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AB-1199 Homes for Families and Corporate Monopoly Transparency Excise Tax: qualified property: reporting requirements.(2021-2022)

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Date Published: 02/18/2021 09:00 PM
AB1199:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 1199


Introduced by Assembly Member Gipson

February 18, 2021


An act to add Article 8 (commencing with Section 12280) to Chapter 3 of Part 2 of Division 3 of Title 2 of the Government Code, and to add Part 6.8 (commencing with Section 11951) to Division 2 of the Revenue and Taxation Code, relating to landlords, and declaring the urgency thereof, to take effect immediately.


LEGISLATIVE COUNSEL'S DIGEST


AB 1199, as introduced, Gipson. Homes for Families and Corporate Monopoly Transparency Excise Tax: qualified property: reporting requirements.
Existing law requires the Secretary of State to perform various duties relating to business entities.
This bill would require a qualified entity, as defined, that owns qualified property, as defined, to report annually to the Secretary of State specified information regarding the qualified property owned by the qualified entity. The bill would require the Secretary of State to create a searchable database, updated annually, on the Secretary of State’s internet website, with the information provided by the qualified entity.
Existing law imposes various taxes, including taxes on the privilege of engaging in certain activities. The Fee Collection Procedures Law, the violation of which is a crime, provides procedures for the collection of certain fees and surcharges.
This bill would impose an annual excise tax upon a qualified taxpayer, as defined, for the privilege of renting or leasing out qualified property, as defined, in this state at an unspecified rate based on the gross receipts of the qualified taxpayer that are derived from rental income. The bill would require the California Department of Tax and Fee Administration to collect the tax pursuant to the Fee Collection Procedures Law and would require all amounts collected, less refunds and administrative costs, to be deposited in the Homes for Families Fund, which the bill would create. Upon appropriation, the bill would require that moneys in the fund be used for specified purposes relating to rental assistance, homelessness, affordable housing, and housing counseling services.
Because the bill would expand the scope of the Fee Collection Procedures Law, the violation of which is a crime, 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 no reimbursement is required by this act for a specified reason.
This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2/3   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

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


SECTION 1.

 Article 8 (commencing with Section 12280) is added to Chapter 3 of Part 2 of Division 3 of Title 2 of the Government Code, to read:
Article  8. Reporting Requirements for Qualified Entities

12280.
 (a) On or before February 1, 2023, and on or before February 1 each year thereafter, a qualified entity that owns qualified property shall report the following information to the Secretary of State in the form and manner as required by the Secretary of State:
(1) The identity of the beneficial owner of each qualified property owned by the qualified entity in the previous calendar year.
(2) The number of units for each qualified property owned by the qualified entity in the previous calender year that were offered for rent or lease.
(b) The Secretary of State shall create a searchable database, updated annually, on the Secretary of State’s internet website, with the information provided by the qualified entity in subdivision (a).
(c) For purposes of this section, both of the following definitions shall apply:
(1) “Qualified entity” means a limited liability company or a limited partnership.
(2) “Qualified property” has the same meaning as that term is defined in Section 11952 of the Revenue and Taxation Code.

SEC. 2.

 Part 6.8 (commencing with Section 11951) is added to Division 2 of the Revenue and Taxation Code, to read:

PART 6.8. Homes for Families and Corporate Monopoly Transparency Excise Tax

11951.
 This part shall be known, and may be cited, as the Homes for Families and Corporate Monopoly Transparency Excise Tax Law.

11952.
 For purposes of this part:
(a) “Affordable housing unit” means a housing unit where rents are legally restricted to reflect no more than 30 percent of the household income for persons and families of low or moderate income.
(b) “Department” means the California Department of Tax and Fee Administration.
(c) “Fund” means the Homes for Families Fund created pursuant to Section 11960.
(d) “Multifamily dwelling” means a residential structure with five or more dwelling units.
(e) “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.
(f) (1) “Qualified property” means real property that is offered for rent or lease and that is either of the following:
(A) A single-family dwelling.
(B) A multifamily dwelling.
(2) “Qualified property” does not include property where 50 percent or more of the units are affordable housing units.
(g) (1) “Qualified taxpayer” means a person or entity that owns 10 or more qualified properties in this state during the calendar year.
(2) “Qualified taxpayer” does not include any of the following:
(A) An eligible nonprofit corporation based in California whose primary activity is the development and preservation of affordable rental housing.
(B) A limited partnership in which the managing general partner is an eligible nonprofit corporation based in California whose primary activity is the development and preservation of affordable housing.
(C) A limited liability company in which the managing member is an eligible nonprofit corporation based in California whose primary activity is the development and preservation of affordable rental housing.
(D) A community land trust as defined in Section 402.1.
(E) A limited-equity housing cooperative as defined in Section 817 of the Civil Code.
(F) The state, the Regents of the University of California, a county, city, district, public authority, or public agency, and any other political subdivision or public corporation in the state.
(h) “Single family dwelling” means a residential structure with less than five dwelling units.

11955.
 (a) An annual excise tax is hereby imposed upon a qualified taxpayer for the privilege of renting or leasing out qualified property in this state at a rate of ___ percent of the gross receipts of the qualified taxpayer that are derived from rental income.
(b) It is the intent of the Legislature to enact legislation that would increase the rate specified in subdivision (a) if the qualified taxpayer receives a certain number of code violations issued by the building department or health department of a city or county.

11957.
 (a) The department shall administer and collect the excise tax imposed by this part pursuant to the Fee Collection Procedures Law (Part 30 (commencing with Section 55001)). For purposes of this part, references in the Fee Collection Procedures Law to “fee” shall include the tax imposed by this part and references to “feepayer” shall include any person or entity liable for the payment of the tax imposed by this part.
(b) The department may prescribe, adopt, and enforce regulations relating to the administration and enforcement of this part, including, but not limited to, provisions governing collections, reporting, refunds, and appeals.
(c) The department may prescribe, adopt, and enforce emergency regulations relating to the administration and enforcement of this part. Any emergency regulations prescribed, adopted, or enforced pursuant to this section shall be adopted in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and, for purposes of that chapter, including Section 11349.6 of the Government Code, the adoption of these regulations is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health and safety, and general welfare.

11958.
 The tax imposed by this part shall not be passed through to tenants by way of higher rents.

11960.
 (a) The Homes for Families Fund is hereby created in the State Treasury.
(b) All taxes, interest, penalties, and other amounts collected pursuant to this part, less refunds and costs of administration, shall be deposited in the fund.
(c) Upon appropriation, moneys in the fund shall be used for the following purposes:
(1) Rental assistance and relief for California tenants.
(2) Support for legal services to prevent evictions, harassment, and violations of law by landlords.
(3) Providing services and programs for persons experiencing homelessness in this state.
(4) Supporting the protection of existing, and the production of new, housing with an affordable housing cost or affordable rent, as defined in Sections 50052.5 and 50053, respectively, of the Health and Safety Code.
(5) Housing counseling services to promote home ownership, job training apprenticeship programs, and support for landlords that own fewer than 10 properties and have lost rental income from tenants due to COVID-19.

SEC. 3.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SEC. 4.

 This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to discourage landlords from raising rents and displacing tenants, to provide relief to tenants facing evictions, and to provide support for home ownership during a health and economic crisis, it is necessary that this act take effect immediately.