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AB-3050 Property taxation: welfare exemption: facilities in the course of construction: low-income rental housing.(2019-2020)

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Date Published: 04/29/2020 09:00 PM
AB3050:v98#DOCUMENT

Amended  IN  Assembly  May 04, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 3050


Introduced by Assembly Member Quirk-Silva

February 21, 2020


An act to amend Section 214.1 214.2 of the Revenue and Taxation Code, relating to taxation. taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 3050, as amended, Quirk-Silva. Property taxation: welfare exemption. 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. Existing 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 would make nonsubstantive changes to this provision.

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.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NOYES   Local Program: NOYES  

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


SECTION 1.

 Section 214.2 of the Revenue and Taxation Code is amended to read:

214.2.
 (a)As used in Section 214.1, “facilities in the course of construction” shall include the includes all of the following:
(a) The demolition or razing of a building with the intent to replace it with facilities to be used exclusively for religious, hospital, or charitable purposes.
(b) As used in Section 214.1, “facilities in the course of construction” shall include definite 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 if the building or improvement is to be used exclusively for religious, hospital, or charitable purposes. Activity as described in the preceding sentence having this subdivision that has been commenced and not yet finished, unless abandoned, shall establish that a building or improvement is “under construction” for the purposes of Section 5 of Article XIII of the California Constitution. Construction shall not be considered “abandoned” if delayed due to reasonable causes and circumstances beyond the assessee’s control, control that occur notwithstanding the exercise of ordinary care and the absence of willful neglect.
(c) For lien dates on and after January 1, 2021, and before January 1, 2026, the acquisition of property or control of a site by an organization meeting the requirements of subdivision (b) of Section 4 of Article XIII of the California Constitution and paragraphs (1) to (7), inclusive, of subdivision (a) of Section 214 with the intent of using that property for a low-income housing project eligible for the partial exemption provided by subdivision (g) of Section 214.

SEC. 2.

 It is the intent of the Legislature to comply with Section 41 of the Revenue and Taxation Code with respect to Section 1 of this act amending Section 214.2 of the Revenue and Taxation Code.

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.
SECTION 1.Section 214.1 of the Revenue and Taxation Code is amended to read:
214.1.

As used in Section 214, “property used exclusively for religious, hospital, or charitable purposes” includes facilities in the course of construction on or after the first Monday of March, 1954, together with the land on which those facilities are located as may be required for their convenient use and occupation, to be used exclusively for religious, hospital or charitable purposes.