Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2010
 

Revenue and Taxation Code

Property Taxation

Part 2. Assessment

CHAPTER 3. Assessment Generally


Article 1 General Requirements

Article 1.3 Assessment of Implements of Husbandry

Article 1.5 Valuation of Open-Space Land Subject to an Enforceable Restriction

Article 1.7 Valuation of Timberland and Timber

Article 1.9 Historical Property

Article 2 Information From Taxpayer

Article 2.5 Change in Ownership Reporting

Article 3 Arbitrary and Penal Assessments

Article 4 Property Escaping Assessment

Article 5 Tax-Deeded Property

Article 6 Assessment Roll

Article 7 Information to Other Taxing Agencies

Article 8 Appraiser Qualifications

Article 9 Consultant Contracts

Chapter 3. Assessment Generally

Article 1. General Requirements

401. Ratio of assessed to full value. Every assessor shall assess all property subject to general property taxation at its full value.

History.—Prior to 1966 this section provided "Except as provided in this part, all taxable property shall be assessed at its full cash value". A succession of amendments from 1966 through 1971 provided that a ratio of assessed value to full cash value of from 20% to 25% be employed and in successive years no less closer to 25% than in the immediate prior year, and that ultimately 25% be employed beginning with the lien date for 1971–72. See: Stats. 1966, p. 658 (First Extra Session), Stats. 1967, p. 942, Stats. 1968, p. 10 (First Extra Session), and Stats. 1971, p. 350. Present wording was enacted by Stats. 1972, p. 2191, in effect March 7, 1973. Stats. 1974, Ch. 311, p. 603, in effect January 1, 1975, substituted "full value" for "full cash value". Stats. 1978, Ch. 1207, in effect January 1, 1979, operative January 1, 1981, deleted "25 percent of" after "taxation at".

Constitutionality.—Article XI, Section 12, of the Constitution does not prohibit the assessment of taxable property by a county at a uniform fraction or ratio of its full cash or market value. Michels v. Watson, 229 Cal.App.2d 404.

Fractional assessments as required by the 1966 amendment to this section are not violative of California Constitution, article XI, section 12, which requires property to be assessed "at its full cash value." This phrase is a term of art and authorizes assessments at a uniform fraction of full cash value. Sacramento County v. Hickman, 66 Cal.2d 841.

"Full cash value", as used in the section, requiring that, with certain exceptions, property be taxed at its "full cash value," means market value. Union Oil Co. v. Ventura County, 41 Cal.App.3d 432; Freeport-McMoran Resource Partners v. Lake County, 12 Cal.App.4th 634.

Construction.—This statutory duty is mandatory. Domenghini v. San Luis Obispo County, 40 Cal.App.3d 689; Simms v. Pope, 218 Cal.App.3d 472. The duties of the assessor are established by statute (Section 401 et seq.). As a county officer, the assessor is subject to supervision by the board of supervisors of the county, but the county may not be compelled to perform the duties of the office. And as the office of the assessor is elective, the supervisory authority of the board of supervisors is limited to ensuring that the assessor faithfully performs the duties of the office, and it does not permit the board to control the manner in which the duties are performed. Thus, the county could not be ordered to grant an exemption from property tax since that duty, when it exists, is one the assessor must perform. Connelly v. Orange County, 1 Cal.4th 1105.

Declaratory relief.—Declaratory relief is unavailable to restrict future assessment practices where there is no showing that the assessor will fail to follow the law and it is conjectural whether a justiciable controversy will arise. Burke v. City and County of San Francisco, 258 Cal.App.2d 32.

Riparian rights.—Riparian rights, being "rights and privileges appertaining to" land [see Section 104], their inclusion in the assessment of the land is contemplated. Thus, if there is to be a separate assessment of riparian lands to one person and of the riparian rights to another, the exclusion of these rights in the assessment of the former must clearly appear. Spring Valley Water Co. v. Alameda County, 24 Cal.App. 278, 281. See also Spring Valley Water Co. v. Alameda County, 88 Cal.App. 157, 163.

Leaseholds.—In determining the value of a leasehold the following items should be considered: (1) Duration of lease; (2) excess of annual benefits derived from the lease over burdens; (3) amortization, during lease, of capital employed; (4) amortization of improvements which revert to the lessor; (5) taxes and other fixed charges. The combined net earnings of the lease over the entire term is its ultimate value, and its present value as of any date upon any assumed rate of interest can be computed from that basis, and the result is the approximate present value of the leasehold. Blinn Lumber Co. v. Los Angeles County, 216 Cal. 474, noted in 21 Calif. L. Rev. 596. Contra, De Luz Homes, Inc. v. San Diego County, 45 Cal.2d 546, holding that in valuing a leasehold by the capitalization of income method it is improper, in computing the anticipated net earnings to be capitalized, to deduct from anticipated gross income the lessee's charges for rent and amortization of his investment, and that statements in the Blinn case requiring the assessing authorities to deduct such charges are disapproved.

The proper method of computing the value of a leasehold of an exempt housing project at a permanent military installation is to deduct from annual anticipated gross income the operating and maintenance expenses and the amount required by the lease to be deposited to a replacement reserve, and to capitalize the difference for the remaining years of the lease at a rate which will allow for risk, interest, and taxes. De Luz Homes, Inc. v. San Diego County, 45 Cal.2d 546; Fairfield Gardens, Inc. v. Solano County, 45 Cal.2d 575; Victor Valley Housing Corp. v. San Bernardino County, 45 Cal.2d 580; El Toro Development Co., Inc. v. Orange County, 45 Cal.2d 586.

Under the capitalization of income method of valuation, it is improper when computing the full cash value to deduct from the anticipated gross receipts, the amount of rent reserved. A leasehold is not less valuable because it has not been paid for in advance, and to draw a distinction between rent paid and rent to be paid confuses the equity the lessee has in the leasehold with its value. Taxation of property at its value without regard to the owner's equity therein is an established principle of ad valorem taxation. The Texas Co. v. Los Angeles County, 52 Cal.2d 55.

Amortization and rental provisions which leave the lessee without equity in a garage operated by a nonprofit corporation under a lease from a city are not to be considered in valuation of the leasehold interest in the garage for tax purposes. Stamps v. Board of Supervisors, 233 Cal.App.2d 256.

In assessing the value of a lessee's possessory interests in tax-exempt land and improvements, it is proper to assess the values of the land and improvements separately. If there is insufficient history of income and expenses and an appraisal based on capitalization thereof would be unreliable, it is proper to use the "imputed income method" if the land and improvements are to be used for enterprise activity. Where a lessee leases property for a certain period and is given the option to extend the lease for an additional like period, the lease term is the total of both periods. Where leased improvements will reach the end of their economic life before the lease terminates, it is proper to value them by the "reproduction cost less depreciation" method. Riverside County v. Palm-Ramon Development Co., 63 Cal.2d 534.

