Senate Standing Committee on Revenue and Taxation

The Committee on Revenue and Taxation will come to order. Let's establish a quorum. Secretary, please call the roll.

[roll call]

We have a quorum.

We have a quorum. We will now hear from the first author. First, chair announcements though. Welcome to the Committee on Revenue and Taxation. We have 21 bills today to consider. One bill is proposed for consent and that is file item number 12, SB 359 by Senator Niello.

The tax expenditures being proposed today have as introduced a collective cost to the state of over $4 billion across the next three fiscal years. We've been able to work with authors to reduce the revenue impacts in some cases. First author we'd like to hear. Welcome, Senator Seyarto.

Go ahead and present your bill.

Thank you, Mr. Chair. And just want to start by thanking the committee for working with my staff and also the stakeholders on this bill. It's an important bill.

Prop 19, which was passed in 2021, included a restriction on the transfer of family homes between parents and their children, particularly regarding the retention of the properties. Proposition 13 protected tax base.

Under Prop 19, a recipient must move into the home, claim it as their principal residence and file for their basic homeowner exemption within one year of receiving the property.

Under current law, individuals who inherit a property that is held in probate have found themselves unable to possess the property under the one year timeline and have lost their Prop 13 protected tax valuation. Anybody who has done probate knows that that is a process that probably takes one or two years sometimes.

Furthermore, under current interpretation, any attempt to change the title to remove other siblings and consolidate the ownership of the home currently triggers a reassessment of the property tax base. This measure will clarify that Prop 19 calendar year for individuals who are undergoing a probate process starts when the home is legally declared to be theirs.

This measure will also clarify individuals may consolidate or change ownership within their siblings within the Prop 19 Year without triggering a reassessment. So with that, I respectfully asked for an I vote. The analysis was very clear and so therefore I didn't feel like there was a need to bring more expert witnesses to say the same thing.

In the interest of your 21 item agenda.

I thank the senator for his consideration here. Is there anyone that wants to speak in favor of the bill?

Good morning. Amy Garrett with California Association of Realtors. Very much in support of this measure to help streamline the implementation of Prop 19. Thank you.

Scott Kaufman, Howard Jarvis Taxpayers Association in support.

Thank you. Anyone wish to speak in opposition to the bill? Well, looks like you have a pretty strong case here, Senator.

Thank you.

And I thank you for bringing the measure forward. Any questions or comments from the committee members? Thank you. Pardon.

Okay. Move the bill. Any other comments? Your office has been very tenacious in working on this bill on Prop 19 and it's implemented in California's 58 counties. Thank you. It's been a pleasure to work with you on the bill, senator, and I'm happy to support it.

Very good. And with that, I would simply ask for an I vote.

We have a motion. Secretary, would you call the roll?

Motion is do passed to the Committee on Appropriations.

[roll call]

The vote is 3 to 0. The bill is on call. Thank you. Next we have Senator Niello.

Senator, please present the bill.

Thank you, Mr. Chair. I believe that I am presenting SB 603 first, so thank you very much for the opportunity to present SB 603.

Existing property tax law already provides that the property tax base year value of real property that is substantially damaged or destroyed by a governor declared disaster may be transferred to a comparable property located in the same county that is acquired by new acquired or newly constructed within five years of the disaster as replacement property.

This has been of benefit to homeowners who are navigating a very difficult time in dealing with a disaster and rebuilding process, which can take a long time. Recent fire events like those in Southern California are showing that five years is proving to be and will prove to be a very difficult timeline to meet.

In recognition of this, the legislature has extended the five year time period numerous times, individually and temporarily for specific events. A Borges bill in 21, a Gallagher bill in 23, an Anderson bill in 2010.

Given the unprecedented wildfires in Los Angeles, in the Los Angeles area this year, it's going to be a huge challenge to see any rebuilding completed within five years.

It is time for the legislature, I think, to consider allowing the local land and tax use authorities to make this decision on an ongoing basis, not disaster by disaster, whether it's fire, floods, mudslides, earthquakes, local boards of supervisors are closer to the problems that are affecting their communities and can adjust the time period if needed.

SB 603 authorizes the County Board of Supervisors of any county affected by a disaster declared by the governor on or after January 1st of this year to extend the five year time period to transfer property tax base year values by up to three years additionally for properties located in the county. Today, I have Larisa Mercado.

Am I pronouncing that correctly? To testify and support on behalf of the California Assessors Association.

You may proceed.

Thank you. Good morning, Chair. Members of the Committee, Larisa Mercado, on behalf of the California Assessors Association in support of SB 603.

Under Prop 50, victims of a natural disaster may transfer the base year value of a damaged or destroyed property to a comparable replacement property within the same county provided that transfer occurs within five years of the disaster event. This existing provision has served as an essential tool for homeowners navigating the long and difficult path to recovery.

However, as we have seen in the aftermath of the recent catastrophic disasters, including the 2025 wildfires in the Palisades, Eaton, Hearst, Lydia, Sunset, and Woodley areas, the timeline for rebuilding or relocating can be far more prolonged than anticipated. Supply chain disruptions, permitting delays, labor shortages and insurance disputes have all contributed to lengthy and often unpredictable recovery periods.

SB 603 acknowledges these realities and ensures that counties can respond to the unique conditions that and recovery challenges faced by their communities while still preserving the integrity and intent of the property's base year value transfers set forth by Prop 13. The Assessors Association supports this bill as a practical and fiscally responsible measure.

Responsible measure that will improve the ability of California counties to serve California. Thank you.

Thank you. Any other witnesses in support?

Amy Garrett, on behalf of California Association of Realtors in support of the measure. Thank you.

Angie Minetti, on behalf of the California Apartment Association in support.

Prop 13 is mentioned. And I appear. Scott Kaufman, Howard Jarvis Taxpayers Association in support.

Thank you. Any witnesses in opposition? None seen. I turn it over to the committee. Any committee members wish to make a statement? Yes, Mr. Grayson.

Thank you, Mr. Chair. And just wanted to thank the author for carrying this important bill. And also the professional testimony of your witness has convinced me to absolutely support the bill and move it at an appropriate time.

Any other committee members? Well, thank you. I'm going to make some comments in support of the bill. It's a thoughtful way to allow local governments to extend property tax deadlines for those affected by wildfires and other disasters. I thank you for bringing this forward and I'm pleased to support the bill.

Well, thank you very much. And allow me to close by saying I respectfully ask for an I vote.

Appreciate the brevity.

And the motion has been moved. Would Secretary call the roll?

[roll call]

The vote is 3 to 0. The vote is on call. Thank you. Now, with the permission of Senator Choi, Senator Niello has asked if he could present the next bill because he has a tight deadline today.

With that permission, Senator Niello.

Thank you very much Senator Choi and Members of the Committee, I am presenting SB 657. SB 657 conforms state law to federal law allowing taxpayers to benefit from the recently approved provisions of the Secure Act of 2022 pertaining to the rollover of funds from qualified tuition plans, also known as 529 accounts, to Roth IRAs.

The Federal Secure 2.0 signed into law in 2022 contained over 90 provisions designed to encourage people to save more for retirement. One of those provisions amended the IRS code to allow for the tax-free and penalty-free rollovers from 529 accounts to Roth IRAs.

Families and potential account holders have long expressed concerns about saving with a 529 account to the possibility of having to take a non-qualified withdrawal and face taxation and or penalties should a beneficiary decide not to pursue post-secondary education or simply have unused funds in the account.

This concern has led to hesitation, delays, or declining to fund 529 savings accounts to the necessary levels needed to adequately save for the rising costs of education.

By conforming state law with federal law. This proposal would greatly help those concerns by providing individuals and families with additional flexibility resulting in higher confidence in long-term accessibility of funds and therefore the opening of more 529 accounts and increased contributions and savings to new 529 accounts.

Further, this proposed change would allow individuals and families to start investing toward their child's retirement. A win-win. To date, 32 other states have conformed to this law. 32 other states. I know there have been concerns raised in the analysis about this being a vehicle for wealthy families to benefit, but that really simply is not the case and I will let my witnesses speak more to that point.

This Bill has garnered bipartisan support and is sponsored by California State Treasurer Fiona Ma. I now would like to turn this over to my witnesses. First we'll have Cassandra DiBenedetto, Executive Director of the ScholarShare Investment Board, followed by Tina Florence on behalf of the California Financial Planning Association.

Witnesses may proceed.

Good morning, Chair and Members. My name is Cassandra DiBenedetto and I serve as the Executive Director of the ScholarShare Investment Board, which administers California's 529 college savings plan, ScholarShare 529.

I'm here today on behalf of State Treasurer Fiona Ma, who proudly sponsors Senate Bill 657, a timely and equitable reform that aligns California law with recent federal changes allowing rollovers from 529 accounts to Roth IRAs.

This Bill addresses a persistent barrier that prevents many families, especially low and moderate income households and families of color, from opening and contributing to 529 plans. The fear that if their child doesn't pursue higher education, they'll be penalized for saving. The fear is very real.

We hear it often from families who want to do the right thing but hesitate to open an account. This uncertainty disproportionately impacts communities that have historically been excluded from financial systems, reinforcing inequities in college access and long-term economic opportunity. SB 657 provides peace of mind.

It allows families to know that if their child takes a different path, their savings can still serve a purpose by helping build retirement security. And these accounts are not just used by wealthy families. In California, more than 57% of scholarship 529 account holds earn under $150,000 a year. Nearly 30% earn under $100,000 a year.

Among new account holders, those numbers are even higher. 67% earn under $150,000 a year. And these are precisely the families that benefit the most from a flexible low-risk savings tool.

According to a Brand Health survey in late 2023, found 73% of our target audience said the option to roll over a savings into a Roth IRA would help spark their interest in opening a ScholarShare 529 account. And with that, I am ready to answer any questions the Committee may have. Thank you.

