BILL NUMBER: SB 657 CHAPTERED
BILL TEXT
CHAPTER 498
FILED WITH SECRETARY OF STATE OCTOBER 3, 1995
APPROVED BY GOVERNOR OCTOBER 2, 1995
PASSED THE ASSEMBLY SEPTEMBER 15, 1995
PASSED THE SENATE JULY 3, 1995
AMENDED IN SENATE JUNE 29, 1995
AMENDED IN SENATE JUNE 8, 1995
AMENDED IN SENATE MAY 23, 1995
AMENDED IN SENATE MAY 15, 1995
AMENDED IN SENATE APRIL 6, 1995
INTRODUCED BY Senator Maddy
FEBRUARY 22, 1995
An act to amend Sections 75.31, 75.51, 75.60, 107, 110, 167, 212,
408, 441, 469, 1604, 1611.6, 1621, 2611.6, 4837.5, 5151, and 23154
of, and to add Section 480.6 to, the Revenue and Taxation Code,
relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
SB 657, Maddy. Property taxation.
Existing property tax law requires a county assessor, whenever he
or she determines a new property tax base year value for a property
pursuant to a supplemental assessment of that property, to send a
notice to the assessee that contains certain information, including
the assessee's right to appeal the supplemental assessment.
This bill would require the notice to also notify the assessee of
his or her right to an informal review of the supplemental
assessment.
Existing property tax law requires each supplemental tax bill to
contain certain information, including the taxpayer's right to an
informal assessment review for the following year if the taxpayer
contacts the assessor by March 1.
This bill would eliminate both the limitation of this informal
assessment review to the following year and the requirement that the
taxpayer contact the assessor by March 1.
Existing property tax law with respect to supplemental tax
assessments authorizes an eligible county to recover its costs of
administering the supplemental roll. Existing law defines an
eligible county, for purposes of this authorization, to mean a county
that is certified by the State Board of Equalization to have an
average level of assessment that is at least 90% or 95% of the
relevant assessment level required by statute, as determined by the
board pursuant to a specified survey.
This bill would, instead, require that the board certify a county
as an eligible county only if the county's average assessment level
is at 95% of the required assessment level determined by the board's
most recent survey of that county, and the sum of the differences
from that assessment level does not exceed 7.5% of the total required
assessed value of that county as determined by that same survey.
Existing property tax law defines a possessory interest in
property that is subject to tax.
This bill would, as specified, require a taxable possessory
interest in property to be independent, durable, and exclusive of
rights held by others in that property. This bill would make
legislative findings and declarations with respect to this
requirement.
Existing property tax law requires that all property subject to
taxation be assessed at its full value.
This bill would specify that intangible assets and rights are not
subject to taxation. This bill would also provide that intangible
assets and rights may not enhance or be reflected in the value of
taxable property, except that taxable property may be assessed and
valued by assuming the presence of intangible assets and rights that
are necessary to put taxable property to beneficial or productive
use.
Existing property tax law establishes a rebuttable presumption
affecting the burden of proof in favor of a taxpayer or assessee who
has supplied the assessor with the information required by law in any
administrative hearing involving the taxation or assessment of an
owner-occupied single-family home.
This bill would extend this rebuttable presumption to a taxpayer
or assessee who has supplied the assessor with the information
required by law in any administrative hearing involving the appeal of
an escape assessment, except as provided.
Existing property tax law requires the assessor, upon the request
of an assessee or the assessee's representative, to make certain
assessment-related materials and information available for inspection
and copying.
This bill would require the assessor, after enrolling an
assessment, to respond to a written request for data supporting the
assessment, including, but not limited to, any appraisal and other
data requested by the assessee. This bill would also require that an
assessee or his or her representative be granted a continuance, as
provided, of an assessment appeals board hearing, where the assessor
has failed to permit the requested inspection and copying and has
introduced requested materials or information at the assessment
appeals board hearing.
Existing property tax law requires each person, as required by the
assessor at any time for purposes of assessment, to make available
for examination information or records regarding his or her property
or any other personal property that is located on premises that he or
she owns or controls.
This bill would require that the assessor be granted a requested
continuance, as provided, of an assessment appeals board hearing in
the case in which a taxpayer fails to comply with this examination
requirement and introduces any materials or information that was
requested for examination at the assessment appeals board hearing.
Existing property tax law requires the assessor to audit the books
and records of a profession, trade, or business at least once every
four years in the case of a taxpayer engaged in a profession, trade,
or business, who owns, claims, possesses or controls locally
assessable trade fixtures and business tangible property with a full
value of $300,000 or more.
This bill would require an assessor, upon a completion of required
audit, to provide the taxpayer with written findings with respect to
any data that would alter any previously enrolled assessment.
Existing property tax law requires the filing of preliminary
change in ownership reports and change in ownership statements with
respect to transfers of real property.
This bill would exclude a holder of a possessory interest in
property owned by a state or local governmental entity from this
requirement with respect to any renewal of a possessory interest as
so described. This bill would instead require the relevant
governmental entity that owns the fee interest in the property in
which the possessory interest has been created to file the required
report or statement with respect to a transfer of that interest. By
imposing new filing duties upon local governmental entities, this
bill would impose a state-mandated local program.
Existing property tax law requires the taxpayer's opinion of
value, as reflected on a timely filed application for reduction in an
assessment of property, to be the basis for the calculation of
property taxes, where the county assessment appeals board has failed
to hear evidence and make a final determination on that application
within either 2 years of the filing of that application or an
extension of that 2-year period. Existing law provides, as one basis
for extension of the 2-year period, the consolidation of an
application for reduction in an assessment with a similar application
for which an extension has already been granted.
