BILL ANALYSIS
SB 671
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Date of Hearing: June 17, 2009
ASSEMBLY COMMITTEE ON AGRICULTURE
Cathleen Galgiani, Chair
SB 671 (Runner) - As Amended: May 11, 2009
SENATE VOTE : 38-0
SUBJECT : Agricultural lands: valuation.
SUMMARY : Permits a county assessor to require a landowner to
deposit a contingency payment when that landowner challenges the
appraised value of land utilizing the conservation provisions of
the Williamson Act (Act). Prohibits these funds to be
interpreted as a limitation for a city or county to recover
their costs due to the cancellation process, and prohibits the
formal review cost to be borne by the non-requesting parties.
EXISTING LAW permits the Act contractee to request non-renewal
of the contract, thereby letting the parcel's contract terminate
over nine years with the property assessment being adjusted by
10% each year until at par with the county assessor's valuation.
An alternative termination method is to request immediate
cancellation of a contract, which requires a county assessor to
determine the current unrestricted fair market value for the
parcel in order to determine and assess the cancellation fee of
12.5% that is required to be paid to the state. Once the
unrestricted value is determined by the assessor and
notification is made to the landowner and the Department of
Conservation (DOC), they both have the option of submitting
valuation information to the assessor for consideration but
cannot have ex parte communications with the assessor. The
assessor is required to notify any ex parte contacts to DOC and
the landowner.
If the landowner and/or DOC disagree with the assessor's value,
they may try to reach agreement upon the value between
themselves, or either party can ask the assessor to conduct a
formal review. Assessors are permitted to recover their
reasonable cost for conducting a formal review from the party
that requests it, and costs may be deducted from the
cancellation payment.
FISCAL EFFECT : The Senate Appropriations Committee determined
that this bill had no significant additional state costs, will
SB 671
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not require appropriation of state funds, and will cause no
significant reduction in revenues. (Senate Rule 28.8)
COMMENTS : The Act was created to help conserve agricultural
lands while maintaining them in production agriculture, and
reducing the pressure on the landowner to sell ground for
development purposes. Land under the Act contracts have an
alternative property tax structure that uses the agricultural
production value as the basis rather than an alternative use
that might have a higher value basis.
The recent building boom brought forward many cancellation and
non-renewal requests to many counties. Most of these did not
cause unsolvable problems for the assessors, landowners or DOC.
However, when the building boom stopped, there were a few
cancellation requests in the works that caused the county
assessors fiscal concerns and one resulted in a fiscal loss to
the county.
In Riverside County, a developer requested the assessor conduct
a formal review, then sued the county but later dropped the
suit, and the cancellation request, due to the drop in real
estate market values. Because the cancellation request was
dropped and no fee assessed, the county could not recover any of
its cost for the formal evaluation review or for defending
itself against the lawsuit.
SB 671 creates the authority for an assessor to request a
landowner pay a contingency fee when asking for the contract
cancellation that can be used to cover the costs associated with
the assessor conducting the cancellation. The bill further
clarifies that this contingency fee does create any limitation
on the authority for cities and counties to recover their cost
in the cancellation process, only stating that the assessor's
cost for conducting a formal review will not be paid by the
non-requesting party.
REGISTERED SUPPORT / OPPOSITION :
Support
California Assessors' Association (Sponsor)
Resource Landowners Coalition
Opposition
SB 671
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None on file
Analysis Prepared by : Jim Collin / AGRI. / (916) 319-2084