Bill Text: CA AB668 | 2015-2016 | Regular Session | Chaptered
Bill Title: Property taxation: assessment: affordable housing.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2015-10-09 - Chaptered by Secretary of State - Chapter 698, Statutes of 2015. [AB668 Detail]
Download: California-2015-AB668-Chaptered.html
BILL NUMBER: AB 668 CHAPTERED
BILL TEXT
CHAPTER 698
FILED WITH SECRETARY OF STATE OCTOBER 9, 2015
APPROVED BY GOVERNOR OCTOBER 9, 2015
PASSED THE SENATE SEPTEMBER 8, 2015
PASSED THE ASSEMBLY SEPTEMBER 9, 2015
AMENDED IN SENATE SEPTEMBER 1, 2015
AMENDED IN SENATE JUNE 25, 2015
AMENDED IN ASSEMBLY MAY 5, 2015
AMENDED IN ASSEMBLY MARCH 26, 2015
INTRODUCED BY Assembly Member Gomez
FEBRUARY 25, 2015
An act to amend Section 402.1 of the Revenue and Taxation Code,
relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
AB 668, Gomez. Property taxation: assessment: affordable housing.
Existing law requires the county assessor to consider, when
valuing real property for property taxation purposes, the effect of
any enforceable restrictions to which the use of the land may be
subjected. Under existing law these restrictions include, but are not
limited to, zoning, recorded contracts with governmental agencies,
and various other restrictions imposed by governments.
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.
Under existing property tax law, the welfare exemption applies to
property that is owned and operated by a nonprofit corporation,
otherwise qualifying for the welfare exemption, that is organized and
operated for the purpose of building and rehabilitating
single-family or multifamily residences for sale, as provided, at
cost to low-income families.
This bill would require the county assessor to consider, when
valuing real property for property taxation purposes, a recorded
contract with a nonprofit corporation that meets prescribed
requirements, including requirements that the nonprofit corporation
has received a welfare exemption for properties intended to be sold
to low-income families who participate in a special no-interest loan
program, and that the contract includes a restriction on the use of
the land for at least 30 years to owner-occupied housing available at
affordable housing cost. By changing the manner in which county
assessors assess property for property taxation purposes, this bill
would impose a state-mandated local program.
This bill would incorporate amendments to Section 402.1 of the
Revenue and Taxation Code proposed by AB 1251, to be operative only
if AB 1251 and this bill are both chaptered and become effective on
or before January 1, 2016, and this bill is chaptered last.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 402.1 of the Revenue and Taxation Code is
amended to read:
402.1. (a) In the assessment of land, the assessor shall consider
the effect upon value of any enforceable restrictions to which the
use of the land may be subjected. These restrictions shall include,
but are not limited to, all of the following:
(1) Zoning.
(2) Recorded contracts with governmental agencies other than those
provided in Sections 422, 422.5, and 422.7.
(3) Permit authority of, and permits issued by, governmental
agencies exercising land use powers concurrently with local
governments, including the California Coastal Commission and regional
coastal commissions, the San Francisco Bay Conservation and
Development Commission, and the Tahoe Regional Planning Agency.
(4) Development controls of a local government in accordance with
any local coastal program certified pursuant to Division 20
(commencing with Section 30000) of the Public Resources Code.
(5) Development controls of a local government in accordance with
a local protection program, or any component thereof, certified
pursuant to Division 19 (commencing with Section 29000) of the Public
Resources Code.
(6) Environmental constraints applied to the use of land pursuant
to provisions of statutes.
(7) Hazardous waste land use restriction pursuant to Section 25240
of the Health and Safety Code.
(8) A recorded conservation, trail, or scenic easement, as
described in Section 815.1 of the Civil Code, that is granted in
favor of a public agency, or in favor of a nonprofit corporation
organized pursuant to Section 501(c)(3) of the Internal Revenue Code
that has as its primary purpose the preservation, protection, or
enhancement of land in its natural, scenic, historical, agricultural,
forested, or open-space condition or use.
(9) A solar-use easement pursuant to Chapter 6.9 (commencing with
Section 51190) of Part 1 of Division 1 of Title 5 of the Government
Code.