This bill would prohibit any consolidation as so described from
occurring after the end of the 2-year period or after the expiration
of any extension of that period unless the taxpayer agrees in
writing. This bill would require a county board of equalization or
assessment appeals board to provide a specified notice to an
applicant for reduction in an assessment of any decision by the board
not to hold a hearing on the applicant's application within the
prescribed 2-year time period. By imposing new notice duties upon
county boards of equalization and assessment appeals boards, this
bill would impose a state-mandated local program.
Existing property tax law provides that the failure of a county
board of equalization or assessment appeals board to make requested
findings with respect to a hearing on an application for reduction in
assessment, or that board's making of deficient findings with
respect to that hearing that lead to a remand, constitutes arbitrary
and capricious action within the meaning of a specified statute so as
to support the allowance of an attorney fee award against the county
for those legal services necessary to obtain proper findings.
This bill would provide that the dollar limitation in the same
specified statute does not apply to an attorney fee award assessed
against the county as a result of the failure to make the requested
findings. This bill would also make technical, clarifying changes.
Existing property tax law prohibits a county from establishing
more than 5 assessment appeals boards.
This bill would instead authorize a county to establish up to 10
assessment appeals boards.
Existing property tax law requires each taxpayer's annual property
tax bill to contain specified information.
This bill would require that information to include notice of the
taxpayer's right to an informal assessment review, the taxpayer's
right to file an application for reduction in assessment, and the
address at which forms for an application in reduction in assessment
may be obtained.
Existing property tax law provides, subject to certain
requirements, that taxes due on escape assessments for prior fiscal
years may be paid over a 4-year period, if the error requiring the
escape assessment was made by the assessor, or was not made by, or
was not the fault of, the assessee.
This bill would eliminate these conditions for the payment of
escape assessment taxes over a 4-year period.
Existing property tax law requires that interest be paid on
specified refund amounts at the county pool apportioned rate, as
defined.
This bill would require instead that interest be paid on these
amounts at the greater of 3% per annum or the county pool apportioned
rate. This bill would also, as provided, specify that this interest
requirement does not apply to interest on refunds of those taxes
that became due and payable before March 1, 1993. This bill would,
subject to this limitation, also generally apply this interest
requirement to amounts of property tax refunds. This bill would
declare that the specification of the date of application of this
requirement does not constitute a change in, but is declaratory of,
existing law.
Existing property tax law provides, with respect to suits for
refund of state-assessed taxes, that the trial court is not
restricted to the administrative record, but may consider all
relevant admissible evidence.
This bill would extend this provision to apply to suits for refund
of locally assessed taxes.
The Bank and Corporation Tax Law imposes a tax, measured by
income, upon the privilege of exercising a corporate franchise within
the state. It provides that this tax is in lieu of all ad valorem
taxes and assessments with respect to a general corporate franchise,
but is not in lieu of taxes or assessments upon special franchises as
may be held by a corporation.
This bill would modify this latter provision to specify that the
corporate franchise tax is not in lieu of any taxes or assessments
upon any real property interests that are conveyed through special
franchises as may be held by a corporation. This bill would also
provide that intangible assets and rights may not enhance or be
reflected in the value of real property interests that are so
conveyed, except that those real property interests may be assessed
and valued by assuming the presence of intangible assets and rights
that are necessary to put those real property interests to beneficial
or productive use.
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, including the creation of a State Mandates Claims Fund
to pay the costs of mandates that do not exceed $1,000,000 statewide
and other procedures for claims whose statewide costs exceed
$1,000,000.
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.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 75.31 of the Revenue and Taxation Code is
amended to read:
75.31. (a) Whenever the assessor has determined a new base year
value as provided in Section 75.10, the assessor shall send a notice
to the assessee showing the following:
(1) The new base year value of the property which has changed
ownership, or the new base year value of the completed new
construction which shall be added to the existing taxable value of
the remainder of the property.
(2) The taxable value appearing on the current roll, and if the
change in ownership or completion of new construction occurred
between March 1 and May 31, the taxable value on the roll being
prepared.
(3) The date of the change in ownership or completion of new
construction.
(4) The amount of the supplemental assessments.
(5) The exempt amount, if any, on the current roll or the roll
being prepared.
(6) The date the notice was mailed.
(7) A statement that the supplemental assessment was determined in
accordance with Article XIIIA of the California Constitution which
generally requires reappraisal of property whenever a change in
ownership occurs or property is newly constructed.
(8) Any other information which the board may prescribe.
(b) In addition to the information specified in subdivision (a),
the notice shall inform the assessee of the procedure for filing a
claim for exemption which is to be filed within 30 days of the date
of the notice.
(c) The notice shall advise the assessee of the right to an
informal review and the right to appeal the supplemental assessment,
and, unless subject to subdivision (d), that the appeal must be filed
within 60 days of the date of the notice. For the purposes of
equalization proceedings, the supplemental assessment shall be
considered an assessment made outside of the regular assessment
period as provided in Section 1605.
(d) For counties in which the board of supervisors has adopted the
provisions of subdivision (c) of Section 1605, the notice shall
advise the assessee of the right to appeal the supplemental
assessment, and that the appeal must be filed within 60 days of the
date of the mailing of the tax bill. For the purposes of
equalization proceedings, the supplemental assessment shall be
considered an assessment made outside of the regular assessment
period as provided in Section 1605.
