Bill Text: CA SB862 | 2021-2022 | Regular Session | Amended
Bill Title: Property tax: exemptions: personal property used for space flight activities.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2022-05-19 - May 19 hearing: Held in committee and under submission. [SB862 Detail]
Download: California-2021-SB862-Amended.html
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Amended
IN
Senate
April 27, 2022 |
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Amended
IN
Senate
April 21, 2022 |
CALIFORNIA LEGISLATURE—
2021–2022 REGULAR SESSION
Senate Bill
No. 862
| Introduced by Senator Umberg (Coauthor: Assembly Member Quirk-Silva) |
January 20, 2022 |
An act to amend Section 242 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
SB 862, as amended, Umberg.
Property tax: exemptions: personal property used for space flight activities.
The California Constitution authorizes the Legislature to classify personal property for differential taxation or for exemption by means of a statute approved by a 2/3 vote of the membership of each house. Pursuant to this constitutional authorization, existing property tax law, for the January 1, 2014, lien date to and including the January 1, 2024, lien date, exempts qualified property, as defined, for use in space flight, including tangible personal property that has space flight capacity, as specified. Existing law repeals this exemption as of July 1, 2025. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives the tax expenditure will achieve, detailed performance indicators, and data collection
requirements.
This bill would extend the above-described repeal date from July 1, 2025, to July 1, 2033, thereby extending operation of the exemption for qualified property for use in space flight. The bill, on or after January 1, 2022, would also expand the exemption for qualified property used in space flight to include tangible personal property used for space flight activities, including tangible personal property that has a role as ground support equipment for space flight launch preparation and operations, as specified, or that has role in testing space flight engines and components at a test site, as specified. The bill would also extend the operation of this exemption indefinitely. The bill would state the intent of the Legislature to comply with the additional information requirement for any bill authorizing a new tax expenditure.
By expanding the scope of this exemption, and
by extending the operation of this exemption indefinitely, exemption, and by requiring county assessors to provide specified information, this bill would impose a state-mandated local program.
Existing law requires any bill authorizing a new tax expenditure, as defined to include tax credits, to contain, among other things, specific goals, purposes, and objectives that the tax credit will achieve, detailed performance indicators, and data collection requirements.
This bill would include findings and reporting requirements in compliance with this requirement.
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 the statutory provisions noted above.
Existing law requires the state 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 those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill.
Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.
This bill would make legislative findings to that effect.
This bill would take effect immediately as a tax levy.
Digest Key
Vote: 2/3 Appropriation: NO Fiscal Committee: YES Local Program: YESBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 242 of the Revenue and Taxation Code is amended to read:242.
(a) There is exempted from the taxes imposed by this part qualified property used for space flight activities.(b) For purposes of this section:
(1) “Qualified property” means any of the following:
(A) Tangible personal property, whether raw materials, work in process or finished goods, that has, or upon manufacture, assembly, or installation has, any of the following:
(i) Space flight capacity, including, but not limited to, an orbital space facility, space propulsion system, space vehicle, launch vehicle,
satellite, or space station of any kind, and any component thereof, regardless of whether that property is to be ultimately returned to this state.
(ii) A role as ground support equipment for space flight launch preparation and operations, including any of the following:
(I) Equipment necessary to distribute commodities to the launch site, space propulsion system, space vehicle, or launch vehicle.
(II) Housing data and communication support systems.
(III) Testing space propulsion systems, space vehicles, or launch vehicles, or any component thereof.
(iii) A role in testing space flight engines and
components at a test site, including any of the following:
(I) Test stands for testing liquid propulsion rocket engines, rocket structural elements, and integrated rocket assemblies, including all propellant and commodity delivery systems.
(II) Instrumentation, command, and control systems for operating test stands.
(III) Environmental protection, safety, and occupational health equipment.
(B) Fuel of a quality that is not adaptable for use in ordinary motor vehicles, but is produced, sold, and used exclusively for space flight.
(2) “Space flight” means any flight designed for
suborbital, orbital, or interplanetary travel by a space vehicle, satellite, space facility, or space station of any kind.
(c) The exemption established by this section shall not be denied by reason of failure, postponement, or cancellation of a launch of a space vehicle, satellite, space facility, or space station of any kind, or the destruction of any launch vehicle or ground support equipment, or any component of a launch vehicle or ground support equipment.
(d) This section shall be operative from the January 1, 2014, lien date to, and including, the January 1, 2032, lien date, and for every
is inoperative for any lien date thereafter.
(e) A taxpayer shall provide, upon request of the assessor, evidence that the qualified property exempted from the taxes imposed by this part pursuant to this section has been or will be used as described in subparagraph (A) of paragraph (1) of subdivision (b).
(f) The exemption provided by this section from the taxes imposed by this part shall be limited to taxpayers that have a primary business purpose in space flight activities.
(g) The amendments made to this section by the act adding this subdivision shall apply commencing with the January 1, 2022, lien date and for every lien date thereafter.
thereafter, until the January 1, 2032, lien date.
(h) This section shall remain in effect only until July 1, 2033, and as of that date is repealed.
It is the intent of the Legislature to comply with Section 41 of the Revenue and Taxation Code.
SEC. 2.
For purposes of complying with Section 41 of the Revenue and Taxation Code, with respect to Section 242 of the Revenue and Taxation Code, as amended by this act, the Legislature finds and declares all of the following:(a) The specific goal, purpose, and objective that the credit will achieve include increasing employment and investment in California in the space flight, launch, engine, and vehicle testing industry in California relative to other states with comparable infrastructure and capacity to support this industry.
(b) Detailed performance indicators for the Legislature to use in determining whether the exemption meets the goals, purposes, and objectives described in subdivision (a) are:
(1) The change in the number of employees in the space flight industry in California resulting from the exemption.
(2) The change in the compensation amounts of employees in the space flight industry in California resulting from the exemption.
(3) The change in the amount of investment made in space flight, launch, engine, and vehicle testing facilities in California resulting from the exemption.
(c) (1) By January 1, 2033, the Legislative Analyst’s Office shall provide to the Assembly Committee on
Revenue and Taxation, the Senate Committee on Governance and Finance, and the public a report that summarizes its findings regarding the performance indicators described in subdivision (b). In researching the report, the Legislative Analyst’s Office may request and receive information from county assessors, the State Board of Equalization, taxpayers benefitting from the exemption, trade associations, or other individuals or entities.
(2) County assessors and the State Board of Equalization shall provide information specified by the Legislative Analyst’s Office as needed to research the report required by this subdivision.
(3) Information received by the Legislative Analyst’s Office shall be subject to the appropriate confidentiality requirements of the State Board of Equalization or the county assessor, or shall be confidential at the request of the taxpayer.
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.SEC. 4.
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. 5.
The Legislature finds and declares that Section 2 of this act imposes a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:The section balances the public’s right of access with taxpayers’ right to privacy.
