California Legislature—2015–16 Regular Session

Assembly Bill No. 567

Introduced by Assembly Member Gipson

February 24, 2015

An act to amend Section 481 of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

AB 567, as introduced, Gipson. Property taxation: change in ownership statement: confidentiality of information.

Existing law requires, upon a change in control or change in ownership of a legal entity that owns an interest in real property in this state, or when requested by the State Board of Equalization, that the person or legal entity acquiring ownership control, or the legal entity that has undergone a change in ownership, file a change in ownership statement with the board, as specified, listing all counties in which the legal entity owns real property. Existing law requires all information requested by the assessor or the board regarding change in ownership reporting or furnished in a change in ownership statement to be held secret, except as specifically provided.

This bill would provide that information requested or furnished in a change in ownership statement, with respect to a legal entity and its real property does not include the fact that a change in ownership statement has been filed with the board or that the board has issued a determination to the assessor relating to a change in ownership statement, and that the board and the assessor are not required to hold these facts secret. This bill would also provide that the disclosure by the board or the assessor that such a change in ownership statement has been filed, where the filing was prompted by information collected by the Franchise Tax Board from the property tax query on the taxpayer’s state income tax return, does not violate the confidentiality of taxpayer return information.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

The Legislature finds and declares all of the
following:

(a) Transparency in assessed value information is critical to the
integrity of the property tax system. The public should have
sufficient information to provide assurance that property tax laws
are equitably applied and that the property tax burden is fairly
distributed. To this end, existing law requires the assessment roll,
which lists the assessed value for every property, to be open to
public inspection. Existing law further requires a quarterly list of
all recorded property transfers occurring in the prior two years to
be open to public inspection in each county.

(b) The right to privacy is a personal and fundamental right
protected by Section 1 of Article I of the California Constitution
and by the 14th Amendment to the United States Constitution. All
individuals have a right to privacy in information pertaining to
them. It is the Legislature’s intent that detailed information
requested by the county assessor or the Board of Equalization and
furnished in the change in ownership statement shall continue to
be held in secret by the assessor and the Board. However, the
Legislature does not intend for the board or the assessor to hold
secret the fact that (1) an individual or legal entity has filed a
change in ownership statement with the board pursuant to Section
480.1 with respect to a change in control as defined in subdivision
(c) of Section 64, or pursuant to Section 480.2 with respect to a
change in ownership as defined in subdivision (d) of Section 64
or that (2) the board has issued a determination to the assessor
relating to the statement filed with the board that a change in
control or change in ownership has occurred. These facts should
not be considered to be confidential information furnished in the
change in ownership statement and should not required to be held
secret by the assessor and the board.

(c) The public interest is not served by holding secret factual
information concerning legal entity changes in ownership that
become public when assessment roll updates reflect assessed value
changes. Furthermore, the public interest is not served when
available information concerning legal entity changes in ownership
is not made public, similar to other transfers in property interests,
merely because the transaction did not require the recordation of
any documents.

(d) This act balances the taxing authority’s responsibility to
safeguard confidential taxpayer information with the public’s right
to timely information.

(e) That local county assessors require the state’s assistance to
administer current change in ownership law as it relates to the
transfers of ownership interests in legal entities. The law requires
the Franchise Tax to include a question on state income tax returns
to assist the State Board of Equalization and the county assessor
in the determination of when legal entity owned property undergoes
a change of ownership for property tax purposes. The Franchise
Tax Board collects these responses for the purpose of transmitting
the information to the State Board of Equalization. The use of the
state income tax return is a practical and cost effective method to
annually communicate with legal entities operating in this state.
In some instances, a legal entity change in ownership statement
filed with the State Board of Equalization will have been prompted
by the legal entity’s response to this question.

(f) That the disclosure by the State Board of Equalization or
assessor that a statement has been filed with the State Board of
Equalization in the case where the filing was prompted by a legal
entity’s response to the property tax query on a state income tax
return should not be deemed to violate the confidentiality of
taxpayer return information. The provisions of this act allowing
the disclosure of limited facts serves a public policy that overrides
the confidentiality of return information collected by the Franchise
Tax Board.

SEC. 2.  

Section 481 of the Revenue and Taxation Code is
amended to read:

481.  

begin insert (a) end insert begin insert   end insert All information requested by the assessor or the board
pursuant to this article or furnished in the change in ownership
statement shall be held secret by the assessor and the board. All
information furnished in either the preliminary change in ownership
statement or the change in ownership statement shall be held secret
by those authorized by law to receive or have access to this
information. These statements are not public documents and are
not open to inspection, except as provided in Section 408.

begin insert

(b) (1) Information requested or furnished in a change in
ownership statement for a change in control or a change in
ownership as defined in subdivision (c) or (d) of Section 64 does
not include the fact that a change in ownership statement has been
filed with the board or that the board has issued a determination
to the assessor relating to a change in ownership statement filed
with the board. The board and the assessor are not required to
hold these facts secret.

end insert begin insert

(2) Notwithstanding any other law, the disclosure by the board
or assessor that a change in ownership statement has been filed
in the case where the filing was prompted by information collected
by the Franchise Tax Board from the property tax query on the
taxpayer’s state income tax return as required by Section 64 shall
not be deemed to violate the confidentiality of taxpayer return
information.

end insert