BILL ANALYSIS
------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 852|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
------------------------------------------------------------
THIRD READING
Bill No: AB 852
Author: Fong (D)
Amended: 8/31/09 in Senate
Vote: 21
SENATE REVENUE & TAXATION COMMITTEE : 5-2, 7/8/09
AYES: Wolk, Alquist, Florez, Padilla, Wiggins
NOES: Walters, Ashburn
NO VOTE RECORDED: Runner
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 52-27, 5/28/09 - See last page for vote
SUBJECT : Property taxation: statement
SOURCE : California Assessors Association
DIGEST : This bill authorizes the county assessor to
refuse to accept any property statement that is not in the
requested format and to require the electronic filing of a
property statement, as provided. This bill requires the
county assessor, if he or she requires a property statement
to be filed electronically, to notify the taxpayer, in
writing, of this requirement. This bill authorizes a
county assessor to apply a penalty on a taxpayer, as
provided, if a taxpayer fails to file a property statement
electronically. This bill requires the Board of
Equalization (BOE) to adopt equipment category codes, as
specified, and requires taxpayers filing a property
CONTINUED
AB 852
Page
2
statement electronically to use the equipment category
codes, as specified.
Senate Floor Amendments of 8/31/09 specify the conditions
under which the assessor may determine that the taxpayer
failed to file the electronically filed property statement
in the required format, require the assessor to notify the
taxpayer, allows the taxpayer to submit an amended property
statement within 12 days, provide that the assessor shall
not have discretion to waive the penalty for a taxpayer who
demonstrates that the electronic filing requirements faces
an reasonable burden, and resolves chaptering conflicts
with AB 311 (Ma).
ANALYSIS : Existing law requires taxpayers that meet
certain criteria to file a signed property statement with
the county assessor. Existing law authorizes the county
assessor to refuse to accept any property statement that he
or she determines to be in error and to accept the filing
of a property statement by the use of electronic media.
This bill allows assessors to require taxpayers to submit
property statements under the following conditions:
1.The taxpayer submits the statement in a form of Internet
media and pursuant to methods specified by the Assessors
and BOE.
2.The taxpayer submits the statement with an electronic
signature verified by procedures set forth by the
Assessors and BOE.
3.The assessor must notify the taxpayer of the electronic
filing requirement. However, the taxpayer need not
comply until the year after notification. The one-year
period to comply with all existing filing requirements
and deadlines with paper filings is to begin on the date
the notification is sent to the taxpayer.
4.The value of the taxpayer's personal property exceeds
$100,000.
5.An assessor who requires a taxpayer to file a property
statement electronically may apply a penalty on a
CONTINUED
AB 852
Page
3
taxpayer if the taxpayer fails to file the property
statement electronically.
This bill requires the assessor complying with the above
requirements to levy a 10 percent penalty if a taxpayer
fails to file the property statement electronically.
The bill provides that the assessor must notify the
taxpayer with 12 days if the property statement is rejected
for not complying with the electronic filing requirement,
and that the taxpayer may file an amended property
statement. The bill allows a taxpayer that fails to file a
statement electronically, but who otherwise complies with
the filing deadline, to file an amended property statement
within 12 days of the assessor's notice or May 7th,
whichever is later.
This bill requires the assessor to exempt from the
electronic filing requirement a taxpayer who demonstrates
that the requirement places an undue burden on his or her
business.
This bill additionally requires BOE, in consultation with
the California Assessors' Association and representatives
of taxpayers to adopt equipment category codes for
electronically filed property statements by January 1,
2011, and for taxpayers to use those codes after January 1,
2012. An assessor is not to penalize a taxpayer for
failing to use the equipment category codes if the BOE
fails to adopt the equipment category codes on or before
January 1, 2011.
Comments
According to the author's office, "AB 852 directs the Board
of Equalization to adopt equipment category descriptions,
in consultation with assessors and taxpayers, and allows an
assessor to require a business to file electronically.
This bill will provide incentives to assessors and
businesses to make the necessary transitions in their
electronic processing systems such that Business Property
Statements can be filed and accepted electronically
statewide. This bill will decrease the amount of paper
filings, which in turn will reduce human errors and costs
CONTINUED
AB 852
Page
4
associated with postage, processing, and data entry."
The purpose of this bill is to provide incentives to
assessors and businesses to make the necessary transitions
in their electronic processing systems, such that business
property statements can be filed and accepted
electronically statewide.
The California Assessors' Association, states that this
bill, by requiring businesses to file their business
property statements electronically, will establish
uniformity and will reduce errors and costs associated with
paper filings.
Personal property used in a trade or business is,
generally, taxable, and the taxpayer who owns that property
must annually report the cost of that property to the local
assessor by filing a property statement (Form 571). Many
assessors provide an opportunity for businesses to file
their property statements electronically, via an
interactive, online filing system. In 2004, local county
assessors created a Joint Powers Agreement (JPA) for
Standard Data Record Development (SDR) and Year to Year
Support. Currently, more than 40 counties participate in
the program. The SDR system is designed to simplify the
process of filing annual property statements for businesses
that have multiple locations in one or more California
counties. The system allows a business to upload data
directly from its internal data processing system into SDR,
which will deliver the data to the corresponding county
assessor. The goal of the SDR system is to allow major
corporations to bypass filing a business property statement
in every county in which they have a business presence. In
addition, assessors could reduce the costs associated with
processing data from the paper statements if statements are
filed electronically. Finally, business filing
electronically via the SDR system would receive their
estimated assessed values earlier and the assessors could
process filings with fewer errors.
The SDR system, however, only accepts business property
statements that are filed electronically in the approved
XML file format, and, in order to create SDR files, a
business must have the SDR software and special
CONTINUED
AB 852
Page
5
programming. Arguably, the level of effort and investment
may not be practical for businesses that are filing for a
single location. Some counties allow taxpayers to submit
their business property statements via the Internet,
requiring no special data format. Generally, this sort of
e-filing is designed for small and medium business owners.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 8/18/09)
California Assessors' Association (source)
Board of Equalization
Santa Clara County Assessor
OPPOSITION : (Verified 8/18/09)
California Farm Bureau Association
ASSEMBLY FLOOR :
AYES: Ammiano, Arambula, Beall, Block, Blumenfield,
Brownley, Buchanan, Caballero, Charles Calderon, Carter,
Chesbro, Coto, Davis, De La Torre, De Leon, Eng, Evans,
Feuer, Fong, Fuentes, Furutani, Galgiani, Gilmore, Hall,
Harkey, Hayashi, Hernandez, Hill, Huber, Huffman, Jones,
Krekorian, Lieu, Bonnie Lowenthal, Ma, Mendoza, Monning,
Nava, John A. Perez, V. Manuel Perez, Portantino, Price,
Ruskin, Salas, Skinner, Solorio, Swanson, Torlakson,
Torres, Torrico, Yamada, Bass
NOES: Adams, Anderson, Bill Berryhill, Tom Berryhill,
Blakeslee, Conway, Cook, DeVore, Duvall, Emmerson,
Fletcher, Fuller, Gaines, Garrick, Hagman, Jeffries,
Knight, Logue, Miller, Nestande, Niello, Nielsen, Silva,
Smyth, Audra Strickland, Tran, Villines
NO VOTE RECORDED: Saldana
DLW:nl 9/1/09 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
CONTINUED
AB 852
Page
6
CONTINUED