BILL ANALYSIS Ó SENATE GOVERNANCE & FINANCE COMMITTEE Senator Lois Wolk, Chair BILL NO: SB 1464 HEARING: 4/24/14 AUTHOR: Committee on G&F FISCAL: No VERSION: 3/13/14 TAX LEVY: No CONSULTANT: Grinnell PROPERTY TAXATION Makes four technical, consensus changes to property tax law suggested by the State Board of Equalization. Background and Proposed Law Senate Bill 1464 contains four changes to property tax law suggested by the Board of Equalization (BOE): I. Name Change. State law directs BOE to determine the interest rate on the capitalization rate that assessors use to value historic property using data published by the Federal Home Finance Board. However, the Federal Home Finance Board changed its name to the Federal Home Finance Agency, so SB 1464 updates the law to reflect the change. II. Consistent Terms. When taxpayers file property tax appeals, the appellate body can be either the county board of supervisors sitting as the county board of equalization, or the board can create an assessment appeals board consisting of members with specified qualifications. Unfortunately, some parts of property tax law don't consistently refer to both terms, including disaster relief law. The bill provides that when assessors notify taxpayers that they're potentially eligible to appeal valuation changes resulting from a disaster, they can appeal to the assessment appeals board in addition to the county board of equalization. III. Cross reference. Current law allows for changes in ownership without reassessment, including when a parent or child transfers property to a disabled ward or a child by will, devise, or inheritance. Revenue and Taxation Code §62, which allows the transfers, relies on a definition for "disability" in subdivision (e) of Section 12304 of the Health and Safety Code, but in 1991, the Legislature SB 1464 (Committee on G&F) - 3/13/14 -- Page 2 re-lettered the definition to subdivision (d) of that section. The bill corrects the cross-reference. IV. Delete superfluous term. The Public Resources Code uses the term "nonprofit organization" when it allows groups to operate state parks on behalf of the state, but the cross-referenced Revenue and Taxation Code currently uses both "nonprofit corporation" and "nonprofit organization" when exempting these groups from the possessory interest tax. Because nonprofit organizations need not incorporate to qualify under the Public Resources Code, the bill deletes "nonprofit corporation" from the R&T Code section. State Revenue Impact BOE states that the measure has no impact on property tax revenues. Comment Purpose of the bill . SB 1464 is this year's omnibus property tax law cleanup bill, and makes four technical, consensus changes intended to improve tax administration for taxpayers, assessors, and BOE. By combining four changes into one bill, there's no need for individual legislative bills for each change. The bill is a consensus project: should anyone object to any provision of the bill, it's removed. Support and Opposition (4/21/14) Support : State Board of Equalization. Opposition : None Received.