Liability of assessors.—An assessment of property at less than its actual value, if made with the purpose of enabling the one assessed to evade taxation, is not a refusal or neglect to perform an official duty, but a "willful and corrupt misconduct in office," for which the assessor might be accused by the grand jury under Section 758 of the Penal Code; but if made in the ordinary exercise of his official duty, without any corrupt or illegal motive, is of a judicial nature, for which he is not amenable to the penal laws of the state. Siebe v. Superior Court, 114 Cal. 551.

A complaint against an assessor alleging that he " willfully and against law" assessed plaintiff's property at too large a sum does not state a cause of action. Such an allegation, without an averment that he acted maliciously and with an intent to wrong or injure the owner of the property, does not negate the presumption that he simply erred in judgment, for which he is not civilly liable, the only remedy being by application to the Board of Equalization. Ballerino v. Mason, 83 Cal. 447.

Work in progress.—Aircraft in the process of being manufactured may be assessed at the book value computed by the corporate owner, despite the fact that such book value contains costs which are directly attributable to the development of the production technique on previously sold aircraft, and not to the aircraft actually being assessed. Lockheed Aircraft Corp. v. Los Angeles County, 207 Cal.App.2d 119.

Assessment of motion picture negatives.—"Market value" for assessment purposes is the value of property when put to beneficial use; it is not merely whatever residual value may remain should the property be reduced to its constituent elements. In the event the beneficial use of the property would not pass to a willing buyer on an open market, the assessor must treat the property as having no actual market for valuation purposes and use such pertinent factors as replacement costs and income analysis for determining valuation. Michael Todd Co. v. Los Angeles County, 57 Cal.2d 684.

Cyclical reassessment.—Where not possible to assess all parcels of real property in one year, a program of assessment of equal numbers of parcels yearly over a three-year period is valid. Lord v. Marin County, 214 Cal.App.2d 25.

Valuation of property on annexation.—When tax-exempt property is included within unhabitated territory proposed to be annexed, its value, for protest purposes, is determined by the county assessor in the same amount he would assess such property if it were not tax exempt, regardless of whether the owner of the tax-exempt property is a protestant. Guerrieri v. City of Fontana, 232 Cal.App.2d 417.

Note.—For additional cases relating to value, see annotations to Section 110 of the code and to Article XIII, Section 1, of the Constitution.

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401.3. Assessment according to value on lien date. The assessor shall assess all property subject to general property taxation on the lien date as provided in Articles XIII and XIII A of the Constitution and any legislative authorization thereunder.

History.—Added by Stats. 1970, p. 390, in effect November 23, 1970. Stats. 1986, Ch. 608, effective January 1, 1987, substituted "on the lien date as provided in Articles XIII and XIII A of the Constitution and any legislative authorization thereunder" for "according to its value on the lien date" after "taxation".

401.4. Valuation of owner-occupied single-family dwelling. When valuing an owner-occupied single-family dwelling and the land on which it is situated that may be required for the convenient occupation and use of such dwelling, if such dwelling is on land which is zoned exclusively for single-family home use or which is zoned for agricultural use where single-family homes are permitted, the assessor shall not value the land at any value greater than that which would reflect the use of the land as a site for a single-family dwelling.

As used in this section, owner-occupied single-family dwelling means any single-family dwelling occupied by an owner thereof as his principal place of residence on the lien date.

History.—Added by Stats. 1972, p. 2960, in effect December 26, 1972, operative on the lien date in 1973. Stats. 1973, Ch. 208, p. 563, in effect July 11, 1973, eliminated two paragraphs stating temporary nature of the section and intention to enact a more detailed program for valuation of single-family dwellings under Section 2.5 of Article XIII of the State Constitution.

Note.—Section 62 of Stats. 1973, Ch. 208, p. 569, provided no payment by state to local governments because of this act.

401.5. Board shall issue data to assessors. The board shall issue to assessors data relating to costs of property, or, with respect to commercial and industrial property, shall, after a public hearing, review and approve commercially available data, and shall issue to assessors other information as in the judgment of the board will promote uniformity in appraisal practices and in assessed values throughout the state. An assessor shall adapt data received pursuant to this section to local conditions and may consider that data together with other factors as required by law in the assessment of property for tax purposes.

History.—Added by Stats. 1947, p. 2301, in effect September 19, 1947. Stats. 1996, Ch. 1087, in effect January 1, 1997, substituted ", or, with respect to commercial and industrial property, shall, after a public hearing, review and approve commercially available data, and shall issue to assessors" for "and such" after "costs of property", and substituted "state" for "State" after "throughout the" in the first sentence; and substituted "An assessor shall adapt data received pursuant to this section to local conditions and may consider that data" for "These data shall be adapted to local conditions and may be considered by the assessors" in the second sentence.

401.6. Entrepreneurial profit. (a) In any case in which the cost approach method is used to value special use property for purposes of taxation, the assessor shall not add a component for entrepreneurial profit unless he or she has market-derived evidence that entrepreneurial profit exists and has not been fully offset by physical deterioration or economic obsolescence.

(b) For purposes of this section:

(1) "Entrepreneurial profit" means either of the following:

(A) The amount a developer would expect to recover with respect to a property in excess of the amount of the developer's costs incurred with respect to that property.

(B) The difference between the fair market value of a property and the total costs incurred with respect to that property.

(2) "Total costs" means both direct costs of construction, including, but not limited to, the costs of land, building materials, and labor, and indirect costs of construction, including, but not limited to, the costs of construction capital and permit fees.

(3) "Special use property" means a limited market property with a unique physical design, special construction materials, or a layout that restricts its utility to the use for which it was built.

History.—Added by Stats. 1995, Ch. 399, in effect January 1, 1996.

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401.8. Intercounty pipeline rights-of-way. (a) Notwithstanding any other provision of law, commencing with the 1995–96 fiscal year, the county assessor shall determine the property tax assessed value in the county attributable to assessable intercounty pipeline rights-of-way on the basis of a single, countywide parcel per taxpayer by combining the assessed values of each separate right-of-way interest, or segment thereof, of the taxpayer in the county. However, the assessor shall maintain a separate base year value as determined pursuant to Section 110.1 for each separate right-of-way interest, or segment thereof.

(b) Any assessment appeal that is authorized to be filed in Sections 401.10 to 401.12, inclusive, with respect to an intercounty pipeline right-of-way interest, or segment thereof, for which the assessor did not assign a value in the manner specified in subdivision (a) of Section 401.10, shall be filed by the taxpayer upon one or more specified intercounty pipeline right-of-way interests, or segments thereof, as described in subdivision (a), and in no event shall be filed with respect to a taxpayer's entire, undivided intercounty pipeline right-of-way. The assessor shall maintain for five calendar years those records for each assessment year that identify each intercounty pipeline right-of-way interest, or segment thereof, located within his or her county, and shall provide the information in those records with respect to a given intercounty pipeline right-of-way interest, or segment thereof, to the taxpayer upon request.

