Amended in Senate August 19, 2016

Amended in Senate August 2, 2016

Amended in Assembly May 19, 2016

Amended in Assembly April 26, 2016

Amended in Assembly April 12, 2016

Amended in Assembly March 18, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2622


Introduced by Assembly Member Nazarian

(Coauthor: Assembly Member Ting)

February 19, 2016


An act to amend Sections 401.17, 441,begin delete 1153,end delete and 1153.5 of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

AB 2622, as amended, Nazarian. Property taxation: certificated aircraft assessment.

Existing property tax law requires the personal property of an air carrier to be taxed at its fair market value, and the California Constitution requires property subject to ad valorem property taxation to be assessed in the county in which it is situated. Existing law, for the 2005-06 fiscal year to the 2016-17 fiscal year, inclusive, specifies a formula to determine the fair market value of certificated aircraft of a commercial air carrier, and rebuttably presumes that the amount determined pursuant to this formula is the fair market value of the certificated aircraft.

This bill would extend the 2016-17 fiscal year termination date to the 2019-20 fiscal year for the above-described provisions relating to the determination of the fair market value and taxation of certificated aircraft.

Existing law, until December 31, 2016, requires the Aircraft Advisory Subcommittee of the California Assessors’ Association to designate, after soliciting input from commercial air carriers operating in the state, a lead county assessor’s office for each commercial air carrier operating certificated aircraft in this state in an assessment year, and requires the lead county assessor to calculate the value of the air carrier’s personal property and to transmit these calculations to other county assessors, but specifies that each county assessor is responsible for assessing and enrolling the taxable value of the property in his or her county, as provided. Existing law, until December 31, 2016, also requires the lead county assessor’s office to lead a team to audit the books and records of commercial air carriers and requires a commercial air carrier that receives a notice of the designation of a lead county assessor’s office to file one signed property statement with the lead county assessor’s office for its personal property at all airport locations and fixtures at all airport locations. Existing law requires the lead county assessor’s office to receive the property statement of each commercial air carrier to which he or she is assigned.

This bill would extend the December 31, 2016, inoperative or repeal date to December 31, 2019, for the above-described provisions. The bill, on or before March 1, 2017, would additionally require the Aircraft Advisory Subcommittee of the California Assessors’ Association to designate contacts in each lead county assessor’s office for each commercial air carrier to address specified issues and to establish best practices for the effective administration of the lead county system and audit process. The bill would require the lead county assessor’s office to transmit the property statement to the assessor of each county in which the personal property of the commercial air carrier is located or has acquired situs, including certificated aircraft. The bill would require a county assessor that receives a property statement from the lead county assessor’s office to direct questions about the contents of the property statement first to the lead county assessor’s office and then, if the lead county assessor’s office is unable to provide an answer, to the commercial air carrier that filed the property statement.

begin delete

Existing property tax law requires the State Board of Equalization, after consultation with county tax assessors, to designate for each assessment year the representative period to be used by the assessors in assessing the aircraft of the carrier.

end delete
begin delete

This bill would require the representative period to consist equally of a week or group of weeks in January and a week or group of weeks in July.

end delete

By extending the application of the aforementioned valuation process for certificated aircraft beyond the 2016-17 fiscal year, thereby imposing new duties upon a lead county assessor’s office, the bill would impose a state-mandated local program.

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.

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.

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

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

P3    1

SECTION 1.  

Section 401.17 of the Revenue and Taxation
2Code
is amended to read:

3

401.17.  

(a) For the 2005-06 fiscal year to the 2019-20 fiscal
4year, inclusive, it shall be rebuttably presumed that the preallocated
5fair market value of each make, model, and series of mainline jets,
6production freighters, and regional aircraft that has attained situs
7within this state is the lesser of the sum total of the amounts
8determined under paragraph (1) or the sum total of the amounts
9determined under paragraph (2). The value of an individual aircraft
10assessed to the original owner of that aircraft shall not exceed its
11original cost from the manufacturer. The preallocated fair market
12value of an aircraft may be rebutted by evidence including, but
13not limited to, appraisals, invoices, and expert testimony.