(e) The notice shall advise the assessee of both of the following:
(1) The requirements, procedures, and deadlines with respect to an
application for the reduction of a base year value pursuant to
Section 80, or the reduction of an assessment pursuant to Section
1603.
(2) The criteria under Section 51 for the determination of taxable
value, and the requirement of Section 1602 that the custodial
officer of the local roll make the roll, or a copy thereof, available
for inspection by all interested parties during regular office
hours.
(f) The notice shall advise the assessee that if the supplemental
assessment is a negative amount the auditor shall make a refund of a
portion of taxes paid on assessments made on the current roll, or the
roll being prepared, or both.
(g) The notice shall be furnished by the assessor to the assessee
by regular United States mail directed to the assessee at the
assessee's latest address known to the assessor.
SEC. 2. Section 75.51 of the Revenue and Taxation Code is amended
to read:
75.51. The tax collector shall mail a supplemental tax bill to
the assessee, including the following information either on the bill
or in a separate statement accompanying the bill:
(a) The information supplied by the assessor to the auditor
pursuant to Section 75.40.
(b) The amount of the supplemental taxes due.
(c) The date the notice is mailed.
(d) The date on which the taxes will become delinquent and the
penalties for delinquency.
(e) A statement that the supplemental taxes were determined in
accordance with Article XIIIA of the California Constitution which
generally requires reappraisal of property whenever a change in
ownership occurs or property is newly constructed.
(f) The tax rates or the dollar amounts of taxes levied by each
revenue district and taxing agency on the property covered by the tax
bill.
(g) Information specifying all of the following:
(1) That if the taxpayer disagrees with a change in the assessed
value as shown on the tax bill, the taxpayer has the right to an
informal assessment review by contacting the assessor's office.
(2) That if the taxpayer and the assessor are unable to agree on
proper assessed value pursuant to an informal assessment review, the
taxpayer has the right to file an application for reduction in
assessment for the following year with the county board of
equalization or the assessment appeals board, as applicable, during
the period from July 2 to September 15, inclusive.
(3) The address of the clerk of the county board of equalization
or the assessment appeals board, as applicable, at which forms for an
application for reduction may be obtained.
SEC. 3. Section 75.60 of the Revenue and Taxation Code is amended
to read:
75.60. (a) Notwithstanding any other provision of law, the board
of supervisors of an eligible county, upon the adoption of a method
identifying the actual administrative costs associated with the
supplemental assessment roll, may direct the county auditor to
allocate to the county, prior to the allocation of property tax
revenues pursuant to Chapter 6 (commencing with Section 95) and prior
to the allocation made pursuant to Section 75.70, an amount equal to
the actual administrative costs, but not to exceed 5 percent of the
revenues which have been collected on or after January 1, 1987, due
to the assessments under this chapter. Those revenues shall be used
solely for the purpose of administration of this chapter, regardless
of the date those costs are incurred.
(b) For purposes of this section:
(1) "Actual administrative costs" includes only those direct costs
for administration, data processing, collection, and appeal which
are incurred by county auditors, assessors, and tax collectors.
"Actual administrative costs" also includes those indirect costs for
administration, data processing, collections, and appeal which are
incurred by county auditors, assessors, and tax collectors and are
allowed by state and federal audit standards pursuant to the A-87
Cost Allocation Program.
(2) The State Board of Equalization shall certify a county as an
eligible county only if both of the following are determined to
exist:
(A) The average assessment level in the county is at least 95
percent of the assessment level required by statute, as determined by
the board's most recent survey of that county performed pursuant to
Section 15640 of the Government Code.
(B) The sum of the absolute values of the differences from the
statutorily required assessment level described in subparagraph (A)
does not exceed 7.5 percent of the total amount of the county's
statutorily required assessed value, as determined pursuant to the
board's survey described in subparagraph (A).
SEC. 4. Section 107 of the Revenue and Taxation Code is amended to
read:
107. "Possessory interests" means the following:
(a) Possession of, claim to, or right to the possession of land or
improvements that is independent, durable, and exclusive of rights
held by others in the property, except when coupled with ownership of
the land or improvements in the same person. For the purposes of
this subdivision:
(1) "Independent" means the ability to exercise authority and
exert control over the management or operation of the property or
improvements, separate and apart from the policies, statutes,
ordinances, rules, and regulations of the public owner of the
property or improvements. A possession or use is independent if the
possessor or operation of the property is sufficiently autonomous to
constitute more than a mere agency.
(2) "Durable" means for a determinable period with a reasonable
certainty that the use, possession, or claim with respect to the
property or improvements will continue for that period.
(3) "Exclusive" means the enjoyment of a beneficial use of land or
improvements, together with the ability to exclude from occupancy by
means of legal process others who may interfere with that enjoyment.
For purposes of this paragraph, "exclusive use" includes the
following types of use in property:
(A) Sole occupancy or use of property or improvements.
(B) Use as a cotenant.
(C) Concurrent use by a person who has a primary or prevailing
right to use property or improvements at any time.
(D) Concurrent uses by persons making qualitatively different uses
of property or improvements.
(E) Concurrent use by persons engaged in similar uses that
diminish the quantity or quality of the property or improvements.
(F) Concurrent use that does not diminish the quantity or quality
of the property or improvements, if the number of those concurrent
use grants is restricted.
A use of property or improvements that does not contain one of the
elements in subparagraphs (A) to (F), inclusive, shall be rebuttably
presumed to be a nonexclusive use.
(b) Taxable improvements on tax-exempt land.
