Code Section Group

Revenue and Taxation Code - RTC

DIVISION 1. PROPERTY TAXATION [50 - 5911]

  ( Division 1 enacted by Stats. 1939, Ch. 154. )

PART 0.5. IMPLEMENTATION OF ARTICLE XIII A OF THE CALIFORNIA CONSTITUTION [50 - 100.96]

  ( Part 0.5 added by Stats. 1979, Ch. 242. )

CHAPTER 4.5. Implementation of Article XIII A For Nonresidential Active Solar Energy Systems [83 - 88]
  ( Chapter 4.5 added by Stats. 2020, Ch. 58, Sec. 2. )

83.
  

The Legislature finds and declares that it is the intent of the Legislature, in enacting this chapter, to ensure active solar energy systems that would have been exempt from taxation because of the new construction exclusion continue to be exempt from taxation until there is a subsequent change in ownership of the active solar energy system.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Conditionally operative pursuant to Section 88. Repealed conditionally, on January 1, 2021, pursuant to Section 88.)

83.5.
  

For purposes of Article XIII A of the California Constitution, all of the following apply:

(a) Notwithstanding Section 105, “improvements” do not include nonresidential active solar energy systems.

(b) Notwithstanding Section 106, “personal property” includes nonresidential active solar energy systems.

(c) “Real property” includes improvements, as defined in Section 105, but does not include personal property, as defined in Section 106.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Conditionally operative pursuant to Section 88. Repealed conditionally, on January 1, 2021, pursuant to Section 88.)

84.
  

For purposes of this chapter, “residential property” means real property used as residential property, including both single-family and multiunit structures, and the land on which those structures are constructed or placed.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Conditionally operative pursuant to Section 88. Repealed conditionally, on January 1, 2021, pursuant to Section 88.)

85.
  

(a) (1) “Nonresidential active solar energy system” means a system that uses solar devices to provide for the collection, storage, or distribution of solar energy, and that is not constructed or installed in or on residential property.

(2) “Nonresidential active solar energy system” does not include solar swimming pool heaters or hot tub heaters.

(b) Nonresidential active solar energy systems may be used for any of the following:

(1) Recreational, therapeutic, or service water heating.

(2) Space conditioning.

(3) Production of electricity.

(4) Process heat.

(5) Solar mechanical energy.

(c) A nonresidential active solar energy system that uses solar energy in the production of electricity includes storage devices, power conditioning equipment, transfer equipment, and parts related to the functioning of those items. In general, the use of solar energy in the production of electricity involves the transformation of sunlight into electricity through the use of devices such as solar cells or other solar collecting equipment. However, a nonresidential active solar energy system used in the production of electricity includes only equipment used up to, but not including, the stage of conveyance or use of the electricity. For the purpose of this section, the term “parts” includes spare parts that are owned by the owner of, or the maintenance contractor for, a nonresidential active solar energy system that uses solar energy in the production of electricity and which spare parts were specifically purchased, designed, or fabricated by or for that owner or maintenance contractor for installation in a nonresidential active solar energy system that uses solar energy in the production of electricity, thereby including those parts in the tax exemption created by this chapter.

(d) A nonresidential active solar energy system that uses solar energy in the production of electricity also includes pipes and ducts that are used exclusively to carry energy derived from solar energy. Pipes and ducts that are used to carry both energy derived from solar energy and from energy derived from other sources are nonresidential active solar energy system property only to the extent of 75 percent of their fair market value.

(e) A nonresidential active solar energy system that uses solar energy in the production of electricity does not include auxiliary equipment, such as furnaces and hot water heaters, that use a source of power other than solar energy to provide usable energy. A nonresidential active solar energy system that uses solar energy in the production of electricity does include equipment, such as ducts and hot water tanks, that is utilized by both auxiliary equipment and solar energy equipment, that is, dual-use equipment. That equipment is nonresidential active solar energy system property only to the extent of 75 percent of its fair market value.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Conditionally operative pursuant to Section 88. Repealed conditionally, on January 1, 2021, pursuant to Section 88.)

86.
  

(a) (1) Subject to paragraph (2), a nonresidential active solar energy system constructed or installed prior to January 1, 2025, shall be exempt from taxation until there is a subsequent change in ownership of the nonresidential active solar energy system.

(2) The exemption described in paragraph (1) applies to a nonresidential active solar energy system constructed or installed prior to the date this chapter becomes operative only if that system would have been excluded, on the date this chapter becomes operative, from the term “newly constructed,” as described in Section 73, had the system been real property instead of personal property and had Section 73 been applicable to nonresidential active solar energy systems.

(3) No nonresidential active solar energy systems constructed or installed on or after January 1, 2025, shall be exempt from taxation pursuant to this subdivision.

(b) Nonresidential active solar energy systems that qualify for the exemption from taxation pursuant to paragraph (1) of subdivision (a) shall continue to be exempt therefrom on and after January 1, 2025, until there is a subsequent change in ownership.

(c) A change in ownership shall be deemed to have occurred for purposes of this section if the transaction would have constituted a change in ownership under Chapter 2 (commencing with Section 60) had the nonresidential active solar energy system been real property instead of personal property.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Conditionally operative pursuant to Section 88. Repealed conditionally, on January 1, 2021, pursuant to Section 88.)

87.
  

(a) The provisions of this chapter are to be construed liberally so as to effectuate their intent, policy, and purposes.

(b) The provisions of this chapter are severable. If any provision of this chapter or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Conditionally operative pursuant to Section 88. Repealed conditionally, on January 1, 2021, pursuant to Section 88.)

88.
  

(a) This chapter shall become operative on the date that an initiative measure adding Section 2.5 to Article XIII A of the California Constitution at the November 3, 2020, statewide general election takes effect pursuant to subdivision (a) of Section 10 of Article II of the California Constitution.

(b) If a majority of the voters do not approve the initiative measure adding Section 2.5 to Article XIII A of the California Constitution at the November 3, 2020, statewide general election, then this chapter shall remain inoperative until January 1, 2021, and as of that date is repealed.

(Added by Stats. 2020, Ch. 58, Sec. 2. (SB 364) Effective September 9, 2020. Repealed conditionally, on January 1, 2021, by its own provisions. Note: Repeal affects Chapter 4.5, commencing with Section 83.)

RTCRevenue and Taxation Code - RTC