Senate BillNo. 801


Introduced by Committee on Governance and Finance (Senators Hertzberg (Chair), Bates, Beall, Hernandez, Lara, Nguyen, and Pavley)

March 24, 2015


An act to amend Sections 16182 and 16183 of the Government Code, and to amend Sections 2515 and 20645.6 of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

SB 801, as introduced, Committee on Governance and Finance. Property tax postponement.

Existing law, on and after February 20, 2009, prohibited a person from filing a claim for postponement, and prohibited the Controller from accepting applications for postponement of ad valorem tax, under the Senior Citizens and Disabled Citizens Property Tax Postponement Law. Existing law, as of July 1, 2016, makes inoperative the prohibition against a qualifying person, as specified, filing a claim for postponement and the Controller from accepting applications for postponement under the program and repeals this prohibition on January 1, 2017.

This bill would eliminate outdated references to “certificates of eligibility” that were previously used under the postponement law. The bill would eliminate references to certain duties on the part of local tax officials, with respect to lien notices, to conform to the superseding duties of the Controller in preparing and filing the notice of lien for postponed taxes with the county recorder at the time payment is made, and would specify payments by the Controller to the county and the refund by the county of taxes paid when a taxpayer successfully appeals his or her denial of postponement under the law. The bill would also clarify that the interest rate on existing loans made prior to the postponement law’s suspension will continue to accrue at the rate specified prior to the suspension of the program.

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

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

P2    1

SECTION 1.  

Section 16182 of the Government Code is
2amended to read:

3

16182.  

(a) All sums paid by the Controller under the provisions
4of this chapter, together with interest thereon, shall be secured by
5a lien in favor of the State of California when funds are transferred
6to the county by the Controller upon the real property for which
7property taxes have been postponed. In the case of a residential
8dwelling which is part of a larger parcel taxed as a unit, such as a
9duplex, farm, or multipurpose or multidwelling building, the lien
10shall be against the entire tax parcel.

11(b) In the case of real property:

12(1) The lien shall be evidenced by a notice of lien for postponed
13property taxes executed by the Controller, or the authorized
14delegate of the Controller, and shall secure all sums paid or owing
15pursuant to this chapter, including amounts paid subsequent to the
16initial payment of postponed taxes on the real property described
17in the notice of lien.

18(2) The notice of lien may bear the facsimile signature of the
19Controller. Each signature shall be that of the person who shall be
20in the office at the time of execution of the notice of lien; provided,
21however, that such notice of lien shall be valid and binding
22notwithstanding any such person having ceased to hold the office
23of Controller before the date of recordation.

24(3) The form and contents of the notice of lien for postponed
25property taxes shall be prescribed by the Controller and shall
26include, but not be limited to, the following:

27(A) The names of all record owners of the real property for
28which the Controller has advanced funds for the payment of real
29property taxes.

30(B) A description of the real property for which real property
31taxes have been paid.

32(C) The identification number of the notice of lien which has
33been assigned the lien by the Controller.

P3    1(4) Within 14 business days of the transfer of funds and the
2notice of lien to the county by the Controller, the notice of lien
3shall be recorded in the office of the county recorder for the county
4in which the real property subject to the lien is located.

5(5) The recorded notice of lien shall be indexed in the Grantor
6Index to the names of all record owners of the real property and
7in the Grantee Index to the Controller of the State of California.

8(6) After the notice of lien has been duly recorded and indexed,
9it shall be returned by the county recorder to the office of the
10Controller. The recorder shall provide the county tax collector with
11a copy of the notice of lien which has beenbegin delete recordedend deletebegin insert executedend insert by
12the Controller.

13(7) From the time of recordation of a notice of lien for postponed
14property taxes, a lien shall attach to the real property described
15therein and shall have the priority of a judgment lien for all
16amounts secured thereby, except that the lien shall remain in effect
17until it is released by the Controller in the manner prescribed by
18Section 16186.

19(c) In the case of mobilehome loans established prior to February
2020, 2009, all of the following shall apply:

21(1) The lien shall be evidenced by a notice of lien for postponed
22property taxesbegin delete excusedend deletebegin insert executedend insert by the Controller, or the authorized
23delegate of the Controller, and shall secure all sums paid owing
24pursuant to this chapter.

25(2) From the time that the Department of Housing and
26Community Development receives the notice of lien from the
27Controller, the department shall impose a moratorium on any other
28amendments to the permanent title record of the mobilehome unit
29until released by the Controller in the manner prescribed by Section
3016186, or an authorization for the amendments is given by the
31Controller in writing.

32(3) From the time of filing a notice of lien, a lien shall attach to
33the mobilehome for which eligibility for the postponement of
34property taxes has been granted.

35

SEC. 2.  

Section 16183 of the Government Code is amended
36to read:

37

16183.  

