Property taxation.

(1) The California Constitution generally limits ad valorem taxes on real property to 1% of the full cash value of that property. For purposes of this limitation, "full cash value" is defined as the assessor's valuation of real property as shown on the 1975–76 tax bill under "full cash value" or, thereafter, the appraised value of that real property when purchased, newly constructed, or a change in ownership has occurred. However, the California Constitution and existing property tax law exclude from a "change in ownership" real property transfers of a principal residence and the first $1,000,000 of the value of other real property between parents and their children, as defined by the Legislature. Existing law defines "real property" to mean the possession of, claim to, ownership of, or right to possession of land; all mines, minerals, and quarries in the land; and improvements to the land. However, real property does not include an interest in a legal entity. This bill would define real property for purposes of the parent-child principal residence exclusion to include an interest in a unit or lot within a cooperative housing corporation, as defined. By changing the manner in which local assessors assess property for purposes of the parent-child principal residence exclusion, and by expanding the crime of perjury by requiring that certain information required be verified under oath, this bill would impose a state-mandated local program. (2) The California Constitution and existing property tax law authorize the base year value of property that is substantially damaged or destroyed by a disaster, as declared by the Governor, to be transferred to comparable property within the same county, which is acquired within 5 years after the disaster, as provided. Existing property tax law authorizes a county board of supervisors to adopt an ordinance that authorizes the transfer, subject to specified conditions and limitations, of the base year value of property that is located within another county in this state and that has been substantially damaged or destroyed by a disaster to comparable replacement property, as provided. Existing property tax law provides that a property is substantially damaged or destroyed if the land or the improvements sustain physical damage amounting to more than 50% of its full cash value immediately prior to the disaster. This bill would, commencing with the 2012–13 fiscal year, provide that property is substantially damaged or destroyed if either the land or the improvements sustain physical damage amounting to more than 50% of either the land's or the improvement's full cash value immediately prior to the disaster. By changing the manner in which local assessors assess property for purposes of the property tax relief described above, this bill would impose a state-mandated local program. (3) The California Constitution and existing property tax law authorize a person who is either severely disabled or over 55 years of age to transfer the base year value, as defined, of specified property to a replacement dwelling located within the same county, except as otherwise provided, as the property from which the base year value is transferred if, among other things, the person claiming the property tax relief is an owner or resident of the original property at the time when the original property was substantially damaged or destroyed by misfortune or calamity. Existing property tax law provides that a property is substantially damaged or destroyed by misfortune or calamity if it sustains physical damage to more than 50% of its full cash value immediately prior to the damaging event. This bill would, commencing with the 2012–13 fiscal year, provide that property is substantially damaged or destroyed by misfortune or calamity if either the land or improvements sustain physical damage amounting to more than 50% of the property's full cash value immediately prior to the misfortune or calamity. By changing the manner in which local assessors assess property for purposes of the property tax relief described above, this bill would impose a state-mandated local program. (4) Existing property tax law allows a person over the age of 55 years or a severely and permanently disabled person to transfer the base year value of his or her property, if that property is eligible for the homeowners' exemption, to any replacement dwelling of equal or lesser value, as specified. This law requires an owner to notify the assessor in writing of the completion of new construction to a replacement dwelling within 30 days of completion. This bill would extend the amount of time that an owner has to notify the assessor of the completion of new construction to within 6 months of completion. (5) Pursuant to an authorization in the California Constitution, existing property tax law excludes from classification as "newly constructed" and "new construction" the construction or reconstruction on that portion of an existing structure of seismic retrofitting components. Existing property tax law, for purposes of this exclusion from classification as "newly constructed," provides that "seismic retrofitting" includes those items referenced in the Uniform Code for Building Conservation of the International Conference of Building Officials, and requires "improvements utilizing earthquake hazard mitigation technologies" to use, among others, technologies referenced in the Uniform Building Code. This bill would update obsolete references to the Uniform Code for Building Conservation of the International Conference of Building Officials and to the Uniform Building Code, by instead referring to the International Existing Building Code of the International Code Council and to the International Building Code. (6) Pursuant to an authorization in the California Constitution, existing property tax law excludes from classification as "newly constructed" and "new construction" the construction, installation, removal, or modification of a portion or structural component of an existing building or structure on or after June 7, 1994, to the extent that it is done for the purpose of making the building more accessible to, or more usable by, a disabled person. The bill would make a technical, nonsubstantive change to correct an obsolete reference. (7) Existing property tax law specifies, with regard to a supplemental assessment, that property tax exemptions shall not apply to a property as of the date of a change in ownership if the transferee did not otherwise qualify for that exemption on the date of the change in ownership. This bill would delete this provision. (8) Existing property tax law provides for an exemption, as specified, for property that is used for college, cemetery, church, religious, exhibition, veterans' organization, tribal housing, or welfare purposes if certain conditions are met, as specified. Existing property tax law also provides for an exemption, as specified, of the home of a disabled veteran, or a veteran's spouse in the case in which the veteran has, as a result of a service-connected disease or injury, died while on active duty in military service, and specifies the termination of this exemption upon that subject property being transferred to a 3rd party that is not eligible for that exemption. This bill would specify the termination of the college, cemetery, church, religious, exhibition, veterans' organization, tribal housing, or welfare exemptions upon the subject property being transferred to a 3rd party that is not eligible for that exemption. The bill would make related changes. By changing the manner in which property tax assessments are administered by county assessors, this bill would impose a state-mandated local program. (9) Existing property tax law provides for the disabled veterans' property tax exemption contingent upon a claim being