BILL ANALYSIS
AB 1029
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Date of Hearing: January 21, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1029 (Blumenfield) - As Amended: January 13, 2010
Policy Committee: Revenue and
Taxation Vote: 7-0
Urgency: Yes State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill re-establishes and modifies the Senior Citizens and
Disabled Citizens Property Tax Postponement program, which was
suspended indefinitely in the 2009-10 budget. Specifically, the
bill:
1)Allows the controller to accept applications for property tax
postponement.
2)Upon appropriation by the Legislature, authorizes the
controller to make tax payments on behalf of claimants and to
pay costs incurred in administering the program from the
Senior Citizens and Disabled Citizens property tax
postponement fund.
3)Makes modifications to the suspended program, including a
$4,000 reduction in the maximum household income for eligible
claimants, a modification to the definition of household
income to exclude losses or other noncash expenses, and a
modification to the filing date for the program.
4)Authorizes county tax collectors to cancel any delinquent
penalties and interest owed by claimants for the 2009-10 and
2010-11 fiscal years.
FISCAL EFFECT
1)Fully funding the modified program would result in annual GF
costs of about $12 million for the next 5-10 years, and
declining annual amounts thereafter as repayment of postponed
claims become available to offset future postponements.
AB 1029
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2)The provision allowing county collectors to cancel delinquent
penalties and interest would result in unknown, but
significant additional costs to the state.
COMMENTS
1)Purpose . This bill is intended to restore and modify the PTP
program in order to help seniors and disabled individuals as
well as to alleviate the negative impact of the program
suspension on delinquency rates and local government revenues.
2)Background . The PTP program allows eligible homeowners - those
62 years of age or older, or blind or disabled individuals -
to defer payment of property taxes until they move, sell the
residence, or pass away. The program is available to persons
with household income of $39,000 or less (as adjusted
beginning in 2010 for inflation) and at least 20% equity in
the home. The 2009-10 budget implemented the governor's
proposal to suspend indefinitely the PTP program and prohibits
the controller from accepting application for the program
3)Key fiscal issue . The PTP suspension was one of many difficult
budget solutions adopted to address an unprecedented budget
shortfall. Since the 2010-11 budget faces an additional $20
billion shortfall, restoration of General Fund spending
associated with this or any other programs suspended in
2009-10 will require even deeper reductions than those already
being proposed.
Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081