Any possessory interest may, in the discretion of the county board
of supervisors, be considered as sufficient security for the payment
of any taxes levied thereon and may be placed on the secured roll.
Leasehold estates for the production of gas, petroleum and other
hydrocarbon substances from beneath the surface of the earth, and
other rights relating to these substances which constitute
incorporeal hereditaments or profits a prendre, are sufficient
security for the payment of taxes levied thereon. These estates and
rights shall not be classified as possessory interests, but shall be
placed on the secured roll.
If the tax on any possessory interest or leasehold estate for the
production of gas, petroleum and other hydrocarbon substances is
unpaid when any installment of secured taxes become delinquent, the
tax collector may use those collection procedures which are available
for the collection of assessments on the unsecured roll.
If the tax on any possessory interest or leasehold estate for the
production of gas, petroleum and other hydrocarbon substances remains
unpaid at the time set for the declaration of default for taxes
carried on the secured roll, the possessory interest tax together
with any penalty and costs which may be accrued thereon while on the
secured roll shall be transferred to the unsecured roll.
SEC. 4.5. Section 167 of the Revenue and Taxation Code is amended
to read:
167. (a) Notwithstanding any other provision of law to the
contrary, and except as provided in subdivision (b), there shall be a
rebuttable presumption affecting the burden of proof in favor of the
taxpayer or assessee who has supplied all information as required by
law to the assessor in any administrative hearing involving the
imposition of a tax on an owner-occupied single-family dwelling, the
assessment of an owner-occupied single-family dwelling, or the appeal
of an escape assessment pursuant to this division.
(b) Nothwithstanding subdivision (a), the rebuttable presumption
described in that subdivision shall not apply in the case of an
administrative hearing with respect to the appeal of an escape
assessment resulting from a taxpayer's failure to file with the
assessor a change in ownership statement, business property
statement, or permit for new construction.
SEC. 5. Section 110 of the Revenue and Taxation Code is amended to
read:
110. (a) Except as is otherwise provided in Section 110.1, "full
cash value" or "fair market value" means the amount of cash or its
equivalent that property would bring if exposed for sale in the open
market under conditions in which neither buyer nor seller could take
advantage of the exigencies of the other and both with knowledge of
all of the uses and purposes to which the property is adapted and for
which it is capable of being used and of the enforceable
restrictions upon those uses and purposes.
(b) For purposes of determining the "full cash value" or "fair
market value" of real property, other than possessory interests,
being appraised upon a purchase, "full cash value" or "fair market
value" shall be the purchase price paid in the transaction unless it
is established by a preponderance of the evidence that the real
property would not have transferred for that purchase price in an
open market transaction. The purchase price shall, however, be
rebuttably presumed to be the "full cash value" or "fair market value"
if the terms of the transaction were negotiated at arms length
between a knowledgeable transferor and transferee neither of which
could take advantage of the exigencies of the other. "Purchase
price," as used in this section, means the total consideration
provided by the purchaser or on the purchaser's behalf, valued in
money, whether paid in money or otherwise. If a single transaction
results in a change in ownership of more than one parcel of real
property, the purchase price shall be allocated among those parcels
and other assets, if any, transferred based on the relative fair
market value of each.
(c) For real property, other than possessory interests, the change
of ownership statement required pursuant to Section 480, 480.1, or
480.2, or the preliminary change of ownership statement required
pursuant to Section 480.4, shall give any information as the board
shall prescribe relative to whether the terms of the transaction were
negotiated at "arms length." In the event that the transaction
includes property other than real property, the change in ownership
statement shall give information as the board shall prescribe
disclosing the portion of the purchase price which is allocable to
all elements of the transaction. If the taxpayer fails to provide
the prescribed information, the rebuttable presumption provided by
subdivision (b) shall not apply.
(d) Except as provided in subdivision (e), for purposes of
determining the "full cash value" or "fair market value" of any
taxable property, all of the following shall apply:
(1) The value of intangible assets and rights relating to the
going concern value of a business using taxable property shall not
enhance or be reflected in the value of the taxable property.
(2) If the principle of unit valuation is used to value properties
that are operated as a unit and the unit includes intangible assets
and rights, then the fair market value of the taxable property
contained within the unit shall be determined by removing from the
value of the unit the fair market value of the intangible assets and
rights contained within the unit.
(3) The exclusive nature of a concession, franchise, or similar
agreement, whether de jure or de facto, is an intangible asset that
shall not enhance the value of taxable property, including real
property.
(e) Taxable property may be assessed and valued by assuming the
presence of intangible assets or rights necessary to put the taxable
property to beneficial or productive use.
(f) For purposes of determining the "full cash value" or "fair
market value" of real property, intangible attributes of real
property shall be reflected in the value of the real property. These
intangible attributes of real property include zoning, location, and
other such attributes that relate directly to the real property
involved.
SEC. 6. Section 212 of the Revenue and Taxation Code is amended to
read:
212. (a) Notes, debentures, shares of capital stock, solvent
credits, bonds, deeds of trust, mortgages, and any interest in that
property are exempt from taxation.
(b) Money kept on hand to be used in the ordinary and regular
course of a trade, profession, or business is exempt from taxation.
(c) Intangible assets and rights are exempt from taxation and,
except as otherwise provided in the following sentence, the value of
intangible assets and rights shall not enhance or be reflected in the
value of taxable property. Taxable property may be assessed and
valued by assuming the presence of intangible assets or rights
necessary to put the taxable property to beneficial or productive
use.
