BILL ANALYSIS
SB 822
Page 1
Date of Hearing: June 15, 2009
ASSEMBLY COMMITTEE ON REVENUE AND TAXATION
Charles M. Calderon, Chair
SB 822 (Revenue and Taxation Committee) - As Introduced: March 10,
2009
Majority vote. Fiscal committee.
SENATE VOTE : 36 - 0
SUBJECT : Property taxation: local administration.
SUMMARY : Makes various non-controversial changes to the
administrative provisions of the property tax law. Specifically,
this bill :
1)Allows a property owner, at the time he/she files an approved
building plan with the city or county, to submit a scale copy of
floor plans and exterior dimensions of the building to the local
assessor in either a paper or an electronic format.
2)Increases from $5,000 to $10,000 the maximum amount of the
"low-value ordinance" exemption that may be granted by each county
board of supervisors to real or personal property qualified for
that exemption.
3)Requires county assessors to supply information from disabled
veterans' property tax exemption claims and county records to the
State Board of Equalizations (BOE), as specified by BOE's written
request, in order to prevent approvals of multiple disabled
veterans' property tax exemption claims within the state for the
same homeowners.
4)Deletes, in the case of a corporate owner of property, a
requirement that the employee or agent who signs the property
statement be designated in writing by the corporation's board of
directors.
5)Deletes a requirement that the property owner signs a copy of the
property statement printed and mailed by the assessor to the
property owners, and instead allows property owners to sign the
attachments, as specified.
6)Allows a county assessor to make a separate valuation of a parcel
SB 822
Page 2
covered by a subdivision map filed for record after the lien date
immediately preceding the current fiscal year, but only if the
board of supervisors of that county enacts an ordinance, by
majority vote, providing for a separate valuation of parcels.
EXISTING LAW :
1)Requires assessors to assess all new construction that occurs
within their county for property tax purposes. Revenue and
Taxation Code (RT&C) Section 72 requires city and county building
departments to provide the local county assessor with a copy of
all building permits issued. R&TC Section 72 also requires
property owners to file with the local assessor a scale copy of
floor plans and exterior dimensions designated for the assessor's
use.
2)Provides that all property is taxable unless otherwise exempted by
the California Constitution or federal law [Article XIII A,
Section 1(a), California Constitution]. Pursuant to Section 7 of
Article XIII of the California Constitution, the Legislature
enacted RT&C Section 155.20 to authorize a county board of
supervisors to exempt from property tax those real and personal
properties having a full value too low to justify the costs of
assessment and collection. It also limits this exemption, which
is referred to as the "low-value ordinance" exemption, granted by
each county board of supervisors to property with a value not
exceeding $5,000, except that in the case of a possessory interest
in specified facilities, the limit is increased to $50,000.
3)Authorizes the exemption from property taxation of the principal
residence of a qualified disabled veteran, or his/her surviving
spouse, in the case where a person has, as a result of a
service-related disease or injury, becomes disabled or died while
on active duty in military service. The amount of exemption,
which is automatically indexed each year, depends upon the
claimant's income. BOE currently maintains a database to monitor
claims for the homeowners' exemption, but not the disabled
veterans' exemption.
4)Imposes an ad valorem tax on all assessable personal property used
in a trade or business at the fair market value of that property.
Requires taxpayers to report the cost of their property holdings
to the local county assessor on a business property statement that
shows all taxable property, both real and personal, owned or
managed by the person filing the statement. In the case of a
corporate owner of property, a business property statement must be
SB 822
Page 3
signed either by an officer of the corporation or an employee or
agent who has been designated in writing by the board of
directors.
5)Requires the county assessor to mail a property statement to any
person required to file one, in order to prompt taxpayers to
complete and file annual property statements. However, it allows
a taxpayer, in lieu of completing the property statement as
printed by the assessor, to furnish the required information as
attachments to the property statement, provided that one copy of
the statement is signed by the taxpayer and contains an
appropriate reference to the data attached.
6)Prohibits the county assessor from making a separate valuation on
any parcel covered by a subdivision map filed for record after the
lien date immediately preceding the current fiscal year.
FISCAL EFFECT : BOE estimates that this bill will have no effect on
the amount of revenues collected by the state or local governments.
However, BOE estimates that, for any county that would opt to raise
the low value exemption to an amount exceeding $5,000, there would
be a small cost savings equal to the difference between the costs of
assessing and billing and the tax proceeds for properties that would
qualify for the low value property exemption only under the
increased limit.
COMMENTS :
1)Purpose of this bill . SB 822 is a technical, non-controversial
bill intended to improve local administration of property tax laws
for the benefit of both taxpayers and assessors.
2)BOE staff's recommendations . Existing law requires that a
taxpayer sign and return the original business property statement
mailed to him/her by the assessor. This bill amends the signature
requirements for the business property statement by allowing the
taxpayer to sign an attachment to the original property statement
rather than the statement itself. Often, but not always, the
"attachment" is a replica of a property statement that is
computer-generated. In its previous Assessment Practices Survey
reports, the BOE has been critical of county assessors' acceptance
of signed electronically-prepared attachments to business property
statements where the original business property statement was
unsigned. This bill seeks to revise the law to reflect current
business practices for those taxpayers who prepare business
property statements using various software applications that
SB 822
Page 4
create replica property statements. However, as noted by BOE
staff, the definition of "attachment" is broad. An "attachment"
may be a supporting document rather than a replica of the business
property statement. Therefore, instead of allowing a taxpayer to
sign an attachment to the original property statement, BOE staff
suggests providing the taxpayer with an option to file a business
property statement that is "substantially identical to the
statement as printed by the assessor" and recommends the following
amendment to R&TC Section 441.5:
"441.5. (a) In lieu of completing the property statement as printed
by the assessor pursuant to Section 452, the assessor may accept
the information required of the taxpayer may be furnished to the
assessor as (1) attachments to the property statement provided
that the attachments shall be in a format as specified by the
assessor and: (a) one copy of the property statement, as printed
by the assessor, is signed by the taxpayer and carries appropriate
reference to the data attached; or (2) an electronically filed the
property statement is filed electronically and that is
authenticated as provided in subdivision (k) of Section 441 ., ;or
(3) a substantially identical property statement to the statement
as printed by the assessor that is signed by the taxpayer.
(b) The assessor may consider any of the methods of providing
information required of the taxpayer described in (a) as the
property statement for purposes of this division ."
3)Related Legislation . AB 3080 (Assembly Revenue and Taxation
Committee), introduced in the 2007-08 Legislative Session, was
identical to this bill. AB 3080 was vetoed by the Governor, with
the following veto message:
"The historic delay in passing the 2008-09 State Budget has forced
me to prioritize
the bills sent to my desk at the end of the year's legislative
session. Given the delay, I
am only signing bills that are the highest priority for
California. This bill does not meet
that standard and I cannot sign it at this time."
REGISTERED SUPPORT / OPPOSITION :
Support
California Assessors' Association
SB 822
Page 5
Opposition
None on file
Analysis Prepared by : Oksana Jaffe / REV. & TAX. / (916) 319-2098