Thank you for the. There we go. Thank you for the opportunity to provide comments in support of the Bill. My name is Tina Florence and I'm a certified financial planner and owner for 20 years of a financial planning and investment firm in Folsom, California. My husband and I raised our family in Folsom and our children attended UC colleges.

I'm also a Board of Directors Member of the Financial Planning Association of California who supports the Bill and provided a letter. This Bill is an important step to continue to support working families and students move forward with the tools they need.

At my firm, 529 ScholarShare accounts are commonly opened by parents or grandparents, but other family members may contribute as well: aunts, uncles, step parents, even the child. Once the account is open, deposits can be made by basically anyone. It's hard to determine exactly how much will be needed for a degree or certificate in the future.

What school will they attend? How long will it take? What will the investments return? Just last week we met with retired clients on a limited budget who opened 529 accounts for their four grandchildren over 15 years ago. And the last one is finishing trade school.

There are some extra funds in the account and they wanted to know their options, so they came to meet with us. They would have been very pleased to be able to roll those extra funds less than $5,000 to a Roth IRA, tax free, for the benefit of their grandchild.

Conforming state and federal law to allow for tax free Roth rollovers for the beneficiary is a powerful message to graduates that investing in the future is a priority. One that their families and policymakers endorse. The option to roll over unused fund is also consistent with the recent passage of the financial literacy course graduation requirement from high school.

What an opportunity for a graduate to complete their degree or certificate and have a tax-free retirement account for them to learn about investing and practice the skills they learned in the financial literacy course.

I saw in the legislative summary report presented earlier for the Bill that the proposed rollover provision, in their opinion, would disproportionately benefit high wage account owners. I disagree.

The true benefit is not the owner of the 529. It's the generation who could start off as a young graduate learning and thinking about their financial future and a Roth IRA with a nod from the California State Legislature. In my experience, 529 accounts are very popular with working families.

Would you please wrap up.

I'm sorry. Who appreciate the opportunity to stretch their funds to meet expenses. Not just wealthy families. When I. When I review the terms of the Bill with friends, neighbors and clients, they're thrilled and hope you will vote in favor for it. Thank you for your time.

I thank the witnesses. Any witnesses in support of the Bill, please approach.

Good morning. Sorry. Joanne Bettencourt on behalf of SIFMA, the Securities Industry and Financial Markets Association, in strong support. Thank you.

Good morning. Mr. Chair and Senators. Rosanna Carvacho Elliott here on behalf of Fidelity Investments. Also in strong support. Thank you.

I thank supporting witnesses. Any witnesses in opposition?

Good morning, Chair and Members. Dani Kando-Kaiser here on behalf of the California Tax Reform Association, in respectful opposition based on partial conformity. The California Tax Reform Association is a coalition of the state's leading labor groups.

This issue should be taken up as part of a larger conformity package in which gains and losses are set against each other and and decisions are made with regard to which conformity issues are necessary, for example, taxpayer simplicity, and which are discretionary as matters of policy. Thank you.

I'll turn to the Committee. Any comments from the Committee Members? Vice Chair is recognized.

Thank you Mr. Chair. So it appears to me that this Bill is simply about fairness.

You know, parents are, were constantly told to save for our kids education and many, we do attempt to do that and the little amounts that we may have to put into a 529 account. But if that money isn't used due to scholarship or a change in plans, we're penalized. And to me that's not fair.

And this Bill I think fixes that. And, you know, I didn't come from the wealthiest of backgrounds. And wealthy families do have financial tools that are easily accessible to them. But for working families, the kind of flexibility, this kind of flexibility makes a real difference, which is why I'll be supporting this.

Thank you for bringing it forward and happy to move the Bill when appropriate.

Well, I thank the author and I thank the witnesses. This Bill SB 657 would allow families to roll over the 529 college funds tax-free into Roth IRAs.

There is a cost to this Bill and it is a very difficult budget season and I have concern that the witnesses have seemed, have tried to address, that allows households that are already able to set aside college funds, effectively allowing those with means to continue building their wealth without tax benefits, without tax penalties.

So for that reason I'm not going to support this and I'm going to withhold a vote on this Bill today.

I appreciate that.

The Senator may close.

And our staffs have had similar comments. I would stress, first of all in promoting things, one of the rules is you repeat it three times. I said twice before that 32 other states have adopted this.

So I will say a third time, 32 other states have adopted this and two-thirds of the states, and specifically with regard to your point, the present circumstance, the current Bill or law as it exists in California, as the treasurer says.

And I think it's a very good point, it discourages lower income people from participating in this because of the uncertainty of the corpus, if you will, of the account if their child chooses to go not to go through higher education for which the account would qualify to pay.

Or if there is leftover amounts they have to pay a penalty in order to gain access to the funds for any purpose for their kids retirement or for their own use.

It actually to the extent we've got a third of the people are 100,000 or less which, by the way, is far from wealthy in this State of California and certainly not someone that would have a huge wealth to pass on to their child when they passed away. So this helps that child.

But that proportion with this Bill would very likely increase substantially, and the average income of people taking advantage of this would decrease substantially, because of the risk of setting it up in the first place. So this really helps that issue about which you are concerned.

So I would respectfully ask for an aye vote from everybody on the Committee and respectfully ask the chair to perhaps change his mind. Thank you.

Well, I thank the author. The Bill has been moved. Will the Secretary call? The roll.

[ROLL CALL]

The vote is 2-0. The bill's on call.

How many Members are not here right now? One.

Oh, just one now.

Thank you very much. And thank you very much to my friend Senator Choi for allowing me to precede him. Appreciate it very much.

Thank you, Senator. Next up we have Senator Choi. You've got a number of bills, Senator. The first would be item File item number one, SB 267.

Good morning, Chair and Members. Yes, I do have seven bills this morning. Let me go through in the order of the bin number. First one is SB 267. 267 recognizes the personal financial sacrifices that teachers make to provide quality education. Surveys indicate that 94% of educators spend between $300 to $500 annually on classroom supplies.

This Bill allows teachers to receive up to $250 of tax credit when they purchase classroom supplies with their own personal money. By alleviating some of the financial burdens associated with the classroom expenditures, SB 267 supports equitable access to quality education by ensuring that teachers have the necessary resources to create effective learning environments, regardless of their personal financial situations.

SB 267 is designed as a temporary measure, effective from January 1, 2026, to December 1st, 2031. This implementation aims to provide immediate relief while encouraging the development of more permanent solutions for funding classroom supplies.

SP 267 is co-authored by both Republicans and Democrats as a bipartisan bill, demonstrating a shared commitment of supporting educators and enhancing the quality of education in California. With me I should have, I have now, Pamela Gibbs, in the front, from the Los Angeles Office of Education, to testify in support of the Bill. Thank you, Pam.

Thank you. The principal witnesses now in support is now recognized.

Thank you very much, Mr. Chair and Members. My name is Pamela Gibbs, representing the Los Angeles County Office of Education, in strong support of SB 267. The bill would provide a modest, but meaningful, state personal income tax credit of up to $250 for qualified teachers who spend their own money on classroom supplies and instructional materials.

As you are well aware, California's educators routinely go above and beyond to support their students, not just with their time, energy, and care, but also with their personal finances. Teachers frequently spend well beyond the $250, each time—several times—that amount on essential classroom items.

This tax credit is not a comprehensive solution, but it is important and it's a first step toward acknowledging and alleviating the financial burden placed on our educators.

My mother was a teacher and one of our favorite outings was going to the teacher parent supply store where we would be with our mom and she would purchase classroom supplies including books, rulers, educational classroom decor, and games for her classroom. And we also enjoyed using our own allowance to purchase puzzles and supplies, as well, for ourselves.

This instilled a love of learning for her students and for her own children. By targeting this credit to teachers who serve at least 900 hours per year in our schools, SB 267 honors the commitment of frontline educators, while making a fiscally responsible investment in the classroom experience of California's children. For these reasons, I respectfully urge your "Aye" vote on SB 267 as a first step towards broader support for educators in our tax policy. Thank you.

Any other witnesses in support? Any principal witness in opposition? Any other witnesses in opposition? So, you're a principal witness in opposition? Okay, thank you.

There we go. Hello again, Danny Kando Kaiser, on behalf of the California Tax Reform Association. Again, we are a coalition of groups, labor groups, from around the state, which does include the California Teachers Association. Respectfully opposing this Bill which would provide taxpayer support for private and religious schools violating a long-standing policy of the State of California.

It is also very difficult to implement and enforce an audit with the result that virtually every teacher could claim a credit with little oversight ability by the Franchise Tax Board. The cost of this Bill comes approx—comes approximately—40% from the education budget.

So, while perhaps this would help teachers, it also harms the financing of public education in the state, with benefits going primarily to private and religious schools. Thank you.

I thank the witness. Any other witnesses in opposition? With that, I will turn to the Committee Members for comments. Senator Ashby is recognized.

Yes. Thank you so much. I, I signed onto this Bill because I think I understand the arguments against but any teacher, in any setting, who spends their own money to support kids, all of our kids, I think this is a very modest thing that we can do for them.

I understand the opposition that maybe it should be more money or maybe we should limit to certain groups, but I think it's a small amount of money and I am grateful to every teacher that my kids have encountered, in any school setting, that would dig into their own pocket, that teachers don't make very much money and to use it to support their kids, whether it's cool pencils and stickers or posters on the wall that encourage our kiddos every day, I just to want to honor that. So, that's why I will continue to support the Bill.

Thank you, Mr. Chair. I'm too going to be supporting this. And, you know, I—having ran a childcare center myself in the past, and seeing firsthand how passionate teachers are about education, and how passionate they are about bringing little things to school, whether it is, you know, stickers, a little, you know, treasure chest.