SEC. 7. Section 408 of the Revenue and Taxation Code is amended to
read:
408. (a) Except as otherwise provided in subdivisions (b), (c),
(d), and (e) any information and records in the assessor's office
which are not required by law to be kept or prepared by the assessor,
and homeowners' exemption claims, are not public documents and shall
not be open to public inspection. Property receiving the homeowners'
exemption shall be clearly identified on the assessment roll. The
assessor shall maintain records which shall be open to public
inspection to identify those claimants who have been granted the
homeowners' exemption.
(b) The assessor may provide any appraisal data in his or her
possession to the assessor of any county.
The assessor shall disclose information, furnish abstracts, or
permit access to all records in his or her office to law enforcement
agencies, the county grand jury, the board of supervisors or their
duly authorized agents, employees or representatives when conducting
an investigation of the assessor's office pursuant to Section 25303
of the Government Code, the Controller, employees of the Controller
for property tax postponement purposes, probate referees, employees
of the Franchise Tax Board for tax administration purposes only,
staff appraisers of the Department of Savings and Loan, the
Department of Transportation, the Department of General Services, the
State Board of Equalization, the State Department of Social
Services, and other duly authorized legislative or administrative
bodies of the state pursuant to their authorization to examine the
records. Whenever the assessor discloses information, furnishes
abstracts, or permits access to records in his or her office to staff
appraisers of the Department of Savings and Loan, the Department of
Transportation, or the Department of General Services pursuant to
this section, the department shall reimburse the assessor for any
costs incurred as a result thereof.
(c) Upon the request of the tax collector, the assessor shall
disclose and provide to the tax collector information used in the
preparation of that portion of the unsecured roll for which the taxes
thereon are delinquent. The tax collector shall certify to the
assessor that he or she needs the information requested for the
enforcement of the assessor's tax lien in collecting those delinquent
taxes. Information requested by the tax collector may include
social security numbers, and the assessor shall recover from the tax
collector his or her actual and reasonable costs for providing the
information. The tax collector shall add the costs described in the
preceding sentence to the assessee's delinquent tax lien and collect
those costs subject to subdivision (e) of Section 2922.
(d) The assessor shall, upon the request of an assessee or his or
her designated representative, permit the assessee or representative
to inspect or copy any market data in the assessor's possession. For
purposes of this subdivision, "market data" means any information in
the assessor's possession, whether or not required to be prepared or
kept by him or her, relating to the sale of any property comparable
to the property of the assessee, if the assessor bases his or her
assessment of the assessee's property, in whole or in part, on that
comparable sale or sales. The assessor shall provide the names of
the seller and buyer of each property on which the comparison is
based, the location of that property, the date of the sale, and the
consideration paid for the property, whether paid in money or
otherwise. However, for purposes of providing market data, the
assessor shall not display any document relating to the business
affairs or property of another.
(e) (1) With respect to information, documents, and records, other
than market data as defined in subdivision (d), the assessor shall,
upon request of an assessee of property, or his or her designated
representative, permit the assessee or representative to inspect or
copy all information, documents, and records, including auditors'
narrations and workpapers, whether or not required to be kept or
prepared by the assessor, relating to the appraisal and the
assessment of the assessee's property, and any penalties and interest
thereon.
(2) After enrolling an assessment, the assessor shall respond to a
written request for information supporting the assessment,
including, but not limited to, any appraisal and other data requested
by the assessee.
(3) Except as provided in Section 408.1, an assessee, or his or
her designated representative, shall not be permitted to inspect or
copy information and records that also relate to the property or
business affairs of another, unless that disclosure is ordered by a
competent court in a proceeding initiated by a taxpayer seeking to
challenge the legality of the assessment of his or her property.
(f) (1) Permission for the inspection or copying requested
pursuant to subdivision (d) or (e) shall be granted as soon as
reasonably possible to the assessee or his or her designated
representative.
(2) If the assessee, or his or her designated representative,
requests the assessor to make copies of any of the requested records,
the assessee shall reimburse the assessor for the reasonable costs
incurred in reproducing and providing the copies.
(3) If the assessor fails to permit the inspection or copying of
materials or information as requested pursuant to subdivision (d) or
(e) and the assessor introduces any requested materials or
information at any assessment appeals board hearing, the assessee or
his or her representative may request and shall be granted a
continuance for a reasonable period of time. The continuance shall
extend the two-year period specified in subdivision (c) of Section
1604 for a period of time equal to the period of continuance.
SEC. 8. Section 441 of the Revenue and Taxation Code is amended to
read:
441. Each person owning taxable personal property, other than a
mobilehome subject to Part 13 (commencing with Section 5800), having
an aggregate cost of thirty thousand dollars ($30,000) or more for
the initial assessment year or an aggregate cost of one hundred
thousand dollars ($100,000) or more for any subsequent assessment
year shall file a signed property statement with the assessor. Every
person owning personal property which does not require the filing of
a property statement or real property shall upon request of the
assessor file a signed property statement. Failure of the assessor
to request or secure the property statement does not render any
assessment invalid.
(a) The property statement shall be declared to be true under the
penalty of perjury and filed with the assessor between the lien date
and 5 p.m. on the last Friday in May, annually, or between the lien
date and any earlier time as the assessor may appoint.
(b) If the assessor appoints a time other than the last Friday in
May, it shall be no earlier than April 1. In this event the penalty
provided by Section 463 shall apply if the property statement is not
filed with the assessor by 5 p.m. on the last Friday in May or if all
of the following apply:
(1) The property statement is not filed within the time appointed
by the assessor.
