Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2010
 

Revenue and Taxation Code

Property Taxation

Part 2. Assessment

Chapter 4. Assessment by State Board of Equalization Generally

Article 1. General Provisions*

Section 721.5

721.5. Electric generation facilities. (a) (1) Notwithstanding Section 721 or any other provision of law to the contrary, commencing with the lien date for the 2003–04 fiscal year, the board shall annually assess every electric generation facility with a generating capacity of 50 megawatts or more that is owned or operated by an electrical corporation, as defined in subdivisions (a) and (b) of Section 218 of the Public Utilities Code.

(2) For purposes of paragraph (1), "electric generation facility" does not include a qualifying small power production facility or a qualifying cogeneration facility within the meaning of Sections 201 and 210 of Title II of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. Secs. 796(17), (18) and 824a-3), and the regulations adopted for those sections under that act by the Federal Energy Regulatory Commission (18 C.F.R. 292.101–292.602).

(b) This section shall be construed to supersede any regulation, in existence as of the effective date of this section, that is contrary to this section.

History.—Added by Stats. 2002, Ch. 57 (AB 81), in effect January 1, 2003.

Construction.—The Board's assessment jurisdiction extends to all entities that can be considered "public utilities" under Article XIII, Section 19, regardless of whether they are regulated by the California Public Utilities Commission. Where the electric generation facilities supply electricity to the general public, they are considered to have made a dedication of their property to the public so as to be considered a public utility. Public utilities, which include all independent electric generation facilities that have dedicated their property to public use, are subject to unit valuation under this section. Such property is valued annually by the Board at its fair market value, and not valued based upon the limitations imposed on the assessment of real property by Article XIII A, Section 3. Independent Energy Producers Assn., Inc. v. State Bd. of Equalization (2004) 125 Cal.App.4th 425.

Constitutionality.—The change in assessment of independent electric generation facilities from local assessment to the Board does not violate Proposition 13 because the California Supreme Court has held that Proposition 13's restrictions on taxation of real property have no application to the unit taxation of public utility property under Article XIII, Section 19. Independent Energy Producers Assn., Inc. v. State Bd. of Equalization (2004) 125 Cal.App.4th 425.

Note.—Section 3 of Stats. 2002, Ch. 57 (AB 81) provided that this act shall not be construed to affect the manner in which property to which this act applies is assessed by the State Board of Equalization. Section 4 thereof provided that notwithstanding Section 17610 of the Government Code, if the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code. If the statewide cost of the claim for reimbursement does not exceed one million dollars ($1,000,000), reimbursement shall be made from the State Mandates Claims Fund.

* Article 1 was added by Stats. 1976, Ch. 877, p. 1990, in effect January 1, 1977.