My daughter loves a treasure chest at school that she buys with her owl bucks. And all that comes from the love and the passion of teachers wanting to get their—wanting to excite their students about education and reward their hard work.

And this is a small, I think, but important show of our appreciation and helping them save in that passion that they give so full heartedly with. And thank you for bringing the Bill forward, Mr.—Dr. Choi.

Thank you.

Comments. I would like to thank Senator Choi for bringing this Bill forward and being a champion for our teachers. The Bill recognizes the personal financial sacrifices made by educators in this state and it targets them with the tax credit. So, I appreciate that. It's not a heck of a lot per teacher.

There might be a way to make sure that money is accounted for a little bit better. But I'm proud to be a co-sponsor and I would like to support the Bill. Senator, would you like to close?

Give me close?

Would you close?

Yes. In contrary to the opposition leader statement that this is not just to benefit private schools or religious schools. This is teachers of public schools and private schools—any teachers. So, please clearly understand that. This supports K-12 teachers in a meaningful way.

It may be small, but it recognizes their zeal to support and educate our children with their personal sacrifices. So, that's the reason I respectfully ask for your "Aye" vote.

Has the Vice Chair moved the Bill? Okay, the Bill is moved. Will the Secretary call the roll?

[Roll Call]

The vote is 4-0. The Bill is on call. Thank you. Senator Choi, your next Bill?

Thank you, sir. Let me continue with the next Bill, SP268, which is my emergencies settlement tax exemption Bill. Under the current law, insurance settlement payments received due to proclaimed state emergency are subject to income tax unless specifically exempted.

Paying income tax on a settlement payment creates a financial burden for victims already struggling to recover from disasters like wildfires, floods and earthquakes. Many victims in Los Angeles County across California are being taxed on money that is meant for rebuilding their lives.

SB268 excludes settlement payments received due to any State of emergency proclaimed by the Governor from state taxable income until 2030. SP268 contains an urgency clause to provide immediate tax relief to current victims and future victims without the need for a case by case legislation to provide disaster tax exemptions.

This bill ensures that the disaster victims receive their full settlement amount rather than having it reduced by taxes. Our constituents deserve a fast recovery and fewer hurdles as they rebuild their communities and their homes. Thank you.

Then the principal witness in support. You're now recognized.

Good morning, Mr. Chair and Members. Angie Minetti here on behalf of the California Apartment Association. In support. In the past few years, the Legislature has adopted bills to exempt settlement money from specific wildfires. The analysis mentions a few of these that the Governor has approved.

AB1249 by Assembly Member Gallagher, which provided this exemption for the Butte Fire, North Bay fires and camp. And then also SB1246 by Senator Stern, which exempted state income tax from state income tax, the amount received for the SoCal Edison and Thomas Fire and Woolsey fires in recent years. This bill is consistent with past legislation.

Residents of LA County have been suffering it from the aftermath of the 2025 wildfires for months.

Instead of having to pass disaster specific bills each time a wildfire occurs, SB 1268 would exempt any settlement money received by a California taxpayer who suffers property damage from any natural disaster that causes the Governor to declare a State of emergency and subsequently receives a monetary settlement.

Unfortunately, due to the cyclical nature of natural disasters in our state, CAA believes this is the right approach and we must. We request your support.

Thank the witness. Any other witnesses in support? Any principal witnesses in opposition? Any witnesses at all in opposition? With that I will turn to the Committee Members for comments or questions. Seeing none. I want to thank the Senator for working on this and bringing it forward and being tenacious.

And it sensibly excludes settlement payments from insurance companies to disaster victims. And I think that's a good thing. I do remain concerned about the bill's reference to accidental or human caused events that may be a little broad in scope. So we can work on that. But I'm pleased to see support the bill.

And has the bill been moved? The Vice Chair moves the bill. Would the author like to close? Thank you, Chairperson.

I was so shocked when I discovered this fact that the insurance settlements from defy victims or any other disasters were considered as income and they have to pay personal income on the settlement fees. So this is to me common sense bill.

And victims of the disaster should not have to wait for special legislation or face unexpected tax bills during the crisis. With that, I hope I can get you a vote in respect to you. You ask for your aye vote.

Well, I think. Senator, the bill the motion has been made and with the secretary call the roll.

[Roll Call]

The vote is 40. The vote is 40. The bill is on hold. Thank you, Mr. Choi. Senator Choi, please proceed with your next item.

Thank you chairperson and the members. My next bill is 269. I'm here. Which is FIO Save for Home Tax Credit act which is a vital step toward in our states fight against the increasing threat of wildfires. We know that the fire danger is no longer a seasonal concern.

It's a year round reality in California and wildfires grow more frequent and destructive. We need bold policies and both protect our communities and empower our residents. SB 269 introduces a personal income tax credit for homeowners who make proactive steps to harden their homes and manage vegetation to reduce fire risk.

Under this bill, starting in 2026, eligible homeowners will be able to claim a credit of 50% only 50% of qualified expenses subject to cap based on their fire zone. They live in ominous in a high very high fire hazard zone. Could receive up to $2,000 per year for home hardening and $500 for vegetation management.

This bill is targeted to help those who need it the most. It is limited to households earning under $140,000 for joint filer- filers and $70,000 for individuals. Only homes located in the officially designated fire hazard zones. Moderate, high or very high will qualify.

In short, we are supporting working and middle class homeowners who are on the front lines of wildfi- wildfire risk and may not have the means to make costly but necessary improvements. SB 269 is not an open checkbook. It includes a $50 million annual cap on total credits with the reservations system to prevent over subscription.

I have Angie Manetti with the California Apartment Association in support of the bill her here as a main witness. Thank you for being here.

Good morning. Good morning Mr. Chair and Members CAA here in support of SB 269.

The tax credits proposed here will positively be used to incentivize behavior and provide a dollar for dollar decrease on a person's tax burden when they take actions to execute home hardening and vegetation mana- management to protect their home and surrounding properties due- from damage due to fires. At the same time that fires are causing irreparable damage,

California's insurance market is in a free fall as insurance cancel- insurers cancel policies, hike premiums or leave the market altogether, which puts an even higher burden on residents. SB 269 would establish a responsible fiscal program to incentivize property owners to make their own home more fire resistant rather than relying on state funded insurance programs after a disaster strikes.

The credits made available by this bill will help ease the financial burden of wildfire mitigation and will incentivize proper vegetation management practices at the residential level. For these reasons we ask for your aye vote.

Any other witnesses in support?

Hello, Amy Garrett with California Association of Realtors in support of this incentive for property owners to voluntarily engage in home hardening measures benefiting their own properties and that of surrounding properties. Thank you.

Good morning Mr. Chair and Members Obed Franco here on behalf of the California Fire Chiefs Association and the Fire District Association of California in support.

Any principal witnesses in opposition?

Good morning again. Dani Kando-Kaiser on behalf of the California Tax Reform Association. The Bill rewards actions taken by homeowners that would take case, take place in case for any homeowner who already desires to protect their homes. The personal responsibility for the property should not be subsidized by the state the cost of necessary services.

For those property owners who cannot afford this work, the state, localities, or insurance companies can set up low cost loan funds to protect these properties. The General Fund should not take the place of personal responsibility nor should it subsidize those that can well afford to take appropriate care for their property. Thank you.

Any other witnesses in opposition? We now turn to the Committee Members for comments. Well, with that I want to thank the Senator for introducing SB 269. And I do want to say that I appreciate you accepting amendments to limit the scope of this to at-risk, high at-risk properties.

Its still expensive and I appreciate the comments of the opposition. But the cost of households hardening their homes is probably a lot less than the cost of cleaning up fires. So if this reduces the chance of fire, I think it's a good Bill and I will support it and I'm pleased to support the Bill. So with that, would the author like to close?

Thank you, sir. SB 269 is a smart, productive tool to incentivize safety and resources resilience before disaster strikes. Prevention is the key rather than trying to spread the fire all of the neighbors and a lot wider and that will cost a lot more money.

And then also air quality that our Legislature has been working for a long time will recede so many years of effort that we are working on. So I think this is a very sensible common sense Bill. I urge you aye vote.

Thank the author. Is there a motion?

I motion to move.

The Vice Chair moves. Will the Secretary call the roll?

[ROLL CALL]

The vote is 4-0 and the Bill is on hold. Mr. Choi, you have another Bill or two?

Yes, sir. Next Bill is SB529. This. This bill incentivizes families to save for higher education by offering a tax deduction for contributions to the California qualified tuition program.

This bill aims to alleviate the financial burden of college expenses and hopefully lead to more students that can graduate from a four year old college degree without the burden of student debt.

By making college savings more accessible, the bill seeks to level the playing field for students from diverse socioeconomic backgrounds, ensuring that more Californians from low and middle income households have the opportunity to pursue higher education.

The proposed tax deduction provides direct financial relief to middle class families, incentivizing them to start immediate pressure of high education costs once they graduate from high schools. SB529 aligns with the California broader objectives of increasing college enrollments and completion rates, contributing to the state's long term economic growth and competitiveness.

We all know that higher education can open many doors. As an immigrant and someone who earned a PhD from working hard during the summertime, education is the key for their future.

From my own personal experience, college education is the key for all the people, especially from low income or moderate income and will open the doors for their future. That's the reason we need to start encouraging all the families to start saving their college tuition rather than relying upon government handouts.

Thank you. Are there any principal witnesses in support? Any other witnesses in support? Principal witnesses in opposition.

Good morning again, Joanne Bettencourt. On behalf of SIFMA, the Securities Industry and Financial Markets Association, we have an opposed unless amended position on this bill. If the goal is to encourage people to save early and often for educational expenses, then SB529 should apply to all qualified 529 plans.

This would ensure that all savers receive the same tax treatment. For example, if a young couple goes into a bank and applies for and gets a 529 private 529 plan for their child, they would not get the deduction.

