BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 703|
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THIRD READING
Bill No: AB 703
Author: Gordon (D)
Amended: 5/24/11 in Assembly
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 9-0, 6/29/11
AYES: Wolk, Huff, DeSaulnier, Fuller, Hancock, Hernandez,
Kehoe,
La Malfa, Liu
SENATE APPROPRIATIONS COMMITTEE : 7-0, 8/15/11
AYES: Kehoe, Walters, Alquist, Emmerson, Lieu, Pavley,
Steinberg
NO VOTE RECORDED: Price, Runner
ASSEMBLY FLOOR : 77-1, 6/1/11 - See last page for vote
SUBJECT : Property taxation: welfare exemption: nature
resources and open space lands
SOURCE : Author
DIGEST : This bill extends the property tax exemption for
specified land acquired by nonprofit organizations for
natural resource preservation and open-space purposes until
2022.
ANALYSIS : The California Constitution (Article XIII,
Section One) provides that all property is taxable unless
explicitly exempted by the Constitution or federal law.
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The Constitution limits the maximum amount of any ad
valorem tax on real property at one percent of full cash
value, plus any locally-authorized bonded indebtedness.
Assessors reappraise property whenever it is purchased,
newly constructed, or when ownership changes. Property
owned by state and local agencies is exempt from the
property tax, but Assessors may assert possessory interests
held by private entities on public lands.
First enacted as an initiative in 1944, the Constitution
additionally allows the Legislature to exempt property used
for charitable purposes, and owned by nonprofit entities
organized and operated for charitable purposes, none of
whose income inure to the benefit of any private
shareholder or individual. The Legislature enacted this
exemption, commonly known as the "welfare exemption."
The Legislature additionally enacted a welfare exemption
from property tax for property that is used exclusively for
the preservation of native plants and animals, biotic
communities, geological or geographical formations of
scientific or educational interest, or open-space lands
used solely for recreation and for enjoyment of scenic
beauty.
Last extended in 2001, the exemption becomes inoperative on
January 1, 2012, and is repealed on January 1, 2013 (SB 198
ÝChesbro], Chapter 533, Statutes of 2001).
This bill extends the inoperative date from January 1, 2012
to January 1, 2022 and the repeal date to January 1, 2023
for the exemption for nature resources and open space
lands.
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
Property tax exemption up to $2,000 up to
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$4,000 up to $4,000 General*
(foregone revenues)
____________
* Revenue loss represents state backfill of property tax
that would go to schools if the exemption were allowed to
expire (assumes a total statewide property tax impact of
up to $10 million, and 40% apportionment to schools).
SUPPORT : (Verified 8/16/11)
American River Conservancy
Audubon California
Big Sir Land Trust
California Association of County Assessors
California Council of Land Trust
California League of Conservation Voters
California Park and Recreation Society
California Taxpayers Association
Defenders of Wildlife
DMB Pacific LLC
Elkhorn Slough Foundation
Friends of the Desert Mountains
Green LA Coalition
Land Trust of Napa County
Land Trust of Santa Cruz County
Los Angeles Assessor's Office
Los Angeles Neighborhood Land Trust
Marin Agricultural Land Trust
Pacoima Beautiful
Peninsula Open Space Trust
Planning and Conservation League
Pomona Valley Audubon Society
Rancho Mission Viejo
San Francisco Bay Joint Venture
San Joaquin River Parkway Trust
Sierra Club California
Sierra-Foothill Conservancy
Sonoma Land Trust
The Nature Conservancy
Trust for Public Land
Tulare Basin Wildlife Partners
Wildlands Conservancy
ARGUMENTS IN SUPPORT : According to the author's office,
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existing property tax law has acknowledged the value of
this charitable service since 1971, affording these lands
with an exemption from property taxes. This exemption has
allowed non-profit organizations to focus their limited
funds on the long-term stewardship of these important
lands, and in many cases on providing the public with
educational programs not offered anywhere else. Without
extending the current 2012 sunset provision associated with
the exemption, these charitable services will be
threatened. This bill extends this sunset for an
additional ten years. By doing so, this bill provides the
same long-term property tax assurances to these important
green spaces that are currently afforded to non-profit
schools, hospitals, and churches.
ASSEMBLY FLOOR : 77-1, 6/1/11
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani,
Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Grove,
Hagman, Halderman, Hall, Harkey, Hayashi, Roger
Hernández, Hill, Huber, Hueso, Huffman, Jeffries, Jones,
Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor,
Mendoza, Miller, Mitchell, Monning, Morrell, Nestande,
Norby, Olsen, Pan, Perea, Portantino, Silva, Skinner,
Smyth, Solorio, Swanson, Torres, Valadao, Wagner,
Wieckowski, Williams, Yamada, John A. Pérez
NOES: Nielsen
NO VOTE RECORDED: Gorell, V. Manuel Pérez
AGB:kc 8/16/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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