Amended in Assembly March 26, 2015

California Legislature—2015–16 Regular Session

Assembly BillNo. 697

Introduced by Assembly Member Chu

February 25, 2015

begin delete An act to amend Section 1101.5 of the Civil Code, relating to water conservation. end deletebegin insertAn act to add and repeal Section 17053 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.end insert


AB 697, as amended, Chu. begin deleteWater-conserving plumbing fixtures. end deletebegin insertPersonal income tax: credits: senior citizen renters.end insert

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The Personal Income Tax Law allows various credits against the tax imposed by that law, including for a qualified renter, defined as an individual who rented and occupied premises in this state which constituted his or her principal place of residence during at least 50% of the taxable year, in a specified amount based on adjusted gross income, as provided.

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This bill would allow, for each taxable year beginning on or after January 1, 2016, and before January 1, 2019, a credit in an amount equal to the increase in rent of a qualified residence in specified counties for the taxable year compared to the previous taxable year that is paid or incurred by a qualified taxpayer, which is defined as a senior citizen meeting a certain low-income requirements.

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This bill would take effect immediately as a tax levy.

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Existing law requires the replacement of plumbing fixtures that are not water conserving, as defined as noncompliant plumbing fixtures, in residential and commercial real property built and available for use on or before January 1, 1994, as specified.

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This bill would make technical, nonsubstantive changes to these provisions.

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Vote: majority. Appropriation: no. Fiscal committee: begin deleteno end deletebegin insertyesend insert. State-mandated local program: no.

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

P2    1begin insert

begin insertSECTION 1.end insert  

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(a) The Legislature finds and declares all of the

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3(1) According to a Kaiser Family Foundation study, California’s
4seniors have the nation’s highest poverty rate.

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begin insert

5(2) Twenty percent of California adults over 65 years of age
6live below the poverty threshold of about $16,000, when the higher
7cost of housing and health care are taken into account.

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begin insert

8(3) Nationally, homelessness among seniors is projected to rise
9by 33 percent between 2010 and 2020, and by 100 percent between
102010 and 2050, according to a 2010 report from the Homelessness
11Research Institute.

end insert
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12(4) The Los Angeles Homeless Services Authority reports that
13from 2011 to 2013, inclusive, Los Angeles County had a 29.1
14percent increase in the number of homeless people 62 years of age
15and older.

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16(5) According to a March 2013 report of the National Low
17Income Housing Coalition, California is the second least affordable
18state behind Hawaii.

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begin insert

19(6) According to the federal Department of Housing and Urban
20Development, fair market rent in California for a two-bedroom
21apartment is $1,341 a month. In order to afford this level of rent
22and utilities, without paying more than 30 percent of income on
23housing, a household needs to earn $4,470 monthly or $53,640
24 annually.

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25(7) Three out of the 10 most expensive metropolitan areas and
26six out of the 10 most expensive counties nationally are in

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28(8) In order to slow the growing numbers of homeless senior
29citizens being priced out of their homes, California must begin to
30explore practical means to slow this disaster.

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P3    1(b) The Legislature hereby enacts this act to test if the personal
2income tax credit described in Section 17053 of the Revenue and
3Taxation Code is a viable method to help low-income California
4senior renters remain in their homes.

end insert
5begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 17053 is added to the end insertbegin insertRevenue and Taxation
end insert
begin insert, to read:end insert

begin insert

begin insert17053.end insert  

(a) For each taxable year beginning on or after
8January 1, 2016, and before January 1, 2019, there shall be
9allowed as a credit against the “net tax,” as defined in Section
1017039, an amount equal to the increase in rent of a qualified
11residence for the taxable year compared to the previous taxable
12year that is paid or incurred by a qualified taxpayer.

13(b) For the purposes of this section, the following definitions
14shall apply:

15(1) “Qualified taxpayer” means a person with all of the
16following characteristics:

17(A) He or she is 62 years of age or older.

18(B) He or she rents a qualified residence as his or her primary
19residence, he or she is named on the lease for that residence, and
20he or she has rented that residence for a period of 12 months or

22(C) His or her combined annual household income is fifty
23thousand dollars ($50,000) or less, more than one-third of which
24is spent on rent.

25(2) “Qualifying residence” means a property that is located in
26the County of Alameda, the City and County of San Francisco, the
27County of Ventura, and the County of Santa Clara.

28(c) In the case where the credit allowed by this section exceeds
29the “net tax,” the excess may be carried over to reduce the “net
30tax” in the following year, and succeeding seven years, if
31necessary, until the total credit is exhausted.

32(d) A credit shall not be allowed under this section if a renter’s
33credit has been claimed by a taxpayer pursuant to Section 17053.5.

34(e) This section shall remain in effect only until December 1,
352019, and as of that date is repealed.

end insert
36begin insert

begin insertSEC. 3.end insert  

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This act provides for a tax levy within the meaning of
37Article IV of the Constitution and shall go into immediate effect.

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Section 1101.5 of the Civil Code is amended to

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(a) On or before January 1, 2019, all noncompliant
2plumbing fixtures in a multifamily residential real property and in
3a commercial real property shall be replaced with water-conserving
4plumbing fixtures.

5(b) An owner or the owner’s agent may enter the owner’s
6property for the purpose of installing, repairing, testing, and
7maintaining water-conserving plumbing fixtures required by this
8section, consistent with the notice requirements of Section 1954.

9(c) On and after January 1, 2019, the water-conserving plumbing
10fixtures required by this section shall be operating at the
11manufacturer’s rated water consumption at the time that the tenant
12takes possession. A tenant shall be responsible for notifying the
13owner or owner’s agent if the tenant becomes aware that a
14water-conserving plumbing fixture within his or her unit is not
15operating at the manufacturer’s rated water consumption. The
16owner or owner’s agent shall correct an inoperability in a
17water-conserving plumbing fixture upon notice by the tenant or if
18detected by the owner or the owner’s agent.

19(d) (1) On and after January 1, 2014, all noncompliant plumbing
20fixtures in a multifamily residential real property and in a
21commercial real property shall be replaced with water-conserving
22plumbing fixtures in the following circumstances:

23(A) For building additions in which the sum of concurrent
24building permits by the same permit applicant would increase the
25floor area of the space in a building by more than 10 percent, the
26building permit applicant shall replace all noncompliant plumbing
27fixtures in the building.

28(B) For building alterations or improvements in which the total
29construction cost estimated in the building permit is greater than
30one hundred fifty thousand dollars ($150,000), the building permit
31applicant shall replace all noncompliant plumbing fixtures that
32service the specific area of the improvement.

33(C) Notwithstanding subparagraph (A) or (B), for any alterations
34or improvements to a room in a building that require a building
35permit and that room contains any noncompliant plumbing fixtures,
36the building permit applicant shall replace all noncompliant
37plumbing fixtures in that room.

38(2) Replacement of all noncompliant plumbing fixtures with
39water-conserving plumbing fixtures, as described in paragraph (1),
40shall be a condition for issuance of a certificate of final completion
P5    1and occupancy or final permit approval by the local building

3(e) On and after January 1, 2019, a seller or transferor of
4multifamily residential real property or of commercial real property
5shall disclose to the prospective purchaser or transferee, in writing,
6the requirements of subdivision (a) and whether the property
7includes any noncompliant plumbing fixtures. This disclosure may
8be included in other transactional documents.


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