Property taxation: welfare exemption: facilities in the course of construction: low-income rental housing.

Existing property tax law, in accordance with the California Constitution, provides for a "welfare exemption" for property used exclusively for religious, hospital, scientific, or charitable purposes and owned or operated by certain types of nonprofit entities, if certain qualifying criteria are met. Under existing property tax law, property that meets these requirements that is used exclusively for rental housing and related facilities is entitled to a partial exemption, equal to that percentage of the value of the property that is equal to the percentage that the number of units serving lower income households represents of the total number of residential units, in any year that any of certain criteria apply. Existing property tax law, in accordance with the California Constitution, specifies that "property used exclusively for religious, hospital, or charitable purposes" includes facilities in the course of construction, and specified land on which the facilities are located, to be used for those purposes. Existing property tax law further specifies that "facilities in the course of construction" includes for these purposes 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. This bill, for lien dates on and after January 1, 2021, and before January 1, 2026, would specify that "facilities in the course of construction" for these purposes also includes the acquisition of property or control of a site by an organization meeting the applicable constitutional and statutory requirements of the welfare exemption with the intent of using that property for a low-income housing project eligible for a partial exemption, as described above. Existing law requires any bill introduced on or after January 1, 2020, that would authorize certain tax expenditures, as defined, to identify specific goals, purposes, and objectives that the expenditure will achieve, detailed performance indicators, and data collection requirements. This bill would state the intent of the Legislature to comply with these requirements with respect to the changes made by the bill. 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. This bill would take effect immediately as a tax levy.