14(1) (A) The original cost for the aircraft, which shall be
15determined as follows and adjusted, as applicable, under
16subparagraphs (B), (C), and (D):

17(i) For owned and leased aircraft, the taxpayer’s or lessor’s
18acquisition cost for that individual aircraft reported in accordance
19with generally accepted accounting principles, and to the extent
P4    1not included in the acquisition cost, transportation costs and
2capitalized interest and the cost of improvements made before a
3transaction described in clause (ii). If the original cost for leased
4aircraft cannot be determined from information reasonably
5available to the taxpayer, original cost may be determined by
6reference to the “average new prices” column of the Airliner Price
7Guide for that model, series, and year of manufacture of aircraft.
8If information is not available in the “average new prices” column
9for that model, series, and year, the original cost may be determined
10using the best indicator of original cost plus all conversion costs
11and improvement costs incurred for that aircraft.

12(ii) For sale/leaseback or assignment of purchase rights
13transaction aircraft, the average of the taxpayer’s cost established
14pursuant to clause (i) and the cost established in a sale/leaseback
15or assignment of purchase rights transaction for individual aircraft
16that transfers the benefits and burdens of ownership to the lessor
17for United States federal income tax purposes. In no event shall
18the original cost for sale/leaseback aircraft be less than the
19taxpayer’s acquisition cost.

20(iii) In the event of a merger, bankruptcy, or change in
21accounting methods by the reporting airline, there shall be a
22rebuttable presumption that the cost of the individual aircraft and
23the acquisition date reported by the acquired company, if available,
24or the cost reported prior to the change in accounting method, are
25the original cost and the applicable acquisition date.

26(B) (i) For mainline jets and production freighters, the original
27cost described in subparagraph (A), plus the cost of any
28improvements not otherwise included in the original cost, shall be
29adjusted from the date of the acquisition of the aircraft to the lien
30date using the monthly United States Department of Labor
31Producer Price Index for aircraft and a 20-year straight-line
32 percent-good table starting from the delivery date of the aircraft
33to the current owner or, in the case of a sale/leaseback or
34assignment of purchase rights transaction, as described in this
35section, the current operator with a minimum combined factor of
3625 percent.

37(ii) For regional aircraft, the original cost described in
38subparagraph (A), plus the cost of any improvements not otherwise
39included in the original cost, shall be adjusted from the date of the
40acquisition of the aircraft to the lien date using the monthly United
P5    1States Department of Labor Producer Price Index for aircraft and
2a 16-year straight-line percent-good table starting from the delivery
3date of the aircraft to the current owner or, in the case of a
4sale/leaseback or assignment of purchase rights transaction, as
5described in this section, the current operator with a minimum
6combined factor of 25 percent.

7(iii) If original cost is determined by reference to the Airliner
8Price Guide “average new prices” column, the adjustments required
9by this paragraph shall be made by setting the acquisition date of
10the aircraft to be the date of the aircraft’s manufacture.

11(C) (i) For mainline jets and regional aircraft, the assessor shall
12analyze the adjusted original cost derived pursuant to subparagraph
13(B), for application of an economic obsolescence allowance which
14shall be determined as follows:

15(I) For the applicable year, the assessor shall calculate the
16average annual net revenue per available seat mile, the net load
17factor, and the yield utilizing the Airline Quarterly Financial
18Review published by the United States Department of
19Transportation, and referring to the section descriptive of the
20passenger airline industry, entitled “System Operations, System
21Pax. Majors” for the calendar year ending December 31
22immediately preceding the applicable assessment date.

23(II) For a 10-year benchmark, the assessor shall calculate as of
24December 31 for each of the 10 calendar years preceding the
25applicable year, the average annual net revenue per available seat
26mile, the net load factor, and the yield utilizing the Airline
27Quarterly Financial Review published by the United States
28Department of Transportation, and referring to the section
29descriptive of the passenger airline industry, entitled “System
30Operations, System Pax. Majors” for the calendar year ending
31December 31 immediately preceding the applicable assessment
32date.

