SB 257

Bill Subjects

Abstract

Pursuant to constitutional authorization, existing property tax law provides a welfare exemption, pursuant to which property used exclusively for religious, hospital, scientific, or charitable purposes owned and operated by specified types of entities is exempt from taxation if it meets certain criteria, including that the property is used for the actual operation of the exempt activity, and does not exceed an amount of property reasonably necessary to the accomplishment of the exempt purpose. Under existing property tax law, property used exclusively for the charitable purposes of museums owned and operated by a religious, hospital, scientific, or charitable fund, foundation, limited liability company, or corporation that meets these criteria is deemed to be within the welfare exemption. Existing property tax law requires a person claiming the welfare exemption to file that claim with the assessor and obtain an organizational clearance certificate from the State Board of Equalization, as provided. This bill would define the term "museum" for these purposes. The bill would provide that property used exclusively for the charitable purposes of museums includes property that a museum makes available for special events, including private rental events for its individual or corporate members, that provide access to the museum's exhibitions, collections, or other educational offerings as part of the events, or that the museum makes available to other nonprofit or government organizations for charitable or governmental purposes, regardless of whether the museum charges any fee or receives charitable contributions in connection with those special events. The bill would further provide that these special event uses shall be considered related to the primary charitable purposes of museums and reasonably necessary or incidental to those purposes. By adding to the duties of assessors in administering the welfare exemption, 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 the statutory provisions noted above. Existing law requires the state 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 those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill. This bill would take effect immediately as a tax levy.