The grandparents go and work with their trusted advisor to contribute to their grandchildren's 529 plan, they would not get the deduction. So as you see, SB529 actually limits investors choice because it makes the driving factor to where the deduction is versus what plan may be more suitable for the saver's overall needs.

And lastly, there are nine states that currently offer the deduction for both private and public 529 plans. And so for those reasons we ask for a no vote today. Thank you.

Hello again Dani Kando Kaiser on behalf of the California Tax Reform Association, California already provides tax advantages for saving for higher education in the scholarship program.

By allowing deductions as this bill proposes, the benefits accrue primarily to those better off families who already can afford to pay for college tuition and already itemized their deductions, which are predominantly better off families.

As a previous veto message of a similar bill pointed out, an additional tax deduction would largely benefit higher income families that have tax liability and enough disposable income to Contribute. Meanwhile, those struggling to afford college get to benefit and the state sustains a revenue loss. Thank you.

Any other witnesses in opposition? We'll now turn to the Committee for Comments hearing. None. Senator, I think this is a good effort. I appreciate the intent of encouraging college savings. However, this is a really bad budget year. We're facing incredible deficits. And because of that I'm not going to be able to support the bill.

But I will not vote in opposition. I'll just withhold vote. Would the other like to close?

Thank you, sir. A while ago, Senator Niello presented his bill of the 529 program. Any remaining amount shall not be penalized and will be allowed to IRA accounts. That is a measure to encourage people to sign on and make contributions early on without the fear of losing or being penalized.

And this bill is not for the rich people. Actually, contrary to the opposition witnesses, the rich people can. They may not have to save their money because they have money. They can afford the high cost of college education.

This is designed for low income, middle income, general people who may not have such a lump sum at the time of when the child goes to college. This is for them early on to save.

And this is a way of encouraging them they could not afford to save, set aside extra money for their college education for their children. This is rewarding, encouraging, incentivizing for their early savings so that they can have at least a tax deduction, not the tax credit.

So I think this is early proportion and encouraging all the general people, especially from low income families or middle income families, not to vote. This bill is not designed for rich people. With that I urge your aye vote.

Thank. The Senator is closed. Is there a motion?

One way to go.

Okay, there's been a motion. Will the Secretary call a roll?

[Roll Call]

Vote is 20. The bill is on call. Thank you. Senator Choi, you have another Bill?

Yes, sir. My next bill, SB 665 will establish an annual tax credit for qualified retail establishments that purchase as security measures aimed to prevent retail thefts. Retail theft has become a significant problem in California, leading to many businesses migrating to other states or closing existing locations in the state.

To combat this increase in crime, many businesses have taken precautionary steps to protect their customers, their workers and their property. They have installed cameras, alarm systems, perimeter security lighting and even purchased exterior license plate reader technology. All of these measures incur serious costs upon businesses. These costs are then passed on to customers through higher prices.

SB 665 helps businesses combat the devastating effects of retail theft by offering a tax credit of up to $10,000 for qualified businesses that have taken extra measures to protect their employees, properties and customers against crime. I urge all the committee members to support this bill which is critical to helping protect the California businesses. Thank you.

Thank the author. Are there any princ- principal witnesses in support?

Mr. Chairman, Trent Smith on behalf of the California Alarm Association in support. I guess I may be the principal, the MeToo and all the support witnesses. So I'm happy to answer any questions.

Thank you. Any other witnesses in support? Are there any principal witnesses in opposition?

I'll just stay at the mic on this one. Dani Kando-Kaiser again on the Cali- on behalf of California Tax Reform Association, respectfully oppose this bill. Retail theft protection is an investment by virtually every retail establishment as a cost of already doing business.

There is little to no benefit to the state from the General Fund providing generous subsidies to retail establishments that do what they must do in the case of- of their business. While the necessity of guarding against theft is a very unfortunate result of crime in our society, all retail establishments are responsible for protecting themselves.

A responsibility that should not be paid by ordinary taxpayers as this bill would propose. Thank you.

Any other witnesses in opposition? I will now turn to the committee for comments.

The vice chair is recognized.

So I'll say that one, I think it's a little insulting to say that it is. Businesses need to assume this as a cost of doing business and responsive and it's their responsibility.

When California has an unfortunately sent a very clear messages- message for years that emboldens criminals and retail theft which is why we saw the overwhelming passage of Prop 36 last year because it's out of control. And this isn't just headlines. This is a daily grind for- for businesses, small and mid sized busine- businesses.

These aren't big corporations with deep pockets. These are family run shops, neighborhood shops, neighborhood staples. These are job creators just trying to stay afloat with how bad retail theft has gotten in our communities and trying to stay. And frankly, I think that this is a necessary bill to help those businesses right now.

It's a modest and targeted bill as well. And it doesn't replace enforcement. I think it complements it and it says to our business owners in California that we have their back. We get it. So I'll be supporting this bill. Dr. Choi, thank you.

Thank you.

Any other members? Well, again I commend the author for bringing this bill forward. The commitment of this committee is to consider each tax proposal for effectiveness and its impact on the budget. Unfortunately, the bill would benefit specific retailers for carrying out responsibilities that they should assume by themselves. And it does have an impact on the budget.

So I'm going to oppose the bill. Would the author like to close?

Yes sir. I feel that government is responsible to create a safe environment for anyone, any citizens and businesses to safely operate their businesses.

But in contrary to the opposition lead statements that we hear is that this is not just providing government subsidy for individual businesses by helping them stay small mom and pop, small retail or even large businesses when they close.

Because of General's pro criminal law Prop 47, even after Prop 36 has passed, no government funding has been made to implement it to provide further safety for the retailers. So they pack and leave. The taxpaying businesses are leaving our state. Think about the loss of the tax revenues that we could have had if they stayed in California.

And then all the small mom and pop stores when they just to give up and close and there's no income and they are not going to be able to pay the necessary due state tax income tax that they could have paid. So protecting the businesses is helping our state to increase or prevent loss of state revenue.

So in fact this is not just helping individual businesses, but this is helping the state to keep the necessary revenue or possibly increase the state revenue in the future so we can keep all the businesses large or small in our state. So this is a small indication, small investment for them to stay here.

So with that I respectfully ask for your aye vote.

Thank the author. Is there a motion?

So moved.

The bill has been move. Will the secretary call the roll?

Motion is do passed to the Committee on Appropriations. [roll call]

The vote is 123. The bill is on call. Thank you Senator.

Thank you.

And you have another bill, Senator?

Yes, sir. Thank you for enduring with me. We have so many bills. Next Bill is SB 666. I hope this is not a bad omen, that number. SB 667 will establish an annual tax credit for qualified applicants who install security surveillance systems at their principal residence. So this is different from my previous Bill for retailers.

This one is for individual homes. For many years, home break-ins and robberies have been a serious problem for residents, leading to lost property and even loss of life.

To combat these crimes, many residents have taken precautionary, cautionary steps to protect their properties and their families by installing doorbell cameras, interior lighting and home alarms, among other security measures.

SB 666 will provide assistance to Californians who purchase security systems to protect their residents by providing tax credit up to $250 per year to residents who take extra measures to protect their homes, belongings, and their families. I urge Committee to support this Bill, which is critical to helping protect the California residents. Thank you.

I thank the author. Are there any principal witnesses in support?

Trent Smith on behalf of the California Alarm Association and support.

Any witnesses in opposition?

Danny Kando Kaiser, on behalf of the Electronic Frontier Foundation. In opposition.

Any other witnesses in opposition? We now move to the Senators in the Committee for comments. The Vice Chair is recognized.

Senator, I'll be supporting this Bill. Again, there's been so many mixed messages in California when it comes to accountability of criminal behavior. And as a result, whether it's international gangs or local gangs, we've seen this influx of home invasions. And I think that most families now are buying Rings and Ring cameras and just to feel safe.

And I think that again, because California has emboldened criminals and created this environment, that it's the least that we can do to help them feel safer in their own homes. And I'll be supporting the Bill. Thank you.

Thank you.

Senator, I support, I appreciate your work and your willingness to work with the Committee. But unlike similar to the prior measure, you're going to be throwing a lot of costs on the General Fund that could be borne by the residents. And it's a big hit on the budget. So I'm going to oppose it. Would you like to close?

Yes. As you may know already, home burglaries are so prevalent now, attracting not only from other communities to affluent communities, but the international groups are coming to the United States and burglarizing our homes. So I think we need to allow homes to be secured and protect their families.

And again, like I said before, keep those families stay in California so that they can keep on paying tax and that will help our state revenue. So therefore, I urge your aye vote.

And the Bill has been moved. Will the Secretary call the roll?

[ROLL CALL]

The vote is one to three. The Bill is on call. Senator Choi, your tenaciousness is about to be concluded. You have one more Bill. Please proceed.

Yeah, this is my last Bill. SB 723 proposes a significant update for California's property tax law by allowing local government to increase the threshold for tax exemptions on lower-value properties of unsecured property tax that each county sends out for the furnitures, equipment, each company has already paid tax and annually they keep on reassessing the value of that tax and the decreasing annually and that amount goes down.

And sometimes it's rather low amount but it's such a burden for businesses to take care of it. Otherwise they will pay the, you know, penalty.

So from the adjusting the lower value from $10,000 to increase to $25,000. Adjusting this threshold reflects today's asset value and inflation. Aligning tax policy with the economic reality. Raising the limit helps reduce the the tax burden on smaller businesses, freeing up capital to reinvest in jobs and growth.

Low-value properties often cost more to assess and collect tax on than the revenue they generate. Increasing the threshold cuts wasteful spending on low-yield tax collection.

SB 723 ensures small scale property owners and low value asset holders are overburdened and can begin to grow and spur economic development. Reducing tax burdens on low value assets encourages entrepreneurs worship and economic resilience in committees statewide. Thank you.

