings under Section 69 that are acquired or newly constructed on or after October 20, 1991, and shall apply commencing with the 199192 fiscal year.
(k)(1)In the case in which a county adopts an ordinance pursuant to paragraph (2) of subdivision (a) that establishes an applicable date which is more than three years prior to the date of adoption of the ordinance, those potential claimants who purchased or constructed replacement dwellings more than three years prior to the date of adoption of the ordinance and who would, therefore, be precluded from filing a timely claim, shall be deemed to have timely filed a claim if the claim is filed within three years after the date that the ordinance is adopted. This paragraph may not be construed as a waiver of any other requirement of this section.
(2)In the case in which a county assessor corrects a base year value to reflect a pro rata change in ownership of a resident-owned mobilehome park that occurred between January 1, 1989, and January 1, 2002, pursuant to paragraph (4) of subdivision (b) of Section 62.1, those claimants who purchased or constructed replacement dwellings more than three years prior to the correction and who would, therefore, be precluded from filing a timely claim, shall be deemed to have timely filed a claim if the claim is filed within three years of the date of notice of the correction of the base year value to reflect the pro rata change in ownership. This paragraph may not be construed as a waiver of any other requirement of this section.
(3)This subdivision does not apply to a claimant who has transferred his or her replacement dwelling prior to filing a claim.
(4)The property tax relief provided by this section, but filed under this subdivision, shall apply prospectively only, commencing with the lien date of the assessment year in which the claim is filed. There shall be no refund or cancellation of taxes prior to the date that the claim is filed.
(l)No escape assessment may be levied if a transfer of base year value under this section has been erroneously granted by the assessor pursuant to an expired ordinance authorizing intercounty transfers of base year value.
(m)(1)The amendments made to subdivisions (b) and (g) of this section by Chapter 613 of the Statutes of 2001 shall apply:
(A)With respect to the transfer of base year value of original properties to replacement dwellings located in the same county, to any replacement dwelling that is purchased or newly constructed on or after November 6, 1986.
(B)With respect to the transfer of base year value of original properties to replacement dwellings located in different counties, to any replacement dwelling that is purchased or newly constructed on or after the date specified in accordance with subparagraph (E) of paragraph (2) of subdivision (a) in the ordinance of the county in which the replacement dwelling is located, but not to any replacement dwelling that was purchased or newly constructed before November 9, 1988.
(C)With respect to the transfer of base year value by a severely and permanently disabled person, to replacement dwellings that are purchased or newly constructed on or after June 6, 1990.
(2)The property tax relief provided by this section in accordance with this subdivision shall apply prospectively only commencing with the lien date of the assessment year in which the claim is filed. There shall be no refund or cancellation of taxes prior to the date that the claim is filed.
(n)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 claimant or the claimants spouse, the claimants or the claimants spouses legal representative, the trustee of a trust in which the claimant or the claimants spouse is a present beneficiary, and the executor or administrator of the claimants or the claimants spouses estate.
(o)The amendments made to this section by the act adding this subdivision shall apply commencing with the lien date for the 201213 fiscal year.
