Bill Text: CA AB2492 | 2009-2010 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Property taxation: change in ownership.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2010-06-21 - Read second time. To third reading. [AB2492 Detail]

Download: California-2009-AB2492-Introduced.html

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BILL NUMBER: AB 2492	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Ammiano

                        FEBRUARY 19, 2010

   An act relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2492, as introduced, Ammiano. Property taxation: change in
ownership.
   The California Constitution generally limits ad valorem taxes on
real property to 1% of the full cash value of that property. For
purposes of this limitation, "full cash value" is defined as the
assessor's valuation of real property as shown on the 1975-76 tax
bill under "full cash value" or, thereafter, the appraised value of
that real property when purchased, newly constructed, or a change in
ownership has occurred. Existing property tax law specifies those
circumstances in which the transfer of ownership interests in a
corporation, partnership, limited liability company, or other legal
entity results in a change in ownership of the real property owned by
that entity, and generally provides that a change in ownership as so
described occurs when a legal entity or other person obtains a
controlling or majority ownership interest in the legal entity.
   This bill would, pursuant to legislative findings and
declarations, state the intent of the Legislature to enact a program
to specify those circumstances under which nonresidential commercial
and industrial property undergoes a change in ownership, to ensure
that all real property is assessed at fair market value when that
real property undergoes a change in ownership.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) For ad valorem property taxation purposes, the California
Constitution generally limits annual increases in the assessed
taxable value of real property to 2 percent of the property's
adjusted base year value, but requires that real property be
reassessed at its full cash value when that real property undergoes a
change in ownership.
   (b) These rules provide a necessary protection for real property
owners when land values rise more rapidly than income.
   (c) Because of difficulties in identifying changes in ownership of
certain nonresidential commercial and industrial properties, these
properties often escape reassessment at full market value upon a
change in ownership.
   (d) As a result of these assessment anomalies, despite rapid
economic growth during the 1990s which increased the value of
nonresidential commercial and industrial properties, the share of
real property taxes paid by nonresidential commercial and industrial
property owners decreased, while the share of real property taxes
paid by residential property owners (e.g. homeowners) increased.
   (e) Failure to capture the rising land values of nonresidential
commercial and industrial properties that have undergone a change in
ownership has a range of negative consequences, including, but not
limited to:
   (1) Hampering the ability of local governments to build new
infrastructure and provide vital services.
   (2) Imposing a disproportionate property tax burden on newly
constructed properties when compared to existing properties.
   (3) Encouraging local governments to foster sales tax-generating
retail development rather than fostering job-creating investments
such as manufacturing.
   (f) Therefore, it is the intent of the Legislature to enact a
program to specify those circumstances under which nonresidential
commercial and industrial property undergoes a change in ownership,
to ensure that all real property is assessed at fair market value
when that real property undergoes a change in ownership.