33(ii) (I) The assessor shall compare each factor calculated under
34subclause (I) of clause (i) with the corresponding factor calculated
35under subclause (II) of clause (i) to derive the percentage that each
36of the factors calculated under subclause (I) of clause (i) deviated
37from the 10-year benchmark calculated under subclause (II) of
38clause (i). The assessor shall then calculate a weighted average of
39the indicated percentage adjustments, weighted as follows:

P6    1(ia) Net revenue per available seat mile shall be weighted 35
2percent.

3(ib) Net load factor shall be weighted 35 percent.

4(ic) Yield shall be weighted 30 percent.

5(II) The assessor shall reduce the adjusted original costs derived
6under subparagraph (B) by the percentage adjustment calculated
7in subclause (I), but only if the final economic obsolescence
8determined under that subclause exceeds 10 percent, otherwise no
9economic obsolescence allowance shall be provided.

10(D) (i) For production freighters, the assessor shall analyze the
11adjusted original cost derived under subparagraph (B), for
12application of an economic obsolescence allowance, as follows:

13(I) For the applicable year, the assessor shall calculate the
14industry average of net revenue per available ton mile and the ton
15load factor based upon the Airline Quarterly Financial Review
16published by the United States Department of Transportation, and
17referring to the section descriptive of the cargo airline industry,
18entitled “System Operations, System Cargo Majors” for the
19calendar year ending December 31 preceding the relevant
20assessment date.

21(II) For a 10-year benchmark, the assessor shall calculate as of
22December 31 for each of the 10 calendar years preceding the
23applicable year, the net revenue per available ton mile and the ton
24load factor utilizing the Airline Quarterly Financial Review
25published by the United States Department of Transportation and
26referring to the section descriptive of the cargo airline industry,
27entitled “System Operations, System Cargo Majors” as of
28December 31 for each of the 10 calendar years preceding the
29calendar year utilized for the subject year, for the calendar year
30ending December 31 immediately preceding the applicable
31assessment date.

32(ii) (I) The assessor shall compare each factor calculated under
33subclause (I) of clause (i) with the corresponding factor calculated
34under subclause (II) of clause (i) to derive the percentage that each
35of the factors calculated under subclause (I) of clause (i) deviated
36from the 10-year benchmark calculated under subclause (II) of
37clause (i). The assessor shall then calculate a weighted average of
38the indicated percentage adjustments so that the net revenue per
39available ton mile is weighted 50 percent and the ton load factor
40is weighted 50 percent.

P7    1(II) The assessor shall reduce the adjusted original costs derived
2under subparagraph (B) by the percentage adjustment calculated
3in subclause (I), but only if the final economic obsolescence
4determined under that subclause exceeds 10 percent, otherwise no
5economic obsolescence allowance shall be provided.

6(2) (A) Except as otherwise provided in subparagraph (B), for
7each individual mainline jet, production freighter, or regional
8aircraft, the assessor shall identify the value referenced in the “Used
9Price of Avg. Acft. Wholesale” column of the Winter edition of
10the Airliner Price Guide by make, model, series, and year of
11manufacture, and deduct 10 percent from that value for a fleet
12discount.

13(B) For each individual mainline jet, production freighter, or
14regional aircraft that is less than two years old and for which the
15Airliner Price Guide does not list used wholesale values, the
16original cost determined under paragraph (1) of subparagraph (A)
17shall be decreased by the lesser of 5 percent or one-half of the
18percentage decrease between original cost and 90 percent of the
19value listed in the “Used Price of Avg. Acft. Wholesale” column
20of the Winter edition of the Airliner Price Guide for a two-year-old
21aircraft of that same make, model, and series.

22(b) For the 2005-06 fiscal year to the 2019-20 fiscal year,
23inclusive, it shall be rebuttably presumed that the preallocated fair
24market value for each make, model, and series of converted
25freighters that has attained situs within this state is the amount that
26is determined as follows:

27(1) (A) The assessor shall begin his or her appraisal of a
28converted freighter as of the relevant lien date by identifying the
29aircraft’s original cost as a passenger aircraft prior to conversion.
30The aircraft’s original cost as a converted freighter shall be the
31lesser of:

32(i) Its trended original cost as a passenger aircraft prior to
33conversion, less a downward adjustment of 10 percent to reflect
34tear-outs.

