BILL ANALYSIS �
AB 2211
Page 1
GOVERNOR'S VETO
AB 2211 (Ting)
As Amended June 18, 2014
2/3 vote
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|ASSEMBLY: |78-0 |(May 28, 2014) |SENATE: |34-0 |(August 26, |
| | | | | |2014) |
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|ASSEMBLY: |77-0 |(August 27, | | | |
| | |2014) | | | |
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Original Committee Reference: L. GOV.
SUMMARY : Requires each county to make available to taxpayers on
its Internet Web site a graph visualization of how general ad
valorem property tax revenues are allocated countywide, at a
summarized jurisdictional level that includes, but is not
limited to, the county, cities, independent special districts,
school districts, and redevelopment successor agencies.
The Senate amendments :
1)Add redevelopment successor agencies to the list of
jurisdictions to be reflected in the graph visualization of
how general ad valorem property tax revenues are allocated
countywide.
2)Clarify that the link provided to the county budget document
shall be the final county budget document.
3)Make other technical and conforming changes.
EXISTING LAW :
1)Requires specified information to be included on each county
tax bill, whether mailed or electronically transmitted or
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included in a separate statement accompanying the bill,
including the following:
a) Value of locally assessed property;
b) Tax rate of a maximum 1% amount of ad valorem tax
imposed on real property;
c) Rate or dollar amount of taxes levied in excess of the
1% limitation to pay for voter approved indebtedness
incurred before July 1, 1978, or bonded indebtedness for
the acquisition of improvement of real property;
d) Amount of any special taxes, special assessments, or
special purpose parcel tax levied;
e) Amount of any tax rate reduction or exemptions; and,
f) Total taxes due and payable on the property covered by
the bill.
AS PASSED BY THE ASSEMBLY , this bill:
1)Required each county to make available to taxpayers on its
Internet Web site a graph visualization of how general ad
valorem property tax revenues are allocated countywide, at a
summarized jurisdictional level that includes, but is not
limited to, the county, cities, independent special districts,
and school districts.
2)Required the Internet Web site to also do the following:
a) Inform taxpayers that the 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, including programs
and services provided by K-12 schools and community
colleges, the county, cities, and special districts;
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b) Provide a brief summary of the types of programs and
services funded with general ad valorem property tax
revenues at a summarized jurisdictional level; and,
c) Include a link to the county budget document where more
information about specific programs and services funded
with general ad valorem property tax revenues is detailed.
3)Required each county to update the graph annually and work to
improve the appearance, organization, and clarity of the
information provided.
4)Provided that if the Commission on State Mandates determines
that this bill contains costs mandated by the state,
reimbursement to local agencies and school districts for those
costs shall be made pursuant to current law governing state
mandated local costs.
FISCAL EFFECT : According to the Senate Appropriations
Committee, unknown state-mandated costs to counties,
reimbursable from the state General Fund, as follows:
1)One-time costs, potentially several hundred thousand dollars
statewide, for each county to create a tool providing a
graphic representation of countywide property tax allocations
on a summarized jurisdictional level, to compile information
on the programs and services funded by property tax revenues,
and post the information and a specified Web site link on the
county website.
2)Likely minor ongoing costs for each county to annually update
the graph and to make improvements in the appearance,
organization, and clarity of the information.
COMMENTS :
1)Purpose of this bill. This bill requires each county to
include on their Web site a graph visualization of how general
ad valorem property tax revenues are allocated countywide at a
summarized jurisdictional level that includes, but is not
limited to, the county, cities, independent special districts,
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school districts, and redevelopment successor agencies, to be
updated annually. Specified information is required to be
included on the Web site including
a brief summary of programs and services funded by property tax
revenue. This bill is author-sponsored.
2)Author's statement. According to the author, "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. For example, 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 lie with which
levels of government. Survey respondents were asked the
following question: 'Of the following choices, on what does
your city or town spend the largest amount of money: public
safety, food stamps, MediCal, or aid to other California
cities, or are you not sure?' Only 25% of survey respondents
correctly identified that public safety was the largest (and
only) municipal expenditure of those listed, and 41% of survey
respondents answered that they did not know.
"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 [1978], voter-approved debt rates
such as payments for school bonds, Mello-Roos taxes, parcel
taxes, and other assessments. Currently, 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.
It is critical that they are provided a receipt for their
payment informing them of the local government services funded
by their payment, similar to any other receipt they receive
when conducting a financial transaction."
3)Property tax. When property owners pay property tax bills to
the county treasurer-tax collector, the funds are transferred
to the county auditor for distribution. According to the
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Legislative Analyst's report entitled, Understanding
California's Property Taxes, "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. On a typical property tax
bill, however, the 1% rate is listed at the general tax levy
or countywide rate with no indication as to which local
governments receive the revenue or for what purpose the funds
are used. In general, county auditors allocate revenue from
the 1% rate to a variety of local governments within the
county pursuant to a series of complex state statutes. More
than 4,000 local governments receive revenue from the 1%
rate."
The allocation system defined in current law was established
by AB 8 (Greene), Chapter 282, Statutes of 1979, commonly
referred to as AB 8. Each county is divided into tax rate
areas, geographical areas within a county served by the same
local governments, county, city, schools, and special
districts. The number of tax rate areas vary - some counties
may have thousands of tax rate areas. Auditors allocate
revenue to local governments, as directed by existing law, by
tax rate area.
The author points to a Contra Costa Grand Jury Report which
concludes that property tax bills give inadequate information
and do not inform the taxpayer on how the 1% countywide tax
dollar is spent. As a result of the Grand Jury Report in
2003, Contra Costa 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, passed out of
the Assembly Local Government Committee on a 7-0 vote and
would have required new information to be included on each
county tax bill that provided a comprehensive account of all
services funded by local governments. AB 920 was later
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amended and 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 failed passage in the Assembly Appropriations
Committee.
5)Arguments in support. Supporters argue that access to this
information will greatly increase taxpayers' understanding of
the roles of property tax revenue and of local government in
providing the services they depend on.
6)Arguments in opposition. None on file.
GOVERNOR'S VETO MESSAGE :
This bill requires each county to develop and annually
update a graph on its Web site that provides taxpayers
with information about how general ad valorem property
tax revenues are allocated countywide, to the county,
cities, independent special districts, school
districts and redevelopment successor agencies.
Providing information to taxpayers about how local
property tax dollars are allocated and spent is
important but this bill would impose a state mandate
on county governments and could result in
corresponding general fund costs. I encourage
counties to put this information on their Web site and
update it accordingly.
Analysis Prepared by : Misa Yokoi-Shelton / L. GOV. / (916)
319-3958
FN: 0005676
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