AB 672 California Assembly · 2025-2026 Regular Session

Real property tax: welfare exemption: community land trusts.

Summary

Existing property tax law, pursuant to constitutional authorization, provides for a "welfare exemption" for property used exclusively for religious, hospital, scientific, or charitable purposes and that is owned or operated by certain types of nonprofit entities, if certain qualifying criteria are met. Existing law also provides, until January 1, 2027, that property is within the welfare exemption if that property is owned by a community land trust, as defined, otherwise qualifying for the welfare exemption, and specified conditions are met, including that the property is being or will be developed or rehabilitated as housing, as specified. Existing law, however, makes community land trusts liable for property tax for the years for which the property was exempt from taxation if the property was not developed or rehabilitated, or if the development or rehabilitation is not in the course of construction, by January 1, 2027, for property acquired before January 1, 2022, or within 5 years of the lien date following acquisition of the property, for property acquired on and after January 1, 2022. This bill would extend the operation of these provisions until January 1, 2032. The bill would make various conforming changes, including with respect to the lien dates for which the exemption applies. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements. This bill would state that it is the intent of the Legislature to apply those requirements to the above-described exemption and would set forth specified information relating to those requirements. In that regard, the bill would require the assessor to provide the State Board of Equalization with certain information and would require the assessor to retain that information, as specified. By imposing additional duties on local tax officials, the bill would impose a state-mandated local program. 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.

Bill status passed both 4 of 5 stages cleared

Introduction

Feb 2025

Committee Review

Aug 2026

Assembly Passage

May 2025

Senate Passage

Aug 2026

Governor

Introduced Feb 14, 2025 Last action Aug 27, 2026

Maddy AI version diff · 4 comparisons

What changed between versions

08/20/26 - Amended Senate → AB672 · 2 edits

MINOR

The bill text is substantively unchanged between the Senate-amended version and the enrolled version. The only differences are procedural: the bill transitioned from 'Amended in Senate' status to 'Enrolled' status after passing the Senate on August 25, 2026 and the Assembly on August 27, 2026. The digest dropped the phrase 'as amended' since this is now the final version sent to the Governor.

TECHNICAL

Bill status changed from 'Amended in Senate' to 'Enrolled' (final version for Governor's signature). Passage dates recorded: Senate August 25, 2026; Assembly August 27, 2026.

Legislative Counsel's Digest changed from 'AB 672, as amended, Caloza' to 'AB 672, Caloza', reflecting that this is the final enrolled text rather than an interim amendment.

04/28/26 - Amended Senate → 08/20/26 - Amended Senate · 4 edits · Aug 20, 2026

MODERATE

The August 20, 2026 Senate amendment to AB 672 completely removed the public employment and labor dispute provisions (PERB notification requirements, PERB intervention rights, and a Judicial Council panel for trial court employee strike injunctions), narrowing the bill to solely address the community land trust property tax exemption. The amendment also extended the sunset date of that exemption from January 1, 2027 to January 1, 2032, and added new data collection and reporting requirements under Section 41 (tax expenditure accountability) requiring assessors and the State Board of Equalization to track exempted assessed value and units created.

Scope change

The bill's scope was significantly narrowed. It previously covered two distinct policy areas: (1) community land trust property tax exemptions and (2) public employee labor dispute procedures including PERB notification, intervention rights, and a specialized judicial panel for trial court employee strikes. The August 20 amendment removed all labor-related provisions, leaving only the community land trust tax exemption extension and new reporting requirements.

SCOPE

All public employment provisions were deleted: the requirement for plaintiffs to notify PERB's general counsel when filing civil actions or TRO applications against public employee strikes (former Section 3599.90), PERB's right of intervention in labor dispute cases (former Section 3599.91), and the Judicial Council requirement to establish a panel of court of appeal justices for hearing trial court employee strike injunctions (former Section 71639.7).

TIMELINE

The sunset date for the community land trust property tax exemption was extended from January 1, 2027 to January 1, 2032, giving community land trusts an additional five years to acquire property and complete development or rehabilitation before becoming liable for back taxes.

REQUIREMENT

A new subdivision (f) was added to Section 214.18 requiring compliance with Section 41 tax expenditure accountability: the State Board of Equalization must annually collect data from county assessors on exempted assessed value and units created, submit a summary report to the Legislature by January 1, 2031, and community land trusts must provide specified information to their local assessor.

FISCAL

The state-mandated local program designation changed from 'no' to 'yes' because the new reporting duties imposed on county assessors constitute a state-mandated local program requiring potential reimbursement under Part 7 of Division 4 of Title 2 of the Government Code.

06/18/25 - Amended Senate → 04/28/26 - Amended Senate · 6 edits · Apr 28, 2026

MODERATE

AB 672 was substantially expanded to add a new Section 1 amending Revenue and Taxation Code Section 214.18, extending the property tax welfare exemption for community land trusts from expiring in 2027 to 2032. The original public employment provisions (PERB notification and intervention rights) were retained but renumbered as Section 2. This matters because it gives community land trusts an additional five years to develop or rehabilitate affordable housing on tax-exempt property before facing retroactive tax liability.