|
Date
|
Status
|
|---|---|
| Feb 4, 2018 | Last day to consider Governor’s veto pursuant to Joint Rule 58.5. |
| Jul 21, 2017 | In Senate. Consideration of Governor's veto pending. |
| Jul 21, 2017 | Vetoed by the Governor. |
| Jul 12, 2017 | Enrolled and presented to the Governor at 12 p.m. |
| Jul 6, 2017 | In Senate. Ordered to engrossing and enrolling. |
| Jul 6, 2017 | Read third time. Passed. Ordered to the Senate. |
| Jun 29, 2017 | Read second time. Ordered to consent calendar. |
| Jun 28, 2017 | From committee: Do pass. Ordered to consent calendar. (Ayes 14. Noes 0.) (June 28). |
| Jun 21, 2017 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 0.) (June 19). Re-referred to Com. on APPR. |
| May 18, 2017 | Referred to Com. on REV. & TAX. |
| Apr 20, 2017 | In Assembly. Read first time. Held at Desk. |
| Apr 20, 2017 | Read third time. Passed. (Ayes 40. Noes 0. Page 765.) Ordered to the Assembly. |
| Apr 18, 2017 | Read second time. Ordered to third reading. |
| Apr 17, 2017 | From committee: Be ordered to second reading pursuant to Senate Rule 28.8. |
| Apr 5, 2017 | Set for hearing April 17. |
| Mar 29, 2017 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 7. Noes 0. Page 538.) (March 29). Re-referred to Com. on APPR. |
| Mar 8, 2017 | Set for hearing March 29. |
| Feb 16, 2017 | Referred to Com. on GOV. & F. |
| Feb 7, 2017 | From printer. May be acted upon on or after March 9. |
| Feb 6, 2017 | Introduced. Read first time. To Com. on RLS. for assignment. To print. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Jul 6, 2017 | SB 246 Bates Consent Calendar Second Day Regular Session | Assembly Floor |
Passed |
|
| Jun 28, 2017 | Do pass. To Consent Calendar. | Assembly Standing Committee on Appropriations |
Passed |
|
| Jun 19, 2017 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Revenue and Taxation |
Passed |
|
| Apr 20, 2017 | Unfavorable (Civil Justice & Claims Subcommittee) | Senate Floor |
Passed |
|
| Mar 29, 2017 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Governance and Finance |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| American G.I. Forum of California | ** Support | Jan 2, 2018 |
| American Legion - Department of California | ** Support | Jan 2, 2018 |
| AMVETS - Department of California | ** Support | Jan 2, 2018 |
| Board of Equalization Member George Runner | ** Support | Jan 2, 2018 |
| Board of Equalization Member, 1st District | ** Support | Jun 16, 2017 |
| California Association Of County Veterans Service Officers | ** Support | Jan 2, 2018 |
| California Association Of Realtors | ** Support | Jan 2, 2018 |
| California State Commanders Veterans Council | ** Support | Jan 2, 2018 |
| Howard Jarvis Taxpayers Association | ** Support | Jan 2, 2018 |
| Leading Age California | ** Support | Jan 2, 2018 |
| Vietnam Veterans of America - California State Council | ** Support | Jan 2, 2018 |
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
VETO
Bill No: SB 246
:
SENATE GOVERNANCE & FIN. COMMITTEE: 7-0, 3/29/17
AYES: McGuire, Nguyen, Beall, Hernandez, Hertzberg, Lara, Moorlach
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
SENATE FLOOR: 40-0, 4/20/17
AYES: Allen, Anderson, Atkins, Bates, Beall, Berryhill, Bradford, Cannella, De León, Dodd, Fuller, Gaines, Galgiani, Glazer, Hernandez, Hertzberg, Hill, Hueso, Jackson, Lara, Leyva, McGuire, Mendoza, Mitchell, Monning, Moorlach, Morrell, Newman, Nguyen, Nielsen, Pan, Portantino, Roth, Skinner, Stern, Stone, Vidak, Wieckowski, Wiener, Wilk
ASSEMBLY FLOOR: 74-0, 7/6/17 (Consent) - See last page for vote
DIGEST:
This bill allows taxpayers granted an initial base year value transfer due to disability to make another claim another after turning 55.
ANALYSIS:
Existing law:
- Provides that all property is taxable at the same percentage of fair market value unless explicitly exempted by the Constitution or federal law (California Constitution, Article XIII).
- Limits the maximum amount of any ad valorem tax on real property at 1% of full cash value, and directs assessors to only reappraise property when newly constructed, or when ownership changes (California Constitution, Article XIIIA).
- Allows a change in ownership exclusions for homeowners over the age of 55 and disabled persons regardless of age to transfer their home’s base year values to a replacement home of equal or lesser value within the same county (Proposition 60, 1988, and Proposition 110, 1990), or to homes in counties that adopt ordinances allowing the transfer (Proposition 90, 1990).
- Limits base year value transfers for properties eligible for the homeowners’ exemption, requires taxpayers to file a claim with the assessor, and provides that taxpayers may only transfer base year values once, except for taxpayers who claim the benefit first as a person 55 years of age or older, and subsequently become disabled (SB 1692, Petris, Chapter 897, Statutes of 1996).
This bill:
- Allows a homeowner who received a disability-based base year value transfer before the age of 55 to receive a second transfer after they reach the age of 55.