Senator is concluded. Any witnesses in support?

David Bollog of Los Angeles County in support. Thank you.

Thank you David. Any other witnesses in support? Any witnesses in opposition? Seeing none. I now turn to the Committee for comments. With that, Senator, thank you for introducing this Bill. It introduces this flexible tool for local governments to help small businesses. I'm going to support this Bill. And would you like to close?

Thank you. I appreciate your support and all the Members to support this Bill. And this will boost all the small businesses and then also reduce unnecessary time for tax collectors for expenses they have to provide for billing for a small amount of tax that they have to collect. So this is another common sense Bill. I urge your aye vote, thank you.

Thank the Senator. Is there a motion? Vice President moves. Would the Secretary call the roll?

[ROLL CALL]

Thank you Chair and Members putting up with me for a long time. Thank you. Have a good day.

Okay, we'll now move to the consent calendar. Would anyone like to pull a bill from the consent calendar? We do have one Bill on the consent calendar, and it's by Senator Niello, Item 12, SB359.

Motion for the second.

Seeing no opposition, a motion has been made. Will the Secretary call the roll?

[Roll Call]

The vote is 4 to 0. The bill, the consent calendar is on hold. Okay. We are now ready to move forward. But I don't see any authors in the galley. Oh, I'm sorry. We see one on the on the podium. Please approach the stand and make your presentation. Thank you. What's that, Sir?

You may proceed.

Mr. Chair and members, SB 587 seeks to incentivize long-term investments and fuel expansion in California's manufacturing industry by providing a state tax credit for the local sales tax paid by manufacturers of qualified equipment purchases. This will facilitate the growth, hiring, and training of skilled workforces for the future and provide high-wage jobs for Californians up and down the state.

Now, according to the 2024 California Jobs Market Briefing published by the Employment Development Department we know as EDD, the manufacturing sector was the only one of--only three industries that experienced job loss during the most recent reporting period.

As a matter of fact, even more notable and alarming about this information from the EDD is that manufacturing is one of the few sectors to have experienced consecutive year over year job losses, something that should give all of us policymakers pause.

In fact, there are approximately 80,000 less manufacturing jobs in California now than there were jobs in September of 2022. SB 587 will help reverse these trends and make California more attractive to investment from manufacturers, especially in light of the fact that 38 states already have a full sales tax, sales and use tax exemption for manufacturing equipment purchases, and five others don't even have a sales tax at all.

So a stout manufacturing job base is key to the global and domestic competitiveness of our economy because of its breadth and variety. California has comparative manufacturing advantages in other regions of the world due to the strength and depth of its innovation and technology.

So it's my hope that this legislation can be a tipping point to encourage a new--quote, 'invent here, manufacture here,' quote--reality by incentivizing companies to plant roots in our state and to grow. SB 587 is sponsored by the Bay Area Council and is supported by a broad statewide coalition of business, labor, and labor groups.

The measure has no opposition. I respectfully ask for your aye vote on this important measure when the time comes. I will have witnesses through the chair self-introduce.

Thank you, Senator Grayson. And the principal witnesses, please proceed.

Senator--am I on here? Okay. Senator, Mr. Chairman, Senators, Matt Regan with the Bay Area Council. We are a business-sponsored advocacy organization in the nine-county Bay Area. We represent about 350 of the largest employers in the region, unfortunately with an ever-shrinking membership in the manufacturing sector, which we hope to reverse.

I'm going to address the workforce issues that are important to this bill. Thankfully we're moving away from the outdated thinking that every child must go to college to be a success. We know that college is not a good fit for every child and it has become cost-prohibitive for far too many California families.

Governor Newsom has announced a very bold target of 500,000 apprentices by 2029, which we support. We are a founding member of the Northern California Apprentice Network to provide alternative career pathways for our young people. We cannot meet those targets without a robust manufacturing sector, and as Senator Grayson said, our manufacturing sector is eroding.

We've lost 468,000 manufacturing jobs in California since 1995. So our objective here is to answer the question: to what purpose do we serve if we're giving our people a great education if they go to Texas for a career for a job? And 40,000 Californians a year are making that move to Texas for a lower cost of living and job opportunities.

So California's unemployment rate is 5.3% which is the third highest in the nation, and we hope that this bill will help address that problem and provide career opportunities in a sector that is declining in California, will provide career opportunities for our young people that are in high-paying jobs that are in very short supply in California. Thank you.

Mr. Chairman and Senators, thank you. Lance Hastings, President of the California Manufacturers and Technology Association. This is the third time legislation like this has been brought forward. The Legislature has passed it near unanimously, the first time unanimously last session, and we're back again asking for support from the state to put some skin in the game to support manufacturing like the other states are doing.

Our unique geographic position on the Pacific Ocean and our trading partners to the west in Asia, to Canada and Mexico in the north and south are very important to California manufacturers, and we would love to make more so that we can export more, but our capital is getting old, the cost of capital is high, and the two features I want to point out about this legislation that should pique the interest of not only the Legislature but the Governor, new capital equipment is going to be more efficient from an energy consumption standpoint.

So that alone should be a cause to advance this legislation. And the other is in a post-Covid environment, we find ourselves in this situation that--as mentioned by the other witness--manufacturing is taking some lumps here in California and we'd like to reverse that trend.

We think that this bill does it, and the reason it does it is because with the economic report that's been included in the analysis--a very nice analysis done, by the way--shows that there is the ripple effect and the multiplier of one billion or more coming back to the State of California in terms of additional tax revenue.

So yes, there is an immediate one-year cost or each year in the loss to the sales tax revenue, but the ripple effect in the additional tax revenue that would come to the state at the local, county, and state level would far surpass that. So we urge your aye vote, appreciate the opportunity to come back, and appreciate Senator Grayson for bringing the bill forward.

Any other witnesses in support?

Thank you, Mr. Chair. Matt Robinson, on behalf of the Specialty Equipment Market Association, SEMA. We have about 1,700 member businesses in California and appreciate the author continuing to work at this. Thank you.

Good morning, Mr. Chair. Chris Micheli, on behalf of the Los Angeles Area Chamber of Commerce, in support. Thank you.

Good morning. Silvio Ferrari, on behalf of California Forever, in support.

Good morning. Trent Smith, on behalf of the Glass Packaging Institute, which consists of the handful of remaining glass bottle manufacturers in California, all of which are unionized shops. Thank you.

Good morning, Mr. Chair. Obed Franco, here on behalf of the California Electric Transportation Coalition in support and the California Biomass Energy Alliance, also in support.

Good morning. Audra Hartmann, on behalf of California Steel Industries, a Nucor Steel and JFE company, in support.

Hi. David Bollog, on behalf of Taxpayer Oversights for Parents and Students. We're in support, and just for clarification, I live in Los Angeles County, I do not represent it, so I apologize if there's any misunderstanding. Thank you.

Thank you. Any witnesses in opposition? Seeing none, I now turn to the committee. Well, thank you for bringing this forward. Senator, you've been very tenacious and, you know, who doesn't want to see manufacturing in California? I certainly do, and this bill will help in that regard. I'm happy to support the bill and I hope we can accomplish something this year. And sir, would you like to close?

Yes. Thank you, Mr. Chair. SB 587, just to clarify, is a tax credit and not a sales tax exemption. It's a tax credit that is equivalent to what a sales tax exemption would be. And it would send a signal to industry across the nation and globally that California is open to welcome their business. So with that, I respectfully ask for an aye vote.

Thank you. Is there a motion? A motion. Would the secretary call the roll?

Motion is do pass to the Committee on Appropriations. [Roll Call]. Three to zero.

The vote is three/zero. The bill is on call. Thank you, Senator. And next, we would have Senator Wiener. Would you please approach and present your bill, Senator?

Thank you very much Mr. Chair. Colleagues, I'm here today to present Senate Bill 336 which will expand California's welfare tax exemption currently available for low-income affordable rental housing below 80% of area median income. It will expand that to include moderate-income rental units up to 120% of area median income.

The Bill provides desperately-needed financial support for what we refer to as "missing middle" housing for moderate-income Californians who do not qualify for low-income housing and who are at times unable to afford market rate housing. Under current law there are various subsidies available to low income housing for people under 80% of area median income.

And those financial subsidies are typically unavailable to moderate-income housing at 80 to 120% of AMI. And so not surprisingly, not enough of that housing is being built and expanding the welfare tax exemption will help those projects pencil and become financially feasible. So we know that we have a deep housing crisis.

We need an all of the above approach. Every single kind of housing. And this is one type of housing we need more of. And so I respectfully ask for your aye vote. With me today to testify is Jacob Bintliff with the San Francisco Office of Economic and Workforce Development.

And I should say that Mayor Lurie of San Francisco is sponsoring, co-sponsor of this Bill, and then Enrique Landa, a developer in San Francisco and managing the partner of - Managing Partner of - Associate Capital.

Thanks, Senator. The witness please proceed.

Thank you. Good morning Chair McNerney and Senators. Jacob Bintliff with San Francisco Office of Economic and Workforce Development here on behalf of Mayor Lurie sponsoring the Bill along with the Housing Action Coalition. As the Senator said, we have a housing crisis.

In particular, the state has set a RHNA goal of 2.5 million homes in the current eight year cycle statewide specifically and we are at 10% of that goal so far. Specifically within that, 420,000 of those homes are supposed to be for moderate-income households that you heard the Senator mention.

That is more than three times the number of moderate-income units that the state actually was able to build in the previous cycle. When it comes to low income housing, the State and Federal Government appropriately provide several subsidy programs, including what is known as the Welfare Property Tax Exemption.

Meanwhile, market rate housing can command high enough for rents to pencil without subsidies for those who can afford it. For moderate-income units, there's no form of general subsidy and they are often unaffordable to folks in the market.

