BILL ANALYSIS Ó
SB 1458
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SENATE THIRD READING
SB
1458 (Bates)
As Amended June 29, 2016
Majority vote. Urgency
SENATE VOTE: 39-0
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Veterans |7-0 |Irwin, Achadjian, | |
|Affairs | |Alejo, Brown, Daly, | |
| | |Frazier, Salas | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Revenue & |9-0 |Ridley-Thomas, | |
|Taxation | |Brough, Dababneh, | |
| | |Gipson, Mullin, | |
| | |O'Donnell, Patterson, | |
| | |Quirk, Wagner | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |20-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, | |
| | |Bonta, Calderon, | |
| | |Chang, Daly, Eggman, | |
| | |Gallagher, Eduardo | |
SB 1458
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| | |Garcia, Holden, | |
| | |Jones, Obernolte, | |
| | |Quirk, Santiago, | |
| | |Wagner, Weber, Wood, | |
| | |Chau | |
| | | | |
| | | | |
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SUMMARY: Expands eligibility for the Disabled Veteran's
Property Tax Exemption (Disabled Veteran's Exemption) to include
a person who has been discharged under the "other than
dishonorable conditions" but who is otherwise eligible for
federal veterans' health and medical benefits, as determined by
the United States Department of Veterans Affairs (USDVA). The
bill also contains technical provisions that allow county
assessors to process assessment roll corrections beyond four
years related to the Disabled Veteran's Exemption.
FISCAL EFFECT: According to the Assembly Appropriations
Committee:
Minor and absorbable administrative costs to the Board of
Equalization (BOE).
Modest General Fund (GF) costs as a result of expanded
eligibility for the Disabled Veteran's Exemption. Annual
property tax revenue loss is approximately $127,000 for every
100 newly-qualified disabled veterans, resulting in GF costs
of approximately $63,500 as a result of the Proposition 98
guarantee. The exact number of newly eligible veterans is
unknown, but likely small.
COMMENTS:
SB 1458
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Purpose: According to the author:
Senate Bill 1458 makes California law consistent with
federal law so that any veteran receiving service-connected
disability benefits at 100% will be eligible to receive the
state's disabled veterans' property tax exemption on their
home. Currently, veterans who have the 100% disability
rating are unable to receive the property tax exemption
unless they are Honorably Discharged. It is unknown how
many veterans fall under the other types of discharge
allowed by this bill (General Discharge Under Honorable
Conditions, Discharge Other than Honorable Conditions),
however it is expected to be a small amount.
A veteran should qualify for the state property tax
exemption if he/she received a 100% disability rating, did
not receive a dishonorable or bad conduct discharge, and if
they qualify for existing USDVA disability compensation
benefits.
SB 1458 necessarily helps California veterans returning
from war receive a well-deserved property tax exemption, as
long as they meet the appropriate discharge eligibility
from the service.
It is not clear that there is a problem that the bill will
solve, in that no evidence has been provided that veterans are
generally more challenged by property taxes than other
subpopulations. However, the basis for this bill seems rooted
in the recognition of the service and sacrifice of veterans,
particularly those with 100% service connected disabilities.
Recognition of such service and sacrifice is a well-established
policy foundation in California.
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The bill does generally conform the state code to the federal
standard. According to the USDVA:
Generally, in order to receive VA [Veterans Affairs]
benefits and services, the Veteran's character of discharge
or service must be under other than dishonorable conditions
(e.g., honorable, under honorable conditions, general).
However, individuals receiving undesirable, bad conduct,
and other types of dishonorable discharges may qualify for
VA benefits depending on a determination made by VA.
But it must be noted that there are fairly complex permutations
that arise depending on the particular veterans benefit and the
particular character of discharge. For example, according to
the USDVA some of the benefit/discharge requirements are:
Discharge Requirements for [disability] Compensation
Benefits
? other than dishonorable conditions ?
Discharge Requirements for Education Benefits
?honorable...
Discharge Requirements for Home Loan Benefits
? other than dishonorable conditions...
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Newly eligible veterans included by this bill will have received
a discharge characterization which is something less than
honorable. However, the bill does not alter the existing 100%
service connected disability requirement and does not abandon a
character of discharge requirement altogether at the negative
end of the spectrum. In summary, the newly eligible were
irrevocably severely disabled in service to the United States
but for innumerable reasons received something less than a
perfect character of discharge and more than a very bad one.
Placing in the balance on one hand an extreme service connected
sacrifice and on the other a broad spectrum of reasons for a
less than perfect discharge, this bill finds the weight of these
to be in favor, for this benefit, of including additional
veterans.
Background. The Disabled Veteran's Exemption exempts a portion
of the assessed value of a principal place of residence from
property tax for qualified veterans and their spouses. In 2016,
most qualified veterans will not pay property taxes on the first
$127,510 of their home's value.
Low-income disabled veterans are granted a more generous
exemption: In 2016, disabled veterans and their spouses with
a household income of $57,258 or less will be exempt from
property taxes on the first $191,266 of their principal place
of residence.
This exemption is also only available to those disabled
veterans who received an Honorable discharge from military
service.
Recent amendments. According to the Assembly Appropriations
Committee:
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[T]he author amended the bill on June 29, 2016 to allow
counties to process assessment roll corrections beyond four
years, consistent with recent legislation. SB 1113 (Knight),
Chapter 656, Statutes of 2014, expanded from four years to
eight the time period in which disabled veterans otherwise
eligible to receive the exemption could be refunded property
taxes previously paid. However, SB 1113 lacked provisions to
allow counties to use their existing roll correction process
as the administrative mechanism to provide these additional
refunds. The most recent amendments give counties the
authority to use their existing roll correction procedures to
provide disabled veterans' exemption refunds for additional
prior tax years as authorized by 2014's SB 1113, and
supporters of the bill argue these technical amendments will
make implementing the Disabled Veteran's Exemption less
complex.
Related Legislation:
SB 1113 (Knight, 2014), Chapter 656 - Property taxation:
disabled veterans' exemption: statute of limitations.
Analysis Prepared by:
John Spangler / V.A. / (916) 319-3550 FN:
0003967
SB 1458
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