- Applies to transfer claims filed on or after January 1, 2018.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
American G.I. Forum of California
American Legion – Department of California
AMVETS – Department of California
Board of Equalization Member George Runner
California Association of County Veterans Service Officers
California Association of Realtors
California State Commanders Veterans Council
Howard Jarvis Taxpayers Association
Leading Age California
Military Officers Association of America, California Council of Chapters
Vietnam Veterans of America – California State Council
OPPOSITION: (Verified 8/22/17)
None received
ARGUMENTS IN SUPPORT: According to the author, “All severely and permanently disabled people, regardless of the age at which they encounter their disability, should have an opportunity to access accommodating housing. California law allows homeowners over the age of 55 and those who are severely and permanently disabled a single chance to sell their home and transfer its base year value to a replacement residence. Since 1996, California has also allowed a homeowner a second chance to transfer the base year value of their home if they claim an age-based base year value transfer and subsequently become seriously and permanently disabled. However, the reverse is not allowed by current law. If a homeowner claims a disability-based base year transfer prior to turning 55, they are not allowed to request a second base year value transfer upon turning 55. This is a problem because it excludes people who become disabled prior to turning 55 and need to relocate again as they age, effectively putting their disability into a lesser category. As people who become severely and permanently disabled prior to becoming 55 will most likely need to move into more accommodating housing as they age, and they deserve the same access to property tax relief as those who become disabled later on in life. Individuals have no control over the timing or progression of their disability, and a lack of access to property tax relief should not impede them from obtaining needed housing. SB 246 fixes this problem by affording those who have claimed a disability-based base year value transfer before the age of 55 the opportunity to receive a second transfer after they reach the age of 55. No matter when a person becomes disabled, they should have every opportunity to secure accommodating housing. SB 246 simply creates parity within the law and offers the severely and permanently disabled the same access to base year value transfers, no matter when they become disabled.”
GOVERNOR'S VETO MESSAGE:
I am returning Senate Bill 246 without my signature.
This bill would allow a homeowner granted an initial base-year property tax valuation transfer claim due to disability to make a second base-year value transfer after they reach the age of 55.
I believe this bill would allow an already generous property tax benefit to be granted a second time on a larger scale. It is not prudent to authorize legislation such as this that would result in unknown long-term costs to the General Fund.
ASSEMBLY FLOOR: 74-0, 7/6/17
AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bonta, Brough, Burke, Caballero, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gomez, Gonzalez Fletcher, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kiley, Levine, Limón, Low, Maienschein, Mathis, Mayes, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Ridley-Thomas, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon
NO VOTE RECORDED: Bocanegra, Calderon, Dababneh, Gray, Lackey, McCarty
1/2/18 9:56:15
**** END ****
Date of Hearing: June 28, 2017
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez Fletcher, Chair
SBPCA Bill Id:SB 246
Author:(Bates) – As Introduced Ver:February 6, 2017
Policy Committee: | Revenue and Taxation | Vote: | 9 - 0 |
Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill provides a person who received a base year value transfer based on a disability before the age of 55 with the ability to receive a second base year value transfer after reaching the age of 55.
FISCAL EFFECT:
An estimated property tax loss of $5,000 annually, resulting in minor General Fund (GF) costs as a result of the Proposition 98 guarantee.
COMMENTS:
- Background. Adopted in June 1978, Proposition 13 was designed to provide real property tax relief by limiting the assessment and taxing powers of state and local governments. As a general rule, Proposition 13 limits any tax on real property to 1% of the property's assessed value, measured as either the assessed value as of the 1975-76 tax year or the appraisal value when purchased, constructed, or a change in ownership has occurred, subject to adjustment for the lesser of inflation or 2% per year. As a result, real property is only reassessed to fair market value upon a change in ownership.
- Base year value transfer. One exception to the rule that a change in ownership results in a property value reassessment is when a “base year value transfer” occurs. As a result of Proposition 60 (1986), Proposition 90 (1988), and Proposition 110 (1990), a disabled homeowner or a homeowner aged 55 or older may elect a transfer of the base year value of the homeowner's principal residence to a replacement residence of equal or lesser value within the same county, or in certain other counties if they accept such a transfer. The base year value transfer allows the homeowner to continue paying property taxes at the amount and rate of growth of the previous residence and not the fair market value of the new residence.
