AB 668, as amended, Gomez. Property taxation: assessment: affordable housing.
Existing law requires the county assessor to consider, when valuing real property for property taxation purposes, the effect of any enforceable restrictions to which the use of the land may be subjected. Under existing law these restrictions include, but are not limited to, zoning, recorded contracts with governmental agencies, and various other restrictions imposed by governments.
begin insertExisting property tax law establishes a welfare exemption under which property is exempt from taxation if, among other things, that property is used exclusively for religious, hospital, scientific, or charitable purposes and is owned and operated by an entity, as provided, that is itself organized and operated for those purposes. Under existing property tax law, the welfare exemption applies to property that is owned and operated by a nonprofit corporation, otherwise qualifying for the welfare exemption, that is organized and operated for the purpose of building and rehabilitating single-family or multifamily residences for sale, as provided, at cost to low-income families.
end insertThis bill would require the county assessor to consider, when valuing real property for property taxation purposes, a recorded contract with a nonprofit corporationbegin delete for the advancement of affordable housing that provides funding or land for affordable housing where the recorded contract restricts the use of the land for at least 30 years to housing available at affordable housing cost or affordable rent.end deletebegin insert that meets prescribed requirements, including requirements that the nonprofit
corporation has received a welfare exemption for properties intended to be sold to low-income families who participate in a special no-interest loan program, and that the contract includes a restriction on the use of the land for at least 30 years to owner-occupied housing available at affordable housing cost.end insert By changing the manner in which county assessors assess property for property taxation purposes, this 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, 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 these statutory provisions.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 402.1 of the Revenue and Taxation Code
2 is amended to read:
(a) In the assessment of land, the assessor shall consider
4the effect upon value of any enforceable restrictions to which the
5use of the land may be subjected. These restrictions shall include,
6but are not limited to, all of the following:
7(1) Zoning.
8(2) Recorded contracts with governmental agencies other than
9those provided in Sections 422, 422.5, and 422.7.
10(3) Permit authority of, and permits issued by, governmental
11agencies exercising land use powers concurrently with local
12governments, including the California Coastal Commission and
13regional coastal commissions, the San Francisco Bay Conservation
P3 1and Development Commission, and the
Tahoe Regional Planning
2Agency.
3(4) Development controls of a local government in accordance
4with any local coastal program certified pursuant to Division 20
5(commencing with Section 30000) of the Public Resources Code.
6(5) Development controls of a local government in accordance
7with a local protection program, or any component thereof, certified
8pursuant to Division 19 (commencing with Section 29000) of the
9Public Resources Code.
10(6) Environmental constraints applied to the use of land pursuant
11to provisions of statutes.
12(7) Hazardous waste land use restriction pursuant to Section
1325240 of the Health and Safety Code.
14(8) A recorded conservation, trail, or scenic easement, as
15described in
Section 815.1 of the Civil Code, that is granted in
16favor of a public agency, or in favor of a nonprofit corporation
17organized pursuant to Section 501(c)(3) of the Internal Revenue
18Code that has as its primary purpose the preservation, protection,
19or enhancement of land in its natural, scenic, historical, agricultural,
20forested, or open-space condition or use.
21(9) A solar-use easement pursuant to Chapter 6.9 (commencing
22with Section 51190) of Part 1 of Division 1 of Title 5 of the
23Government Code.
24(10) Abegin delete recordedend delete contractbegin delete withend deletebegin insert where the following apply:end insert
25begin insert(A)end insertbegin insert end insertbegin insertThe contract is withend insert a nonprofit corporation organized
26pursuant to Section 501(c)(3) of the Internal Revenue Code that
27hasbegin delete as its primary purpose the advancement of affordable housing begin insert received a welfare exemption under Section 214.15
28and that provides funding or land for affordable housing where
29the recordedend delete
30for properties intended to be sold to low-income families who
31participate in a special no-interest loan program.end insert
32begin insert(B)end insertbegin insert end insertbegin insertTheend insert
contract restricts the use of the land for at least 30 years
33tobegin insert owner-occupiedend insert housing available at affordable housing cost
34begin delete or affordable rentend delete in accordance withbegin delete Sectionsend deletebegin insert Sectionend insert
50052.5
35begin delete and 50053end delete of the Health and Safety Code.begin delete end delete
36(C) The contract includes a deed of trust on the property in
37favor of the nonprofit corporation to ensure compliance with the
38terms of the program, which has no value unless the owner fails
39to comply with the covenants and restrictions of the terms of the
40home sale.
P4 1(D) The local housing authority or an equivalent agency, or, if
2none exists, the city attorney or county counsel, has made a finding
3that the long-term deed
restrictions in the contract serve a public
4purpose.
5(E) The contract is recorded.
end insert
6(b) There is a rebuttable presumption that restrictions will not
7be removed or substantially modified in the predictable future and
8that they will substantially equate the value of the land to the value
9attributable to the legally permissible use or uses.
10(c) Grounds for rebutting the presumption may include, but are
11not necessarily limited to, the past history of like use restrictions
12in the jurisdiction in question and the similarity of sales prices for
13restricted and unrestricted land. The possible expiration of a
14restriction at a time certain shall not be conclusive evidence of the
15future removal or modification of the restriction unless there is no
16opportunity or likelihood of the continuation or renewal
of the
17restriction, or unless a necessary party to the restriction has
18indicated an intent to permit its expiration at that time.
19(d) In assessing land with respect to which the presumption is
20unrebutted, the assessor shall not consider sales of otherwise
21comparable land not similarly restricted as to use as indicative of
22value of land under restriction, unless the restrictions have a
23demonstrably minimal effect upon value.
24(e) In assessing land under an enforceable use restriction wherein
25the presumption of no predictable removal or substantial
26modification of the restriction has been rebutted, but where the
27restriction nevertheless retains some future life and has some effect
28on present value, the assessor may consider, in addition to all other
29legally permissible information, representative sales of comparable
30lands that are not under restriction but upon which natural
31
limitations have substantially the same effect as restrictions.
32(f) For the purposes of this section the following definitions
33apply:
34(1) “Comparable lands” are lands that are similar to the land
35being valued in respect to legally permissible uses and physical
36attributes.
37(2) “Representative sales information” is information from sales
38of a sufficient number of comparable lands to give an accurate
39indication of the full cash value of the land being valued.
P5 1(g) It is hereby declared that the purpose and intent of the
2Legislature in enacting this section is to provide for a method of
3determining whether a sufficient amount of representative sales
4information is available for land under use restriction in order to
5ensure the accurate assessment of that
land. It is also hereby
6declared that the further purpose and intent of the Legislature in
7enacting this section and Section 1630 is to avoid an assessment
8policy which, in the absence of special circumstances, considers
9uses for land that legally are not available to the owner and not
10contemplated by government, and that these sections are necessary
11to implement the public policy of encouraging and maintaining
12effective land use planning. This statute shall not be construed as
13requiring the assessment of any land at a value less than as required
14by Section 401 or as prohibiting the use of representative
15comparable sales information on land under similar restrictions
16when this information is available.
If the Commission on State Mandates determines that
18this act contains costs mandated by the state, reimbursement to
19local agencies and school districts for those costs shall be made
20pursuant to Part 7 (commencing with Section 17500) of Division
214 of Title 2 of the Government Code.
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