BILL ANALYSIS �
AB 2643
Page 1
ASSEMBLY THIRD READING
AB 2643 (Ma)
As Amended May 16, 2012
Majority vote
LOCAL GOVERNMENT 8-0 REVENUE & TAXATION 7-0
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|Ayes:|Smyth, Alejo, Bradford, |Ayes:|Perea, Harkey, Beall, |
| |Campos, Davis, Gordon, | |Cedillo, Wagner, Gordon, |
| |Hueso, Norby | |Nestande |
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SUMMARY : Makes several changes to the statutes related to
property tax collection. Specifically, this bill :
1)Deletes the exception for the return of replicated property
tax payments, for purposes of allowing the tax collector to
apply any refund due to a taxpayer, or the taxpayer's agent,
to any delinquent taxes due for the same property for which
the same taxpayer, or his or her agent, is liable, thereby
applying the provisions authorizing the tax collector to apply
any refund to any delinquent taxes.
2)Limits penalty relief, for cases in which a taxpayer has
failed to pay taxes on an assessment that is the subject of a
pending informal review due to a decline in value as a result
of damage, destruction, depreciation, obsolescence, removal of
property, or other factors causing a decline in value, to the
difference between the county assessor's final determination
of value and the value on the assessment roll for the fiscal
year covered by the application.
3)Restricts the penalty relief specified in 3) above to those
properties upon which an application for an informal review is
pending before the county assessor on the effective date of
the bill's implementation, or in situations where those
applications for an informal review are filed with the county
board after the date of the bill's implementation.
4)Specifies for the penalty relief for any taxpayer that has
paid at least 80% of the amount of tax finally determined due
by the county assessor within 30 days of filing an application
for reassessment, that the tax collector must accept payment
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of the balance of the tax due without penalties or interest.
5)Requires the California Association of County Treasurers and
Tax Collectors (CACTTC) to notify all taxpayers that receive a
tax bill of the provisions of the bill related to penalty
relief.
6)Provides that the provisions of the bill related to penalty
relief may only become operative if the board of supervisors
of a county adopts a resolution or ordinance approving this
section.
7)Extends, for purposes of calculating the interest on property
tax refunds, the time period the county treasurer has to
advise the State Controller of the county pool apportioned
rate and of computations made in deriving that rate from 60 to
90 days.
EXISTING LAW :
1)Requires, when the amount of property taxes paid exceeds the
amount due by more than $10, the tax collector to send notice
of the overpayment to the taxpayer, and provides that the
notice must be mailed to the taxpayer's last known address and
state the amount of overpayment and that a refund claim may be
filed, as specified.
2)Allows the tax collector to apply any refund due a taxpayer,
or the taxpayer's agent, to any delinquent taxes due on the
same property for which the same taxpayer or his or her agent
is liable, except as specified for the return of replicated
property tax payments.
3)Limits, in the case in which a taxpayer has failed to pay
taxes on an assessment that is the subject of a pending
assessment appeal, as provided, the amount of penalty relief
to the difference between the final determination of value by
the county board, as defined, and the value on the assessment
roll for the fiscal year covered by the application.
4)Requires the county board to provide a specified notice to
taxpayers impacted by the penalty provisions.
5)Requires the payment of interest on property tax refunds at
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the greater of 3% per annum or the county pool apportioned
rate.
6)Requires the county treasurer to advise the State Controller
of the county pool apportioned rate and of computations made
in deriving that rate, no later than 60 days after the end of
that fiscal year.
FISCAL EFFECT : None
COMMENTS : This bill is sponsored by the CACTTC and makes
several changes to the laws related to property tax collection.
The bill extends the time county treasurers have to calculate
the pool rate and report it to the State Controller from 60 days
to 90 days after the end of the fiscal year. Current law
requires the payment of interest on property tax refunds at the
greater of 3% per annum or the county pool apportioned rate.
Additionally, the bill limits penalty relief, for cases in which
a taxpayer has failed to pay taxes on an assessment that is the
subject of a pending informal review due to a decline in value
as a result of the damage, destruction, depreciation,
obsolescence, removal of property, or other facts causing a
decline in value, to the difference between the county
assessor's final determination of value and the value on the
assessment roll for that fiscal year. The bill provides that
penalty relief only applies to those properties for which an
application for an informal review is pending before the county
assessor on or after the effective date of the bill's
implementation.
Current law limits penalty relief, for cases in which a taxpayer
has failed to pay taxes on an assessment that is the subject of
a pending assessment appeal, to the difference between the
county board of supervisor's final determination of value and
the value on the assessment roll for that fiscal year. Current
law requires the county board of supervisors to provide mailed
notice to each taxpayer upon an application for reduction in
assessment with the county board if that taxpayer will be
impacted by the penalty provisions, and also requires the board
of supervisors, with the approval of the county's tax collector
and auditor, to adopt an ordinance that approves this section of
law dealing with limiting penalty relief. The penalty under
these provisions is 10% of the tax due.
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Under current law, the penalty calculations are different
depending upon whether the assessor or the assessment appeals
board lowers the value. This bill creates consistency in the
penalty calculations by making it the same for both types of
valuation decreases. The sponsor indicates that this provision
will remove the incentive for taxpayers to pay tax bills late
when a value reduction is pending from the assessor.
Amendments taken in the Assembly Revenue and Taxation Committee
include the 80% safe harbor rule and also require the county
assessor to notify taxpayers of the limited penalty relief upon
filing an application for an information review, and give the
county board of supervisors the authority to opt in to the
penalty relief provisions of the bill.
Support arguments: Supporters argue that this bill clarifies
the statutes related to property tax collection and overpayment,
penalty relief, and gives county treasurers a longer period of
time to calculate the pool rate and report it to the State
Controller.
Opposition arguments: None on file.
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958
FN: 0003657