BILL ANALYSIS �
AB 2211
Page 1
Date of Hearing: May 7, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 2211 (Ting) - As Amended: April 28, 2014
Policy Committee: Local
GovernmentVote:9 - 0
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill requires each county to make property tax revenue
allocation information available on its website. Specifically,
this bill:
1)Requires each county to make available to taxpayers on its
website a graph visualization of how general ad valorem
property tax revenues are allocated countywide to each
jurisdiction, including the county, cities, special districts
and school districts. Each county must update the graph
annually and work to improve the appearance, organization, and
clarity of the information provided.
2)Requires the website to:
a) Inform taxpayers that general ad valorem property tax
revenues remain in the county in which they are collected
and are used to fund a significant number of local
government programs and services provided by all
jurisdictions.
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b) Provide a brief summary of the types of programs and
services funded with general property tax revenues provided
by jurisdiction.
c) Include links to other jurisdiction's that have websites
with more information about specific programs and services
funded with general property tax revenues.
1)Requires counties, as they update their information technology
systems, to work towards acquiring systems that are able to
provide taxpayers with an interactive, searchable database
that allows taxpayers to input information regarding their
property tax liability and receive a customized, comprehensive
account of all of the services funded with general ad valorem
property tax revenues in the tax rate area in which the
property of the taxpayer is located.
FISCAL EFFECT
This bill is keyed a state mandate. If the Commission on State
Mandates determines this bill contains reimbursable costs, there
will be unknown, but likely significant costs to the state (GF)
to reimburse counties as follows:
a)One-time costs, likely in the range of $150,000 to $300,000
statewide, for each county to compile information on tax
revenue allocation by jurisdiction, design a graphic
presentation, prepare program summaries for services provided
by each jurisdiction, compile website links, and post this
information to its website.
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b)On-going costs, likely minor, to provide annual updates and
improvements to the website.
c)Although the timeframe is unclear in the bill, substantial
reimbursable costs, likely in the millions of dollars
statewide, depending on the information technology upgrades
and changes necessary, for each county to provide an
interactive, searchable database that allows taxpayers to
receive customized information by tax rate area.
COMMENTS
1)Purpose . The author notes that California property tax bills
are complex and often confusing to the taxpayer. Many
taxpayers are unaware that all revenue from property taxes is
kept exclusively at the local level for vital services such as
education, police and fire protection, parks and recreation,
and so much more. A 2013 report commissioned by the Center for
California Studies at Sacramento State found that a majority
of taxpayers do not understand which service responsibilities
are with which levels of government.
The property tax bill includes payments for the general 1% ad
valorem property tax levied on all properties across the state
pursuant to Proposition 13, voter-approved debt rates such as
payments for school bonds, Mello-Roos taxes, parcel taxes, and
other assessments. Property tax bills identify the purpose of
each payment, except for the general 1% ad valorem tax, the
largest tax on the property tax bill. This bill seeks to
provide additional information to taxpayers on the allocation
and use of the ad valorem property tax via county websites.
2)Background . When property taxes are paid to the county
treasurer -tax collector, the funds are transferred to the
county auditor for distribution. Ad valorem property taxes,
the 1% rate and voter-approved debt rates, account for nearly
90% of the revenue collected from property tax bills in
California, roughly $43 billion in 2010-2011. More than 4,000
local governments receive revenue from the 1% rate. In
general, county auditors allocate revenue from the 1% rate to
a variety of local governments within the county by tax rate
area, geographical areas within a county served by the same
local governments, county, city, schools, and special
districts. The number of tax rate areas varies, some counties
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have thousands of tax rate areas.
3)Current Practice . As a result of the Grand Jury Report in
2003, which concluded that property tax bills give inadequate
information and do not inform the taxpayer on how the 1%
countywide tax dollar is spent, Contra Costa County developed
an online tool that allows taxpayers to use their tax rate
area to see by percentage where their property taxes are
allocated. Other counties like Santa Clara post a tax rate
book online where taxpayers can see where their money is
allocated by each of the 813 tax rates areas, and San Diego
posts a pie chart online of property tax allocation.
4)Previous legislation . AB 920 (Ting) of 2013 would have
established the Property Tax Transparency and Accountability
Program which would have required three participating counties
to include on each county tax bill a comprehensive account of
revenues and services funded by local governments for each tax
rate area. AB 920 was held on this committee's Suspense File.
Analysis Prepared by : Jennifer Swenson / APPR. / (916)
319-2081