UPDATE - June 11, 2015
On June 10th, Senate Constitutional Amendment 5 - a split roll property tax measure - was introduced.
With a two-thirds vote of the Legislature, SCA 5 would to amend the California State Constitution to allow for regular reassessments of commercial and industrial property to their fair market value, starting with the 2018-19 fiscal year. However, the constitutionally mandated 1 percent tax rate would be retained, and Proposition 13 protections would continue to apply to residential rental property and agricultural property.
The measure would also provide for a five-year phase-in of regular fair market value reassessments for certain commercial and industrial property owners; and exempt from personal property taxes $500,000 of tangible personal property used for business purposes, beginning January 1, 2019.
If approved by two-thirds of the California State Legislature, the measure would be placed on the November 2016 ballot. The Governor’s signature is not required.
BOMA California members are coordinating with Californians to Stop Higher Property Taxes and allied groups such as the California Chamber, CalTax, and Howard Jarvis, to respond to this attempt to amend Proposition 13, through news media, social media, and direct contact with legislators.
Regardless of what you may see or hear from the media, please know that BOMA California is pushing back. Click here for materials that can help you respond locally should you engage with the press or local opinion leaders.
Click here for the text of the split roll property tax measure SCA 5 (Mitchell & Hancock).
--------------------
UPDATE - May 12, 2015
A new effort to change Proposition 13 protections for commercial real estate has manifested.
Indeed, a group has formed to engender public opinion in support of changing Proposition 13 to include split roll and advance legislative efforts to introduce a bill in the California State Legislature to change existing property tax law. As leaders of the commercial real estate industry in California, please remain vigilant and conversant about the issue to help counter the political hyperbole.
Sign-up for updates from Californians to Stop Higher Property Taxes - a BOMA California partner organization, to stay appraised of the latest news.
---------------------
Original Post - May 16, 2014 |
| L to R: Asm. Ammiano; Asm. Bocanegra |
Over the years, a few complex property purchase deals have given the appearance of an attempt to avert the Proposition 13 change of ownership rules. The transactions have been highlighted and used to commove the reform proponents of the property tax law. This current agreement between stakeholders is meant to update some of the laws implementing statutes to address this viewpoint.
Currently, a property is reassessed when it is sold and/or changes ownership. However, if none of the purchasers acquires more than a 50% interest, reassessment may not necessarily be triggered. AB 2372 will be amended to clarify that as long as 90% of a property is sold, a reassessment would be triggered, regardless of whether any individual buys more than 50% of the property. Safeguards are being negotiated by your BOMA California advocates in Sacramento now to clarify that the change of ownership amendments do not apply to normal turnover of stock for publicly traded companies.
As our organizations have done in the past, BOMA San Francisco and BOMA California will continue to defend Proposition 13 - an initiative that protects both residential and commercial properties. However, part of an effective defense of the property tax law is to recognize that the intent of the original language may need to be updated to assure the voter approved goals of the initiative are being met. BOMA believes this agreement does just that.
Split Roll Measures Still Loom
For 2014, various members of the California State Legislature continue to pursue public policies that would undermine the intent of the property tax protections approved by voters under Proposition 13. Indeed, there are upwards of nine California Constitutional Amendments seeking to lower voter thresholds to amend the initiative's tax protection on properties from 2/3rds (66.66%) to 55%.
Rest assured that your fellow BOMA California members are working hard to protect the industry's interest. Stay tuned for updates in future blog posts.
No comments:
Post a Comment