BILL NUMBER: SB 1480 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 8, 2016
INTRODUCED BY Committee on Governance and Finance (Senators
Hertzberg (Chair), Beall, Hernandez, Lara, Moorlach, Nguyen, and
Pavley)
MARCH 17, 2016
An act to amend Section 1840 Sections
254.5, 1840, and 4674 of the Revenue and Taxation Code,
relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
SB 1480, as amended, Committee on Governance and Finance.
Property tax: local government property: application.
Property taxation.
Existing law relieves applicants granted a welfare exemption and
owning certain exempt property from reapplying for the welfare
exemption in any subsequent year in which there has been no transfer
of, or other change in title to, the exempted property and the
property is used exclusively by a governmental entity or by a
nonprofit corporation, as specified. Existing law requires the
assessor to annually mail a notice to every applicant relieved of the
requirement of filing an annual application as so described and
requires the notice to be in a form and contain that information that
the State Board of Equalization may prescribe. Existing law also
requires the notice to include a card that is to be returned to the
assessor by an applicant desiring to maintain eligibility for the
welfare exemption.
This bill would instead require the State Board of Equalization to
prescribe the form and content of the notice after consultation with
the California Assessors' Association. The bill would eliminate the
requirement that the notice include a card and would instead require
the notice to inform any applicant desiring to maintain eligibility
for the welfare exemption for the next fiscal year of the procedure
to reaffirm exemption eligibility.
The California Constitution generally exempts real property that
is owned by a local government from property taxation, but provides
that real property owned by a local government that is located
outside its boundaries is taxable if it was taxable when acquired.
Existing law authorizes a county, city and county, or municipal
corporation that owns taxable property to apply to the State Board of
Equalization for a review, equalization, or adjustment of a property
tax assessment relating to this publicly-owned property. Existing
law requires that this application be submitted to the board on or
before the later of either July 20 or within 2 weeks of the date upon
which a county assessor delivers the local roll containing that
assessment to the county auditor.
This bill would instead require that this application be submitted
to the board on or before November 30.
Existing law generally authorizes a county tax collector to sell
tax-defaulted property 5 years or more, or 3 years or more, as
applicable, after that property has become tax defaulted. Existing
law requires the proceeds from the sale of tax-defaulted property to
be deposited in the delinquent tax sale trust fund and requires the
proceeds in the fund to be distributed in a specified manner.
Existing law requires any excess proceeds remaining in the delinquent
tax sale trust fund after distribution of the proceeds to be
retained in the fund subject to being claimed by parties of interest,
as provided. Existing law, at the expiration of a specified time
period, authorizes any excess proceeds not claimed to be transferred
to the county general fund.
This bill would authorize the county to deduct certain costs prior
to transferring any excess proceeds not claimed to the county
general fund.
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 254.5 of the Revenue
and Taxation Code is amended to read:
254.5. (a) Claims for the welfare exemption and the veterans'
organization exemption shall be filed on or before February 15 of
each year with the assessor.
The assessor may not approve a property tax exemption claim until
the claimant has been issued a valid organizational clearance
certificate pursuant to Section 254.6. Financial statements shall be
submitted only if requested in writing by the assessor.
(b) (1) The assessor shall review all claims for the welfare
exemption to ascertain whether the property on which the exemption is
claimed meets the requirements of Section 214. The assessor shall
also review all claims for the veterans' organization exemption to
ascertain whether the property on which the exemption is claimed
meets the requirements of Section 215.1. In this connection, the
assessor shall consider, among other matters, whether:
(A) Any capital investment of the owner or operator for expansion
of a physical plant is justified by the contemplated return thereon,
and required to serve the interests of the community.
(B) The property on which the exemption is claimed is used for the
actual operation of an exempt activity and does not exceed an amount
of property reasonably necessary to the accomplishment of the exempt
purpose.
(2) The assessor may institute an audit or verification of the
operations of the owner or operator of the applicant's property to
ascertain whether both the owner and operator meet the requirements
of Section 214.
(c) (1) The assessor may deny a claim for the welfare exemption on
a property, notwithstanding that the claimant has been granted an
organizational clearance certificate by the board.
(2) If the assessor finds that the claimant's property is
ineligible for the welfare exemption or the veterans' organization
exemption, the assessor shall notify the claimant in writing of all
of the following:
(A) That the property is ineligible for the exemption.
(B) That the claimant may seek a refund of property taxes paid by
filing a refund claim with the county.
(C) That if the claimant's refund claim with the county is denied,
the claimant may file a refund action in superior court.
