BILL ANALYSIS                                                                                                                                                                                                    �




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  SB 1464                     HEARING: 4/24/14 
          AUTHOR:  Committee on G&F             FISCAL:  No
          VERSION:  3/13/14                     TAX LEVY:  No
          CONSULTANT:  Grinnell                 

                               PROPERTY TAXATION
          

          Makes four technical, consensus changes to property tax law  
          suggested by the State Board of Equalization.


                           Background and Proposed Law  

          Senate Bill 1464 contains four changes to property tax law  
          suggested by the Board of Equalization (BOE):

          I.  Name Change.  State law directs BOE to determine the  
          interest rate on the capitalization rate that assessors use  
          to value historic property using data published by the  
          Federal Home Finance Board.  However, the Federal Home  
          Finance Board changed its name to the Federal Home Finance  
          Agency, so SB 1464 updates the law to reflect the change.

          II.  Consistent Terms.  When taxpayers file property tax  
          appeals, the appellate body can be either the county board  
          of supervisors sitting as the county board of equalization,  
          or the board can create an assessment appeals board  
          consisting of members with specified qualifications.   
          Unfortunately, some parts of property tax law don't  
          consistently refer to both terms, including disaster relief  
          law.  The bill provides that when assessors notify  
          taxpayers that they're potentially eligible to appeal  
          valuation changes resulting from a disaster, they can  
          appeal to the assessment appeals board in addition to the  
          county board of equalization.  

          III.  Cross reference.  Current law allows for changes in  
          ownership without reassessment, including when a parent or  
          child transfers property to a disabled ward or a child by  
          will, devise, or inheritance.  Revenue and Taxation Code  
          �62, which allows the transfers, relies on a definition for  
          "disability" in subdivision (e) of Section 12304 of the  
          Health and Safety Code, but in 1991, the Legislature  




          SB 1464 (Committee on G&F) - 3/13/14 -- Page 2



          re-lettered the definition to subdivision (d) of that  
          section.  The bill corrects the cross-reference.  

          IV.  Delete superfluous term.  The Public Resources Code  
          uses the term "nonprofit organization" when it allows  
          groups to operate state parks on behalf of the state, but  
          the cross-referenced Revenue and Taxation Code currently  
          uses both "nonprofit corporation" and "nonprofit  
          organization" when exempting these groups from the  
          possessory interest tax.  Because nonprofit organizations  
          need not incorporate to qualify under the Public Resources  
          Code, the bill deletes "nonprofit corporation" from the R&T  
          Code section.  


                               State Revenue Impact
           
          BOE states that the measure has no impact on property tax  
          revenues.


                                     Comment  

           Purpose of the bill  .  SB 1464 is this year's omnibus  
          property tax law cleanup bill, and makes four technical,  
          consensus changes intended to improve tax administration  
          for taxpayers, assessors, and BOE.  By combining four  
          changes into one bill, there's no need for individual  
          legislative bills for each change.  The bill is a consensus  
          project: should anyone object to any provision of the bill,  
          it's removed.


                         Support and Opposition  (4/21/14)

           Support  :  State Board of Equalization.

           Opposition  :  None Received.