BILL ANALYSIS                                                                                                                                                                                                    Ó


          |SENATE RULES COMMITTEE            |                   AB 563|
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                                 THIRD READING

          Bill No:  AB 563
          Author:   Furutani (D)
          Amended:  8/29/11 in Senate
          Vote:     21

           SENATE GOVERNANCE & FINANCE COMMITTEE  :  6-3, 6/29/11
          AYES:  Wolk, DeSaulnier, Hancock, Hernandez, Kehoe, Liu
          NOES:  Huff, Fuller, La Malfa

           SENATE APPROPRIATIONS COMMITTEE  :  6-2, 8/15/11
          AYES:  Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
          NOES:  Walters, Emmerson
          NO VOTE RECORDED:  Runner
          ASSEMBLY FLOOR  :  52-27, 5/31/11 - See last page for vote

           SUBJECT  :    Property taxation:  assessor:  disclosure:  
          appraisal information

           SOURCE  :     City of Los Angeles

           DIGEST  :    This bill requires a county assessor to provide 
          information to city finance officials when conducting an 
          investigation related to the imposition of a documentary 
          transfer tax on an unrecorded change in control or 
          ownership of property and requires the city to reimburse 
          the assessor for any costs incurred in disclosing this 

           Senate Floor Amendments  of 8/29/11 resolve conflict between 


                                                               AB 563

          AB 563 (Furutani) and SB 948 (Senate Governance and Finance 
          AB 563 (Furutani) amends Section 408 of the Revenue and 
          Taxation Code to allow designated employees of a city's 
          finance office access to the County Assessor's records to 
          administer a city's documentary transfer tax.  SB 948 
          amends the same section to allow County Treasurer-Tax 
          Collectors to make a written request to the County Assessor 
          to access records to administer tax sales, and allows the 
          Assessor to disclose the information.  The 8/29/11 
          amendments resolve this conflict by striking this bill's 
          changes to Section 408 (the entirety of the bill) and 
          inserting identical language into new Section 408.4.

           ANALYSIS  :    The California Constitution (Article XIIIA, 
          Section 4) prohibits the state from levying transaction 
          taxes or sales taxes on transfers of real property; 
          however, the Documentary Transfer Tax (DTT), enacted in 
          1967, allows cities and counties to enact taxes on deeds of 
          transfer of realty within that jurisdiction.  Counties or 
          cities may use proceeds of the tax for general or specific 
          purposes, although all DTTs levied thus far are general 
          taxes.  County recorders administer the tax, and cannot 
          record the property transfer until the purchaser pays the 
          tax.  Counties collect the tax but remit the city tax to 
          the appropriate city.  All of California's 58 counties and 
          hundreds of cities levy the tax, ranging from the general 
          law city rate of fifty-five cents per $1000 of value up to 
          $15.00 per $1,000 in the City of Oakland.  In counties, the 
          rate is $0.55 for each $500 of value.  The DTT is largely 
          modeled after the repealed Federal Documentary Stamp Tax.

          This bill amends Section 408.4 of the Revenue and Taxation 
          Code to require the assessor to disclose information, 
          furnish abstracts, or permit access to all records in 
          his/her office to designated employees of a city's finance 
          office when conducting an investigation to determine 
          whether a documentary transaction tax should be imposed for 
          an unrecorded change in control or ownership of property 
          and requires the city to reimburse the assessor for any 
          costs incurred in disclosing this information.  Upon 
          request, the assessors shall provide the information to the 
          designated employee, who must certify to the assessor that 
          the information is necessary to assist with the preparation 


                                                                AB 563

          and enforcement of the DTT, and is not a public record that 
          is open to public inspection.  This bill states that any 
          information provided cannot include social security 

          Generally, any information and records in the assessor's 
          office are not public documents and are not open to public 
          inspection, unless allowed by law.  Exemptions include 
          information for law enforcement agencies, county grand 
          jury, or the Board of Supervisors.  Two years ago, the 
          Legislature required the assessor to disclose information, 
          furnish abstracts, and permit access to all records to the 
          County Recorder when conducting an investigation to 
          determine whether the documentary transfer tax is due.  The 
          City of Los Angeles wants the Assessor to share this 
          information with city financial officials to help assess 
          the DTT.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  Yes

          According to the Senate Appropriations Committee:

                         Fiscal Impact (in thousands)

           Major Provisions               2011-12      2012-13    
           2013-14   Fund  

          Information sharing          Unknown reimbursable costs 
          to assessors                 General 
          mandate          to provide specified information to city

           SUPPORT  :   (Verified  8/29/11)

          City of Los Angeles (source)
          California Assessors' Association
          California Nurses Association
          California Tax Reform Association
          City of Lakewood


                                                                AB 563

           ARGUMENTS IN SUPPORT  :    According to the author, "AB 563 
          would allow for information sharing between County 
          Assessor's Offices' and cities to identity change of 
          ownership legal entity transfers and other real property 
          transfers that may not be currently captured.  Enactment of 
          the proposed legislation is estimated to result in improved 
          and increased collection of the Documentary Transfer Tax at 
          a time of fiscal crisis for local governments."

           ASSEMBLY FLOOR  :  52-27, 5/31/11
          AYES:  Alejo, Allen, Ammiano, Atkins, Beall, Block, 
            Blumenfield, Bonilla, Bradford, Brownley, Buchanan, 
            Butler, Charles Calderon, Campos, Carter, Cedillo, 
            Chesbro, Davis, Dickinson, Eng, Feuer, Fong, Fuentes, 
            Furutani, Galgiani, Gatto, Gordon, Hall, Hayashi, Roger 
            Hernández, Hill, Huber, Hueso, Huffman, Lara, Bonnie 
            Lowenthal, Ma, Mendoza, Mitchell, Monning, Pan, Perea, V. 
            Manuel Pérez, Portantino, Skinner, Solorio, Swanson, 
            Torres, Wieckowski, Williams, Yamada, John A. Pérez
          NOES:  Achadjian, Bill Berryhill, Conway, Cook, Donnelly, 
            Fletcher, Beth Gaines, Garrick, Grove, Hagman, Halderman, 
            Harkey, Jeffries, Jones, Knight, Logue, Mansoor, Miller, 
            Morrell, Nestande, Nielsen, Norby, Olsen, Silva, Smyth, 
            Valadao, Wagner
          NO VOTE RECORDED:  Gorell

          AGB:kc  8/29/11   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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