(2) The assessor has given notice by certified or registered mail,
or by first-class mail, properly addressed with postage prepaid, no
earlier than 15 days after the time appointed by the assessor of
nonreceipt of the property statement within the appointed time. If
the notice is given by first-class mail, the assessor shall obtain a
certificate of mailing issued by the United States Postal Service
verifying the fact and date of mailing of the notice.
(3) The property statement has not been filed with the assessor
within 15 days following the date of receipt of the notice, if the
notice is given by certified or registered mail, or within 20 days
following the date shown on the certificate of mailing, if the notice
is given by first-class mail.
(c) The property statement may be filed with the assessor through
the United States mail, properly addressed with postage prepaid.
This subdivision shall be applicable to every taxing agency,
including, but not limited to, a chartered city and county, or
chartered city.
(d) At any time, as required by the assessor for assessment
purposes, every person shall make available for examination
information or records regarding his or her property or any other
personal property located on premises he or she owns or controls. In
this connection details of property acquisition transactions,
construction and development costs, rental income, and other data
relevant to the determination of an estimate of value are to be
considered as information essential to the proper discharge of the
assessor's duties.
(e) In the case of a corporate owner of property, the property
statement shall be signed either by an officer of the corporation or
an employee or agent who has been designated in writing by the board
of directors to sign the statements on behalf of the corporation.
(f) In the case of property owned by a bank or other financial
institution and leased to an entity other than a bank or other
financial institution, the property statement shall be submitted by
the owner bank or other financial institution.
(g) The assessor may refuse to accept any property statement he or
she determines to be in error.
(h) If a taxpayer fails to provide information to the assessor
pursuant to subdivision (d) and introduces any requested materials or
information at any assessment appeals board hearing, the assessor
may request and shall be granted a continuance for a reasonable
period of time. The continuance shall extend the two-year period
specified in subdivision (c) of Section 1604 for a period of time
equal to the period of the continuance.
SEC. 9. Section 469 of the Revenue and Taxation Code is amended to
read:
469. In any case in which locally assessable trade fixtures and
business tangible personal property owned, claimed, possessed, or
controlled by a taxpayer engaged in a profession, trade, or business
has a full value of three hundred thousand dollars ($300,000) or
more, the assessor shall audit the books and records of that
profession, trade, or business at least once each four years. If the
board determines the
value of property pursuant to Section 15640 of the Government Code,
that determination may be deemed an audit by the assessor for
purposes of this section.
Upon completion of an audit of the taxpayer's books and records,
the taxpayer shall be given the assessor's findings in writing with
respect to data that would alter any previously enrolled assessment.
Equalization of the property by a county board of equalization or
assessment appeals board pursuant to Chapter 1 (commencing with
Section 1601) of Part 3 of this division shall not preclude a
subsequent audit and shall not preclude the assessor from levying an
escape assessment in appropriate instances, but shall preclude an
escape assessment being levied on that portion of the assessment that
was the subject of the equalization hearing.
If the result of an audit for any year discloses property subject
to an escape assessment, then the original assessment of all property
of the assessee at the location of the profession, trade, or
business for that year shall be subject to review, equalization and
adjustment by the county board of equalization or assessment appeals
board pursuant to Chapter 1 (commencing with Section 1601) of Part 3
of this division, except in those instances when the property had
previously been equalized for the year in question.
If the audit for any particular tax year discloses that the
property of the taxpayer was incorrectly valued or misclassified for
any cause, to the extent that this error caused the property to be
assessed at a higher value than the assessor would have entered on
the roll had the incorrect valuation or misclassification not
occurred, then the assessor shall notify the taxpayer of the amount
of the excess valuation or misclassification, and the fact that a
claim for cancellation or refund may be filed with the county as
provided by Sections 4986 and 5096.
SEC. 10. Section 480.6 is added to the Revenue and Taxation Code,
to read:
480.6. Notwithstanding any other provision of law, a holder of a
possessory interest in real property that is owned by a state or
local governmental entity shall not be required to file a preliminary
change in ownership report or change in ownership statement with
respect to any renewal of that possessory interest. Any preliminary
change in ownership report or change in ownership statement that is
required to be filed with respect to a possessory interest as
described in the preceding sentence shall be filed in accordance with
this article by the state or local governmental entity that is the
fee owner of the property in which the relevant possessory interest
has been created. The failure of a state or local governmental
entity to comply with this filing requirement shall not give rise to
any interest or penalties assessed against the holder of the
possessory interest.
SEC. 11. Section 1604 of the Revenue and Taxation Code is amended
to read:
1604. (a) In counties of the first class, annually, on the fourth
Monday in September, the county board shall meet to equalize the
assessment of property on the local roll. The board shall continue
to meet for that purpose, from time to time, until the business of
equalization is disposed of.
(b) In all other counties, annually, on the third Monday in July,
the county board shall meet to equalize the assessment of property on
the local roll. It shall continue to meet for that purpose, from
time to time, until the business of equalization is disposed of.
Any taxpayer may petition the board for a reduction in an
assessment and a proportionate reduction or refund of the taxes
extended thereon by filing an application pursuant to Section 1603 or
Section 5097.
The county board shall have no power to receive or hear any
petition for a reduction in an escaped assessment made pursuant to
Section 531.1 nor a penal assessment levied in respect thereto, nor
to reduce those assessments.
