BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 261|
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THIRD READING
Bill No: AB 261
Author: Dickinson (D)
Amended: 5/11/11 in Assembly
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 7-2, 6/29/11
AYES: Wolk, Huff, DeSaulnier, Hancock, Hernandez, Kehoe,
Liu
NOES: Fuller, La Malfa
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 62-16, 5/31/11 - See last page for vote
SUBJECT : Property tax: tax-defaulted property
SOURCE : California Association of County Treasurers and
Tax
Collectors
DIGEST : This bill clarifies that prescriptive easements
run with the tax-defaulted property sold in a tax sale and
requires any person wishing to commence a proceeding in
court based on alleged invalidity or irregularity of a sale
of tax-defaulted property to first petition the local board
of supervisors, as specified, to have the tax sale
rescinded.
ANALYSIS :
CONTINUED
AB 261
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Existing Law :
1. Requires a property owner to pay property taxes to the
treasurer or tax collector of the county within which
the property is located.
2. Provides that, if property taxes are not paid within
five years of the notice of impending default, the
property becomes subject to sale and will be sold at a
public auction. The tax collector has the power to sell
property that has been tax-defaulted for five years or
more, or three years or more in the case of
nonresidential commercial property. Tax-defaulted
property may be sold under either of the following
procedures, each with distinct statutory requirements:
A. Sale to private persons (including taxing
authorities) by auction.
B. Sale to state and local taxing agencies by
agreement.
3. States that, when tax-defaulted property is sold, the
deed conveys title to the purchaser free of all
encumbrances existing before the sale, with specified
exceptions, including an exception for certain
easements, such as servitudes upon, or burdens to, the
property, water rights (the record title to which is
held separately from the title to the property) and
restrictions of record.
4. Specifies that a proceeding based on alleged invalidity
or irregularity of any proceedings instituted in a sale
of tax-defaulted property can only be commenced within
one year after the date of execution of the tax
collector's deed.
This bill requires persons who challenge the validity of a
tax sale to first petition the Board of Supervisors for a
rescission within one year of the sale. If the Board
rejects the petition, the person must commence the
proceeding challenging the validity of the tax sale within
one year of the rejection. This bill applies to tax sales
completed on or after January 1, 2012.
AB 261
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This bill also clarifies that prescriptive easements also
transfer to the purchaser of a property redeemed in a tax
sale.
Comments
This bill responds to the curious case of Helen Lee and
Catherine Santana v. Robert Lyles, Shirley Lyles, and the
County of Sacramento , Sacramento Superior Ct., Case #
05AS01166. Lee and Santana sued the Lyles and the County
to invalidate a tax sale of a 10 foot wide piece of
property, which the County had six years prior sold to the
Lyles after properly noticing Lee and Santana. Lee and
Santana sued to invalidate the sale, stating they had
adverse possession, and revealed at trial that they found
it easier to park on the strip of land sold. The Court
sided with the Lyles and the County, finding that the
County followed the law, and that Lyles' owning the strip
of land did not deny Lee and Santana of access to their
property. The Court also found that Lee and Santana could
produce no evidence of adverse possession as a result of
parking there. Under this bill, Lee and Santana could not
wait six years to sue the purchasers and the County.
Instead, they would have one year to petition the county
board of supervisors to rescind the sale, then another year
to file suit if the board declined their petition.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 8/15/11)
California Association of County Treasurers and Tax
Collectors (source)
ARGUMENTS IN SUPPORT : According to the author, "AB 261
is a simple measure intended to clarify current law with
respect to prescriptive easements and to simplify and
streamline dispute procedures arising from tax lien sales
of real property."
AB 261
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ASSEMBLY FLOOR :
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Davis, Dickinson, Eng, Feuer,
Fong, Fuentes, Furutani, Galgiani, Gatto, Gordon, Hall,
Harkey, Hayashi, Roger Hern�ndez, Hill, Huber, Hueso,
Huffman, Jeffries, Lara, Bonnie Lowenthal, Ma, Mendoza,
Miller, Mitchell, Monning, Nestande, Norby, Pan, Perea,
V. Manuel P�rez, Portantino, Silva, Skinner, Smyth,
Solorio, Swanson, Torres, Valadao, Wieckowski, Williams,
Yamada, John A. P�rez
NOES: Conway, Cook, Donnelly, Fletcher, Beth Gaines, Grove,
Hagman, Halderman, Jones, Knight, Logue, Mansoor,
Morrell, Nielsen, Olsen, Wagner
NO VOTE RECORDED: Garrick, Gorell
AGB:do 8/16/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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