History.—Added by Stats. 1995, Ch. 32, in effect June 28, 1995. Stats. 1996, Ch. 801, in effect September 24, 1996, added subdivision letter designation (a) before "Notwithstanding any other", and added subdivision (b).

Note.—Sec. 1 of Stats. 1996, Ch. 801 provides that the Legislature finds and declares that there are possible conflicts between the existing Section 401.8 of the Revenue and Taxation Code, as proposed to be added by Assembly Bill 1286. Therefore, it is the intent of the Legislature in enacting Section 2 of this act to amend Section 401.8 of the Revenue and Taxation Code to eliminate any possible conflict between that section and Sections 401.10 to 401.12, inclusive, of the Revenue and Taxation Code, as added by Chapter 76 of the Statutes of 1996.

401.9. Land use restriction contracts; 1997 recordations. [Repealed by Stats. 2003, Ch. 471 (SB 1062), in effect January 1, 2004.]

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401.10. Intercounty pipelines; full cash value. [Repealed by Stats. 1997, Ch. 17 (SB 947), in effect January 1, 1998.]

Effective until January 1, 2011

401.10. Intercounty pipelines; full cash value. (a) Notwithstanding any other provision of law relating to the determination of the values upon which property taxes are based, values for each tax year from the 1984–85 tax year to the 2010–11 tax year, inclusive, for intercounty pipeline rights-of-way on publicly or privately owned property, including those rights-of-way that are the subject of a change in ownership, new construction, or any other reappraisable event during the period from March 1, 1975, to June 30, 2011, inclusive, shall be rebuttably presumed to be at full cash value for that year, if all of the following conditions are met:

(1) (A) The full cash value is determined to equal a 1975–76 base year value, annually adjusted for inflation in accordance with subdivision (b) of Section 2 of Article XIII A of the California Constitution, and the 1975–76 base year value was determined in accordance with the following schedule:

(i) Twenty thousand dollars ($20,000) per mile for a high density property.

(ii) Twelve thousand dollars ($12,000) per mile for a transitional density property.

(iii) Nine thousand dollars ($9,000) per mile for a low density property.

(B) For purposes of this section, the density classifications described in subparagraph (A) are defined as follows:

(i) "High density" means Category 1 (densely urban) as established by the State Board of Equalization.

(ii) "Transitional density" means Category 2 (urban) as established by the State Board of Equalization.

(iii) "Low density" means Category 3 (valley-agricultural), Category 4 (grazing), and Category 5 (mountain and desert) as established by the State Board of Equalization.

(2) The full cash value is determined utilizing the same property density classifications that were assigned to the property by the State Board of Equalization for the 1984–85 tax year or, if the density classifications were not so assigned to the property for the 1984–85 tax year, the density classifications that were first assigned to the property by the board for a subsequent tax year.

(3) (A) If a taxpayer owns multiple pipelines in the same right-of-way, an additional 50 percent of the value attributed to the right-of-way for the presence of the first pipeline, as determined under paragraphs (1) and (2), shall be added for the presence of each additional pipeline up to a maximum of two additional pipelines. For any particular taxpayer, the total valuation for a multiple pipeline right-of-way shall not exceed 200 percent of the value determined for the right-of-way of the first pipeline in the right-of-way in accordance with paragraphs (1) and (2).

(B) If the State Board of Equalization has determined that an intercounty pipeline, located within a multiple pipeline right-of-way previously valued in accordance with subparagraph (A), has been abandoned as a result of physical removal or blockage, the assessed value of the right-of-way attributable to the last pipeline enrolled in accordance with subparagraph (A) shall be reduced by not less that 75 percent of that increase in assessed value that resulted from the application of subparagraph (A).

(4) If all pipelines of a taxpayer located within the same pipeline right-of-way, previously valued in accordance with this section, are determined by the State Board of Equalization to have been abandoned as the result of physical removal or blockage, the assessed value of that right-of-way to that taxpayer shall be determined to be no more than 25 percent of the assessed value otherwise determined for the right-of-way for a single pipeline of that taxpayer pursuant to paragraphs (1) and (2).

(b) If the assessor assigns values for any tax year from the 1984–85 tax year to the 2010–11 tax year, inclusive, in accordance with the methodology specified in subdivision (a), the taxpayer's right to assert any challenge to the right to assess that property, whether in an administrative or judicial proceeding, shall be deemed to have been raised and resolved for that tax year and the values determined in accordance with that methodology shall be rebuttably presumed to be correct. If the assessor assigns values for any tax year from the 1984–85 tax year to the 2010–11 tax year, inclusive, in accordance with the methodology specified in subdivision (a), any pending taxpayer lawsuit that challenges the right to assess the property shall be dismissed by the taxpayer with prejudice as it applies to intercounty pipeline rights-of-way.

(c) Notwithstanding any change in ownership, new construction or decline in value occurring after March 1, 1975, if the assessor assigns values for rights-of-way for any tax year from the 1984–85 tax year to the 2010–11 tax year, inclusive, in accordance with the methodology specified in subdivision (a), the taxpayer may not challenge the right to assess that property and the values determined in accordance with that methodology shall be rebuttably presumed to be correct for that property for that tax year.

(d) Notwithstanding any change in ownership, new construction, or decline in value occurring after March 1, 1975, if the assessor does not assign values for rights-of-way for any tax year from the 1984–85 tax year to the 2010–11 tax year, inclusive, at the 1975–76 base year values specified in subdivision (a), any assessed value that is determined on the basis of valuation standards that differ, in whole or in part, from those valuation standards set forth in subdivision (a) shall not benefit from any presumption of correctness, and the taxpayer may challenge the right to assess that property or the values for that property for that tax year. As used herein, a challenge to the right to assess shall include any assessment appeal, claim for refund, or lawsuit asserting any right, remedy, or cause of action relating to or arising from, but not limited to, the following or similar contentions:

(1) That the value of the right-of-way is included in the value of the underlying fee or railroad right-of-way.

(2) That assessment of the value of the right-of-way to the owner of the pipeline would result in double assessment.

(3) That the value of the right-of-way may not be assessed to the owner of the pipeline separately from the assessment of the value of the underlying fee.

(e) Notwithstanding any other provision of law, during a four-year period commencing on the effective date of this section, the assessor may issue an escape assessment in accordance with the specific valuation standards set forth in subdivision (a) for the following taxpayers and tax years:

(1) Any intercounty pipeline right-of-way taxpayer who was a plaintiff in Southern Pacific Pipe Lines, Inc. v. State Board of Equalization (1993) 14 Cal.App.4th 42, for the tax years 1984–85 to 1996–97, inclusive.

(2) Any intercounty pipeline right-of-way taxpayer who was not a plaintiff in Southern Pacific Pipe Lines, Inc. v. State Board of Equalization (1993) 14 Cal.App.4th 42, for the tax years 1989–90 to 1996–97, inclusive.