35(ii) Its value described in the Winter edition of the Airliner Price
36Guide in the “Used Price of Avg. Acft. Wholesale” column in
37passenger configuration, less a downward adjustment of 10 percent
38to reflect tear-outs.

39(B) The amount determined under subparagraph (A) shall be
40adjusted according to the following:

P8    1(i) If, on the relevant lien date, the frame of the aircraft is 15
2years old or more, 50 percent of the cost to convert the aircraft to
3a freighter shall be added to the value determined under
4subparagraph (A).

5(ii) If, on the relevant lien date, the frame of the aircraft is less
6than 15 years old, 75 percent of the cost to convert the aircraft to
7a freighter shall be added to the value determined under
8subparagraph (A).

9(iii) In addition, all other improvements, including capitalized
10interest, to the aircraft that are not otherwise included in the
11aircraft’s original and conversion costs shall be added at full value.

12(2) The amount determined under paragraph (1) shall be adjusted
13from the date of the conversion of the aircraft to the lien date using
14the monthly United States Department of Labor Producer Price
15Index for aircraft and a 16-year straight-line percent-good table,
16however, the percent-good applied to the aircraft shall in no event
17be less than 15 percent.

18(3) If the Airliner Price Guide “Used Price of Avg. Acft.
19Wholesale” is utilized under paragraph (1), only the improvements
20and adjusted conversion costs pertaining to the converted freighter
21shall be adjusted from the date of the conversion of the aircraft to
22the relevant lien date using the monthly United States Department
23of Labor Producer Price Index for aircraft and a 16-year
24straight-line percent-good table. In no event, however, shall the
25percent-good applied to the improvements and adjusted conversion
26costs be less than 15 percent.

27(4) (A) Except as otherwise provided in subparagraph (B), the
28assessor shall reduce the adjusted original cost, plus improvements,
29and adjusted conversion costs, derived under paragraphs (1) to (3),
30inclusive, by the obsolescence percentage adjustment calculated
31for production freighters under subparagraph (D) of paragraph (1)
32of subdivision (a).

33(B) If the Airliner Price Guide “Used Price of Avg. Acft.
34Wholesale” is utilized under paragraph (1), only the improvements
35and adjusted conversion costs pertaining to the converted freighter
36shall be reduced by the obsolescence percentage adjustment
37described in subparagraph (A).

38(c) For purposes of this section, if the Airliner Price Guide
39ceases to be published or the format significantly changes, a guide
40or adjustment agreed to by commercial air carriers and the counties
P9    1in which certificated aircraft have situs shall be substituted. If these
2parties do not agree on a guide or adjustment, the State Board of
3Equalization shall determine the guide or adjustment.

4(d) The taxpayer shall, to the extent that information is
5reasonably available to the taxpayer, furnish the county assessor
6with an annual property statement that includes the aircraft original
7costs as defined in subparagraph (A) of paragraph (1) of
8subdivision (a). If an air carrier that has this information reasonably
9available to it fails to report original cost and improvements, as
10required by Sections 441 and 442, an assessor may in that case
11make an appropriate assessment pursuant to Section 501.

12(e) For purposes of this section, all of the following apply:

13(1) “Converted freighter” means a certificated aircraft, as defined
14in Section 1150, that, following its original manufacture, was used
15for passenger transportation, but was later converted to be used
16primarily for cargo transportation purposes.

17(2) “Mainline jet” means a certificated aircraft, as defined in
18Section 1150, that is either of the following:

19(A) Manufactured by Boeing, Airbus, or McDonnell Douglas.

20(B) Capable of being configured with approximately 100 seats
21or more.

22(3) “Production Freighter” means a certificated aircraft, as
23defined in Section 1150, that immediately following its
24manufacture is deployed primarily for cargo transportation
25purposes.

26(4) “Regional aircraft” means a certificated aircraft, as defined
27in Section 1150, that is either of the following:

28(A) Manufactured by ATR (Avions De Transport Regional),
29Beech, British Aerospace Jetstream, Canadair Regional Jet, Cessna,
30DeHaviland, Embraer, Fairchild, or Saab.