(10) A contract where the following apply:
(A) The contract is with a nonprofit corporation organized
pursuant to Section 501(c)(3) of the Internal Revenue Code that has
received a welfare exemption under Section 214.15 for properties
intended to be sold to low-income families who participate in a
special no-interest loan program.
(B) The contract restricts the use of the land for at least 30
years to owner-occupied housing available at affordable housing cost
in accordance with Section 50052.5 of the Health and Safety Code.
(C) The contract includes a deed of trust on the property in favor
of the nonprofit corporation to ensure compliance with the terms of
the program, which has no value unless the owner fails to comply with
the covenants and restrictions of the terms of the home sale.
(D) The local housing authority or an equivalent agency, or, if
none exists, the city attorney or county counsel, has made a finding
that the long-term deed restrictions in the contract serve a public
purpose.
(E) The contract is recorded and provided to the assessor.
(b) There is a rebuttable presumption that restrictions will not
be removed or substantially modified in the predictable future and
that they will substantially equate the value of the land to the
value attributable to the legally permissible use or uses.
(c) Grounds for rebutting the presumption may include, but are not
necessarily limited to, the past history of like use restrictions in
the jurisdiction in question and the similarity of sales prices for
restricted and unrestricted land. The possible expiration of a
restriction at a time certain shall not be conclusive evidence of the
future removal or modification of the restriction unless there is no
opportunity or likelihood of the continuation or renewal of the
restriction, or unless a necessary party to the restriction has
indicated an intent to permit its expiration at that time.
(d) In assessing land with respect to which the presumption is
unrebutted, the assessor shall not consider sales of otherwise
comparable land not similarly restricted as to use as indicative of
value of land under restriction, unless the restrictions have a
demonstrably minimal effect upon value.
(e) In assessing land under an enforceable use restriction wherein
the presumption of no predictable removal or substantial
modification of the restriction has been rebutted, but where the
restriction nevertheless retains some future life and has some effect
on present value, the assessor may consider, in addition to all
other legally permissible information, representative sales of
comparable lands that are not under restriction but upon which
natural limitations have substantially the same effect as
restrictions.
(f) For the purposes of this section the following definitions
apply:
(1) "Comparable lands" are lands that are similar to the land
being valued in respect to legally permissible uses and physical
attributes.
(2) "Representative sales information" is information from sales
of a sufficient number of comparable lands to give an accurate
indication of the full cash value of the land being valued.
(g) It is hereby declared that the purpose and intent of the
Legislature in enacting this section is to provide for a method of
determining whether a sufficient amount of representative sales
information is available for land under use restriction in order to
ensure the accurate assessment of that land. It is also hereby
declared that the further purpose and intent of the Legislature in
enacting this section and Section 1630 is to avoid an assessment
policy which, in the absence of special circumstances, considers uses
for land that legally are not available to the owner and not
contemplated by government, and that these sections are necessary to
implement the public policy of encouraging and maintaining effective
land use planning. This statute shall not be construed as requiring
the assessment of any land at a value less than as required by
Section 401 or as prohibiting the use of representative comparable
sales information on land under similar restrictions when this
information is available.
SEC. 1.5. Section 402.1 of the Revenue and Taxation Code is
amended to read:
402.1. (a) In the assessment of land, the assessor shall consider
the effect upon value of any enforceable restrictions to which the
use of the land may be subjected. These restrictions shall include,
but are not limited to, all of the following:
(1) Zoning.
(2) Recorded contracts with governmental agencies other than those
provided in Sections 422, 422.5, and 422.7.
(3) Permit authority of, and permits issued by, governmental
agencies exercising land use powers concurrently with local
governments, including the California Coastal Commission and regional
coastal commissions, the San Francisco Bay Conservation and
Development Commission, and the Tahoe Regional Planning Agency.
(4) Development controls of a local government in accordance with
any local coastal program certified pursuant to Division 20
(commencing with Section 30000) of the Public Resources Code.
(5) Development controls of a local government in accordance with
a local protection program, or any component thereof, certified
pursuant to Division 19 (commencing with Section 29000) of the Public
Resources Code.
(6) Environmental constraints applied to the use of land pursuant
to provisions of statutes.
(7) Hazardous waste land use restriction pursuant to Section 25226
of the Health and Safety Code.