- Using both types of base year value transfers. Typically, a person can only transfer the base year value of their home once per lifetime. However, as result of SB 1692 (Petris), Chapter 897, Statutes of 1996, a person can receive another a base year value transfer for a disability even if a person has already received a base year transfer based on age. Prior to the enactment of SB 1692, only one lifetime transfer was allowed, irrespective of whether the transfer was based on age or disability. The constitutional provision that allows for a base year value transfer does not impose a limitation on the number of transfers that may occur. The limitations are set in statute and can therefore be modified.
- Purpose. According to the author, SB 246 will create equality in property tax law for severely and permanently disabled people, regardless of the age at which they encounter their disability. The author notes that under current law, a person who becomes disabled after turning 55 can take advance of two base year value transfer opportunities, but that opportunity is not available to those who are disabled before the age of 55 and need to seek other housing later in life.
- Related legislation. AB 1165 (Gloria), which expands eligibility for base year value transfers to include a person who has a severely and permanently disabled child, is pending in the Senate Committee on Governance and Finance.
Analysis Prepared by: Luke Reidenbach / APPR. / (916) 319-2081
Date of Hearing: June 19, 2017
ASSEMBLY COMMITTEE ON REVENUE AND TAXATION
Sebastian Ridley-Thomas, Chair
SBPCA Bill Id:SB 246
Author:(Bates) – As Introduced Ver:February 6, 2017
Majority vote. Fiscal committee.
SENATE VOTE: 40-0
SUBJECT: Property tax: base year value transfers
SUMMARY: Provides a person who received a base year value transfer based on a disability before the age of 55 with the ability to receive a second base year value transfer after reaching the age of 55.
EXISTING LAW:
- Provides that all property is taxable, unless otherwise provided by the California Constitution or federal laws [California Constitution, Article XIII, Section 1(a)].
- Limits ad valorem taxes on real property to 1% of the full cash value of that property [California Constitution, Article XIII A, Section 1(a)].
- Requires real property to be reassessed to its current fair market value whenever a "change in ownership" occurs, but creates exceptions to numerous transfers. (California Constitution, Article XIII A, Section 2; Revenue and Taxation Code (R&TC) Sections 60 – 69.5.) The assessed value of the property established initially for property tax purposes is generally referred to as the "base year value", which is subject to annual increases for inflation, not to exceed 2%.
- Allows property owners over 55 years of age and disabled persons an opportunity to transfer the base year value of their principle residence, within two years from the sale of the original residence, to a replacement home of equal or lesser value within the same county, or to a replacement home in counties that have adopted ordinances allowing the transfer, provided certain conditions are met and the county assessor is properly notified. A second transfer is permitted if an individual received an age-based value transfer and subsequently became severely disabled. In the reverse, an individual who received a disability-based value transfer is not allowed to receive a second transfer based on age after turning 55 years of age. Currently, Alameda, El Dorado, Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Mateo, Santa Clara, Tuolumne, and Ventura Counties allow these out-of-county transfers. Base-year transfers allow taxpayers to continue to pay property taxes at the amount and rate of growth of their previous home and prevent reassessments of their newly purchased homes to full market value.
FISCAL EFFECT: The State Board of Equalization (BOE) estimates that this bill would reduce property tax revenues at the basic 1% tax rate by about $5,000 annually.
COMMENTS:
- The author has provided the following statement in support of this bill:
SB 246 seeks to create equality in property tax law for severely and permanently disabled people, regardless of the age at which they encounter their disability.
Homeowners can currently take two base year value transfers in a specific order. First for being over the age of 55 and a second if they subsequently become disabled. However, the reverse is not currently allowed.
People who become severely and permanently disabled prior to turning 55 will most likely need to seek more accommodating housing as they age, and they deserve the same access to property tax relief as those who become disabled later on in life. Individuals have no control over the timing or progression of their disability, and a lack of access to property tax relief should not impede them from obtaining needed housing.
SB 246 establishes parity in this process by allowing those who first receive a disability-based transfer the opportunity to seek a second age-based transfer.