(d) Notwithstanding subdivision (a), an applicant, granted a
welfare exemption and owning any property exempted pursuant to
Section 214.15 or Section 231, shall not be required to reapply for
the welfare exemption in any subsequent year in which there has been
no transfer of, or other change in title to, the exempted property
and the property is used exclusively by a governmental entity or by a
nonprofit corporation described in Section 214.15 for its interest
and benefit. The applicant shall notify the assessor on or before
February 15 if, on or before the preceding lien date, the applicant
became ineligible for the welfare exemption or if, on or before that
lien date, the property was no longer owned by the applicant or
otherwise failed to meet all requirements for the welfare exemption.
Prior to the lien date, the assessor shall annually mail a notice
to every applicant relieved of the requirement of filing an annual
application by this subdivision.
The notice shall be in a form and contain that information that
the board may prescribe, after consultation with the California
Assessors' Association, and shall set forth the circumstances
under which the property may no longer be eligible for exemption, and
advise the applicant of the duty to inform the assessor if the
property is no longer eligible for exemption.
The notice shall include a card that is to be returned to
the assessor by inform any applicant desiring
to maintain eligibility for the welfare exemption under Section
214.15 or Section 231. The card shall be in the following
form: 231 for the next fiscal year of the procedure to
reaffirm exemption eligibility. The failure to reaffirm eligibility
for the exemption does not of itself constitute a waiver of exemption
as called for by the California Constitution, but may result in
additional contact by the assessor to verify exempt activity.
To all persons who have received a welfare exemption under Section
214.15 or Section 231 of the Revenue and Taxation Code for the ____
fiscal year.
Question: Will the property to which the exemption applies in the
____ fiscal year continue to be used exclusively by government or by
an organization as described in Section 214.15 for its interest and
benefit in the ____ fiscal year?
YES ___ NO ___
Signature: ____________
Title: ________________
Failure to return this card does not of itself constitute a waiver
of exemption as called for by the California Constitution, but may
result in onsite inspection to verify exempt activity.
(e) Upon any indication that a welfare exemption or veterans'
organization exemption on the property has been incorrectly granted,
the assessor shall redetermine eligibility for the exemption. If the
assessor determines that the property, or any portion thereof, is no
longer eligible for the exemption, he or she shall immediately cancel
the exemption on so much of the property as is no longer eligible
for the exemption.
(f) If a welfare exemption or veterans' organization exemption on
the property has been incorrectly allowed, an escape assessment as
provided by Article 4 (commencing with Section 531) of Chapter 3 in
the amount of the exemption, with interest as provided in Section
506, shall be made, and a penalty shall be assessed for any failure
to notify the assessor as required by this section in an amount
equaling 10 percent of the escape assessment, but may not exceed two
hundred fifty dollars ($250).
(g) Pursuant to Section 15640 of the Government Code, the board
shall review the assessor's administration of the welfare exemption
and the veterans' organization exemption as part of the board's
survey of the county assessment roll to ensure the proper
administration of the exemption.
SECTION 1. SEC. 2. Section 1840 of
the Revenue and Taxation Code is amended to read:
1840. If any county, city and county, or municipal corporation
desires to secure a review, equalization, or adjustment of the
assessment of its property by the board pursuant to subdivision (g)
of Section 11 of Article XIII of the California Constitution, it
shall apply to the board for that review, equalization, or adjustment
in writing on or before November 30. If the assessment objected to
is one made outside the regular period for those assessments, the
application for review shall be filed with the board within 60 days
from the date the tax bill is mailed to the assessee.
Every application shall show the facts claimed to require action
of the board, and a copy of the application shall be filed with the
assessor whose assessment is questioned. Upon receipt of a timely
application, the board shall afford the applicant notice and a
hearing in accordance with any rules and regulations as the board may
prescribe. The failure to file a timely application shall bar the
applicant from relief under subdivision (g) of Section 11 of Article
XIII or this section.
SEC. 3. Section 4674 of the Revenue and
Taxation Code is amended to read:
4674. Any excess in the proceeds deposited in the delinquent tax
sale trust fund remaining after satisfaction of the amounts
distributed under Sections 4672, 4672.1, 4672.2, 4673, and 4673.1
shall be retained in the fund on account of, and may be claimed by
parties of interest in the property as provided in, Section 4675. At
the expiration of the period specified in subdivision (e) of Section
4675, any excess proceeds not claimed under Section 4675 may be
transferred to the county general fund. fund
of the county by the county auditor, except that prior to the
transfer, the county may deduct those costs of maintaining the
redemption and tax-defaulted property files, and those costs of
administering and processing the claims for excess proceeds,
that have not been recovered under any other law.