Bill Text: CA AB1788 | 2011-2012 | Regular Session | Amended
Bill Title: Property taxation: welfare exemption: course of
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2012-05-25 - In committee: Set, first hearing. Held under submission. [AB1788 Detail]
Download: California-2011-AB1788-Amended.html
BILL NUMBER: AB 1788 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 22, 2012
INTRODUCED BY Assembly Member Morrell
FEBRUARY 21, 2012
An act to amend Sections 214.1 and 214.2 of the Revenue and
Taxation Code, relating to taxation, to take effect immediately, tax
levy.
LEGISLATIVE COUNSEL'S DIGEST
AB 1788, as amended, Morrell. Property taxation: welfare
exemption: course of construction.
(1) Pursuant to authorization in the California Constitution,
existing property tax law establishes a welfare exemption under which
property is exempt from taxation if, among other things, that
property is used exclusively for religious, hospital, scientific, or
charitable purposes and is owned and operated by an entity, as
provided, that is itself organized and operated for those purposes.
The California Constitution specifies that this exemption applies to
buildings under construction, the land on which the buildings are
situated, and equipment in the buildings if their intended use is
exclusively for exempt purposes. Existing property tax law specifies
that property used exclusively for religious, hospital, or charitable
purposes includes facilities in the course of construction, as
defined, and the land on which the facilities are located.
This bill would, pursuant to these constitutional provisions,
additionally specify that property used exclusively for those
purposes includes equipment in those facilities, as provided. This
bill would also define "course of construction" to include
the period subsequent to an owner filing a completed application for
a building permit "facilities in the course of
construction" to include prospective construction or rehabilitation
of a new or existing building or improvement, evidenced by an
application for a building permit, if that building or improvement
will be used exclusively for religious, hospital, or charitable
purposes and if construction commences within 12 months of the date
that the permit is approved , as provided.
(2) Section 2229 of the Revenue and Taxation Code requires the
Legislature to reimburse local agencies annually for certain property
tax revenues lost as a result of any exemption or classification of
property for purposes of ad valorem property taxation.
This bill would provide that, notwithstanding Section 2229 of the
Revenue and Taxation Code, no appropriation is made and the state
shall not reimburse local agencies for property tax revenues lost by
them pursuant to the bill.
(3) This bill would take effect immediately as a tax levy, but its
operation would commence with the lien date for the 2013-14 fiscal
year.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 214.1 of the Revenue and Taxation Code is
amended to read:
214.1. (a) As used in Section 214, property used exclusively for
religious, hospital or charitable purposes includes facilities in the
course of construction on or after the first Monday of March, 1954,
together with the land on which the facilities are located and the
equipment in the facilities as may be required for their convenient
use and occupation, if the intended use of the facilities, land, and
equipment is exclusively for religious, hospital or charitable
purposes.
(b) The amendments made to this section by the act adding this
subdivision are enacted pursuant to subdivision (b) of Section 4 and
Section 5 of Article XIII of the California Constitution.
SEC. 2. Section 214.2 of the Revenue and Taxation Code is amended
to read:
214.2. (a) As used in Section 214.1, "facilities in the course of
construction" shall include the demolition or razing of a building
with the intent to replace it with facilities to be used exclusively
for religious, hospital, or charitable purposes.
(b) As used in Section 214.1, "facilities in the course of
construction" shall include definite onsite physical activity
connected with construction or rehabilitation of a new or existing
building or improvement, that results in changes visible to any
person inspecting the site, where the building or improvement is to
be used exclusively for religious, hospital, or charitable purposes.
Activity as described in the preceding sentence having been commenced
and not yet finished, unless abandoned, shall establish that a
building or improvement is "under construction" for the purposes of
Section 5 of Article XIII of the California Constitution.
Construction shall not be considered "abandoned" if delayed due to
reasonable causes and circumstances beyond the assessee's control,
that occur notwithstanding the exercise of ordinary care and the
absence of willful neglect.
(c) (1) As used in Section 214.1, "facilities in the course of
construction" shall include prospective construction or
rehabilitation of a new or existing building or improvement, as
evidenced by application to the local planning or building department
for a building permit, if the both of the
following occur:
(A) The building or
improvement is to be used exclusively for religious, hospital, or
charitable purposes. Exempt
(B) The construction commences within
12 months of the date on which the building permit is approved.
(2) Exempt status shall be
granted and any tax, penalty, or interest levied on the exempt
portion of the assessment shall be canceled or refunded upon
confirmation that the physical activity described in subdivision (b)
has commenced.
(2)
(3) For property acquired or not existing until after
the lien date, any exemption allowed pursuant to paragraph (1) shall
be applied retroactively to the date of the permit application in
accordance with the procedures contained in Sections 271 and 272, and
shall be subject to the four-year limitation set forth in
subdivision (a) of Section 4831.
SEC. 3. Notwithstanding Section 2229 of the Revenue and Taxation
Code, no appropriation is made by this act and the state shall not
reimburse any local agency for any property tax revenues lost by it
pursuant to this act.
SEC. 4. This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.
However, the amendments made to Sections 214.1 and 214.2 of the
Revenue and Taxation Code by this act are operative commencing with
the lien date for the 2013-14 fiscal year.