(f) Any escape assessment levied under subdivision (e) shall not be subject to penalties or interest under the provisions of Section 532. If payment of any taxes due under this section is made within 45 days of demand by the tax collector for payment, the county shall not impose any late payment penalty or interest. Taxes not paid within 45 days of demand by the tax collector shall become delinquent at that time, and the delinquent penalty, redemption penalty, or other collection provisions of this code shall thereafter apply.

(g) For purposes of this section, "intercounty pipeline right-of-way" means, except as otherwise provided in this subdivision, any interest in publicly or privately owned real property through which or over which an intercounty pipeline is placed. However, "intercounty pipeline right-of-way" does not include any parcel or facility that the State Board of Equalization originally separately assessed using a valuation method other than the multiplication of pipeline length within a subject property by a unit value determined in accordance with the density category of that subject property.

(h) This section shall remain in effect only until January 1, 2011, and, as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2011, deletes or extends that date.

History.—Added by Stats. 1996, Ch. 801, in effect September 24, 1996. Stats. 1997, Ch. 17 (SB 947), in effect January 1, 1998, renumbered former section 410.10 to 401.10, added "from" after "period" in the first sentence of subdivision (a), deleted paragraph (1) of subdivision (h) which stated "(1) It is the intent of the Legislature in enacting this section that this section supersede and be operative in place of Section 401.10 of the Revenue and Taxation Code, as added by Chapter 76 of the Statutes of 1996.", and deleted paragraph designation (2) before "This section" in subdivision (h). Stats. 2000, Ch. 607 (AB 2612), in effect January 1, 2001, substituted "2010-11" for "2000-01" after "to the", added "from" after "the period", and substituted "2011" for "2001" after "June 30," in the first sentence of subdivision (a); substituted "2010-11" for "2000-01" after "to the" in the first sentence, and substituted "2010-11" for "2000-01" after "to the" in the second sentence of subdivision (b); substituted "2010-11" for "2000-01" after "to the" in the first sentence of subdivision (c); substituted "2010-11" for "2000-01" after "to the" in the first sentence of subdivision (d); and substituted "2011" for "2001" after "January 1," twice in the first sentence of subdivision (h).

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401.11. Intercounty pipelines; refunds and billings. [Repealed by Stats. 1997, Ch. 17 (SB 947), in effect January 1, 2000.]

401.12. Intercounty pipelines; settlement agreement controls. Sections 401.10 and 401.11 do not abrogate, rescind, preclude, or otherwise affect any separate settlement agreement entered into prior to the effective date of those sections between a county and an intercounty pipeline right-of-way taxpayer concerning the subject matter of Sections 401.10 and 401.11. In the event of a conflict between any settlement agreement and the provisions of Sections 401.10 and 401.11, the settlement agreement shall control.

History.—Added by Stats. 1996, Ch. 76, in effect June 28, 1996.

401.13. Intracounty pipelines; consolidated assessment. Notwithstanding any other provision of law, on or after January 1, 1998, the assessor shall determine the assessed value of pipelines and related rights-of-way that are located wholly within the county on the basis of a single, countywide parcel per taxpayer, and, to that end, shall combine the assessed value of each component or segment of those pipelines or rights-of-way. However, the assessor shall maintain a separate base year value for each of these components or segments.

History.—Added by Stats. 1997, Ch. 941 (SB 542), in effect January 1, 1998.

401.15. Certificated aircraft; fiscal years 1997–98 to 2003–04. (a) Notwithstanding any other provision of law, for any county that makes available the credits provided for in Section 5096.3, the full cash values of certificated aircraft for fiscal years to the 1997–98 fiscal year, inclusive, are presumed to be those values enrolled by the county assessor or, in the case of timely escape assessments upon certificated aircraft issued on or after April 1, 1998, pursuant to Sections 531, 531.3, and 531.4, the values enrolled upon those escape assessments, provided that the escape assessment is made in accordance with the methodology in subdivision (b). For escape assessments for fiscal years to the 1997–98 fiscal year, inclusive, the assessor shall use the methodology and minimum and market values set by the California Assessors' Association for the applicable fiscal year in lieu of the methodology set forth in subparagraph (C) or (D) of paragraph (1) of subdivision (b). The assessor is not required to revise or change existing enrolled assessments that are not subject to escape assessment to reflect the methodology in this section. Nothing in this section precludes audit adjustments and offsets as set forth in Section 469 or the correction of reporting errors raised by an airline. Nothing in this section affects any presumption of correctness concerning allocation of aircraft values.

(b) (1) For the 1998–99 fiscal year to the 2002–03 fiscal year, inclusive, and including escape assessments levied on or after April 1, 1998, for any fiscal year to the 2002–03 fiscal year, inclusive, except as otherwise provided in subdivision (a), certificated aircraft shall be presumed to be valued at full market value if all of the following conditions are met:

(A) Except as provided in subparagraph (D), value is derived using original cost. The original cost shall be the greater of the following:

(i) Taxpayer's cost for that individual aircraft reported in accordance with generally accepted accounting principles, so long as that produces net acquisition cost, and to the extent not included in the taxpayer's cost, transportation costs and capitalized interest and the cost of any capital addition or modification made before a transaction described in clause (ii).

(ii) The cost established in a sale/leaseback or assignment of purchase rights transaction for that individual aircraft that transfers the benefits and burdens of ownership to the lessor for United States federal income tax purposes.

If the original cost for leased aircraft cannot be determined from information reasonably available to the taxpayer, original cost may be determined by reference to the "average new prices" column of the Airliner Price Guide for that model, series, and year of manufacture of aircraft. If information is not available in the "average new prices" column for that model, series, and year, the original cost may be determined using the best indicator of original cost plus all conversion costs incurred for that aircraft. In the event of a merger, bankruptcy, or change in accounting methods by the reporting airline, there shall be a rebuttable presumption that the cost of the individual aircraft and the acquisition date reported by the acquired company, if available, or the cost reported prior to the change in accounting method, are the original cost and the applicable acquisition date.

(B) Original cost, plus the cost of any capital additions or modifications not otherwise included in the original cost, shall be adjusted from the date of the acquisition of the aircraft to the lien date using the producer price index for aircraft and a 16-year straight-line percent good table starting from the delivery date of the aircraft to the current owner or, in the case of a sale/leaseback or assignment of purchase rights transaction, as described in this section, the current operator with a minimum combined factor of 25 percent, unless this adjustment results in a value less than the minimum value for that aircraft computed pursuant to subparagraph (C), in which case the minimum value may be used. If original cost is determined by reference to the Airliner Price Guide "average new prices" column, the adjustments required by this paragraph shall be made by setting the acquisition date of the aircraft to be the date of the aircraft's manufacture.

(C) For certificated aircraft of a model and series that has been in revenue service for eight or more years, the minimum value shall not exceed the average of the used aircraft prices shown in columns other than the "average new prices" column for used aircraft of the oldest aircraft for that model and series in the Airliner Price Guide most recently published as of the lien date. Minimum values shall not be utilized for certificated aircraft of a model and series that has been in revenue service for less than eight years.

