BILL ANALYSIS Ó
AB 563
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Date of Hearing: May 27, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 563 (Furutani) - As Amended: May 11, 2011
Policy Committee: Revenue and
Taxation Vote: 6-3
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill authorizes city employees to obtain or access
otherwise confidential information from the county assessor when
the city is conducting an investigation to determine whether the
documentary transfer tax (DTT) is imposed. Specifically, this
bill:
1)Requires a county assessor to disclose information, furnish
abstracts and permit access to all records in his/her office
to employees of a city that is conducting an investigation to
determine whether a DTT is to be imposed.
2)Imposes a state-mandated local program and states that, if the
Commission on State Mandates determines that this bill
contains mandates by the state, reimbursement to local
agencies and school districts for the costs shall be made
pursuant to the statutory provisions.
FISCAL EFFECT
Mandated state reimbursement is unlikely. The records can be
made available at county offices during the normal course of
business for minimal cost.
COMMENTS
1)Purpose. The author states, "AB 563 would allow for
information sharing between County Assessor's Offices' and
cities to identify change of ownership legal entity transfers
and other real property transfers that may not be currently
captured. Enactment of the proposed legislation is estimated
AB 563
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to result in improved and increased collection of the
Documentary Transfer Tax at a time of fiscal crisis for local
governments."
2)Arguments in support . The City of Los Angeles, sponsor of AB
563, believes that "an information sharing program, modeled
after the AB 63/SB 1146 program that was initiated in the fall
of 2001 would prove successful in capturing tax owed to local
governments, while maintaining taxpayer confidentiality
protections." The sponsor states that, "At a time of fiscal
crisis for local governments, this type of program would help
result in improved and increased collection of an existing
revenue source."
3)Documentary transfer tax . The DTT law, enacted in 1967,
allows cities and counties to enact, by ordinance, taxes on
documents that serve to transfer real property. The DTT
applies to deeds of transfer of realty within the jurisdiction
that imposes a DTT and is based on the value of the transfer.
The tax may be used for general or specific purposes, although
all DTTs levied thus far are general taxes. The tax is
administered by county recorders who cannot, by law, record
the property transfer until the tax is paid. Counties collect
the tax but remit the city tax to the appropriate city.
All of California's 58 counties impose the tax, and hundreds
of California cities also levy the tax, ranging from the
general law city rate of $.55 for each $500 of value up to
$7.50 in the City of Oakland. Non-charter cities within a
county that imposes a DTT may impose its tax at half of the
rate of the county, which works as a credit against the county
rate. Charter cities may impose a DTT at a higher rate, but
if they do set a higher rate, then the city DTT does not serve
as a credit against the county tax.
4)Access to records in the county assessor's office . Existing
law provides that any information and records in the county
assessor's office are not public documents and shall not be
open to public inspection, unless specifically exempted by
law. Exemptions include sharing of information with law
enforcement agencies, county grand jury or the board of
supervisors. In 2009, the list of enumerated exemptions was
expanded to allow a county recorder access to all records in
the assessor's office for purposes of determining whether a
DTT is due .
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5)Similar legislation. SB 816 (Ducheny), Chapter 622, Statutes
of 2009, made changes in the DTT law relative to city
ordinances, assessor records, and change of ownership
statements, including allowing county recorders to assess the
county assessors' records when investigating if a DTT is due.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081