Tax Equity Allocation.

Plain English Breakdown

The bill's specific impact is limited to exchanges involving the City of Rancho Mirage, not all qualifying cities.

Tax Equity Allocation

This law changes how property tax money is shared between counties and cities by removing certain reductions for a specific city, requiring state reimbursement if it imposes costs on local agencies.

What This Bill Does

• Removes the requirement that auditors reduce property tax distributions to qualifying cities by amounts exchanged with community services districts, specifically involving the City of Rancho Mirage.
• Changes how property taxes are divided among local agencies in a county.
• Requires state reimbursement if the bill imposes costs on local agencies.

Who It Names or Affects

• Local auditors who manage property tax distributions.
• Qualifying cities that receive property tax revenue, specifically involving the City of Rancho Mirage.
• Community services districts involved in exchanges with qualifying cities.

Terms To Know

Tax Equity Allocation

A formula used to distribute property taxes among local agencies and cities.

State-mandated local program

A state requirement that forces local governments to follow certain rules or spend money on specific programs.

Limits and Unknowns

• The bill specifically affects the City of Rancho Mirage and does not specify which other qualifying cities are affected.
• It is unclear how much property tax revenue will be impacted by this change.
• The exact reimbursement process for local agencies depends on the Commission on State Mandates' determination.

Official Summary Text

AB 1112, as amended, Wallis.
Tax Equity Allocation.
Existing property tax law requires the auditor of each county with qualifying cities, as defined, to make certain property tax revenue allocations to those cities in accordance with an established Tax Equity Allocation formula. In any fiscal year in which a qualifying city is to receive a distribution under these provisions, existing law requires the auditor to reduce the actual amount distributed to the qualifying city by the sum of specified amounts, including any amount of property tax revenues that has been exchanged pursuant to specified law between the City of Rancho Mirage and a community services district.
This bill would remove the above-described property tax revenues from the reductions to the actual amount distributed. By changing the duties on local officials to administer Tax Equity Allocation, 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.
By removing the above-described property tax revenues from the reductions to the actual amount distributed, this bill would change the pro rata shares in which ad valorem property tax revenues are allocated among local agencies in a county, within the meaning of paragraph (3) of subdivision (a) of Section 25.5 of
Article XIII of the California Constitution, and thus would require for passage the approval of
2
/
3
of the membership of each house of the Legislature.

Current Bill Text

Download Bill PDF