(D) For out-of-production aircraft that were recommended to be valued by a market approach for 1998 by the California Assessors' Association, assessments will be based at the lower of the following:

(i) The values established by the association for the 1998 lien date.

(ii) The average of the used aircraft prices shown in the columns other than the "average new prices" column for used aircraft of the five oldest years for the aircraft model and series or that lesser time for which data is available in the Airliner Price Guide.

(2) Notwithstanding paragraph (1), in computing assessed value, the assessor may allow for extraordinary obsolescence if supported by market evidence and the taxpayer may challenge the assessment for failure to do so. To constitute market evidence of extraordinary obsolescence and to permit an assessment appeal, the evidence must show that the functional and/or economic obsolescence is in excess of 10 percent of the value for the aircraft model and series otherwise established pursuant to subparagraph (B), (C), or (D) of paragraph (1).

(3) For purposes of paragraph (1), if the Airliner Price Guide ceases to be published or the format significantly changes, a guide or adjustment agreed to by the airlines and the taxing counties shall be substituted.

(c) (1) For the 2003–04 fiscal year, certificated aircraft shall be presumed to be valued at full market value if all of the following conditions are met:

(A) Except as provided in subparagraph (D), value is derived using original cost. The original cost shall be the greater of the following:

(i) Taxpayer's cost for that individual aircraft reported in accordance with generally accepted accounting principles, so long as that produces net acquisition cost, and to the extent not included in the taxpayer's cost, transportation costs and capitalized interest and the cost of any capital addition or modification made before a transaction described in clause (ii).

(ii) Taxpayer's cost as established pursuant to this subdivision plus one-half of the incremental difference between taxpayer's cost and the cost established in a sale/leaseback or assignment of purchase rights transaction for individual aircraft that transfers the benefits and burdens of ownership to the lessor for United States federal income tax purposes.

If the original cost for leased aircraft cannot be determined from information reasonably available to the taxpayer, original cost may be determined by reference to the "average new prices" column of the Airliner Price Guide for that model, series, and year of manufacture of aircraft. If information is not available in the "average new prices" column for that model, series, and year, the original cost may be determined using the best indicator of original cost plus all conversion costs incurred for that aircraft. In the event of a merger, bankruptcy, or change in accounting methods by the reporting airline, there shall be a rebuttable presumption that the cost of the individual aircraft and the acquisition date reported by the acquired company if available, or the cost reported prior to the change in accounting method, are the original cost and the applicable acquisition date.

(B) Original cost, plus the cost of any capital additions or modifications not otherwise included in original cost, shall be adjusted from the date of the acquisition of the aircraft to the lien date using the producer price index for aircraft and a 16-year straight-line percent good table starting from the delivery date of the aircraft to the current owner or, in the case of a sale/leaseback or assignment of purchase rights transaction, as described in this section, the current operator with a minimum combined factor of 25 percent, unless this adjustment results in a value less than the minimum value for that aircraft computed pursuant to subparagraph (C), in which case the minimum value may be used. If original cost is determined by reference to the Airliner Price Guide "average new prices" column, the adjustments required by this paragraph shall be made by setting the acquisition date of the aircraft to be the date of the aircraft's manufacture.

(C) For certificated aircraft of a model and series that has been in revenue service for eight or more years, the minimum value shall not exceed the average of the used aircraft prices shown in columns other than the "average new prices" column for used aircraft of the oldest aircraft for that model and series in the Airliner Price Guide most recently published as of the lien date. Minimum values shall not be utilized for certificated aircraft of a model and series that has been in revenue service for less than eight years.

(D) For out-of-production aircraft that were recommended to be valued by a market approach for 1998 by the California Assessors' Association, their assessments shall be based at the lower of the following:

(i) The values established by the association for the 1998 lien date.

(ii) The average of the used aircraft prices shown in the columns other than the "average new prices" column for used aircraft of the five oldest years for the aircraft model and series or that lesser time for which data is available in the Airliner Price Guide.

(2) Notwithstanding paragraph (1), in computing assessed value, the assessor may allow for extraordinary obsolescence if supported by market evidence and the taxpayer may challenge the assessment for failure to do so. To constitute market evidence of extraordinary obsolescence and to permit an assessment appeal, the evidence must show that the functional and or economic obsolescence is in excess of 10 percent of the value for the aircraft model and series otherwise established pursuant to subparagraph (B), (C), or (D) of paragraph (1).

(3) For purposes of paragraph (1), if the Airliner Price Guide ceases to be published or the format significantly changes, a guide or adjustment agreed to by the airlines and the taxing counties shall be substituted.

(d) To calculate the values prescribed in subdivisions (b) and (c), the taxpayer shall, to the extent that information is reasonably available to the taxpayer, furnish the county assessor with an annual property statement that includes the aircraft original costs as defined in subparagraph (A) of paragraph (1) of subdivision (b) or (c). If an air carrier that has this information reasonably available to it fails to report original cost and additions, as required by Sections 441 and 442, an assessor may make an appropriate assessment pursuant to Section 501.

History.—Added by Stats. 1998, Ch. 86 (AB 1807), in effect June 30, 1998. Stats. 1999, Ch. 83 (SB 966), in effect January 1, 2000, added "that" after "assessments, provided" in the first sentence of subdivision (a); added a comma after "acquired company" and substituted "method, are" for "method is" after "in accounting" in the third sentence of the second paragraph and substituted "association" for "Association" after "by the" in clause (i) of subparagraph (D) of subsection (i), and substituted "and/or" for "and or" after "the functional" in the second sentence of subsection (2) of subdivision (b); added a comma after "acquired company" and substituted "method, are" for "method is" after "in accounting" in the third sentence of the second paragraph and substituted "association" for "Association" after "by the" in clause (i) of subparagraph (D) of subsection (1) of subdivision (c); and substituted "To" for "In order to" before "calculate" in the first sentence, and substituted "If" for "In the event" before "an air carrier", deleted "Revenue and Taxation Code" after "required by", deleted "in that case" after "an assessor may", and deleted "Revenue and Taxation Code" after "pursuant to" in the second sentence of subdivision (d).

Note.—Section 1 of Stats. 1998, Ch. 86 (AB 1807) provided that (a) the Legislature finds and declares all of the following:

(1) Two of the most difficult and contentious property tax assessment issues in recent years have concerned the assessment of certificated aircraft and airline possessory interests, other than interests stated in a written agreement for terminal, cargo, hangar, automobile parking lots, storage and maintenance facilities and other buildings and the land thereunder leased in whole or in part by an airline.

(2) These issues have given rise to litigation and appeals challenging assessments involving hundreds of millions of dollars of property tax revenues.

(3) The uncertainty created by pending litigation and appeals over the assessment of airline property and possessory interests in publicly owned airports is disruptive to both airline industry tax planning and local government and school finance.