(c) If the county assessment appeals board fails to hear evidence
and fails to make a final determination on the application for
reduction in assessment of property within two years of the timely
filing of the application, the taxpayer's opinion of market value as
reflected on the application for reduction in assessment shall be the
value upon which taxes are to be levied for the tax year covered by
the application, unless either of the following occurs:
(1) The taxpayer and the county assessment appeals board mutually
agree in writing, or on the record, to an extension of time for the
hearing.
(2) The application for reduction is consolidated for hearing with
another application by the same taxpayer with respect to which an
extension of time for the hearing has been granted pursuant to
paragraph (1). In no case shall the application be consolidated
without the taxpayer's written agreement after the two-year time
period has passed or after an extension of the two-year time period
previously agreed to by the taxpayer has expired.
The reduction in assessment reflecting the taxpayer's opinion of
market value shall not be made, however, until two years after the
close of the filing period during which the timely application was
filed. Further, this subdivision shall not apply to applications for
reductions in assessments of property where the taxpayer has failed
to provide full and complete information as required by law or where
litigation is pending directly relating to the issues involved in the
application. This subdivision is only applicable to applications
filed on or after January 1, 1983.
(d) If, pursuant to subdivision (c), the applicant's opinion of
value has been placed on the assessment roll, that value shall remain
on the roll until the county board makes a final determination on
the application. The value so determined by the county board, plus
appropriate adjustments for the inflation factor, shall be entered on
the assessment roll for the fiscal year in which the value is
determined. No increased or escape taxes other than those required
by a purchase, change in ownership, or new construction, or resulting
from application of the inflation factor to the applicant's opinion
of value shall be levied for the tax years during which the county
board failed to act.
(e) The county board shall notify the applicant in writing of any
decision by that board not to hold a hearing on his or her
application for reduction in assessment within the two-year period
specified in subdivision (c). This notice shall also inform the
applicant that the taxpayer's opinion of value as reflected on the
application for reduction in assessment shall, as a result of the
county board's failure to hold a hearing within the prescribed time
period, be the value upon which taxes are to be levied in the absence
of the application of either paragraph (1) or (2) of subdivision
(c).
SEC. 12. Section 1611.6 of the Revenue and Taxation Code is
amended to read:
1611.6. If the county board fails to make findings upon request,
or if findings made are found by a reviewing court to be so deficient
that a remand to the county board is ordered to secure reasonable
compliance with the elements of findings required by Section 1611.5,
the action of the county board shall be deemed to be arbitrary and
capricious within the meaning of Section 800 of the Government Code,
so as to support an allowance of reasonable attorney's fees against
the county for the services necessary to obtain proper findings. The
dollar limitation set forth in Section 800 of the Government Code
shall not apply to an allowance of attorney's fees pursuant to this
section.
SEC. 13. Section 1621 of the Revenue and Taxation Code is amended
to read:
1621. Not more than 10 assessment appeals boards may be created
within any county. Assessment appeals boards shall be designated by
number in the ordinance providing for their creation.
SEC. 14. Section 2611.6 of the Revenue and Taxation Code is
amended to read:
2611.6. The following information shall be included in each
county tax bill or in a separate statement accompanying the bill:
(a) The full value of locally assessed property, including
assessments made for irrigation district purposes in accordance with
Section 26625.1 of the Water Code.
(b) The tax rate required by Article XIIIA of the California
Constitution.
(c) The rate or dollar amount of taxes levied in excess of the
1-percent limitation to pay for voter-approved indebtedness incurred
before July 1, 1978, or bonded indebtedness for the acquisition or
improvement of real property approved by two-thirds of the voters on
or after June 4, 1986.
(d) The amount of any special taxes and special assessments
levied.
(e) The amount of any tax rate reduction pursuant to Section 100
of this code, with the notation: "Tax reduction by (name of
jurisdiction)."
(f) The amount of any exemptions. Exemptions reimbursable by the
state shall be separately shown.
(g) The total taxes due on the property covered by the bill.
(h) Instructions on tendering payment, including the name and
mailing address of the tax collector.
(i) Information specifying all of the following:
(1) That if the taxpayer disagrees with the assessed value as
shown on the tax bill, the taxpayer has the right to an informal
assessment review by contacting the assessor's office.
(2) That if the taxpayer and the assessor are unable to agree on a
proper assessed value pursuant to an informal assessment review, the
taxpayer has the right to file an application for reduction in
assessment for the following year with the county board of
equalization or the assessment appeals board, as applicable, during
the period from July 2 to September 15, inclusive.
(3) The address of the clerk of the county board of equalization
or the assessment appeals board, as applicable, at which forms for an
application for reduction may be obtained.
SEC. 15. Section 4837.5 of the Revenue and Taxation Code is
amended to read:
4837.5. Notwithstanding any other provision of law, taxes due,
whether secured or unsecured, on escape assessments for prior fiscal
years may be paid over a four-year period at the option of the
assessee if: (a) the additional tax is over five hundred dollars
($500), and (b) a written request for installment payment is filed by
the assessee with the tax collector prior to the time the second
installment of taxes on the secured roll becomes delinquent, or by
the last day of the month following the month in which the tax bill
is mailed, whichever is later. The tax collector shall include with
the property tax bill a notice of the payment provisions of this
section. For unsecured taxes, the written request for installment
payment shall be filed with the tax collector prior to the date on
which those taxes become delinquent.
If payment by installments is requested, 20 percent or more of the
tax shall be paid no later than the deadline for filing the written
request. The current taxes and prior year taxes with penalties and
costs thereon shall be paid with or prior to the initial installment
payment. In each succeeding fiscal year, the assessee shall pay,
before the delinquency date of the second installment of current
taxes on the secured roll, all current year taxes, and a sum at least
sufficient to reduce the outstanding balance of the tax by 20
percent of the original amount. In the case of unsecured taxes, the
required annual installment shall be paid on or before August 31.
