BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 2291|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
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THIRD READING
Bill No: AB 2291
Author: Achadjian (R)
Amended: 6/8/16 in Senate
Vote: 21
SENATE GOVERNANCE & FIN. COMMITTEE: 6-1, 6/15/16
AYES: Hertzberg, Beall, Hernandez, Lara, Moorlach, Pavley
NOES: Nguyen
ASSEMBLY FLOOR: 74-0, 4/14/16 - See last page for vote
SUBJECT: Property taxes: delinquent taxes: partial payment:
fee
SOURCE: Author
DIGEST: This bill authorizes a county board of supervisors to
allow the tax collector to charge a fee for the reasonable costs
of partial property tax payments.
ANALYSIS:
1)Sets January 1 of each year as the "lien date," or the date
upon which the assessor values property, and property taxes
are imposed on its owner in the form of a lien against the
property.
2)Requires tax collectors to send bills to taxpayers on the
secured roll by November 1.
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3)Requires taxpayers must pay their bills in two installments:
the first on November 1, which becomes delinquent December 10,
and the second on February 1, with delinquency occurring on
April 10, but allows taxpayers to pay in full in the first
installment.
4)Imposes a 10% penalty on each delinquent amount, and allows
counties to also apply administrative charges.
5)Provides that a property becomes tax defaulted if taxes remain
unpaid as of June 30, triggering redemption penalties of 1.5%
a month until the full amount is paid.
6)Allows the tax collector with approval by the board of
supervisors to sell a tax defaulted residential property to
satisfy back taxes, penalties, costs, and other liens; for
commercial property, the tax collector can do so after three
years.
7)Requires counties to allow taxpayers to pay in installments by
making an initial payment of 20% of the amount outstanding,
but only after a property becomes tax defaulted. Under an
installment plan, taxpayers must make one payment a year for
five years, in addition to paying current taxes. Failure to
make timely payments on an installment plan again places the
property in default; however, taxpayers can enter into another
installment plan at the beginning of the next fiscal year.
8)Allows tax collectors to also accept partial payments from
delinquent taxpayers if authorized to do so by the board of
supervisors.
9)Authorizes tax collectors to charge fees for certain
activities, such as an application fee for valuing property
for the purpose of redemption, or a processing fee for
entering into an installment payment plan; however, existing
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law does not clearly authorize the tax collector to charge a
fee for accepting partial payments.
This bill:
1)Allows a county board of supervisors to authorize the tax
collector to recover the reasonable costs for instituting and
maintaining a partial payment arrangement for property taxes.
2)Requires the initial ordinance authorizing the fee to
establish the maximum fees that the tax collector can charge,
which the measure limits only to cost recovery.
3)Requires the county board of supervisors to adopt the fee and
any subsequent changes during a regularly scheduled meeting
after at least one public meeting where oral and written
presentations can be made.
4)States that the fee is imposed for a specific government
service or product provided directly to the payor that is not
provided to those not charged, and which does not exceed the
reasonable cost to provide the service for purposes of the
California Constitution.
5)Says that the fee is subject to statutory requirements that
cap the fee at the amount reasonably necessary to provide the
service.
Background
Tax collectors generally rely on county general fund allocations
from the board of supervisors to operate their offices and
fulfill their legal duties. As such, funding and service levels
will vary from county to county, and tax collectors must compete
for funding against many other worthy causes such as public
safety, health care, and other county offices and services when
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the Board enacts the budget. State law explicitly allows tax
collectors to charge fees to recover the reasonable costs for
some specified services, but not do so for accepting partial
payments. Many counties already accept partial payments without
charging a fee, paying for any costs out of general funding.
Any county that currently does not accept partial payments can
commence doing so without charging a fee. Taxpayers with
sufficient means are not likely to make partial payments given
significant penalties, interest, and risk of tax sale, so adding
a fee on to taxpayers who can only pay partially may serve as a
financial barrier to taxpayers who can't pay in full.
Additionally, counties who have been accepting partial payments
without a fee would have legal authorization to do so under AB
2291, which allows tax collectors to shift costs currently
funded as part of general operations onto taxpayers who can only
make partial payments. However, some counties that won't
currently accept partial payments without charging a fee may
choose to do so under AB 2291.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:NoLocal: No
SUPPORT: (Verified6/17/16)
California Association of County Treasurer-Tax Collectors
California State Association of Counties
Santa Clara County Board of Supervisors
OPPOSITION: (Verified6/17/16)
None received
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ARGUMENTS IN SUPPORT: According to the author, "AB 2291
would simply allow counties to recover the cost of providing an
alternative for taxpayers with tax-defaulted property.
Accepting payments on a monthly basis would offer a
substantially lower barrier to entry than the existing, more
restrictive Permanent Installment Plan. As a result, AB 2291
would allow more taxpayers to begin paying off their delinquent
taxes with lower monthly payments in the same manner they
typically pay other debt. This will have direct benefits to
taxpayers who are making earnest efforts to pay taxes owed. AB
2291 is both taxpayer friendly and maintains local control for
countries that choose to provide this service."
ASSEMBLY FLOOR: 74-0, 4/14/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,
Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley,
Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth
Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto,
Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Roger
Hernández, Holden, Jones, Jones-Sawyer, Kim, Lackey, Linder,
Lopez, Low, Maienschein, Mathis, Mayes, Medina, Mullin,
Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas,
Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond,
Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NO VOTE RECORDED: Harper, Irwin, Levine, McCarty, Melendez,
Nazarian
Prepared by:Colin Grinnell / GOV. & F. / (916) 651-4119
6/17/16 15:03:51
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