(b) It is the intent of the Legislature in enacting this act to facilitate resolution of the disputes over the assessment of certificated aircraft by codifying recommendations produced by a county and airline industry working group, that do all of the following:

(1) Establish valuation methodology for certificated aircraft.

(2) Clearly establish a presumption of correctness if county assessors follow the assessment methodology set out in this measure and in Assembly Bill 2318.

(3) Dispose of certain outstanding litigation and appeals over aircraft valuation.

(4) Mitigate the financial impact of this statutory change on local governments and schools by establishing a method by which the issuance of any prior year refunds to litigating airlines would be treated as credits against future tax payments.

Section 6 thereof provided that this act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:

This measure is necessary to provide guidance and clarification that is essential to the fair and efficient taxation of airline industry property and possessory interests in publicly owned airports in the current year, and to clarify the status of prior-year property tax payments that have funded essential services provided by local governments and schools.

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401.16. Percent good factors. If, for purposes of property taxation, the county assessor utilizes the reproduction or replacement cost approach to value to determine the value of tangible personal property or trade fixtures, both of the following apply:

(a) (1) If the county assessor depreciates this property using percent good factors published by the State Board of Equalization that provide separate factors for property that is first acquired new and property that is first acquired used, the assessor may not average the published factors to apply these factors to both classes of new and used property.

(2) Notwithstanding paragraph (1), if information reported by a taxpayer does not indicate whether this property was first acquired by the taxpayer new or used, the assessor may average the published factors.

(b) If the county assessor depreciates this property using percent good factors that include a minimum percent good, the minimum percent good factors shall be determined in a manner that is supportable.

History.—Added by Stats. 2002, Ch. 299 (AB 2714), in effect January 1, 2003.

401.17. Certificated aircraft; fiscal years 2005–06 to 2010–11. (a) For the 2005–06 fiscal year to the 2010–11 fiscal year, inclusive, the preallocated fair market value of each make, model, and series of mainline jets, production freighters, and regional aircraft that has attained situs within this state is the lesser of the sum total of the amounts determined under paragraph (1) or the sum total of the amounts determined under paragraph (2).

(1) (A) The original cost for the aircraft, which shall be determined as follows and adjusted, as applicable, under subparagraphs (B), (C), and (D):

(i) For owned and leased aircraft, the taxpayer's or lessor's acquisition cost for that individual aircraft reported in accordance with generally accepted accounting principles, and to the extent not included in the acquisition cost, transportation costs and capitalized interest and the cost of improvements made before a transaction described in paragraph (ii). If the original cost for leased aircraft cannot be determined from information reasonably available to the taxpayer, original cost may be determined by reference to the "average new prices" column of the Airliner Price Guide for that model, series, and year of manufacture of aircraft. If information is not available in the "average new prices" column for that model, series, and year, the original cost may be determined using the best indicator of original cost plus all conversion costs and improvement costs incurred for that aircraft.

(ii) For sale/leaseback or assignment of purchase rights transaction aircraft, the average of the taxpayer's cost established pursuant to clause (i) and the cost established in a sale/leaseback or assignment of purchase rights transaction for individual aircraft that transfers the benefits and burdens of ownership to the lessor for United States federal income tax purposes. In no event shall the original cost for sale/leaseback aircraft be less than the taxpayer's acquisition cost.

(iii) In the event of a merger, bankruptcy, or change in accounting methods by the reporting airline, there shall be a rebuttable presumption that the cost of the individual aircraft and the acquisition date reported by the acquired company, if available, or the cost reported prior to the change in accounting method, are the original cost and the applicable acquisition date.

(B) (i) For mainline jets and production freighters, the original cost described in subparagraph (A), plus the cost of any improvements not otherwise included in the original cost, shall be adjusted from the date of the acquisition of the aircraft to the lien date using the monthly United States Department of Labor Producer Price Index for aircraft and a 20-year straight-line percent-good table starting from the delivery date of the aircraft to the current owner or, in the case of a sale/leaseback or assignment of purchase rights transaction, as described in this section, the current operator with a minimum combined factor of 25 percent.

(ii) For regional aircraft, the original cost described in subparagraph (A), plus the cost of any improvements not otherwise included in the original cost, shall be adjusted from the date of the acquisition of the aircraft to the lien date using the monthly United States Department of Labor Producer Price Index for aircraft and a 16-year straight-line percent-good table starting from the delivery date of the aircraft to the current owner or, in the case of a sale/leaseback or assignment of purchase rights transaction, as described in this section, the current operator with a minimum combined factor of 25 percent.

(iii) If original cost is determined by reference to the Airliner Price Guide "average new prices" column, the adjustments required by this paragraph shall be made by setting the acquisition date of the aircraft to be the date of the aircraft's manufacture.

(C) (i) For mainline jets and regional aircraft, the assessor shall analyze the adjusted original cost derived pursuant to subparagraph (B), for application of an economic obsolescence allowance which shall be determined as follows:

(I) For the applicable year, the assessor shall calculate the average annual net revenue per available seat mile, the net load factor, and the yield utilizing the Airline Quarterly Financial Review published by the United States Department of Transportation, and referring to the section descriptive of the passenger airline industry, entitled "System Operations, System Pax. Majors" for the calendar year ending December 31 immediately preceding the applicable assessment date.

(II) For a 10-year benchmark, the assessor shall calculate as of December 31 for each of the 10 calendar years preceding the applicable year, the average annual net revenue per available seat mile, the net load factor, and the yield utilizing the Airline Quarterly Financial Review published by the United States Department of Transportation, and referring to the section descriptive of the passenger airline industry, entitled "System Operations, System Pax. Majors" for the calendar year ending December 31 immediately preceding the applicable assessment date.

(ii) (I) The assessor shall compare each factor calculated under subclause (I) of clause (i) with the corresponding factor calculated under subclause (II) of clause (i) to derive the percentage that each of the factors calculated under subclause (I) of clause (i) deviated from the 10-year benchmark calculated under subclause (II) of clause (i). The assessor shall then calculate a weighted average of the indicated percentage adjustments, weighted as follows:

(aa) Net revenue per available seat mile shall be weighted 35 percent.

(ab) Net load factor shall be weighted 35 percent.

(ac) Yield shall be weighted 30 percent.

(II) The assessor shall reduce the adjusted original costs derived under subparagraph (B) by the percentage adjustment calculated in subclause (I), but only if the final economic obsolescence determined under that subclause exceeds 10 percent, otherwise no economic obsolescence allowance shall be provided.

(D) (i) For production freighters, the assessor shall analyze the adjusted original cost derived under subparagraph (B), for application of an economic obsolescence allowance, as follows:

(I) For the applicable year, the assessor shall calculate the industry average of net revenue per available ton mile and the ton load factor based upon the Airline Quarterly Financial Review published by the United States Department of Transportation, and referring to the section descriptive of the cargo airline industry, entitled "System Operations, System Cargo Majors" for the calendar year ending December 31 preceding the relevant assessment date.

