Bill Text: CA AB1760 | 2013-2014 | Regular Session | Chaptered
Bill Title: Property taxation: welfare exemption: rental housing and related facilities: payment in lieu of taxes agreement.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Passed) 2014-09-27 - Chaptered by Secretary of State - Chapter 671, Statutes of 2014. [AB1760 Detail]
Download: California-2013-AB1760-Chaptered.html
BILL NUMBER: AB 1760 CHAPTERED
BILL TEXT
CHAPTER 671
FILED WITH SECRETARY OF STATE SEPTEMBER 27, 2014
APPROVED BY GOVERNOR SEPTEMBER 27, 2014
PASSED THE SENATE AUGUST 26, 2014
PASSED THE ASSEMBLY AUGUST 27, 2014
AMENDED IN SENATE AUGUST 22, 2014
AMENDED IN SENATE JUNE 11, 2014
AMENDED IN ASSEMBLY MAY 28, 2014
AMENDED IN ASSEMBLY MAY 14, 2014
AMENDED IN ASSEMBLY APRIL 1, 2014
INTRODUCED BY Assembly Members Chau and Bocanegra
(Principal coauthor: Senator Jackson)
FEBRUARY 14, 2014
An act to add Sections 214.06, 214.07, and 214.09 to the Revenue
and Taxation Code, relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
AB 1760, Chau. Property taxation: welfare exemption: rental
housing and related facilities: payment in lieu of taxes agreement.
Existing property tax law establishes a partial welfare exemption
for property used exclusively for rental housing and related
facilities that are owned and operated by either of any certain types
of nonprofit entities or veterans' organizations that meet specified
exemption requirements, if either of certain qualifying criteria are
met. Existing law requires the owner of the property, in order to be
eligible for the exemption, to certify that the funds that would
have been necessary to pay property taxes are used to maintain the
affordability of, or reduce rents otherwise necessary for, the units
occupied by lower income households.
This bill would, on or after January 1, 2015, prohibit a local
government from entering into a payment in lieu of taxes (PILOT)
agreement with a property owner of a low-income housing project, and
would make any PILOT agreement entered into in violation of this
provision void and unenforceable. The bill would establish a
conclusive presumption that any payments made under a PILOT agreement
entered into before January 1, 2015, comply with the certification
requirement described above and were or are used to maintain the
affordability of, or reduce rents otherwise necessary for, the units
occupied by lower income households. The bill would define a PILOT
agreement to mean any agreement entered into between a local
government and a property owner of a low-income housing project that
requires the owner of the low-income housing project to pay the local
government a charge, as provided, and would define a "low-income
housing project" to mean a low-income housing project that is
eligible for the exemption described above.
This bill would become operative only if SB 1203 of the 2013-14
Regular Session is enacted and takes effect on or before January 1,
2015.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares the following:
(a) In Section 50001 of the Health and Safety Code, the
Legislature has long declared that the subject of housing is of vital
statewide importance to the health, safety, and welfare of the
residents of this state.
(b) The lack of housing, and in particular the lack of decent,
safe, and sanitary housing that is affordable to low-income
households, is a critical problem that continues to threaten the
economic, environmental, and social quality of life in California.
(c) The Legislature, in enacting subdivision (g) of Section 214 of
the Revenue and Taxation Code in 1987, determined that the funds
that were being paid in property taxes could better be used in
furtherance of the goal of providing low-income housing and that a
property tax exemption was necessary to ensure that low-income
housing properties with restricted rents would be able to provide the
residents with a livable community and remain financially feasible
over the life of the deed restrictions, generally 55 years.
(d) Payment in lieu of taxes agreements are an issue of statewide
concern because of the need to prevent arbitrary and discriminatory
financial barriers that prevent construction of needed low-income
housing in the state. Therefore, restricting agreements with local
governments as set forth in Section 214.06 of the Revenue and
Taxation Code is a matter of statewide concern and not a municipal
affair as that term is used in Section 5 of Article XI of the
California Constitution.
SEC. 2. Section 214.06 is added to the Revenue and Taxation Code,
to read:
214.06. (a) Notwithstanding any other law, on or after January 1,
2015, a local government shall not enter into a payment in lieu of
taxes (PILOT) agreement with a property owner of a low-income housing
project. Any PILOT agreement entered into in violation of this
subdivision shall be void and unenforceable.
(b) An inference shall not be drawn from the enactment of this
section with regard to whether the law, as it read prior to January
1, 2015, authorized a local government to enter into a PILOT
agreement.
SEC. 3. Section 214.07 is added to the Revenue and Taxation Code,
to read:
214.07. (a) Notwithstanding any other law, it shall be
conclusively presumed that any payments made under any payment in
lieu of taxes (PILOT) agreement entered into before January 1, 2015,
comply with the certification requirements of subparagraph (B) of
paragraph (2) of subdivision (g) of Section 214 and were or are used
to maintain the affordability of, or reduce rents otherwise necessary
for, the units occupied by lower income households.
(b) An inference shall not be drawn from the enactment of this
section with regard to whether the law, as it read prior to January
1, 2015, authorized a local government to enter into a PILOT
agreement.
SEC. 4. Section 214.09 is added to the Revenue and Taxation Code,
to read:
214.09. For purposes of Sections 214.06, 214.07, and 214.08, all
of the following shall apply:
(a) "Local government" means any city, county, city and county,
housing authority, housing successor to a redevelopment agency, or a
joint powers agency that has approved land use entitlements or
building permits, provided land or financing, or approved the
issuance of tax-exempt bonds pursuant to the federal Tax Equity and
Fiscal Responsibility Act for the low-income housing project.
(b) "Low-income housing project" means a low-income housing
project that is eligible for the exemption provided by subdivision
(g) of Section 214.
(c) "Payment in lieu of taxes agreement" means any agreement
entered into between a local government and a property owner of a
low-income housing project that requires the owner of the low-income
housing project to pay the local government a charge to compensate
the local government for lost property tax revenues resulting from
the low-income housing project receiving an exemption pursuant to
subdivision (g) of Section 214.
SEC. 5. This act shall become operative only if Senate Bill 1203
of the 2013-14 Regular Session is also enacted and takes effect on or
before January 1, 2015.
