SSF Neighbor Opines on Assembly Bill 2502 (Land Use), Assembly Bill 2668 (Property Taxation)

South San Francisco, CA   April 12, 2016   Pat Lee, SSF Neighbor & Guest Writer 

I try to stay on top of the happenings in our State Capital, especially bills that will have a direct impact on our local communities, which is no easy task when you try to follow how one bill will interact with others on the books or new ones coming into play. These two bills are especially important considering the housing crisis we see locally, and regionally, and it’s important that we understand the ramifications.  As appears so confusing so let me see if I can simplify. Please remember, this is only my opinion

I tried to read up on all the bills (CLICK HERE TO READ) and many articles seek to address this, including  Bartholomew’s piece in the SF Examiner (CLICK HERE). However it still seems confusing and it would be interesting to learn of other people’s opinions, which is why I am sharing mine below. We need this conversation.

AB2502-

This one the state assembly can approve w/o voter approval. Amends section 65850(which says the legislative body can regulate everything-buildings, height, size, parking, signs–anything you can think of) of the Government Code for Planning and Zoning Law
Basically city, county or city and county can regulate zoning including conditions of developments and inclusionary housing.
First of all does this mean that the city can set a regulation and then has to get approval from the county?
What the heck then does city and county mean?
This bill would allow mandates for rental stock regulations.
This would clarify a conflict in the regulations that arose as a result of the Palmer/Sixth St Properties, LP v City of Los Angeles (2009), which said the city’s inclusionary housing law was a type of rent control banned by the Costa-Hawkins Rental Housing Act, which basically says a city can’t do rental control on most single-family homes and apartment buildings built in 1995 and after.

Are you confused yet?

AB2668-

(sponsored by the Ca Assn of Realtors–surely no hands in the cookie jar) This one has to be approved by 2/3 of the voters after approved by the state legislature. amends Section 69.5 of the Revenue and Taxation code

Currrently Prop 60 and 90 allow for this if the property is worth less than the one they currently reside in. This would give a similar option if the new property is worth more.
How anyone will figure out how this really works is beyond me. There are so many if ands and buts it will make your head spin.
So here’s how it works I think..if you or any title holder of the property (ie:trustee–not corps or partnerships) is 55+ or severely disabled you can sell your owner occupied home and buy another in the same county you can apply for a property tax adjustment, as long as you do this within 2 yrs of selling the original home and buying the next one and the next one is worth more. You can transfer your base property tax year to the new home and keep your prop 13 amount in tact. The difference between the base year and the greater value is your new home tax basis, based on the full cash value of each
I think this means:
$500k original home
$700k new home
$200k difference-only this amount is added to your base yr value to determine your tax for new residence

This is a one time option unless you go from 55+ to severly disabled, then you and use this again

State will pay all administrative costs back to the county, but not the loss of property tax revenue

There are soooo many varieties that would come into play, this is ripe for a dispute if it passes.

You can use this out of county if the two counties agree..oh that should be fun!

The basis can b/c a nightmare..
..imagine a farm..the residence building is the only part that can claim this, the rest of the farm is not included–imagine figuring that out.
..imagine a condo..you really don’t own the land, just the building and you then move to a 55+ community-imagine figuring that out.
..imagine husband/wife–he is 55+ makes the claim, she benefits I guess, but what income tax implication does that have for her?
I can go on, but you get the idea. There are 20 pages of variables in the bill.

Now this provision would not include anything except owner occupied dwellings. So if you are not living in the home for whatever the reason, but need to sell the house for your upkeep there is not assistance to you in the next place. Family has to sell the home, pay capital gain and the rest you can use to care for yourself.

In sum seems Mullin thinks the housing shortage is caused by seniors and/or severally disabled not moving to smaller digs to free up larger homes because of the property tax basis. Now it may be true that some us stay put b/c of property taxes, but don’t think this bill will cure the housing shortage.

And that’s my opinion, I’d be interested to learn what others believe these two bills will accomplish.

-Pat Lee