- Committee Staff Comments:
- Proposition 13: Much of the law pertaining to property taxation is prescribed by Articles XIII and XIII A (commonly known as "Proposition 13") of the California Constitution. Proposition 13 was added to the California Constitution in June 1978 and was most recently amended by Proposition 26 in 2010. Proposition 13 was designed to provide real property tax relief by imposing a set of interlocking limitations upon the assessment and taxing powers of state and local governments. Section 1 of Article XIII A states that, as a general rule, the maximum amount of any ad valorem tax on real property may not exceed 1% of the property's full cash value, as adjusted for the lesser of inflation or 2% per year. The term "full cash value" is defined as the "county assessor's valuation of real property as shown on the 1975-1976 tax bill" or, thereafter, "the appraised value of real property when purchased, newly constructed, or a change in ownership has occurred after the 1975 assessment" [California Constitution, Article XIII A, Sections 1 and 2]. In other words, the California Constitution requires that real property be reassessed to its current fair market value whenever a "change in ownership" occurs.
- Acquisition-value system: In an acquisition-value system, property taxes are based on the purchase price of the property, plus any allowed growth. Since market values increase, on average, at a faster rate than those allowed under the California Constitution, the current assessed value of property is presumed to be lower than its market value. If market values continue to outpace assessed value, property taxes for a newly purchased property will far exceed taxes for an identical property that has not been sold. All else being equal, residential property owners who have lived in their homes longer pay less in property taxes than those who have recently acquired property. The expense of operating local governments, therefore, disproportionately falls on newer homebuyers.
The acquisition-value system also causes a reduction in mobility, known as a "moving penalty" or "lock-in effect." Specifically, the current tax system discourages a property owner from moving to a home that better meets his or her needs because moving to a new property triggers a reassessment to the full market value and, in some cases, substantially higher property taxes. The threat of higher property taxes lengthens the time a resident stays in a particular home. In fact, from 1970 to 2000, the average tenure length for owners and renters in California increased by 1.04 years and 0.79 years, respectively[1].
- Response to moving penalties: In response to moving penalties, voters amended the California Constitution to allow homeowners over the age of 55[2] or homeowners who are disabled[3] an opportunity to transfer the base year value of their principal residence, within two years from the sale of the original residence, to a replacement home of equal or lesser value within the same county or to a replacement home in counties that have adopted ordinances allowing the transfer[4]. Base year transfers allow homeowners to continue paying property taxes at the amount and rate of growth of their previous homes and prevent reassessments of their newly purchased or constructed homes to full market value.
- Background: SB 1692 (Petris), Chapter 897, Statutes of 1996, amended R&TC Section 69.5(b)(7) to allow for an additional transfer based on disability if a person has already received a base year transfer based on age. Prior to the enactment of SB 1692, only one lifetime transfer was allowed, irrespective of whether the transfer was based on age or disability. The constitutional provision that allows for a base year value transfer does not impose a limitation on the number of transfers that may occur. The limitations are set in statute and can therefore be modified, as they were in 1996 with SB 1692.
- What does this bill do? This bill would again modify the base year transfer limit by allowing an individual to receive an age-based transfer after the age of 55 even if the person had already utilized a transfer based on disability. The author is attempting to provide parity since the law allows an individual to utilize a disability-based transfer after utilizing an age-based transfer but does not allow an individual to take advantage of the age-based transfer after utilizing a disability-based transfer.
REGISTERED SUPPORT / OPPOSITION:
Support
American G.I. Forum of California
American Legion Department of California
AMVETS Department of California
Board of Equalization Member, 1St District
California Association of County Veteran Service Officers
California Association of Realtors
California State Commanders Veterans Council
Howard Jarvis Taxpayers Association
LeadingAge California
Military Officers Association of America, California Council of Chapters
Vietnam Veterans of America-California State Council
Opposition
None on file
Analysis Prepared by: Carlos Anguiano / REV. & TAX. / (916) 319-2098
Wasi, Nada and White, Michelle J., Property Tax Limitations and Mobility: The Lock-in Effect of California's Proposition 13, NBER Working Paper No. 11108, Feb., 2005. ↑
In 1986, the voters passed Proposition 60 that amended the Constitution to allow a person over the age of 55 to sell a principal residence and transfer its base year value to a replacement principal residence within the same county. ↑
In 1990, the voters passed Proposition 110 that amended the Constitution to extend these provisions to any severely and permanently disabled person regardless of age. ↑
In 1988, Proposition 90 was passed by the voters. That proposition amended the Constitution to extend the base year value transfer provisions to a replacement residence located in another county on a county-optional basis. ↑
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
THIRD READING
Bill No: SB 246
:
SENATE GOVERNANCE & FIN. COMMITTEE: 7-0, 3/29/17
AYES: McGuire, Nguyen, Beall, Hernandez, Hertzberg, Lara, Moorlach
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
DIGEST: This bill allows taxpayers granted an initial base year value transfer due to disability to make another claim another after turning 55.
