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SB-1056 Property taxes: welfare exemption: community land trust.(2017-2018)

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Date Published: 02/12/2018 09:00 PM
SB1056:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Senate Bill No. 1056


Introduced by Senator Beall
(Coauthors: Senators Hertzberg, McGuire, Newman, Portantino, and Wieckowski)

February 12, 2018


An act to add Section 214.18 to the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


SB 1056, as introduced, Beall. Property taxes: welfare exemption: community land trust.
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 that is owned or operated by certain types of nonprofit entities, if certain qualifying criteria are met.
This bill, for lien dates occurring on and after January 1, 2019, would provide 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. The bill would prohibit this exemption from being denied on the basis that the subject property does not currently contain specified property that is in the course of construction.
By imposing new duties upon local government officials with respect to the exemption provided by this bill, this 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.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares all of the following:
(a) The availability of housing is of vital statewide importance, and the development of decent and secure housing for every Californian is a priority of the highest order.
(b) There is currently a severe housing crisis in California, especially impacting the ability of persons and families of low and moderate income to purchase and own a home or unit.
(c) Community land trusts and limited equity housing cooperatives acquire, develop, rehabilitate, and own single-family dwelling units and multifamily housing unit projects for the specific purpose of providing, among other affordable housing options, limited equity home ownership to persons and families of low and moderate income.
(d) To facilitate the acquisition, development, rehabilitation, financing, and ownership of housing for persons and families of low and moderate income, community land trusts and limited equity housing cooperatives must have certainty and uniformity across the state when valuation of property is conducted by county assessors so that, when acquiring, developing, or rehabilitating property for persons and families of low and moderate income, the value of the property is exempt from property taxation prior to the occupancy or ownership of that housing to facilitate development and rehabilitation of restricted affordable dwellings and units.

SEC. 2.

 Section 214.18 is added to the Revenue and Taxation Code, to read:

214.18.
 (a) Property is within the exemption provided by Sections 4 and 5 of Article XIII of the California Constitution if the property is owned by a community land trust, otherwise qualifying for exemption under Section 214, and all of the following conditions are met:
(1) The property is being or will be developed or rehabilitated as an owner occupied single-family dwelling, as an owner-occupied unit in a multifamily dwelling, or as a member occupied unit in a limited equity housing cooperative.
(2) Improvements on the property are or will be available for use and ownership by a qualified owner.
(3) A deed restriction or other instrument, requiring a contract or contracts serving as an enforceable restriction on the value of the land pursuant to paragraph (11) of subdivision (a) of Section 402.1 no later than the sale or transfer of improvements on the property, is recorded on or before the lien date following the acquisition of the property by the community land trust.
(b) In the case of property not previously designated as an open space, the exemption provided by subdivision (a) shall not be denied to a property on the basis that the property does not currently contain a single-family dwelling, a unit in a multifamily dwelling, or a unit in a limited equity housing cooperative, that is in the course of construction.
(c) For purposes of this section, all of the following definitions shall apply:
(1) “Community land trust” has the same meaning as that term is defined in clause (ii) of subparagraph (B) paragraph (11) of subdivision (a) of Section 402.1.
(2) “Limited equity housing cooperative” has the same meaning as that term is defined in Section 817 of the Civil Code.
(3) “Persons and families of low or moderate income” has the same meaning as that term is defined in Section 50093 of the Health and Safety Code.
(4) “Qualified owner” means persons and families of low or moderate income, including persons and families of low or moderate income that own a dwelling or unit collectively as member occupants or resident shareholders of a limited equity housing cooperative.
(d) This section shall apply to lien dates occurring on and after January 1, 2019.

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.

 This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.