(II) For a 10-year benchmark, the assessor shall calculate as of December 31 for each of the 10 calendar years preceding the applicable year, the net revenue per available ton mile and the ton load factor utilizing the Airline Quarterly Financial Review published by the United States Department of Transportation and referring to the section descriptive of the cargo airline industry, entitled "System Operations, System Cargo Majors" as of December 31 for each of the 10 calendar years preceding the calendar year utilized for the subject year, for the calendar year ending December 31 immediately preceding the applicable assessment date.

(ii) (I) The Assessor shall compare each factor calculated under subclause (I) of clause (i) with the corresponding factor calculated under subclause (II) of clause (i) to derive the percentage that each of the factors calculated under subclause (I) of clause (i) deviated from the 10-year benchmark calculated under subclause (II) of clause (i). The assessor shall then calculate a weighted average of the indicated percentage adjustments so that the net revenue per available ton mile is weighted 50 percent and the ton load factor is weighted 50 percent.

(II) The assessor shall reduce the adjusted original costs derived under subparagraph (B) by the percentage adjustment calculated in subclause (I), but only if the final economic obsolescence determined under that subclause exceeds 10 percent, otherwise no economic obsolescence allowance shall be provided.

(2) (A) Except as otherwise provided in subparagraph (B), for each individual mainline jet, production freighter, or regional aircraft, the assessor shall identify the value referenced in the "Used Price of Avg. Acft. Wholesale" column of the Winter edition of the Airliner Price Guide by make, model, series, and year of manufacture, and deduct 10 percent from that value for a fleet discount.

(B) For each individual mainline jet, production freighter, or regional aircraft that is less than two years old and for which the Airliner Price Guide does not list used wholesale values, the original cost determined under paragraph (1) of subparagraph (A) shall be decreased by the lesser of 5 percent or one-half of the percentage decrease between original cost and 90 percent of the value listed in the "Used Price of Avg. Acft. Wholesale" column of the Winter edition of the Airliner Price Guide for a two-year old aircraft of that same make, model, and series.

(b) For the 2005–06 fiscal year to the 2010–11 fiscal year, inclusive, the preallocated fair market value for each make, model, and series of converted freighters that has attained situs within this state shall be determined as follows:

(1) (A) The assessor shall begin his or her appraisal of a converted freighter as of the relevant lien date by identifying the aircraft's original cost as a passenger aircraft prior to conversion. The aircraft's original cost as a converted freighter shall be the lesser of:

(i) Its trended original cost as a passenger aircraft prior to conversion, less a downward adjustment of 10 percent to reflect tear outs.

(ii) Its value described in the Winter edition of the Airliner Price Guide in the "Used Price of Avg. Acft. Wholesale" column in passenger configuration, less a downward adjustment of 10 percent to reflect tear-outs.

(B) The amount determined under subparagraph (A) shall be adjusted according to the following:

(i) If, on the relevant lien date, the frame of the aircraft is 15 years old or more, 50 percent of the cost to convert the aircraft to a freighter shall be added to the value determined under subparagraph (A).

(ii) If, on the relevant lien date, the frame of the aircraft is less than 15 years old, 75 percent of the cost to convert the aircraft to a freighter shall be added to the value determined under subparagraph (A).

(iii) In addition, all other improvements, including capitalized interest, to the aircraft that are not otherwise included in the aircraft's original and conversion costs shall be added at full value.

(2) The amount determined under paragraph (1) shall be adjusted from the date of the conversion of the aircraft to the lien date using the monthly United States Department of Labor Producer Price Index for aircraft and a 16-year straight-line percent-good table, however, the percent-good applied to the aircraft shall in no event be less than 15 percent.

(3) If the Airliner Price Guide "Used Price of Avg. Acft. Wholesale" is utilized under paragraph (1), only the improvements and adjusted conversion costs pertaining to the converted freighter shall be adjusted from the date of the conversion of the aircraft to the relevant lien date using the monthly United States Department of Labor Producer Price Index for aircraft and a 16-year straight-line percent-good table. In no event, however, shall the percent-good applied to the improvements and adjusted conversion costs be less than 15 percent.

(4) (A) Except as otherwise provided in subparagraph (B), the assessor shall reduce the adjusted original cost, plus improvements, and adjusted conversion costs, derived under paragraphs (1) to (3), inclusive, by the obsolescence percentage adjustment calculated for production freighters under subparagraph (D) of paragraph (1) of subdivision (a).

(B) If the Airliner Price Guide "Used Price of Avg. Acft. Wholesale" is utilized under paragraph (1), only the improvements and adjusted conversion costs pertaining to the converted freighter shall be reduced by the obsolescence percentage adjustment described in subparagraph (A).

(c) For purposes of this section, if the Airliner Price Guide ceases to be published or the format significantly changes, a guide or adjustment agreed to by commercial air carriers and the counties in which certificated aircraft have situs shall be substituted. If these parties do not agree on a guide or adjustment, the State Board of Equalization shall determine the guide or adjustment.

(d) The taxpayer shall, to the extent that information is reasonably available to the taxpayer, furnish the county assessor with an annual property statement that includes the aircraft original costs as defined in subparagraph (A) of paragraph (1) of subdivision (a). If an air carrier that has this information reasonably available to it fails to report original cost and improvements, as required by Sections 441 and 442, an assessor may in that case make an appropriate assessment pursuant to Section 501.

(e) For purposes of this section, all of the following apply:

(1) "Converted freighter" means a certificated aircraft, as defined in Section 1150, that, following its original manufacture, was used for passenger transportation, but was later converted to be used primarily for cargo transportation purposes.

(2) "Mainline jet" means a certificated aircraft, as defined in Section 1150, that is either of the following:

(A) Manufactured by Boeing, Airbus, or McDonnell Douglas.

(B) Capable of being configured with approximately 100 seats or more.

(3) "Production Freighter" means a certificated aircraft, as defined in Section 1150, that immediately following its manufacture is deployed primarily for cargo transportation purposes.

(4) "Regional aircraft" means a certificated aircraft, as defined in Section 1150, that is either of the following:

(A) Manufactured by ATR (Avions De Transport Regional), Beech, British Aerospace Jetstream, Canadair Regional Jet, Cessna, DeHaviland, Embraer, Fairchild, or Saab.

(B) Generally configured with fewer than 100 seats.

(5) "Improvements" means the cost of any modifications or capital additions that materially add to the value of or substantially prolong the useful life of the aircraft, or make it adaptable to a different use. "Improvements" include modification costs incurred during a heavy maintenance visit to the extent that they materially add to the value of or substantially prolong the useful life of the aircraft. "Improvements" do not include repair and maintenance costs incurred for the purpose of keeping the aircraft in an ordinarily efficient operating condition.

(6) "Net revenue per available seat mile" means operating revenue per available seat mile less cost per available seat mile as determined by the United States Department of Transportation.

(7) "Net load factor" means actual passenger load factor less breakeven passenger load factor, as determined by the United States Department of Transportation.

