BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session SB 1188 (McGuire) - Wildlife management areas: payment of taxes and assessments ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: February 18, 2016 |Policy Vote: N.R. & W. 9 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: April 25, 2016 |Consultant: Narisha Bonakdar | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: SB 1188 requires, instead of authorizes, the Department of Fish and Wildlife (department) to pay annual in lieu payments and specified assessments to counties in which wildlife management areas are located. Fiscal Impact: Ongoing annual cost pressures of $644,000 (General Fund) for annual obligations to counties for "payments in lieu of taxes" (PILT). Background: State lands, including wildlife management areas, are exempt from property taxes under the State Constitution. However, existing law (Fish and Game Code §1504) requires the department to compensate counties for lost property taxes and certain assessments resulting from the establishment of a wildlife management area. These PILT payments are equal to the county taxes levied upon the property at the time the state SB 1188 (McGuire) Page 1 of ? acquired the property, plus any assessments levied upon the property by any irrigation, drainage, or reclamation district. State PILT payments were only partially paid from FY 1998-99 until FY 2002-03, when they were completely suspended. The PILT arrears and ongoing payments to counties have been a topic in budget discussions in recent years. According to the LAO, the PILT arrears equal approximately $8 million. At its April 9, 2015 hearing, the Senate Budget subcommittee #2 passed a motion that added an $8 million appropriation to the 2015-16 budget to pay PILT arrears. This appropriation was later removed, and replaced with a $644,000 appropriation to pay current year PILT payments. Budget trailer bill language also made the payments permissive. The FY 2016-17 budget currently includes $644,000 for the state's PILT Program. Proposed Law: SB 1188 requires, instead of authorizes, the department to pay annual in lieu payments to counties in which wildlife management areas are located. It also requires, instead of authorizes, the department to pay assessments levied upon the property by any irrigation, drainage, or reclamation district. Under current statute, payments may only be made if funds are appropriated for this purpose. Related Legislation: SB 83 (Committee on Budgets) made in lieu payment permissive, and prohibited the allocation of in lieu payments to a school district, a community college district, or a county superintendent of schools. SB 234 (Wolk, 2015) would have made a one-time appropriation of $19 million from the General Fund to the department to pay for outstanding PILT obligations to counties (held in the Senate Appropriations Committee). SB 1410 (Wolk, 2014) would have appropriated $19 million to pay the PILT arrears and would have continuously appropriated $2 million annually for future PILT payments (held in the Senate SB 1188 (McGuire) Page 2 of ? Appropriations Committee). AB 1452 (Wolk, 2007) would have appropriated $7,415,000 to pay PILT arrears (bill was subsequently amended to a different subject area). Staff Comments: Staff notes that the cost pressures associated with this bill could equate to an annual appropriation of $644,000. Staff also notes the $8 million in PILT arrears. If enacted, this bill would become effective in 2017, and any resulting obligations for PILT arrears would begin at that time. This bill does not impact any arrears that may have accrued prior to enactment of the bill. -- END --