BILL ANALYSIS
AB 1568
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CONCURRENCE IN SENATE AMENDMENTS
AB 1568 (Salas)
As Amended September 10, 2009
Majority vote
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|ASSEMBLY: | |(June 2, 2009) |SENATE: |35-0 |(September 11, |
| | | | | |2009) |
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(vote not relevant)
Original Committee Reference: HEALTH
SUMMARY : Adds specified wildfires to the list of disasters
eligible for beneficial homeowners' property tax exemption
treatment, and special "carry forward" treatment of excess
disaster losses and creates the Children's Health and Human
Services Special Fund (Fund) in the State Treasury.
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Add the following wildfires (Wildfires) to the list of
disasters eligible for beneficial homeowners' property tax
exemption treatment, and special "carry forward" treatment of
excess disaster losses:
a) The wildfires that commenced in the County of Santa
Barbara in November 2008;
b) The wildfires that commenced in the Counties of Los
Angeles and Ventura in October 2008 or November 2008;
c) The wildfires that commenced in the Counties of Orange,
Riverside, and San Bernardino in November 2008; and,
d) The wildfires that commenced in the County of Santa
Barbara in May 2009.
2)Provide that any dwelling that qualified for a homeowners'
property tax exemption before the Wildfires, that was damaged
or destroyed by the Wildfires, and that has not changed
ownership since the Wildfires, shall not be denied a
homeowners' exemption solely because that dwelling was
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temporarily damaged or destroyed, or was being reconstructed
by the owner, or was temporarily uninhabited as a result of
restricted access.
3)Provide that any taxpayer's excess disaster loss resulting
from the Wildfires shall be carried forward to each of the
five taxable years following the taxable year for which the
loss is claimed. However, if there is any excess disaster
loss remaining after this five-year period, then the
applicable percentage of that excess disaster loss shall be
carried forward to each of the next 10 taxable years.
4)Specify that, if the Commission on State Mandates determines
that this bill contains costs mandated by the state, local
agencies and school districts will be reimbursed for those
costs.
5)Establish the Fund in the State Treasury, into which shall be
deposited revenues derived from the imposition of tax on
Medi-Cal managed care plans under Revenue and Taxation Code
Section 12201 et seq. Moneys in the Fund shall be used
exclusively for the purposes set forth in AB 1422 (Bass) of
2009.
EXISTING LAW :
1)Homeowners' Exemption:
a) Exempts the first $7,000 of the full value of a dwelling
from property tax, when the dwelling is occupied by an
owner as his/her principal residence. However, if a
property is no longer owner-occupied or is vacant on the
lien date (January 1), the property is not eligible for the
exemption for the succeeding tax year; and,
b) Provides certain disaster-related exceptions to the
general rule that a property must be owner-occupied on the
lien date to receive the homeowners' exemption. Under
these exceptions, properties that were eligible for the
homeowners' exemption immediately before the disaster, do
not change ownership after the disaster, and are vacant
solely because of damage incurred during the disaster,
continue to be eligible for the homeowners' exemption.
2)Income Tax Losses:
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a) Allows non-business taxpayers with casualty losses that
are not reimbursed by insurance and that exceed $100 plus
10% of the taxpayer's adjusted gross income (AGI) to claim
these losses as itemized deductions on their tax return.
Taxpayers may carry forward 100% of any remaining losses
for up to 10 years. Corporate taxpayers with casualty
losses that are not reimbursed by insurance are not subject
to the $100 plus 10% of AGI threshold, but are subject to
the same carry forward rules that apply to individual
taxpayers; and,
b) Allows both individual and corporate taxpayers who
experience losses as a result of certain named disasters to
claim these losses either in the year in which the loss
occurred or in the preceding year.
AS PASSED BY THE ASSEMBLY , this bill:
1)Made the Public Assistance Reporting Information System
(PARIS) a permanent program by repealing language making PARIS
a two-year pilot program where the Department of Health Care
Services (DHCS) selects three consenting counties that have in
operation a United States Department of Veterans Affairs
medical center to participate in the pilot.
2)Repealed language allowing DHCS to expand the PARIS pilot
program statewide and continue it indefinitely if DHCS
determines PARIS is cost effective.
3)Required DHCS to implement the PARIS pilot program by January
1, 2010, instead of July 1, 2009.
FISCAL EFFECT :
1)Homeowners' Exemption: The Board of Equalization estimates
that extending the homeowners' exemption to homes that are
uninhabitable on the lien date will result in revenue losses
of roughly $70,000.
2)Income Tax Losses: The Franchise Tax Board estimates minimal
revenue losses resulting from the carry forward provisions of
this bill.
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COMMENTS : This bill is designed to provide tax relief to those
impacted by the wildfires that occurred in Southern California
in late 2008 and early 2009.
This bill is similar to other tax relief legislation passed in
the wake of natural disasters, save for one key difference.
Typically, disaster relief legislation includes a mechanism for
reimbursing counties for property tax losses resulting from the
reassessment of damaged properties. This bill contains no such
provisions, however, and includes only those provisions
providing beneficial homeowners' property tax exemption
treatment, and special carry forward rules for excess disaster
losses.
This bill was substantially amended in the Senate and the
Assembly-approved provisions of this bill were deleted. This
bill is inconsistent with Assembly action and the provisions of
this bill have not been heard in an Assembly policy committee
this legislative session.
This bill contains tax provisions similar to those included in
the following two bills also introduced in the current
Legislative Session:
1)AB 15 (Fuentes): This bill would add the wildfires that
occurred in Los Angeles and Ventura Counties in 2008 to the
list of disasters eligible for full state reimbursement of
local property tax losses, beneficial homeowners' property tax
exemption treatment, and special carry forward treatment of
excess disaster losses. AB 15 (Fuentes) is pending in the
Senate.
2)AB 50 (Nava): Adds the wildfires that occurred in Santa
Barbara County in 2008 and 2009 and the wildfires that
occurred in Orange, Riverside, and San Bernardino Counties in
2008 to the list of disasters eligible for full state
reimbursement of local property tax losses, beneficial
homeowners' property tax exemption treatment, and special
"carry forward" treatment of excess disaster losses. On
September 9, 2009, AB 50 (Nava) was refused passage on the
Senate floor, with reconsideration granted.
Analysis Prepared by : Oksana Jaffe and M. David Ruff / REV. &
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