31(B) Generally configured with fewer than 100 seats.

32(5) “Improvements” means the cost of any modifications or
33capital additions that materially add to the value of or substantially
34prolong the useful life of the aircraft, or make it adaptable to a
35different use. “Improvements” include modification costs incurred
36during a heavy maintenance visit to the extent that they materially
37add to the value of or substantially prolong the useful life of the
38aircraft. “Improvements” do not include repair and maintenance
39costs incurred for the purpose of keeping the aircraft in an
40ordinarily efficient operating condition.

P10   1(6) “Net revenue per available seat mile” means operating
2revenue per available seat mile less cost per available seat mile as
3determined by the United States Department of Transportation.

4(7) “Net load factor” means actual passenger load factor less
5break-even passenger load factor, as determined by the United
6States Department of Transportation.

7(8) “Net revenue per available ton mile” means operating
8revenue per ton mile less cost per available ton mile as determined
9by the United States Department of Transportation.

10(9) “Yield” means average revenue per revenue passenger mile
11as determined by the United States Department of Transportation.

12(10) “Ton Load Factor” means that percentage of effective use
13of cargo capacity as determined by the United States Department
14of Transportation.

15(f) The amendments made by the act adding this subdivision
16shall apply with respect to lien dates occurring on and after January
171, 2011.

18

SEC. 2.  

Section 441 of the Revenue and Taxation Code is
19amended to read:

20

441.  

(a) Each person owning taxable personal property, other
21than a manufactured home subject to Part 13 (commencing with
22Section 5800), having an aggregate cost of one hundred thousand
23dollars ($100,000) or more for any assessment year shall file a
24signed property statement with the assessor. Every person owning
25personal property that does not require the filing of a property
26statement or real property shall, upon request of the assessor, file
27a signed property statement. Failure of the assessor to request or
28secure the property statement does not render any assessment
29invalid.

30(b) The property statement shall be declared to be true under
31the penalty of perjury and filed annually with the assessor between
32the lien date and 5 p.m. on April 1. The penalty provided by Section
33463 applies for property statements not filed by May 7. If May 7
34falls on a Saturday, Sunday, or legal holiday, a property statement
35that is mailed and postmarked on the next business day shall be
36deemed to have been filed between the lien date and 5 p.m. on
37May 7. If, on the dates specified in this subdivision, the county’s
38offices are closed for the entire day, that day is considered a legal
39holiday for purposes of this section.

P11   1(c) The property statement may be filed with the assessor
2through the United States mail, properly addressed with postage
3prepaid. For purposes of determining the date upon which the
4property statement is deemed filed with the assessor, the date of
5postmark as affixed by the United States Postal Service, or the
6date certified by a bona fide private courier service on the envelope
7containing the application, shall control. This subdivision shall be
8applicable to every taxing agency, including, but not limited to, a
9chartered city and county, or chartered city.

10(d) (1) At any time, as required by the assessor for assessment
11purposes, every person shall make available for examination
12information or records regarding his or her property or any other
13personal property located on premises he or she owns or controls.
14In this connection details of property acquisition transactions,
15construction and development costs, rental income, and other data
16relevant to the determination of an estimate of value are to be
17considered as information essential to the proper discharge of the
18assessor’s duties.

19(2) (A) This subdivision shall also apply to an owner-builder
20or an owner-developer of new construction that is sold to a third
21party, is constructed on behalf of a third party, or is constructed
22for the purpose of selling that property to a third party.

23(B) The owner-builder or owner-developer of new construction
24described in subparagraph (A), shall, within 45 days of receipt of
25a written request by the assessor for information or records, provide
26the assessor with all information and records regarding that
27property. The information and records provided to the assessor
28shall include the total consideration provided either by the
29purchaser or on behalf of the purchaser that was paid or provided
30either, as part of or outside of the purchase agreement, including,
31but not limited to, consideration paid or provided for the purchase
32or acquisition of upgrades, additions, or for any other additional
33or supplemental work performed or arranged for by the
34owner-builder or owner-developer on behalf of the purchaser.