As a result, in high cost areas like San Francisco in particular, we actually produce more market rate and more low-income housing than we produce moderate-income housing. This dynamic is what's referred to as the missing middle.

Which means our middle-income workforce, teachers, first responders, nurses, construction workers and other middle-class professionals are being left out of the housing market. Needless to say, if our middle-class workforce can't afford to live in California, they will go elsewhere and our economy will pay the price.

Senators, that's why we're proposing to provide one form of public subsidy to meet this critical gap in our housing market. SB 336 does this by simply expanding the long-standing Welfare Tax Exemption Program to cover these moderate income households. With a couple of important differences.

Firstly, the Bill would only apply to new housing that is built after January 1st of 2026. And the Bill requires that moderate-income units must be rented below market rates, even when the 120% of AMI cap could allow for higher rents. Otherwise, the Bill would treat moderate-income the same as low-income units are currently.

The same minimum 55-year deed restriction to require long term affordability and the same enforcement mechanisms as applied today, including annual verification by the State Board of Equalization.

You've taken two minutes. So.

Okay. Thank you very much for your considerations. Thank you.

Thank you. Good morning, Chair McNerney and other Senators. My name is Enrique Landa and I'm the managing partner of Associate Capital.

I'm leading a development in San Francisco that's under construction right now, taking a 21 acre site and transforming it into a new part of the city that will include 1.5 million square feet of commercial, including a cancer center for the University of California, and then up to 2,000 units of housing, 30% of which will be permanently affordable to low and moderate-income San Franciscans.

While housing production in San Francisco has been notoriously slow, I'm proud to say that we're just months away from opening 105 units of workforce housing that will be permanently rent restricted, serving households between 50 and 110% of the average median income. As Jacob mentioned, this is the missing middle.

It's the essential workforce that gets left behind both by market rate and affordable housing developers. To our knowledge, this is the first privately financed 100% workforce housing project to be delivered in San Francisco. And it was only made possible by a novel program by CalFHA.

Though modest in scale to our broader project, this building was extraordinarily complex. There are no clear sources of financing or subsidies to support this income band. This project required more than two years of structuring, coordinating across three law firms, two investment banks, a commercial lender, and vital support from the San Francisco Office of Economic and Workforce Development.

We were only able to do this because we had a larger project that was able to cross-subsidize this effort. Patient capital. That gave us time to figure this out. This wasn't a replicatable path, but with this legislation it could be.

This proposal builds on the existing welfare tax exemption that's worked incredibly well for under 80% AMI and extends it to people who otherwise would not get housing. For developers, both affordable and market rate like us, this would find another tool to be able to serve this missing middle market at scale.

This, as Jacob mentioned, we've set middle-income housing policy priorities to deliver a lot of housing. But to date, we've provided no meaningful financial support to make that happen. Without this action, this housing is not going to get built. To be clear, in most cases workforce housing costs more to build than it's worth when it's completed.

And extending the tax abatement to 120 AMI helps restore this balance and gives these projects a real shot at viability.

Okay, would you please wrap up?

That's it.

Okay, thank you. Good timing. Are there any other witnesses in support?

Clifton Wilson, on behalf of the Mayor of the City and County of San Francisco, Daniel Lurie. As I stated, proud sponsor of the Bill and thank you Senator for this measure. Appreciate it.

Mr. Chair and Members, Rand Martin on behalf of the AIDS Health Care Foundation and its Housing as a Human Rights Division in strong support of this Bill. Thank you.

Good morning Chair and Members. Catherine Charles, on behalf of the Housing Action Coalition, a proud co-sponsor, and on behalf of the Bay Area Council in support. Thank you.

Good morning Mr. Chair and Members. Raymond Contreras with Lighthouse Public affairs on behalf of SPUR. Abundant Housing LA, Circulate San Diego, and the San Diego Housing Commission, all in strong support. Thank you.

Thank you. Any witnesses in opposition?

Good morning. Larissa Mercado, on behalf of the California Assessors Association. We have an opposed unless amended position. We look forward to working with the author and his staff on addressing the self-certification portion of the measure. Thank you.

Amy Garrett with California Association of Realtors in respectful opposition to the Bill. Thank you.

Thank. Now I turn to the Committee. Any Committee Members wish to comment or question? Okay, I'm going to say something first. I appreciate that, Senator, you've been a tremendous force for housing and for transportation California. And if anyone can make a difference that has made a difference, it will be your hard work.

So I appreciate that and I really appreciate what this aims at is the missing middle. As one of the witnesses said, when you care about how firefighters, police officers, teachers can afford houses in our communities. And so with that, I'm going to support the Bill. Senator, would you like to close?

Respectfully ask for an aye vote.

I like that kind of close. And is there a motion? I think one was made. The Bill is moved. Will the Secretary call the roll?

[ROLL CALL]

The vote on this Bill is 4 to 0. The Bill is on call. Thank you, Senator. Thank you so much. It looks like we have Senator Alvarado-Gil, would you please approach and present your bills? Proceed when ready.

Madam—Mr. Chair—just verifying we'll be starting with Senate Bill 353?

Yes. Okay, great. I do have witnesses that I will ask to come forward. This is our Senate Bill 353 that I'm presenting today.

And this will remove the sunset date of 2027 from the existing Farm to Food Bank Tax Credit, which offers a 15% tax credit to farmers who donate food to our local food banks. This credit encourages donations of fresh produce and nutritious items such as fruits, vegetables, meat products, dairy products, eggs, and grains.

The Food to Farm Bank Tax Credit was initially enacted in 2012, through AB 152, and this Program has proved its effectiveness and is still going strong today. In 2023, this Credit resulted in $8.2 million worth of donated food going to our food banks, with over $769,000 in tax credits given back to participating farmers.

SB 353 is about a long-term food access and agricultural sustainability. Making this tax credit permanent makes it possible for food banks and farmers to plan for the long term. Food banks can also plan their collections and giveaways around regular fresh donations.

Our farmers, especially our small and mid-sized ones, can confidently incorporate donations into their annual operations, knowing that the support will set or would—won't—suddenly expire. Additionally, this Bill helps address food insecurity, especially in rural and underserved communities, by ensuring that fresh, healthy food gets into the hands of those who need it most.

According to the California Association of Food Banks, 22% of California households and 27% of households with children struggle to put food on the table. And at the same time, this credit allows a way to eliminate food waste and save food products that farmers cannot sell but are good enough quality to donate.

This Bill protects the vital cycle of tax credits to farmers and ensures easier access to healthy food for family. With Senate Bill 353, there's no question in who the food is going to, or if it's being put to good use. I have with me today, to testify, Mr. Mike Sproull, who is the Founder and Executive Director of the Food Bank of El Dorado County.

Thank the—Senator, he witness may proceed.

I don't have a lot of experience with this. I'm just a food banking guy up the hill. But I speak for about 12,000 people a month that we feed in El Dorado County, like all over the state. A lot of this is planning, like the Senator was saying. We have no way to plan anymore.

We don't know when we're going to be cut programs. We got programs cut recently from the USDA. We just need some continuity of if these programs are going to be kept up so the food banks can plan, and the people could know what we're ordering and what we're getting. It's getting pretty crazy like that out there.

So, that's all I ask you today, is to think about this because a lot of people rely on it. A lot of people, as you know, are really hurting right now, and we want to help them, and anything you could do to help those poor people, I would appreciate it very much.

I thank the witness. Any other witnesses in support?

Good morning, Chair and Members. Melissa Koshlaychuk, with Western Growers, in support. Thank you.

Thank you.

Hi there. Erica Parker, with Californians Against Waste, in support, along with the City of Woodland, Dr. Bronner's, Bayview Senior Services, Alina's Lab Kitchen, and then, Second Harvest Food Bank of Orange County. Thank you.

David Bollock, representing Serving Family Values and also as somebody who's benefited from a food bank, I really support this. Thank you.

Thank you.

Scott Kaufman, Howard Jarvis Taxpayer Association, in support.

Thanks, Scott. Any principal witnesses in opposition? Any witnesses, at all, care to oppose? Thank you. Anyone on the Committee? Vice Chair is recognized.

I just want to thank the witness for your testimony. I think sometimes we may forget how intimidating it can be to come and testify on a really important issue too, that impacts your community.

That—and I appreciate you fighting for it, fighting for access to fresh vegetables and fruit for families who are struggling because everything is so expensive, from eggs to meat, to fresh fruits and vegetables. So, I just wanted to say I appreciate your testimony and I'll be supporting your Bill.

Thank you.

Yeah, thank the author for bringing the Bill forward. It's a good one. I agree with you wholeheartedly.

We may all have different reasons for why we support the Bill or why we're concerned about this issue, but I think we all land in the same place—that we want to support those who are working the hardest to get food and nutritious items on the tables and plates of our constituents. I think this is—it's a modest bill, but it does address an issue that I think you stated it clearly.

We've all been hit by the federal cut to food banks across our districts. This is a way for us to try to counter that, in some part. And I appreciate what you do.

I appreciate that you came here and you were willing to testify. You'll have my support today as well.

Senator Alvarado-Gil, thank you for authoring this Bill. I've been meeting with food bank and suppliers in my district and they're hurting. And I also have a large ag. community and they are also facing difficult choices.

So, I think this is a good Bill and it will reduce food waste, and it will help provide nutritious food for families in need. I'm happy to support the measure. Would you like to close?

Just like to thank Mr. Sproull for being here today. He's very modest and humble. He single-handedly helped to feed entire communities during the Caldor Fire in our recovery and partnered with our local farmers and ag. So, I want to thank you, Mr. Sproull, for being here and I respectfully ask for an "Aye" vote.

Do I hear a motion? Those moved. Will the Secretary call the roll?