filed, as specified. Existing property tax law requires, if property becomes eligible for the exemption after the lien date and an appropriate application is filed on or before the lien date in the calendar year next following the calendar year in which the property became eligible, the refund or cancellation of taxes on that portion of the assessed value of the property that would have been exempt under a timely and appropriate application. This bill would, instead, require the refund or cancellation of taxes, if an appropriate application for the exemption is filed on the later of 90 days after the date on which the property became eligible or on or before the next following lien date. (10) Existing property tax law requires the county assessor each year to mail a notice to all disabled veterans who received the disabled veterans' property tax exemption in the immediately preceding year, as specified. This bill would instead require, prior to the lien date, the assessor to annually mail a notice to all claimants who received the disabled veterans' property tax exemption in the immediately preceding year. By requiring local officials to additionally provide notice to a disabled veteran's spouse and an unmarried surviving spouse who received the disabled veterans' property tax exemption, this bill would impose a state-mandated local program. (11) Existing property tax law requires a person or legal entity to file a change in ownership statement whenever there occurs any change in ownership of real property or of a manufactured home, as specified, whenever a person or entity obtains a controlling or majority ownership interest in a legal entity, or whenever an entity makes specified transfers of ownership interests in the legal entity. Existing law imposes a penalty if a person or legal entity required to file a change in ownership statement fails to do so within a specified time period from the date of a written request by either the assessor or the State Board of Equalization, as applicable. Existing property tax law authorizes the county board of supervisors to order this penalty abated, if an assessee establishes that the failure to file a change in ownership statement within a specified time period was due to reasonable cause and not due to willful neglect, and the assessee has filed the change in ownership statement with either the assessor or the State Board of Equalization, as applicable, and an application for abatement of the penalty with the county board of supervisors, as provided. This bill would, instead, authorize the county board of equalization or the assessment appeals board to order the penalty abated, and would, instead, require an application for abatement of the penalty to be filed with the county board of equalization or the assessment appeals board. (12) The California Constitution requires the State Board of Equalization to assess the property, other than franchises, of specified types of entities. Existing property tax law provides for the valuation, as a unit, of properties of a state assessee that are operated as a unit as a primary function of that assessee. Existing property tax law requires a state assessee, upon the board's request, and in compliance with the applicable deadlines, to file a property statement relating to its state-assessed property. Existing law imposes penalties upon a taxpayer's failure to timely file a required property statement, including a penalty of 10% of unitary value with respect to that part of the property statement relating to the development of the unitary value of operating property, and a penalty of 10% of the allocated value of property with respect to that part of the property statement that lists or describes specific operating property, and requires the imposition of an additional 25% penalty if the failure to file is a willful or fraudulent attempt to evade tax. Existing law also imposes an additional 10% penalty, as specified, upon the failure of a state assessee to either timely file a property statement or to accurately report taxable tangible personal property on a property statement, if that failure requires the board to make a subsequent assessment of the value of property that escaped assessment, and requires the imposition of an additional 25% penalty if the failure to file or report is willful or fraudulent. Existing law authorizes the board to abate these penalties if the assessee establishes that the failure to file was due to reasonable cause, but only if the assessee timely files an application for abatement of the penalty. This bill would expressly provide for the board to abate the penalties, as described above, in whole or in part. (13) Existing property tax law establishes various requirements and procedures for the assessment of property and the compilation of the tax assessment rolls. Existing property tax law generally authorizes the correction, subject to specified time requirements, of any error that results in an incorrect entry on the property tax roll, except for, among other things, an error that involves the exercise of value judgment, but authorizes the correction of any error or omission involving the exercise of a value judgment that arises solely from a failure to reflect a decline in taxable value of real property, as provided. This bill would extend this authority to correct the roll with regard to an error or omission involving the exercise of a value judgment that arises solely from a failure to reflect a decline in taxable value, to floating homes and manufactured homes, as provided. (14) The Private Railroad Car Tax Law imposes a tax, computed as specified, on private railroad cars, as defined, operated in this state, and is administered by the State Board of Equalization. Existing law requires the board, once it proposes to make a determination to grant a refund for the overpayment of that tax of over $15,000 or a cancellation of amounts due of over $15,000, to make those proposed determinations available as a public record for a specified amount of time, as provided. This bill would raise the threshold for the public record requirement regarding the State Board of Equalization's determinations in the above-described circumstances to $50,000. (15) Existing property tax law requires the personal property of an aircraft be taxed at its fair market value, and the California Constitution requires property subject to ad valorem property taxation to be assessed in the county in which it is situated. This law defines "certificated aircraft," "air taxi," and "aircraft." This bill would replace obsolete statutory references to the "Civil Aeronautics Board of the United States" with the "Federal Aviation Administration," would delete other obsolete statutory references to the "California Public Utilities Commission" in these definitions, and would make other technical, nonsubstantive changes. (16) Existing property tax law authorizes any person filing an affidavit of interest to apply to the tax collector to have any parcel separately valued on the current roll for the purpose of paying taxes, and requires the application to be made during the current fiscal year and to set forth specific information describing the parcel sought to be separately valued. Existing law authorizes a county, upon approval of the board of supervisors, to prohibit these applications during the 10 working days preceding each tax installment delinquency date and during the 10 working days preceding June 30 of each year. This bill would instead authorize the county to allow these applications between July 1 and March 31. (17) 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 with regard to certain mandates no reimbursement is required by this act for a specified reason. With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above. (18) 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.