Existing law:
- Provides that all property is taxable at the same percentage of fair market value unless explicitly exempted by the Constitution or federal law (California Constitution, Article XIII).
- Limits the maximum amount of any ad valorem tax on real property at 1% of full cash value, and directs assessors to only reappraise property when newly constructed, or when ownership changes (California Constitution, Article XIIIA).
- Allows a change in ownership exclusions for homeowners over the age of 55 and disabled persons regardless of age to transfer their home’s base year values to a replacement home of equal or lesser value within the same county (Proposition 60, 1988, and Proposition 110, 1990), or to homes in counties that adopt ordinances allowing the transfer (Proposition 90, 1990).
- Limits base year value transfers for properties eligible for the homeowners’ exemption, requires taxpayers to file a claim with the assessor, and provides that taxpayers may only transfer base year values once, except for taxpayers who claim the benefit first as a person 55 years of age or older, and subsequently become disabled (SB 1692, Petris, Chapter 897, Statutes of 1996).
This bill:
- Allows a homeowner who received a disability-based base year value transfer before the age of 55 to receive a second transfer after they reach the age of 55.
- Applies to transfer claims filed on or after January 1, 2018.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
Board of Equalization Member George Runner
American G.I. Forum of California
American Legion – Department of California
AMVETS – Department of California
California Association of County Veterans Service Officers
California Association of Realtors
California State Commanders Veterans Council
Howard Jarvis Taxpayers Association
Leading Age California
Military Officers Association of America, California Council of Chapters
Vietnam Veterans of America – California State Council
OPPOSITION: (Verified 4/17/17)
None received
ARGUMENTS IN SUPPORT: According to the author, “All severely and permanently disabled people, regardless of the age at which they encounter their disability, should have an opportunity to access accommodating housing. California law allows homeowners over the age of 55 and those who are severely and permanently disabled a single chance to sell their home and transfer its base year value to a replacement residence. Since 1996, California has also allowed a homeowner a second chance to transfer the base year value of their home if they claim an age-based base year value transfer and subsequently become seriously and permanently disabled. However, the reverse is not allowed by current law. If a homeowner claims a disability-based base year transfer prior to turning 55, they are not allowed to request a second base year value transfer upon turning 55. This is a problem because it excludes people who become disabled prior to turning 55 and need to relocate again as they age, effectively putting their disability into a lesser category. As people who become severely and permanently disabled prior to becoming 55 will most likely need to move into more accommodating housing as they age, and they deserve the same access to property tax relief as those who become disabled later on in life. Individuals have no control over the timing or progression of their disability, and a lack of access to property tax relief should not impede them from obtaining needed housing. SB 246 fixes this problem by affording those who have claimed a disability-based base year value transfer before the age of 55 the opportunity to receive a second transfer after they reach the age of 55. No matter when a person becomes disabled, they should have every opportunity to secure accommodating housing. SB 246 simply creates parity within the law and offers the severely and permanently disabled the same access to base year value transfers, no matter when they become disabled.”
4/19/17 10:26:33
**** END ****
SENATE COMMITTEE ON GOVERNANCE AND FINANCE
Senator Mike McGuire, Chair
2017 - 2018 Regular
Bill No: | SB 246 | Hearing Date: | 3/29/17 |
Author: | Bates | Tax Levy: | No |
Version: | 2/6/17 | Fiscal: | Yes |
Consultant: | Grinnell | ||
Property tax: base year value transfers
Allows taxpayers granted an initial base year value transfer due to disability make claim another after turning 55.