[Roll Call]

The vote is 4 to 0. The Bill is on call.

Great. Thank you.

Senator, you have another Bill?

Yes. I have another bill. Thank you. Mister . I have two witnesses that will ask to come forward for Senate Bill 696. Mr. Chair, I will be presenting Senate Bill 696 which is a bill that provides a sales and use tax exemption for all fire departments, volunteer fire departments, and fire protection districts in our great State of California.

This is focused on the purchase of firefighting equipment and apparatuses only. I have proudly partnered with El Dorado County Fire District Protection District for this bill who have seen firsthand the costs that incur on smaller departments who serve large populations.

This bill is also about keeping California safe and making rural living affordable again by removing the added cost of sales tax on essential life saving tools. Senate Bill 696 will ensure that more of every public dollar goes directly to frontline emergency response and the protection of rural homes, preventing the high cost of rebuilding.

Firefighting equipment is not a luxury, yet it is a necessity that we continue to tax at high levels. Small rural volunteer departments across California are being priced out of their equipment that they need due to rising costs and constraint budgets. Our bill directly supports these departments by reducing their financial burden.

And this means more funds can be reallocated towards hiring, training, maintenance, and rapid response capacity. This exemption is narrowly tailored. It applies only to firefighting equipment and apparatuses, large infrequent purchases that departments already plan for in cycles of 10 to 20 years.

It exempts items that are directly used in the process of firefighting, including electronic communication equipment such as radios, specialized vehicles such as fire engines, ladder trucks, vessels such as boats and rafts, PPE such as breathing apparatuses and safety boots. Emergency services equipment including ladders, hoses, axes, defibrillators, medical supplies.

All of these items that are absolutely essential to firefighting. And exempting their sales and use tax allows those funds to be directly reinvested into their continued purchases and use. This bill is aligned with state goals on wildfire mitigation and climate resilience.

Investing in fire readiness helps us to prevent larger disasters, reduce costs over time, and protect our critical infrastructure. This includes schools and homes and businesses. This bill has the support from fire departments and fire protection districts across the state, as well as the California Fire Chiefs Association, whose membership includes more than 800 fire agencies operating in our state.

I have with me today to testify the honorable Paul Gilchrest, who serves on the El Dorado County Fire Protection District Board of Directors, and Maurice Johnson, former fire chief of the El Dorado Hills Fire Department and current interim general manager of the Cameron Park Community Services District.

I thank the Senator. The witness may proceed. I just want to remind you that you have four minutes between you, so be kind to each other. You may proceed.

Good morning. My name is Maurice Johnson. Mr. Chair and committee, I'm Maurice Johnson. I currently serve as interim general manager for Cameron Park Community Services District. And I'm also here today representing the Fire Districts Association of California, which proudly supports Senate Bill 696.

I bring over 35 years of fire service experience in the fire service, including serving as a fire chief. And I've seen firsthand the operations and financial pressures our fire agencies face, particularly in rural and wildland urban interface communities.

SB 696, authored by Senator Alvarado-Gil, is a practical no-cost measure that would exempt fire departments and districts from state use and sales tax when purchasing fire apparatus, equipment, and specialized vehicles. These are life saving tools, essential, not optional.

In California, the devastating wildfires that dominate the national headlines, fought not only by our state and federal agencies, but also your local government fire departments. We proudly stand shoulder to shoulder with our state and federal partners in these devastating battles, united in one mission to protect lives, property, and natural resources.

This bill is an investment in California's Local Emergency Response Infrastructure. SB 696 does not create new bureaucracy or added cost to the state. It simply allows local local agencies to keep more of their limited resources working for their communities.

On behalf of the Cameron Park Community Service District, Fire Districts Association of California, and fire districts across California, I respectfully urge your aye vote on this important legislation. Thank you for your time and thank you for your continued support of public safety.

Good morning, Honorable Judge McNerny and Chair and members of the Senate Revenue Tax Committee. My apologies, sir. A little nervous. My name is Paul Gilchrest, Director Division 5 with El Dorado County Fire Protection District. I rise today for bringing strong support for Senate Bill 696. Let's begin with the facts.

Earlier this year, Southern California wildfires caused over $250 billion in damages to public and private sector entities. That's only a fraction of what's yet to come in 2025 and in the following years. The costs are staggering and continue to rise.

Meanwhile, the very agencies tasked with containing these disasters are being forced to operate with their hands tied behind their back. Here's the problem. Fire districts are first, primarily funded through local property taxes. Second, 10% is taken off the top of these property taxes. And third, when these departments spend those dollars on critical firefighting equipment, they're taxed again.

That's triple taxation. It's like stopping an ambulance to charge a person having a heart attack, multiple tolls. It's wrong, it's reckless, and it's dangerous. Now, let's address the fiscal impact. The estimated sales and use tax revenue invested into the fire service under this bill is $21 million in the next fiscal year compared to the 250 billion.

That's a 0.0084% investment in prevention. Every dollar that stays in our fire districts is a dollar that strengthens prevention, boosts readiness and reduces long term losses. In 1736, Benjamin Franklin, when advocating for the fire service, said, an ounce of prevention is worth a pound of cure.

We knew then and we know now it's more cost effective to prevent fires than deal with the aftermath. I urge you as leaders to exercise your wisdom in handling public affairs with cost effectiveness and provide the people with the best public safety. Please vote yay on this or hey. Thank you.

I think there are witnesses. Any witnesses in support?

Good morning, Mr. Chair and members. Obed Franco here on behalf of the California Fire Chiefs Association and the Fire Districts Association of California, in support.

David Bullock on behalf of Taxpayers Oversight for Parents and Students, in support. Thank you.

Scott Kaufman, Howard Jarvis Taxpayer Association, in support.

Thank you. Any witnesses in opposition? It would be hard to oppose this. Any members of the committee wish to comment? Yes.

Thank you again to the author for this bill, but I can't pass up the opportunity to thank Chief. This is a product of Sacramento County serving in El Dorado County. But I think this is an important bill because, you know, the fires in the region really affect the region.

So if El Dorado County doesn't have a grass rig, it means the grass rig from Sacramento needs to make its way up the hill and folks are going to have to wait till that grass rig gets there. And God help us if we have another grass fire in a different part of Sacramento County.

When you come from the big city in a really large region, which is about a six county region for Sacramento, you're used to being the supplier of all the tools and resources. So this bill will actually allow us to see our partner entities in smaller counties.

This, this senator and I represent the same amount of people, but she's got 11 counties and I have half of one. So we need El Dorado County and other small counties in the region to be able to purchase their own equipment. This will help them do that.

It's a big ask to ask them to get anything more than a truck or an engine. So if you ask them to get these rigs or you're asking them to buy aerial equipment, that will help them, we need to provide whatever support we can. So I appreciate the bill, really appreciate my chief. Thanks for being here.

Well, good. Thank you. Thank you, Senator, for bringing this forward. We love our firefighters. We want to make sure they have the equipment they need. And when everyone else runs away from danger, they run toward it.

That's right.

I appreciate that. And this bill maximizes scarce public safety dollars and accelerates the deployment of life saving equipment. I'll be in support of the bill. Senator, would you like to close?

Thank you. I just want to acknowledge those men and women that fought so courageously in the Southern California fires. Every single county in California deployed firefighters to help fight those fires. And that's just a testament to the courage of Californians and that mutual aid that the senator from Sacramento mentioned.

We are all in this together, in the time of crisis and calamity. And having that right equipment available at all areas of California is so important. So I respectfully ask for an aye vote.

Is there a motion?

So moved.

Vice Chair moves. Will the secretary call the roll?

[ROLL CALL]

Thank you.

That is on call. We will now be moving to file item number 17. Senator Grove is copy. I'm moving in order. Is that? Senator, we'll move to File item number 18. Senator Blakespear. You are recognized when you're ready, senator.

Thank you so much. I'm here today on SB 710, I think. Is it okay if my witness comes forward to the to sit down? Thank you.

I'm here today on SB710, which extends an existing important tax incentive for homeowners and small business owners to install solar panels, which is important as the state works to increase green energy production and meet its climate goals.

To illustrate the issue, the total cost to install a residential solar panel and storage system in 2025 is in the tens of thousands of dollars.

This tax incentive, which only applies to the first installer, prevents the cost of the system from being added to the value of your home for the purpose of property taxes, saving residents anywhere from two to five hundred dollars per year.

This helps make solar installation more affordable and shortens how long it takes homeowners to cover the cost of installation and begin saving money. The current tax exclusion for solar, which has existed for over 25 years, is set to expire at the end of 2026. The timing couldn't be worse.

Solar adoption rates have recently plummeted due to reduced rates homeowners now receive for providing solar energy to the grid. Taking away this property tax exclusion would almost certainly hurt solar adoption even more. California made a commitment to achieving 100% carbon free electricity by 2045. But we're struggling to stay on track to meet that goal.

We need three times the amount of clean generation and eight times the amount of storage than we currently have, according to a joint report led by the California Energy Commission. The current Bill balances the need to continue encouraging solar adoption with the need of local governments for property tax revenue.

Thus, this Bill does not continue the current tax exclusion for utility-scale solar farms and requires the solar energy from non-residential systems to be consumed on-site in order to qualify. We anticipate a net gain in property tax revenue for local governments as a result of this.

Now more than ever, it's important to maintain this crucial incentive that makes the solar transition more affordable for individuals, businesses, schools, and others, and helps the state meet its clean energy goals. Thank you to the Chair and to the Committee for Working closely with my office on technical amendments to align the Bill with the PUC rules.

We've also been working with the assessors on their needs. With me today I have Laura Deehan on behalf of Environment California who is the sponsor of the Bill. Thank you, Senator. The witness is recognized for two minutes.

Thank you.

