Bill Text: CA AB2021 | 2021-2022 | Regular Session | Amended
Bill Title: Property tax sales: access to tax-defaulted property information.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Engrossed - Dead) 2022-08-11 - In committee: Held under submission. [AB2021 Detail]
Download: California-2021-AB2021-Amended.html
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Amended
IN
Assembly
May 19, 2022 |
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Amended
IN
Assembly
April 07, 2022 |
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Amended
IN
Assembly
March 24, 2022 |
| Introduced by Assembly Member Wicks |
February 14, 2022 |
LEGISLATIVE COUNSEL'S DIGEST
This bill would expand the definition of “nonprofit organization” for purposes of tax-defaulted property sales to include community housing development organizations and community land trusts. The bill would require a tax collector, before conducting a tax sale to a nonprofit organization, to evaluate if there is a way to bring a homeowner current on their taxes if the property is owner occupied. The bill would redefine the term “low-income persons” as “low- or moderate-income households” for purposes of tax-defaulted property sales. The bill would make other conforming changes in this regard.
This bill would require the State Controller’s
office and the Committee on County Tax Collecting Procedures to convene a joint advisory group on tax-defaulted property sales that considers the landscape of tax sales across the state and engages stakeholders to promote the usage of tax sales for affordable low- and moderate-income housing production. The bill would require the joint advisory group to submit a report to the Legislature by January 1, 2024, that includes recommendations and best practices for facilitating the sale of tax delinquent properties to nonprofit organizations and local governments. The bill would repeal the provisions establishing the joint advisory group on January 1, 2025.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YESBill Text
The people of the State of California do enact as follows:
(a)Notwithstanding any other provision of law, any county, city, city and county, or any nonprofit organization as defined in Section 3772.5, may request the tax collector to bring to the next scheduled public auction any residential real property that meets all of the following requirements:
(1)The property taxes have been delinquent for at least three years.
(2)The real property will serve the public benefit of providing housing directly related to low- or
moderate-income households.
(3)The real property is not occupied by the owner as
their principal place of residence.
(b)Every request submitted to the tax collector shall include the following:
(1)A formal resolution of the governing board of the county, city, city and county, or nonprofit organization, requesting the accelerated auction of the real property and stating the public benefit.
(2)A written plan for the development, rehabilitation, or proposed
use of the real property and how low- or moderate-income households will be served.
(c)Upon receiving a request as provided by this section, the tax collector shall include the real property in the next scheduled public auction.
(d)(1)If the real property is acquired by a nonprofit organization at auction, a deed restriction shall be placed on the real property, requiring the real property to be used for housing
for low- or moderate-income households for a period of at least 30 years.
(2)(A)In lieu of the 30-year restriction required by paragraph (1), the deed may provide for equity sharing upon resale, if the real property is a single-family home that will be sold by the nonprofit organization to a low- or moderate-income owner-occupant.
(B)To the extent not in conflict with another public funding source or law, all of the following shall apply to an equity-sharing agreement provided for by the deed:
(i)Upon resale by an owner-occupant of the home, the owner-occupant of the home shall retain the market value of any improvements, the downpayment, and their proportionate share of appreciation. The nonprofit organization shall recapture any initial subsidy and its proportionate share of appreciation, which shall then be used for the purpose of providing financial assistance to low- or moderate-income homebuyers.
(ii)For purposes of this subdivision, the initial subsidy shall be equal to the fair market value of the home at the time of initial sale to the
low- or moderate-income owner-occupant minus the initial sale price to
the low- or moderate-income owner-occupant, plus the amount of any downpayment assistance or mortgage assistance. If upon resale by the owner-occupant the market value is lower than the initial market value, then the value at the time of the resale shall be used as the initial market value.
(iii)For purposes of this subdivision, the nonprofit organization’s proportionate share of appreciation shall be equal to the ratio of the initial subsidy to the fair market value of the home at the time of initial sale.
(e)This section may not be construed to preclude the application, to the real
property or the current owners of that property, of any other provision of law not in conflict with this section.
In addition to the provisions of Sections 3695 and 3695.4 relative to objections to sales, any nonprofit organization may file with the county tax collector written objection to the sale for taxes of, and a written application to purchase in accordance with Chapter 8 (commencing with Section 3771), any residential or vacant real property that the nonprofit organization states in writing that it will:
(a)In the case of residential real property, rehabilitate the property and:
(1)Sell or rent to low- or moderate-income households. This includes:
(A)Low- or moderate-income supportive housing, as defined in Section 50675.14 of the Health and Safety Code.
(B)Low- or moderate-income housing which includes on-site supportive services, as defined in Section 65582 of the Government Code.
(2)Otherwise use the property to serve low- or moderate-income households.
(b)In the case of vacant real property, one or more of the following:
(1)Construct residential dwellings on the property and sell or rent the property to low- or moderate-income households.
(2)Otherwise use the property to serve low- or moderate-income households.
(3) Dedicate the vacant property to public use, including those uses referred to in subdivision
(a) and the following:
(A)Open space for public use.
(B)Open space for use for the production of food sold for the benefit of the community in which it is situated.
The objection and application shall be filed with the tax collector before the date of the first publication or posting of the notice of intended sale pursuant to Sections 3702 and 3703. If the nonprofit organization files an objection and application in compliance with this section and with any conditions of sale established pursuant to Section 3795.5, the tax collector may not proceed with the sale of the property.
The terms “nonprofit organization,”
“low- or moderate-income households” and “rehabilitation” shall have the same meaning in this section as in Chapter 8 (commencing with Section 3771).
For purposes of this chapter:
(a)“Low- or moderate-income households” means persons and families of low or moderate income, as defined by Section 50093 of the Health and Safety Code.