(a) begin delete(1)end deletebegin deleteend deleteFrom the time a payment is made pursuant to
38Section 16180, the amount of that payment shall bear interest at a
39rate (not compounded), determined as follows:

P4    1(1) Beginning July 1, 2016, the rate of interest shall be 7 percent
2per annum.

3(2) The Controller shall establish an adjusted rate of interest for
4the purpose of this subdivision not later than July 15th of any year
5if the effective annual yield of the Pooled Money Investment
6Account for the prior fiscal year is at least a full percentage point
7more or less than the interest rate which is then in effect. The
8adjusted rate of interest shall be equal per annum to the effective
9annual yield earned in the prior fiscal year by the Pooled Money
10Investment Account rounded to the nearest full percent, and shall
11become effective for new deferrals, beginning on July 1, 1984,
12and on July 1 of each immediately succeeding year, until June 30,
132016.

14(3) begin deleteThe end deletebegin insertFor loans made prior to June 30, 2016, the end insertrate of
15interest provided pursuant to this subdivision for the first fiscal
16year commencing after payment is made pursuant to Section 16180
17shall apply for that fiscal year and each fiscal year thereafter until
18these postponed property taxes are repaid.

19(b) The interest provided for in subdivision (a) shall be applied
20beginning the first day of the month following the month in which
21that payment is made and continuing on the first day of each month
22thereafter until that amount is paid. In the event that any payments
23are applied, in any month, to reduce the amount paid pursuant to
24Section 16180, the interest provided for herein shall be applied to
25the balance of that amount beginning on the first day of the
26following month.

27(c) In computing interest in accordance with this section,
28fractions of a cent shall be disregarded.

29(d) For the purpose of this section, the time a payment is made
30shall be deemed to be the timebegin delete a certificate of eligibility is
31countersigned byend delete
begin insert an electronic funds transfer is made by the
32Controller toend insert
the tax collector or the delinquency date of the
33respective tax installment, whichever is later.

34(e) The Controller shall include on forms supplied to claimants
35pursuant to Sections 20621, 20630.5, 20639.9, 20640.9, and 20641
36of the Revenue and Taxation Code, a statement of the interest rate
37which shall apply to amounts postponed for the fiscal year to which
38the form applies.

39

SEC. 3.  

Section 2515 of the Revenue and Taxation Code is
40amended to read:

P5    1

2515.  

(a) Uponbegin delete expeditiously processingend deletebegin insert receivingend insert a “notice
2of lien for postponed property taxes” from thebegin delete tax collector,end delete
3begin insert Controller,end insert the tax collector or the assessor, whichever is
4applicable, shallbegin delete immediately:end delete

begin delete

5(1) Enter, on the notice of lien, a description of the real property
6for which the taxes have been paid by use of a certificate of
7eligibility pursuant to Section 2514. Such description shall be a
8“metes and bounds,” “lot-block-tract,” or such other description
9as is determined by the Controller to sufficiently describe the real
10property for the purpose of securing the state’s lien.

11(2) Enter on the notice of lien, the names of all record owners
12of the property described under subdivision (a) of this section, as
13disclosed by the assessor’s records.

14(3) Upon entry of the information required by subdivisions (a)
15and (b) of this section on the notice of lien, the assessor shall
16immediately forward the notice of lien to the county recorder.

end delete

17begin delete(4)end deletebegin deleteend deletebegin deleteEnterend deletebegin insert immediately enterend insert on the assessment records applicable
18to the property, the fact that the taxes on the property have been
19postponed and the Controller’s identification number, and shall,
20if such record reveals a change in the ownership status of the
21property subsequent to the date of entry of the postponement
22information thereon, notify the Controller within 60 days of
23processing the change in the ownership status in the manner
24prescribed by the Controller.

25(b) From the time of recordation of the notice of lien pursuant
26to Section 16182 of the Government Code, the lien for postponed
27property taxes shall be deemed to impart constructive notice of
28the contents thereof to subsequent purchasers, mortgagees, lessees,
29and other lienors.

30

SEC. 4.  

Section 20645.6 of the Revenue and Taxation Code
31 is amended to read:

32

20645.6.  

(a) If the Controller denies a postponement claim
33under Chapter 2 (commencing with Section 20581), Chapter 3
34(commencing with Section 20625), Chapter 3.3 (commencing with
35Section 20639), or Chapter 3.5 (commencing with Section 20640),
36and the denial is reversed after appeal pursuant to Section 20645.1,
37the Controller shall electronically transfer funds to thebegin delete county, if
38the taxes for the fiscal year have been paid,end delete
begin insert countyend insert for the amount
39of the taxes.begin insert If the taxes for the fiscal year were previously paid,
40the county shall refund the overpayment to the taxpayer.end insert
If the
P6    1taxes for the fiscal year are delinquent, any resulting penalties or
2interest shall be canceled.

3(b) The Controller shall notify the claimant in writing when an
4electronic funds transfer has been made pursuant to subdivision
5(a).



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