Background
Article XIII of the California Constitution provides that all property is taxable unless explicitly exempted by the Constitution or federal law. The Constitution limits the maximum amount of any ad valorem tax on real property at 1% of full cash value, and directs assessors to only reappraise property when newly constructed, or when ownership changes (Proposition 13, 1978). Voters subsequently approved change in ownership exclusions to allow homeowners over the age of 55 and disabled persons (regardless of age) to transfer their home’s base year values to a replacement home of equal or lesser value within the same county (Proposition 60, 1988, and Proposition 110, 1990), or to homes in counties that adopt ordinances allowing the transfer (Proposition 90, 1990). Eleven counties currently allow these out-of-county transfers (Alameda, El Dorado, Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Mateo, Santa Clara, Tuolumne, and Ventura). Base year value transfers allow taxpayers to continue to pay property taxes at the factored base year value of their previous home, and not on the cash value of their newly purchased home, often resulting in tax savings.
While the Constitution allows for base year value transfers, the Legislature provides the specific eligibility requirements in statute. Under state law, taxpayers can only transfer base year values for properties eligible for the homeowners’ exemption, must file a claim with the assessor, and may only transfer base year values once. The Legislature added a sole exception to the one-time limit on transfers for taxpayers who claim the benefit first as a person 55 years of age or older, and subsequently become disabled (SB 1692, Petris, 1996). In that case, the taxpayer can transfer the base year value from the original home twice; however, the law does not similarly treat a taxpayer who initially claims the transfer a disabled person cannot then subsequently claim another benefit after they turn 55. The author wants to allow these taxpayers to transfer their initial base year values a second time.
Proposed Law
SB 246 allows a homeowner who received a disability-based base year value transfer before the age of 55 to receive a second transfer after they reach the age of 55. The measure would apply to transfer claims filed on or after January 1, 2018.
State Revenue Impact
According to the Board of Equalization (BOE), assessors grant only 75 base year value transfers for disabled persons each year, with approximately 2,000 disabled persons have been granted base year value transfers statewide in the last 27 years. As such, they assume SB 246 will only result in four more additional transfers statewide each year, resulting in about $5,000 in annual revenue losses.
Comments
1. Purpose of the bill. According to the author, “All severely and permanently disabled people, regardless of the age at which they encounter their disability, should have an opportunity to access accommodating housing. California law allows homeowners over the age of 55 and those who are severely and permanently disabled a single chance to sell their home and transfer its base year value to a replacement residence. Since 1996, California has also allowed a homeowner a second chance to transfer the base year value of their home if they claim an age-based base year value transfer and subsequently become seriously and permanently disabled. However, the reverse is not allowed by current law. If a homeowner claims a disability-based base year transfer prior to turning 55, they are not allowed to request a second base year value transfer upon turning 55. This is a problem because it excludes people who become disabled prior to turning 55 and need to relocate again as they age, effectively putting their disability into a lesser category. As people who become severely and permanently disabled prior to becoming 55 will most likely need to move into more accommodating housing as they age, and they deserve the same access to property tax relief as those who become disabled later on in life. Individuals have no control over the timing or progression of their disability, and a lack of access to property tax relief should not impede them from obtaining needed housing. SB 246 fixes this problem by affording those who have claimed a disability-based base year value transfer before the age of 55 the opportunity to receive a second transfer after they reach the age of 55. No matter when a person becomes disabled, they should have every opportunity to secure accommodating housing. SB 246 simply creates parity within the law and offers the severely and permanently disabled the same access to base year value transfers, no matter when they become disabled.”
2. Expands tax benefit. While SB 246’s changes are only expected to result in four new transfers per year, the measure does expand a current tax benefit. As a result, the state and affected local agencies may have to reduce spending or increase taxes to match the amount of foregone revenue.
3. BOE and assessors. In 1850, the Legislature first directed county assessors to tax property; however, assessors in different counties often applied different tax rates and methods of assessment. The California Constitution of 1879 created BOE to equalize rates and assessment practices among counties. State law requires BOE to track base year value transfers to ensure that taxpayers are not filing multiple claims for benefits when they are not eligible.
Support and Opposition
(3/23/17)
Support: BOE Member George Runner, California Association of Realtors, Howard Jarvis Taxpayers Association
Opposition: None received.
-- END --
Discussed in Hearing
Assembly Standing Committee on Revenue and Taxation
Senate Floor
Bill Author
Bill Co-Author(s):