35(e) In the case of a corporate owner of property, the property
36statement shall be signed either by an officer of the corporation or
37an employee or agent who has been designated in writing by the
38board of directors to sign the statements on behalf of the
39corporation.

P12   1(f) In the case of property owned by a bank or other financial
2institution and leased to an entity other than a bank or other
3financial institution, the property statement shall be submitted by
4the owner bank or other financial institution.

5(g)  The assessor may refuse to accept any property statement
6he or she determines to be in error.

7(h) If a taxpayer fails to provide information to the assessor
8pursuant to subdivision (d) and introduces any requested materials
9or information at any assessment appeals board hearing, the
10assessor may request and shall be granted a continuance for a
11reasonable period of time. The continuance shall extend the
12two-year period specified in subdivision (c) of Section 1604 for a
13period of time equal to the period of the continuance.

14(i) Notwithstanding any other provision of law, every person
15required to file a property statement pursuant to this section shall
16be permitted to amend that property statement until May 31 of the
17year in which the property statement is due, for errors and
18omissions not the result of willful intent to erroneously report. The
19penalty authorized by Section 463 does not apply to an amended
20statement received prior to May 31, provided the original statement
21is not subject to penalty pursuant to subdivision (b). The amended
22property statement shall otherwise conform to the requirements
23of a property statement as provided in this article.

24(j) This subdivision shall apply to the oil, gas, and mineral
25extraction industry only. Any information that is necessary to file
26a true, correct, and complete statement shall be made available by
27the assessor, upon request, to the taxpayer by mail or at the office
28of the assessor by February 28. For each business day beyond
29February 28 that the information is unavailable, the filing deadline
30in subdivision (b) shall be extended in that county by one business
31day, for those statements affected by the delay. In no case shall
32the filing deadline be extended beyond June 1 or the first business
33day thereafter.

34(k) The assessor may accept the filing of a property statement
35by the use of electronic media. In lieu of the signature required by
36subdivision (a) and the declaration under penalty of perjury
37required by subdivision (b), property statements filed using
38electronic media shall be authenticated pursuant to methods
39specified by the assessor and approved by the board. Electronic
P13   1media includes, but is not limited to, computer modem, magnetic
2media, optical disk, and facsimile machine.

3(l) (1) After receiving the notice required by Section 1162, the
4manager in control of a fleet of fractionally owned aircraft shall
5file with the lead county assessor’s office one signed property
6statement for all of its aircraft that have acquired situs in the state,
7as described in Section 1161.

8(2) Flight data required to compute fractionally owned aircraft
9allocation under Section 1161 shall be segregated by airport.

10(m) (1) After receiving the notice required by paragraph (5) of
11subdivision (b) of Section 1153.5, a commercial air carrier whose
12certificated aircraft is subject to Article 6 (commencing with
13Section 1150) of Chapter 5 shall file with the lead county assessor’s
14office designated under Section 1153.5 one signed property
15statement for its personal property at all airport locations and
16fixtures at all airport locations.

17(2) Each commercial air carrier may file one schedule for all of
18its certificated aircraft that have acquired situs in this state under
19Section 1151.

20(3) Flight data required to compute certificated aircraft allocation
21under Section 1152 and subdivision (g) of Section 202 of Title 18
22of the California Code of Regulations shall be segregated by airport
23location.

24(4) Beginning with the 2006 assessment year, a commercial air
25carrier may file a statement described in this subdivision
26electronically by means of the California Assessor’s Standard Data
27Record (SDR) network. If the SDR is not equipped to accept
28electronic filings for the 2006 assessment year, an air carrier may
29file a printed version of its property statement for that year with
30its lead county assessor’s office.

31(5) This subdivision shall remain operative only until December
3231, 2019.

begin delete33

SEC. 3.  

Section 1153 of the Revenue and Taxation Code is
34amended to read:

35

1153.  

(a) After consulting with the assessors of the counties
36in which aircraft of an air carrier normally make physical contact,
37the board shall designate for each assessment year the
38representative period to be used by the assessors in assessing the
39aircraft of the carrier.