(8) (A) A recorded conservation, trail, or scenic easement, as
described in Section 815.1 of the Civil Code, that is granted in
favor of a public agency, or in favor of a nonprofit corporation
organized pursuant to Section 501(c)(3) of the Internal Revenue Code
that has as its primary purpose the preservation, protection, or
enhancement of land in its natural, scenic, historical, agricultural,
forested, or open-space condition or use.
(B) A recorded greenway easement, as described in Section 816.52
of the Civil Code, that is granted in favor of a public agency, or in
favor of a nonprofit corporation organized pursuant to Section 501
(c)(3) of the Internal Revenue Code that has as its primary purpose
the developing and preserving of greenways.
(9) A solar-use easement pursuant to Chapter 6.9 (commencing with
Section 51190) of Part 1 of Division 1 of Title 5 of the Government
Code.
(10) A contract where the following apply:
(A) The contract is with a nonprofit corporation organized
pursuant to Section 501(c)(3) of the Internal Revenue Code that has
received a welfare exemption under Section 214.15 for properties
intended to be sold to low-income families who participate in a
special no-interest loan program.
(B) The contract restricts the use of the land for at least 30
years to owner-occupied housing available at affordable housing cost
in accordance with Section 50052.5 of the Health and Safety Code.
(C) The contract includes a deed of trust on the property in favor
of the nonprofit corporation to ensure compliance with the terms of
the program, which has no value unless the owner fails to comply with
the covenants and restrictions of the terms of the home sale.
(D) The local housing authority or an equivalent agency, or, if
none exists, the city attorney or county counsel, has made a finding
that the long-term deed restrictions in the contract serve a public
purpose.
(E) The contract is recorded and provided to the assessor.
(b) There is a rebuttable presumption that restrictions will not
be removed or substantially modified in the predictable future and
that they will substantially equate the value of the land to the
value attributable to the legally permissible use or uses.
(c) Grounds for rebutting the presumption may include, but are not
necessarily limited to, the past history of like use restrictions in
the jurisdiction in question and the similarity of sales prices for
restricted and unrestricted land. The possible expiration of a
restriction at a time certain shall not be conclusive evidence of the
future removal or modification of the restriction unless there is no
opportunity or likelihood of the continuation or renewal of the
restriction, or unless a necessary party to the restriction has
indicated an intent to permit its expiration at that time.
(d) In assessing land with respect to which the presumption is
unrebutted, the assessor shall not consider sales of otherwise
comparable land not similarly restricted as to use as indicative of
value of land under restriction, unless the restrictions have a
demonstrably minimal effect upon value.
(e) In assessing land under an enforceable use restriction wherein
the presumption of no predictable removal or substantial
modification of the restriction has been rebutted, but where the
restriction nevertheless retains some future life and has some effect
on present value, the assessor may consider, in addition to all
other legally permissible information, representative sales of
comparable lands that are not under restriction but upon which
natural limitations have substantially the same effect as
restrictions.
(f) For the purposes of this section the following definitions
apply:
(1) "Comparable lands" are lands that are similar to the land
being valued in respect to legally permissible uses and physical
attributes.
(2) "Representative sales information" is information from sales
of a sufficient number of comparable lands to give an accurate
indication of the full cash value of the land being valued.
(g) It is hereby declared that the purpose and intent of the
Legislature in enacting this section is to provide for a method of
determining whether a sufficient amount of representative sales
information is available for land under use restriction to ensure the
accurate assessment of that land. It is also hereby declared that
the further purpose and intent of the Legislature in enacting this
section and Section 1630 is to avoid an assessment policy which, in
the absence of special circumstances, considers uses for land that
legally are not available to the owner and not contemplated by
government, and that these sections are necessary to implement the
public policy of encouraging and maintaining effective land use
planning. This statute shall not be construed as requiring the
assessment of any land at a value less than as required by Section
401 or as prohibiting the use of representative comparable sales
information on land under similar restrictions when this information
is available.
SEC. 2. Section 1.5 of this bill incorporates amendments to
Section 402.1 of the Revenue and Taxation Code proposed by both this
bill and Assembly Bill 1251. It shall only become operative if (1)
both bills are enacted and become effective on or before January 1,
2016, (2) each bill amends Section 402.1 of the Revenue and Taxation
Code, and (3) this bill is enacted after Assembly Bill 1251, in which
case Section 1 of this bill shall not become operative.
SEC. 3. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.