Scope change

The bill's scope expanded significantly from a single-subject public employment measure (PERB notification and intervention) to a two-part bill that also addresses property tax policy for community land trusts. The new provisions apply to all community land trusts statewide that own or acquire property qualifying for the welfare exemption, with the extended timeline running through January 1, 2032.

SCOPE

Entirely new Section 1 amending Revenue and Taxation Code Section 214.18, adding a property tax welfare exemption provision for community land trusts that was not in the prior version of the bill.

TIMELINE

The deadline for community land trusts to have development or rehabilitation in the course of construction is extended from January 1, 2027 to January 1, 2032 for property acquired on and after January 1, 2022. The window for new acquisitions eligible for the exemption is also extended from 'before January 1, 2027' to 'before January 1, 2032.'

The sunset date of Section 214.18 is extended from January 1, 2027 to January 1, 2032.

FISCAL

A new provision states that no state appropriation is made and the state shall not reimburse local agencies for property tax revenues lost due to this exemption, overriding the general reimbursement requirement in Revenue and Taxation Code Section 2229.

ENFORCEMENT

State-mandated local program designation changed from 'no' to 'yes' because the new property tax provisions impose additional duties on local tax officials (assessors).

REQUIREMENT

Community land trusts must notify the county assessor if exempt property is not in the course of construction by the applicable deadline, triggering retroactive tax liability for all years the property was exempt.

Floor votes · Senate Aug 25, 2026 · Assembly May 15, 2025

How they voted

39–0

Passed · 1 other

Total votes 40

Aug 25, 2026

D Democratic30

30 Yea

100% Yea

R Republican10

9 Yea 1

90% Yea

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Aug 27, 2026

Lower · Passed

Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 75. Noes 0.).

lower

Aug 27, 2026

Lower · Passed

From committee: That the Senate amendments be concurred in. (Ayes 7. Noes 0.) (August 27).

lower

Aug 25, 2026

Committee

Re-referred to Com. on REV. & TAX. pursuant to Assembly Rule 77.2.

lower

Aug 25, 2026

Introduced

In Assembly. Concurrence in Senate amendments pending.

lower

Aug 25, 2026

Upper · Passed

Read third time. Passed. Ordered to the Assembly. (Ayes 37. Noes 0.).

upper

Aug 20, 2026

Upper · Passed

Read third time and amended. Ordered to second reading.

upper

Aug 13, 2026

Upper · Passed

From committee: Do pass. (Ayes 7. Noes 0.) (August 13).

upper

Jun 22, 2026

Committee

In committee: Referred to APPR. suspense file.

upper

Jun 10, 2026

Upper · Passed

From committee: Do pass and re-refer to Com. on APPR. (Ayes 5. Noes 0.) (June 10). Re-referred to Com. on APPR.

upper

May 13, 2026

Committee

Re-referred to Com. on REV. & TAX.

upper

Apr 30, 2026

Committee

Re-referred to Com. on RLS. pursuant to Senate Rule 29.10(c).

upper

Apr 28, 2026

Upper · Passed

Read second time and amended. Ordered returned to second reading.

upper

Aug 19, 2025

Upper · Passed

From committee: Be ordered to second reading pursuant to Senate Rule 28.8.

upper

Jul 16, 2025

Upper · Passed

From committee: Do pass and re-refer to Com. on APPR. (Ayes 11. Noes 2.) (July 15). Re-referred to Com. on APPR.

upper

Jun 25, 2025

Upper · Passed

From committee: Do pass and re-refer to Com. on JUD. (Ayes 4. Noes 1.) (June 25). Re-referred to Com. on JUD.

upper

Jun 18, 2025

Introduced

From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on L., P.E. & R.

upper

Jun 18, 2025

Committee

Referred to Coms. on L., P.E. & R. and JUD.

upper

May 15, 2025

Lower · Passed

Read third time. Passed. Ordered to the Senate. (Ayes 62. Noes 4. Page 1562.)

lower

May 7, 2025

Lower · Passed

From committee: Do pass. (Ayes 11. Noes 0.) (May 7).

lower

Apr 8, 2025

Lower · Passed

From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 0.) (April 8). Re-referred to Com. on APPR.

lower

Mar 19, 2025

Lower · Passed

From committee: Do pass and re-refer to Com. on JUD. (Ayes 6. Noes 0.) (March 19). Re-referred to Com. on JUD.

lower

Mar 3, 2025

Committee

Referred to Coms. on P. E. & R. and JUD.

lower

Feb 15, 2025

Lower · Passed

From printer. May be heard in committee March 17.

lower

1 primary · 0 co-sponsors