Can you hear me okay? No. Thank you so much, Vice Chair Valaderas and Committee Members. My name is Laura Deehan. I'm the State Director for Environment California and we are proud to sponsor SB 710 by Senator Blakespear. California has long been a leader on clean energy.

We're the number one state in the whole country for solar power and for battery storage. And one of the ways we've been able to lead the charge is by aligning our tax policy with our clean energy goals.

SB 710 continues this practice now, 25-year long practice, by excluding new solar and storage installations in homes and small businesses from triggering an increase in the property tax evaluation. Without this, Californians would be effectively penalized for investing in clean air and greater grid resilience.

And with the extreme heat and wildfires and blackouts becoming more frequent, energy storage can be more than a comfort. It can actually be a lifeline for a lot of people. And so SB 710 really recognizes that our tax code should not discourage those investments. It's about building a cleaner, safer, more resilient California.

It will also help reduce peak energy demand, improve grid reliability and cut pollution. So I urge you to support SB 710 and continue to protect Californians freedom to go solar in the future.

Thank you. Is there anyone else here in support of the Bill? Please state your name, your organization and position.

Yes. Thank you. Kim Stone of Stone Advocacy on behalf of the California Solar and Storage Association. And I've also been asked to relay the support of the Environmental Working Group and PearlX. Thank you.

Ellie Fenton-Sutliff, intern at Stone Advocacy here supporting on behalf of Citizens Climate Lobby - the Santa Cruz Chapter, Indivisible Marin, Recolte Energy and the Solar Rights Alliance. Thank you.

Good morning. Katie Davey with the Dairy Institute of California here in support. Thank you.

Good morning. Audra Hartmann, on behalf of the California Large Energy Consumers Association in support.

Are there any key witnesses in opposition? Seeing none. Anyone else wish to express their opposition? We will bring it back to the Committee.

I'll move the Bill.

Senator, would you like to close?

I respectfully ask for your aye vote. Thank you.

Excellent. We have the Bill that's been moved. Secretary, please call the roll.

[ROLL CALL]

That vote is 3-0. That is on call. We'll now move to File Item number 17. Senator Grove, SB 566. Senator, you're recognized when you're ready.

Thank you. Thank you, Madam Chair. Colleagues, today I rise to present Senate Bill 566, which seeks to increase the Homeowners' Exemption and the renters tax credit for our senior citizens age 62 and older to reflect the inflationary pressures that they're facing. All of us are facing inflationary pressures, but specifically our seniors on fixed incomes.

Californians are struggling to afford the cost of living in our state. These financial burdens are becoming especially challenging for our elderly population. Many seniors who own homes are on fixed incomes and limited budgets, they struggle to pay rent or property taxes, and they often are forced to choose between paying rent, eating their next meal, or purchasing necessary medications.

As they age, many seniors face an increased risk of homelessness and their life savings are gradually depleted. In fact, older Californians now represent the fastest growing age group within the state's homeless population. Forty-eight percent of those that we know that are homeless are 50 years old or older. With SB 566, we can make housing more affordable in California. The Homeowners' Exemption and tax credit was established in 1972. Okay? In 1972. In 1972, I was seven years old. That's when it was established. It was last adjusted in 1979, over 45 years ago.

Since then, rent and home prices have skyrocketed and California renters and homeowners are in desperate need of financial relief. Despite these dramatic increases in the cost of living in the State of California, no significant adjustments have been made for these exemptions.

For perspective, according to the Census Bureau, in 2023, there were a total of 3.5 million homeowners and 1.35 million renters all over the age of 60. That's roughly about five million people that this bill would help.

There have been many attempts by both Democrats and Republicans in the past to revise the dollar amounts to better address the financial pressures faced by our residents, especially our elderly ones, but those estimates have failed. In 1979, the median household income in the State of California was $62,000 roughly, according to Google. In 2025, it's $904,000, and this tax credit has not been adjusted since then.

Senate Bill 566 proposed to increase Homeowners' Exemption from $7,000. So right now they get a tax credit on the first $7,000 of the property value, again, created in 1979 when the home value was $62,000, and we'd like to increase it to $50,000 for the renter's tax credit from $60 to $275 for single filers, $120 to $550 for joint filers for individuals age 62 and older. This just affects our senior population. I'd like to restate those numbers. In 1979, they got a $7,000 tax credit on a roughly $62,000 home.

In 2025, they get a $7,000 tax credit on roughly a $904,000 home if you take the medium average home price. Now, I'm not saying every senior lives in a home of that substantial number, but the bottom line is that the cost of living has increased dramatically in the State of California and we haven't done anything to fix it.

SB 566 was introduced at the request of an elderly constituents that reached out to my office seeking relief from the financial burdens that they're facing. And then we quickly realized with the coalition of housing seniors that are struggling to survive in the State of California, that this affects all of your districts as well.

Actually, Kern County is one of the most affordable counties that we have to live in, so your districts are disproportionately affected with the increase of inflation. Since many of my constituents are homeowners in rural communities, I believe a change in the Homeowners' Exemption is necessary, especially considered it hasn't been updated in decades, as previously stated in my comments.

I appreciate the willingness of the chair through the committee staff to engage in discussions regarding amendments to the bill, concerns regarding the Homeowners' Exemptions specifically now. It applies to everyone age 62 and older, regardless of the socioeconomic status. Socioeconomic status is understandable.

As discussed, I'm willing to add an income threshold for homeowners, but I believe it should be a reasonable compromise to ensure that the benefit goes to those who need it the most. We need to make sure that, like I said, our seniors are taken care of.

A lot of our seniors are losing their homes because of the tax structure that they have and they can't make those decisions based on the cost of everything else that they have to deal with. However, I do believe that the Homeowners' Exemption component of this bill is critical. It's not just for my district, but many senior homeowners across California. Therefore, I can't agree to remove all this provisions or this provision as proposed by the amendments in my bill.

Again, I've suggested adding income thresholds for homeowners, but I can't amend out the homeowners altogether because we actually got an individual that reached out to our office that needed help to be able to stay in their home or they would become homeless, and it's the asset that they have that they've paid for all of their life, but because of the situation they find themselves in now, they couldn't afford the property taxes.

So we can't exclude homeowners just because they have an asset, and we definitely don't want to exclude renters because they find themselves in the same situation. So Madam Chair, thank you. The Legislature has made addressing the state's affordability crisis a priority this year and SB 566 will help do that. And I respectfully ask for your aye vote today. With me to testify is Scott Kaufman, the Legislative Director of Howard Jarvis Taxpayers Association, who represents taxpayers all across the State of California.

Thank you Senator, and you are recognized for two minutes.

Thank you. Scott Kaufman, Howard Jarvis, Legislative Director for the Howard Jarvis Taxpayers Association. As was mentioned, the Homeowner's Exemption and the renters tax credit were established in 1972 and they have not been updated since 1979. Currently, the dollar value of the Homeowners' Exemption is only around 70,000--or it's $70. It's $7,000 a year, one percent of that $70. That's how we get to that.

As the staff report notes, SB 566's exemption would have a value of around $500, a sevenfold increase, and while perhaps--still a small amount for those with sufficient wealth to pay their property taxes--500 more dollars a year for low-income seniors would have a sizable impact on their ability to weather increasing costs in these uncertain economic times.

This is also true of elderly renters. The benefits of raising the renters' credit from 60 to $275 are clear to anyone who has faced skyrocketing rents in the last couple of years. Even with Prop 13, we get calls from elderly homeowners all the time that are having trouble paying their property taxes. You know, we advise them to the low-income tax postponement program, but many do not qualify, so this remains an issue even with the benefits of Prop 13.

So adjusting these amounts to reflect current inflation rates will help ensure that older Californians can remain in their homes and better manage the cost of living. For these reasons, we support SB 566 and urge the Legislature to pass this important measure reaffirming California's commitment to affordable living for our senior population. Thank you.

Thank you. Are there any key witnesses here also in support? Correction. If you're here in support, please state your name, your organization, and your position.

David Bollog, on behalf of Serving Family Values and Taxpayers Oversights for Parents and Students and probably everybody on my block. Thank you so much for this bill. In support.

Amy Garrett, on behalf of California Association of Realtors, in very strong support for this Homeowners' Exemption increase for those 62 years and older. Thank you.

Thank you. Do we have any key witnesses here in opposition?

Hello. Dani Kando-Kaiser, here on behalf of the California Tax Reform Association, respectfully in opposition. I think we are all in agreement that the Homeowner's Exemption in Prop 13 is outmoded and in need of an update. Because of the benefits of Prop 13 varying so widely among homeowners, a flat credit has a varying percentage of relief to homeowners paying that property tax.

The benefit in this bill to homeowners over 62 is perhaps the most problematic since those homeowners are likely to be longtime owners who already have the most favorable property tax situation and who can take their lower property taxes with them when they move.

Elderly homeowners with low-income and trouble paying their property taxes also have effective deferral programs which do allow them to stay in their homes. We see no real justification for increasing an outmoded and expensive property tax exemption at the cost of schools and public services. Thank you.

So we're at anyone else in the room here for opposition.

Are there any other witnesses in opposition? Any other witnesses in opposition? Would Senators--

Move to the committee?

You have a comment?

Yes.

Please.

So California seniors, especially those living in my district in the high desert, are getting crushed by the rising cost of living. And fixed incomes haven't changed, but the price of groceries, the price of utilities, insurance, and obviously housing has increased. And I've heard it over and over from community members that people can't afford to stay in California.

And I think this is reasonable, as you mentioned--it is long overdue, and both the Homeowners' Exemption and the renters tax credit need to reflect today's economic reality. And 1972--I won't--I guess I'll date myself. I wasn't even born in 1972. This is long overdue and it really targets those who need it most living on fixed incomes, which is why I'll be supporting this bill and thank you for bringing it forward.

Thank you, ma'am.