(b)(1)“Nonprofit organization” means a nonprofit organization incorporated pursuant to Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the
Corporations Code for the purpose of acquisition of either of the following:
(A)Single-family or multifamily dwellings for rehabilitation and sale or rent to low- or moderate-income households or for other use to serve
low- or moderate-income households.
(B)Vacant land for construction of residential dwellings and subsequent sale or rent to low- or moderate-income households, for other use to serve low- or moderate-income households,
or for dedication of that vacant land to public use.
(2)A nonprofit organization which proposes to construct or rehabilitate housing for low- or moderate-income households must also meet the following criteria:
(A)It has a letter from the Internal Revenue Service affirming its tax-exempt status pursuant to Section 501(c)(3) of the Internal Revenue Code and is not a private foundation as that term is defined in Section 509 of the Internal Revenue Code.
(B)It is based in California.
(C)It has developed deed-restricted affordable rental or homeownership housing in California.
(3)“Nonprofit organization” includes both of the following:
(A)A community housing development organization, as described in Section 92.300 of Title 24 of the Code of Federal Regulations.
(B)A community land trust, as defined in clause (ii) of subparagraph (C) of paragraph (11) of subdivision (a) of Section 402.1.
(c)“Rehabilitation” means repairs and improvements to a substandard building, as defined in Section 17920.3 of the Health and Safety Code, necessary to make it a building that is not a substandard building.
Whenever property tax defaulted for five years or more, or three years or more in the case of nonresidential commercial property, as defined in Section 3691, in an applicable county, has been sold for taxes for two or more years or has been deeded for taxes to a taxing agency other than the state, the governing body of the taxing agency may, as provided in this article, make an agreement with the board of supervisors of the county in which the property is situated for the purchase of, or
for an option to purchase, all or any of the tax-defaulted property or any part thereof including a right-of-way or other easement. When a part of a tax-defaulted parcel is sold the balance continues subject to redemption, if the right of redemption has not been terminated, and shall be separately valued for the purpose of redemption in the manner provided by Chapter 2 (commencing with Section 4131) of Part 7 of this division, except that no application need be made.
Whenever property has been tax defaulted for five years or more, or three years or more in the case of nonresidential commercial property, as defined in Section 3691, in an applicable county, whether or not the property is subject to or has been sold or deeded for taxes to a taxing agency other than the state, the state, county, or any revenue district the taxes of which on the property are collected by county officers
may purchase the property or any part thereof, including any right-of-way or other easement, pursuant to this chapter.
(a)When residential or vacant property has been tax defaulted for five years or more, or three years or more after the property has become tax defaulted and is subject to a nuisance abatement lien, that property may, with the approval of the board of supervisors of the county in which it is located, be purchased pursuant to this chapter by a nonprofit organization, provided that:
(1)In the case of residential property, the nonprofit organization shall rehabilitate the property and:
(A)Sell or rent the property to low- or moderate-income households.
(B)Otherwise use the property to serve low- or moderate-income households.
(2)In the case of vacant property, the nonprofit organization shall do one or more of the following:
(A)Construct residential dwellings on the property and sell or rent the property to low- or moderate-income households.
(B)Otherwise use the property to serve low- or
moderate-income households.
(C)Dedicate the vacant property to public use.
(b)The terms and conditions of any conveyance to a nonprofit corporation pursuant to this section shall be specified in the deed or other instrument of conveyance.
(c)Prior to conducting a sale in a property which is owner occupied, alternatives will continue to be evaluated thoroughly to determine if there is a way to bring the homeowner current on their taxes, instead of selling their home in a tax sale.
In the case of an agreement involving a nonprofit organization, the board of supervisors may establish conditions of sale, including reporting, to assure the completion of rehabilitation within a reasonable time and maximum benefit to low- or moderate-income households. These conditions shall include, but are not limited to, the following:
(a)Requiring compliance with a jurisdiction’s consolidated plan or a community development plan.
(b)Articles of incorporation filed
with the Secretary of State, stating that the organization is incorporated for the purposes specified in subdivision (b) of Section 3772.5.
SEC. 8.SECTION 1.
Chapter 8.5 (commencing with Section 3850) is added to Part 6 of Division 1 of the Revenue and Taxation Code, to read:CHAPTER 8.5. Access to Tax-Defaulted Property Information
3850.
(a) Every tax collector shall include all of the following in at least one location on their internet website:3851.
Annually beginning January 1, 2024, the State Controller’s office shall post a report on its internet website which includes all the following information for the state and for each county:(a)The State Controller’s office and the Committee on County Tax Collecting Procedures established pursuant to Section 30302 of the Government Code shall convene a joint advisory group on the Chapter 7 (commencing with Section 3691) and Chapter 8 (commencing with Section 3771) tax defaulted sale process, which will do the following:
(1)Consider the current landscape of Chapter 7 (commencing with Section 3691) and Chapter 8 (commencing with Section 3771) tax sales across the state.
(2)Engage stakeholders to promote usage of Chapter 7 (commencing with Section 3691) and Chapter 8 (commencing with Section 3771) tax sales for affordable low- and moderate-income housing
production, including, but not limited to:
(A)Community land trusts.
(B)Nonprofit housing organizations.
(C)Local government representatives.
(D)Academic researchers.
(E)Organizations with past or current pilot programs.
(3)On or before January 1, 2024, report to the Legislature pursuant to Section 9795 of the Government Code on recommendations and best practices for facilitating the sale of tax delinquent properties pursuant to this part to nonprofit organizations and local governments.
(b)The joint advisory group may meet virtually.
(c)This section shall remain in effect until January 1, 2025, and as of that date is repealed.
