SB 274

Bill Subjects

Abstract

(1) The California Constitution authorizes the Legislature to provide that a person who is either severely disabled or over the age of 55 years may transfer the base year value, as defined, of property that is eligible for the homeowners' property tax exemption to a replacement dwelling that is of equal or lesser value located within the same county as the property from which the base year value is transferred, provided the replacement dwelling is purchased or newly constructed within 2 years of the sale of the original property, subject to certain conditions. This bill would provide that the base year value of an original property may be transferred to a replacement dwelling that is of greater value, and would require the base year value of the replacement dwelling to be calculated by adding the difference between the full cash value of the original property and the full cash value of the replacement property to the base year value of the original property. This bill would extend the period of time during which a severely disabled person or a person over 55 years of age has to purchase or construct a replacement dwelling, in order to qualify for the transfer, from 2 years to 3 years of the sale of the original property. (2) Existing law defines "full cash value of the replacement dwelling" for purposes of this property tax relief to mean the replacement dwelling's full cash value, determined in accordance with a specified provision, as of the date on which the replacement dwelling was purchased or new construction was completed. This bill would provide that full cash value of the replacement dwelling may also mean, in specified circumstances, the fair market value of the replacement dwelling, determined in accordance with a specified provision, as of the date on which the original property is sold.  (3) By changing the manner in which local 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. (4) Section 2229 of the Revenue and Taxation Code requires the Legislature to reimburse local agencies annually for certain property tax revenues lost as a result of any exemption or classification of property for purposes of ad valorem property taxation. This bill would provide that, notwithstanding Section 2229 of the Revenue and Taxation Code, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill. (5) This bill would take effect immediately as a tax levy, but would become operative only if Senate Constitutional Amendment 11 of the 2009–10 Regular Session is approved by the voters.