BILL ANALYSIS Ó AB 1534 Page 1 Date of Hearing: May 13, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 1534 (Committee on Revenue and Taxation) - As Amended April 30, 2015 ----------------------------------------------------------------- |Policy |Revenue and Taxation |Vote:|9 - 0 | |Committee: | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill prohibits an assessor or any person employed by the office of an assessor from making any decisions regarding "change in ownership" issues or property tax exemptions without holding valid assessment analyst certificates issued by the Board of Equalization (BOE), but only if the relevant city or county has adopted a resolution upon recommendation of the assessor to require a valid assessment analyst certificate. Specifically, this bill: 1)Requires the BOE to prepare an examination with the assistance AB 1534 Page 2 and advice of the California Assessors' Association and provide it for applicants. 2)Requires a certified assessment analyst to complete at least 24 hours of training conducted or approved by the BOE in each one-year period; requires an advanced assessment analyst to complete at least 12 hours of training in each one-year period. 3)Exempts persons holding a valid appraiser's or advanced appraiser's certificate issued by the BOE from having to also receive an assessment analyst certificate. 4)Requires the BOE to prescribe an advanced course of study and prepare an advanced level examination with the assistance and advice of the California Assessors' Association, and requires the BOE to issue an advanced assessment analyst certificate for an applicant who has held a valid assessment analyst certificate for at least three years and has either successfully completed an advanced study course or passed an advanced level examination. 5)Allows the BOE to issue temporary and/or interim certificates AB 1534 Page 3 in limited circumstances. 6)Prohibits the BOE from imposing any charge upon a county, city or an applicant for an assessment analyst examination or certification or training conducted by the BOE. FISCAL EFFECT: Estimated GF costs of approximately $175,000 in the first year and $150,000 each year thereafter to the BOE to establish and administer the certificate program. COMMENTS: 1)Purpose. According to the authors, state law does not require any certification or training for employees of county assessors who make change in ownership or exemption decisions, yet their decisions can potentially impact the tax roll by adding or removing millions of dollars each year. The authors and supporters, including the California Assessors' Association, believe change in ownership and exemption decisions are highly complex and require a thorough understanding of legal documents as well as a variety of statutes, regulations, and court decisions. Current law already requires appraisers to be certified, and this bill will create similar certification procedures for employees of assessors making those decisions, ensuring they are educated and trained. AB 1534 Page 4 2)Change in Ownership. Since the adoption of Proposition 13 in 1978, real property has generally been taxed on its value at the time of its acquisition, with increases for inflation limited to 2% per year. The property is reassessed to its market value when the ownership of property is changed. While the requirement to reassess property upon a change in ownership is contained in the California Constitution, the phrase "change in ownership" is not defined. There have been hundreds of court cases relating to interpretation of "change in ownership" and exemption issues, leading to considerable legal debate as to its meaning and intended interpretation. 3)Mandatory Certification, If You Want It. This bill is substantially similar to AB 2756 (Revenue and Taxation Committee) of 2014, which was vetoed by the Governor. That bill required all assessor offices to obtain the training and certification of its employees, resulting in a state mandate. In his veto message, the Governor made clear that county assessors should be providing this training without a state mandate. This bill includes an opt-in provision for county assessors, requiring counties and cities to first adopt a resolution upon recommendation of the assessor before requiring its employees to obtain certifications. As a result, this bill does not create a state mandate. Analysis Prepared by:Joel Tashjian / APPR. / (916) 319-2081 AB 1534 Page 5