No penalties shall be charged as long as installment payments are
made timely; and, in the case of secured taxes, as long as all
payments are made timely, an affidavit regarding the property shall
not be published pursuant to Section 3371.
If any installment is not paid timely, or if the property on the
secured roll becomes tax defaulted, or if the property changes
ownership, or if taxes for the property on the unsecured roll are not
paid before becoming delinquent, the balance of the tax remaining to
be paid shall immediately become due and payable, and no further
installment payments for that escape assessment or correction shall
be authorized. The tax collector shall inform the auditor of the
defaulted, off-roll installment plan and of the delinquent amount
remaining unpaid.
The auditor shall add the unpaid balance, plus penalties and costs
thereon, to the current roll, adjust the tax collector's charge
accordingly, and the remaining balance of the tax shall become
subject to all of the provisions of this division applicable to
delinquent taxes.
The tax collector shall maintain records listing the current
status of all the installment accounts authorized under this section.
The status of each installment account shall be entered on the
current roll and the tax collector may file for record with the
county recorder a certificate pursuant to Section 2191.3.
When the installment account is paid in full before 5 p.m. on June
30 of the year in which the account has become defaulted and the tax
collector has filed for record a certificate of lien, the tax
collector shall also file for record a release of that lien. Where
the account is not paid in full until after June 30 of the year in
which the account became defaulted, the filings of the certificates
of lien and release of lien shall be subject to recording fees
charged to the taxpayer.
SEC. 16. Section 5151 of the Revenue and Taxation Code is amended
to read:
5151. (a) Interest at the greater of 3 percent per annum or the
county pool apportioned rate shall be paid, when that interest is ten
dollars ($10) or more, on any amount refunded under Section 5096.7,
or refunded to a taxpayer for any reason whatsoever. However, no
interest shall be paid under the provisions of this section if the
taxpayer has been given the notice required by Section 2635 and has
failed to apply for the refund within 30 days after the mailing of
that notice. For purposes of this section, "county pooled
apportioned rate" means the annualized rate of interest earned on the
total amount of pooled idle funds from all accounts held by the
county treasurer, in excess of the county treasurer's administrative
costs with respect to that amount, as of June 30 of the preceding
fiscal year for which the refund is calculated.
(b) Subdivision (a) does not apply to interest on refunds of those
amounts of tax that became due and payable before March 1, 1993.
Interest on refunds of those amounts of tax that became due and
payable before March 1, 1993, and have not been refunded as of April
6, 1995, shall be paid at that rate provided for by this section as
it read prior to January 1, 1993. This subdivision shall not be
construed to affect the interest paid on refunds of those amounts of
tax that became due and payable before March 1, 1993, and have been
refunded as of April 6, 1995.
(c) Interest allowed under this section shall be computed using
whichever of the following periods provides the longest period:
(1) The date of the recording of the deed to the public agency
acquiring the property in eminent domain to the date of the filing of
the claim for refund.
(2) The date of the payment of the tax on property subject to an
application for equalization of the assessed value thereof to the
date of the determination of the equalized value of the property.
(3) The date of the payment of the tax on property subject to a
refund as a result of an assessor error in assessing the property to
a date 15 days after the date of approval of the correction to the
tax roll that was not the result of court action or an assessment
appeal decision.
(4) Forty-five days following the filing of a claim for refund
until the refund is paid.
The interest charged shall be apportioned to the appropriate
funds, as determined by the county auditor.
SEC. 17. Section 23154 of the Revenue and Taxation Code is amended
to read:
23154. The tax imposed under this chapter is in lieu of all ad
valorem taxes and assessments of every kind and nature upon the
general corporate franchises of the corporations taxable under this
chapter but is not in lieu of any taxes or assessments upon real
property interests not otherwise exempted from taxation or
assessment, that are created by special franchises owned, held, or
used by those corporations. All those real property interests, not
otherwise exempted from taxation or assessment that are created by
those special franchises shall be assessed annually by the board, at
their actual value, in the same manner as is provided for the
assessment of other property to be assessed by that board under
Section 19 of Article XIII of the California Constitution, and shall
be subject to taxation to the same extent and in the same manner as
other property assessed under that constitutional provision by the
board. For purposes of assessing a real property interest pursuant
to the preceding sentence, the value of intangible assets or rights
shall not enhance or be reflected in the value of that real property
interest, except that the real property interest may be assessed and
valued by assuming the presence of intangible assets and rights
necessary to put the real property interest to beneficial or
productive use.
SEC. 18. The Legislature finds and declares that taxpayer
compliance, uniformity of administration, and the business climate
will all be improved by the amendments to Section 107 of the Revenue
and Taxation Code made by Section 4 of this act.
SEC. 19. The addition of subdivision (b) to Section 5151 of the
Revenue and Taxation Code made by Section 16 of this act does not
constitute a change in, but is declaratory of, existing law.
SEC. 20. Notwithstanding Section 17610 of the Government Code, if
the Commission on State Mandates determines that this act contains
costs mandated by the state, reimbursement to local agencies and
school districts for those costs shall be made pursuant to Part 7
(commencing with Section 17500) of Division 4 of Title 2 of the
Government Code. If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.
Notwithstanding Section 17580 of the Government Code, unless
otherwise specified, the provisions of this act shall become
operative on the same date that the act takes effect pursuant to the
California Constitution.