BILL ANALYSIS �
AB 892
Page 1
Date of Hearing: May 15, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 892 (Daly) - As Amended: April 29, 2013
Policy Committee: Local
GovernmentVote:9-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill requires the Board of Equalization (BOE) to report
annually to the Governor on the imposition of each locally
assessed parcel tax, as specified.
FISCAL EFFECT
Estimated costs to BOE of approximately $250,000 for expanding
their existing study on property tax. The bill requires BOE, in
implementing the provisions of the bill to utilize existing
funds or resources. By redirecting existing resources, the bill
will create cost pressure because of the previous work that is
no longer being done.
COMMENTS
1)Purpose . According to the author, this bill will provide
greater transparency to the tax system by requiring BOE to
publish information on parcel taxes in the annual property tax
report to the Governor. The author notes this report is a
widely used document and with this bill will include property
taxes.
2)Support . According to supporters, including the California
Chamber of Commerce and the National Federation of Business,
they support this bill because it would increase transparency
and oversight of locally assessed parcel taxes. Parcel taxes
have become an increasingly popular option for local entities.
Supporters note, each year voters in various jurisdictions
are asked to decide on upwards of 30 or so local parcel tax
measures, but little information is available on how many past
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parcel taxes have been levied in their county, how much
revenue has been generated by those taxes, or what programs
have benefited from those revenues. They state there is no
aggregated information to help state and local lawmakers
determine the efficacy of such taxes.
3)Background . Existing law requires BOE to annually report to
the Governor the assessed value of state-assessed and locally
assessed real and personal property in each county and
incorporated city or town. This bill would add to the annual
report specified information on parcel taxes. This bill
requires BOE to report to the Governor the imposition of each
locally assessed parcel tax, including, but not limited to,
the parcel tax type and rate, number of parcels subject to and
exempt from the tax, sunset date and amount of revenue
received from the parcel tax.
4)Parcel taxes . Article XIII A of the California Constitution
allows cities, counties and special districts, by a two-thirds
vote of the qualified electors in that jurisdiction, to impose
special taxes, except ad valorem taxes on real property or a
transaction tax or sales tax on the sale of real property
within that city, county or special district. A parcel tax is
a particular type of excise tax that is based on either a flat
per-parcel rate or a rate that varies depending upon use,
size, and/or number of units on each parcel. A parcel tax is
a special tax receiving two-thirds voter approval pursuant to
Section 4 of Article XIIIA.
With the approval of at least two-thirds of the voters, local
governments can impose a parcel tax on all parcels or a subset
of parcels in their jurisdiction. Parcel taxes can be used to
fund a variety of local government services, even if the
taxpayer who pays a parcel tax does not actually use the
services funded by that tax. However, if services are used by
a taxpayer, the parcel tax must be proportional to their use
by the taxpayer. Parcel tax revenue is also restricted to the
public programs, services, or projects that voters approved
when enacting that parcel tax.
5)LAO report. According to the Legislative Analyst's report
entitled, Understanding California's Property Taxes , "Recent
election reports and financial data suggest that parcel taxes
represent a significant and growing source of revenue for some
local governments. Specifically, between 2001 and 2012, local
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voters approved about 180 parcel tax measures to fund cities,
counties and special districts, and about 135 measures to fund
K-12 districts. The most recent K-12 financial data
(2009-2010) indicate that schools received about $350 million
from this source. We were not able to locate information on
the statewide amount of parcel tax revenue collected by
cities, counties, and special districts."
6)There is no registered opposition to this bill.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081