Amended in Assembly March 26, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 668

Introduced by Assembly Member Gomez

February 25, 2015

begin delete An act relating to taxation. end delete begin insert An act to amend Section 402.1 of the Revenue and Taxation Code, relating to taxation. end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 668, as amended, Gomez. Property taxation: assessment: affordable housing.

Existing law requires the county assessor to consider, when valuing real property for property taxation purposes, the effect of any enforceable restrictions to which the use of the land may be subjected. Under existing law these restrictions include, but are not limited to, zoning, recorded contracts with governmental agencies, and various other restrictions imposed by governments.

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This bill would state the intent of the Legislature to enact legislation that would require a county assessor to consider a recorded contract with a nonprofit corporation that restricts the use of the land for at least 30 years for affordable housing or affordable rent when valuing real property for property taxation purposes.

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This bill would require the county assessor to consider, when valuing real property for property taxation purposes, a recorded contract with a nonprofit corporation for the advancement of affordable housing that provides funding or land for affordable housing where the recorded contract restricts the use of the land for at least 30 years to housing available at affordable housing cost or affordable rent. By changing the manner in which county assessors assess property for property taxation purposes, this bill would impose a state-mandated local program.

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The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

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This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.

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Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program:  begin delete no end delete begin insert yes end insert .

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

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begin insert SECTION 1. end insert   

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begin insert Section 402.1 of the end insert begin insert Revenue and Taxation Code end insert
begin insert is amended to read: end insert

402.1.  

(a) In the assessment of land, the assessor shall consider
the effect upon value of any enforceable restrictions to which the
use of the land may be subjected. These restrictions shall include,
but are not limited to, all of the following:

(1) Zoning.

(2) Recorded contracts with governmental agencies other than
those provided in Sections 422, 422.5, and 422.7.

(3) Permit authority of, and permits issued by, governmental
agencies exercising land use powers concurrently with local
governments, including the California Coastal Commission and
regional coastal commissions, the San Francisco Bay Conservation
and Development Commission, and the Tahoe Regional Planning
Agency.

(4) Development controls of a local government in accordance
with any local coastal program certified pursuant to Division 20
(commencing with Section 30000) of the Public Resources Code.

(5) Development controls of a local government in accordance
with a local protection program, or any component thereof, certified
pursuant to Division 19 (commencing with Section 29000) of the
Public Resources Code.

(6) Environmental constraints applied to the use of land pursuant
to provisions of statutes.

(7) Hazardous waste land use restriction pursuant to Section
25240 of the Health and Safety Code.

(8) A recorded conservation, trail, or scenic easement, as
described in Section 815.1 of the Civil Code, that is granted in
favor of a public agency, or in favor of a nonprofit corporation
organized pursuant to Section 501(c)(3) of the Internal Revenue
Code that has as its primary purpose the preservation, protection,
or enhancement of land in its natural, scenic, historical, agricultural,
forested, or open-space condition or use.

(9) A solar-use easement pursuant to Chapter 6.9 (commencing
with Section 51190) of Part 1 of Division 1 of Title 5 of the
Government Code.

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(10) A recorded contract with a nonprofit corporation organized
pursuant to Section 501(c)(3) of the Internal Revenue Code that
has as its primary purpose the advancement of affordable housing
and that provides funding or land for affordable housing where
the recorded contract restricts the use of the land for at least 30
years to housing available at affordable housing cost or affordable
rent in accordance with Sections 50052.5 and 50053 of the Health
and Safety Code.

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(b) There is a rebuttable presumption that restrictions will not
be removed or substantially modified in the predictable future and
that they will substantially equate the value of the land to the value
attributable to the legally permissible use or uses.

(c) Grounds for rebutting the presumption may include, but are
not necessarily limited to, the past history of like use restrictions
in the jurisdiction in question and the similarity of sales prices for
restricted and unrestricted land. The possible expiration of a
restriction at a time certain shall not be conclusive evidence of the
future removal or modification of the restriction unless there is no
opportunity or likelihood of the continuation or renewal of the
restriction, or unless a necessary party to the restriction has
indicated an intent to permit its expiration at that time.

(d) In assessing land with respect to which the presumption is
unrebutted, the assessor shall not consider sales of otherwise
comparable land not similarly restricted as to use as indicative of
value of land under restriction, unless the restrictions have a
demonstrably minimal effect upon value.

(e) In assessing land under an enforceable use restriction wherein
the presumption of no predictable removal or substantial
modification of the restriction has been rebutted, but where the
restriction nevertheless retains some future life and has some effect
on present value, the assessor may consider, in addition to all other
legally permissible information, representative sales of comparable
lands that are not under restriction but upon which natural
limitations have substantially the same effect as restrictions.

(f) For the purposes of this section the following definitions
apply:

(1) “Comparable lands” are lands that are similar to the land
being valued in respect to legally permissible uses and physical
attributes.

(2) “Representative sales information” is information from sales
of a sufficient number of comparable lands to give an accurate
indication of the full cash value of the land being valued.

(g) It is hereby declared that the purpose and intent of the
Legislature in enacting this section is to provide for a method of
determining whether a sufficient amount of representative sales
information is available for land under use restriction in order to
ensure the accurate assessment of that land. It is also hereby
declared that the further purpose and intent of the Legislature in
enacting this section and Section 1630 is to avoid an assessment
policy which, in the absence of special circumstances, considers
uses for land that legally are not available to the owner and not
contemplated by government, and that these sections are necessary
to implement the public policy of encouraging and maintaining
effective land use planning. This statute shall not be construed as
requiring the assessment of any land at a value less than as required
by Section 401 or as prohibiting the use of representative
comparable sales information on land under similar restrictions
when this information is available.

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begin insert SEC. 2. end insert   

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If the Commission on State Mandates determines that
this act contains costs mandated by the state, reimbursement to
local agencies and school districts for those costs shall be made
pursuant to Part 7 (commencing with Section 17500) of Division
4 of Title 2 of the Government Code.

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SECTION 1.  

It is the intent of the Legislature to enact
legislation that would require a county assessor to consider a
recorded contract with a nonprofit corporation that restricts the
use of the land for at least 30 years for affordable housing or
affordable rent when valuing real property for property taxation
purposes.

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