Real property tax: welfare exemption: moderate-income housing.

Plain English Breakdown

The exact definition of 'low- and moderate-income' households is not provided in the summary.

Real Property Tax Exemption for Moderate-Income Housing

The bill creates a partial property tax exemption for residential rental properties used by low- and moderate-income households.

What This Bill Does

• Provides a partial welfare exemption from real property taxes for certain residential rental properties serving low- and moderate-income households, based on the percentage of units serving these households relative to total units.
• Requires owners to certify under penalty of perjury that the units are indeed serving low- or moderate-income households.
• Expands duties for local tax officials who will need to verify this information.
• Limits state reimbursement to local agencies for property tax revenue lost due to this exemption.

Who It Names or Affects

• Owners and managers of residential rental properties serving low- and moderate-income households
• Local tax officials responsible for verifying property use

Terms To Know

welfare exemption

A reduction in real property taxes for certain types of non-profit or charitable uses.

severable

If part of the law is found to be invalid, the rest can still be used.

Limits and Unknowns

• The bill does not specify how local agencies will verify that properties are serving low- and moderate-income households.
• It limits state reimbursement for property tax revenue lost due to this exemption.
• The exact definition of 'low- and moderate-income' is not provided in the summary.

Official Summary Text

SB 336, as amended, Wiener.
Real property tax: welfare exemption: moderate-income housing.
Existing property tax law, pursuant to constitutional authorization, provides for a “welfare exemption” for property used exclusively for religious, hospital, scientific, or charitable purposes and that is owned or operated by certain types of nonprofit entities, if certain qualifying criteria are met. That law provides a partial welfare exemption in the case of residential rental property used for lower income households, as specified, calculated as that percentage of the value of the property that is equal to the percentage that the number of units serving lower income households represents of the total number of residential units.
This bill would provide a partial welfare exemption in the case of
certain
residential rental property used for low- and moderate-income households. The partial exemption would be equal to that percentage of the value of the property that is equal to the percentage that the number of units serving low- and moderate-income
households
households, as defined,
represents of the total number of residential units, as provided. The bill would require an owner to make specified certifications, under penalty of perjury, relating to the use of the property. By expanding the duties of local tax officials, and by expanding the crime of perjury, this bill would impose a state-mandated local program.
The bill would declare that its provisions are
severable.
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 with regard to certain mandates no reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so 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.

Current Bill Text

Download Bill PDF