P14   1(b) The representative period shall consist equally of both of
2the following:

3(1) A week or group of weeks in January.

4(2) A week or group of weeks in July.

end delete
5

begin deleteSEC. 4.end delete
6
begin insertSEC. 3.end insert  

Section 1153.5 of the Revenue and Taxation Code is
7amended to read:

8

1153.5.  

(a) The Aircraft Advisory Subcommittee of the
9California Assessors’ Association shall, after soliciting input from
10commercial air carriers operating in the state, do all of the
11following:

12(1) On or before March 1, 2006, and on or before each March
131 thereafter, designate a lead county assessor’s office for each
14commercial air carrier operating certificated aircraft in this state
15in that assessment year.

16(2) Every third year thereafter, redesignate a lead county
17assessor’s office for each of these air carriers, unless an air carrier
18and its existing lead county assessor’s office concur to waive this
19redesignation.

20(3) On or before March 1, 2017, do both of the following:

21(A) Designate two contacts in each lead county assessor’s office
22for each of these carriers that will be available to address reporting
23issues and issues with the California Assessor’s Standard Data
24Record network.

25(B) Establish best practices for the effective administration of
26the lead county system and audit process.

27(b) The lead county assessor’s office described in subdivision
28(a) shall do all of the following:

29(1) Calculate, pursuant to Section 401.17, an unallocated value
30of the certificated aircraft of each commercial air carrier to which
31he or she is designated.

32(2) Electronically transmit to the assessor of each county in
33which the property described in paragraph (1) has situs for the
34assessment year the values determined by the lead county
35assessor’s office under paragraph (1).

36(3) (A) Receive the property statement, as described in
37subdivision (m) of Section 441, of each commercial air carrier to
38which he or she is designated. The lead county assessor’s office
39shall transmit the property statement to the assessor of each county
40in which the personal property of the commercial air carrier is
P15   1located or has acquired situs, including the property described in
2paragraph (1).

3(B) A county assessor that receives a property statement
4pursuant to this section shall direct questions about the contents
5of the property statement first to the lead county assessor’s office
6and then, if the lead county assessor’s office is unable to provide
7an answer, to the commercial air carrier that filed the property
8statement.

9(4) Lead the audit team described in subdivision (d) when that
10team is conducting an audit of a commercial air carrier to which
11he or she is designated.

12(5) Notify, in writing, each commercial air carrier for which he
13or she has been designated of this designation on or before the first
14March 15 that follows that designation.

15(c) (1) Notwithstanding subdivision (b), the county assessor of
16each county in which the personal property of a commercial air
17carrier has situs for an assessment year is solely responsible for
18assessing that property, applying the allocation formula set forth
19in Section 1152, and enrolling the value of the property in that
20county, but, in determining the unallocated fleet value for each
21make, model, and series of certificated aircraft of a commercial
22air carrier, the assessor may consult with the lead county assessor’s
23office designated for that commercial air carrier.

24(2) The lead county assessor’s office is subject to Section 322
25of Title 18 of the California Code of Regulations and Sections
26408, 451, and 1606 to the same extent as the assessor described in
27paragraph (1).

28(d) Notwithstanding Section 469, an audit of a commercial air
29carrier shall be conducted once every four years on a centralized
30basis by an audit team of auditor-appraisers from at least one, but
31not more than three, counties, as determined by the Aircraft
32Advisory Subcommittee of the California Assessors’ Association.
33An audit, so conducted, shall encompass all of the California
34Personal Property and fixtures of the air carrier and is deemed to
35be made on behalf of each county for which an audit would
36otherwise be required under Section 469.

37(e) This section shall remain in effect only until December 31,
382019, and as of that date is repealed.

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begin deleteSEC. 5.end delete
2
begin insertSEC. 4.end insert  

If the Commission on State Mandates determines that
3this act contains costs mandated by the state, reimbursement to
4local agencies and school districts for those costs shall be made
5pursuant to Part 7 (commencing with Section 17500) of Division
64 of Title 2 of the Government Code.



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