(8) "Net revenue per available ton mile" means operating revenue per ton mile less cost per available ton mile as determined by the United States Department of Transportation.

(9) "Yield" means average revenue per revenue passenger mile as determined by the United States Department of Transportation.

(10) "Ton Load Factor" means that percentage of effective use of cargo capacity as determined by the United States Department of Transportation.

History.—Added by Stats. 2005, Ch. 699 (AB 964), in effect October 7, 2005.

Note.—Section 1 of Stats. 2005, Ch. 699 (AB 964) provided that:

(a) The Legislature finds and declares all of the following:

(1) A difficult and contentious property tax assessment issue concerns the assessment of certificated aircraft following the incident of September 11, 2001. The difficulty of measuring the economic obsolescence resulting from the incident, pertaining to a variety of aircraft types, many with tax situs in several counties, justifies a standardized approach to the appraisal of these aircraft.

(2) The difficulty of appraising certificated aircraft following the incident has given rise to much litigation and many tax appeals.

(3) The uncertainty created by pending litigation and appeals over the assessment of airline property is disruptive to both airline industry tax planning and local government and school finance.

(b) It is the intent of the Legislature in enacting this act to establish a unique methodology for the assessment of certificated aircraft in light of the special circumstances that befell this property and the airline industry following the September 11, 2001, incident. Specialized procedures, including the unique valuation methodology enacted herein, are justified by the multijurisdictional use of certificated aircraft property, and the manner in which valuations of this property are allocated. Therefore, in order to facilitate resolution of the disputes over the assessment of certificated aircraft, it is the intent of the Legislature to codify recommendations produced by a county and airline industry working group, to establish a uniform valuation methodology specifically designed and adopted for the unique circumstance of certificated aircraft property.

Section 5 thereof provided that the provisions of this measure are severable. If any provision of this measure or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

Section 7 thereof provided that this act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to establish, for the current fiscal year, a uniform valuation methodology for certificated aircraft in light of the special circumstances affecting the airline industry following the September 11, 2001 incident, it is necessary that this act take effect immediately.

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401.20. High technology industries; full cash value. (a) (1) The State Board of Equalization shall, in consultation with the California Assessors' Association and representatives of the computer, semiconductor, and biopharmaceutical industries, conduct a study to obtain and analyze data in order to update the information used to develop the valuation factors annually published by the State Board of Equalization that are applied to nonproduction computers, semiconductor manufacturing equipment, and biopharmaceutical industry equipment and fixtures.

(2) The State Board of Equalization shall conduct the study described in paragraph (1) only if funds are appropriated by the Legislature to the board for that purpose during the 2005–06 Regular Session.

(3) To the extent the State Board of Equalization periodically conducts these studies, the board shall publish revised valuation factors based on the updated information. If the board reviews the data and determines that an update is not warranted, the existing factors shall remain in effect.

(b) (1) Notwithstanding any other provision of law relating to the determination of the values for property tax assessment, values determined by using valuation factors resulting from the study described in subdivision (a), as instructed by the State Board of Equalization for nonproduction computers, semiconductor manufacturing equipment, and biopharmaceutical industry equipment and fixtures, shall be rebuttably presumed to be the full cash value.

(2) The assessor or the taxpayer shall have the right to present evidence supporting values different from those based on the published factors in order to attempt to overcome the presumption.

(c) The presumption in subdivision (b) shall not apply to any particular tax year if the information upon which the valuation factors for that category of property are based was last reviewed by the State Board of Equalization more than six years before the lien date for that tax year.

History.—Added by Stats. 2006, Ch. 417 (AB 2182), in effect January 1, 2007.

Note.—Section 1 of Stats. 2006, Ch. 417 (AB 2182) provided that: (a) The Legislature finds and declares all of the following:

(1) The property used in certain high technology focused industries is subject to the rapid pace of technological change.

(2) The annual valuation factors currently published by the State Board of Equalization that are used to assess this property is based upon dated studies, causing the validity of these factors to be questioned and giving rise to costly and time-consuming assessment appeals and litigation.

(3) A new study would allow the development of objective and defensible valuation factors and ensure more accurate assessments.

(4) The uncertainty created by pending appeals and litigation over the valuation of this property is disruptive to industry tax planning, local government finance, and school finance.

(b) It is the intent of the Legislature in enacting this act to do both of the following:

(1) Facilitate uniform assessment practices in the assessment of this property within the State of California.

(2) Facilitate the resolution of disputes over the assessment of this property by clearly establishing a presumption of correctness if county assessors use a prescribed assessment methodology.

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402. Cultivated and uncultivated land. Cultivated and uncultivated land of the same quality and similarly situated shall be assessed at the same value.

402.1. Land use restrictions. (a) In the assessment of land, the assessor shall consider the effect upon value of any enforceable restrictions to which the use of the land may be subjected. These restrictions shall include, but are not limited to, all of the following:

(1) Zoning.

(2) Recorded contracts with governmental agencies other than those provided in Sections 422 and 422.5.

(3) Permit authority of, and permits issued by, governmental agencies exercising land use powers concurrently with local governments, including the California Coastal Commission and regional coastal commissions, the San Francisco Bay Conservation and Development Commission, and the Tahoe Regional Planning Agency.

(4) Development controls of a local government in accordance with any local coastal program certified pursuant to Division 20 (commencing with Section 30000) of the Public Resources Code.

(5) Development controls of a local government in accordance with a local protection program, or any component thereof, certified pursuant to Division 19 (commencing with Section 29000) of the Public Resources Code.

(6) Environmental constraints applied to the use of land pursuant to provisions of statutes.

(7) Hazardous waste land use restriction pursuant to Section 25240 of the Health and Safety Code.

(8) A recorded conservation, trail, or scenic easement, as described in Section 815.1 of the Civil Code, that is granted in favor of a public agency, or in favor of a nonprofit corporation organized pursuant to Section 501(c)(3) of the Internal Revenue Code that has as its primary purpose the preservation, protection, or enhancement of land in its natural, scenic, historical, agricultural, forested, or open-space condition or use.

(b) There is a rebuttable presumption that restrictions will not be removed or substantially modified in the predictable future and that they will substantially equate the value of the land to the value attributable to the legally permissible use or uses.

(c) Grounds for rebutting the presumption may include, but are not necessarily limited to, the past history of like use restrictions in the jurisdiction in question and the similarity of sales prices for restricted and unrestricted land. The possible expiration of a restriction at a time certain shall not be conclusive evidence of the future removal or modification of the restriction unless there is no opportunity or likelihood of the continuation or renewal of the restriction, or unless a necessary party to the restriction has indicated an intent to permit its expiration at that time.

(d) In assessing land with respect to which the presumption is unrebutted, the assessor shall not consider sales of otherwise comparable land not similarly restricted as to use as indicative of value of land under restriction, unless the restrictions have a demonstrably minimal effect upon value.

(e) In assessing land under an enforceable use restriction wherein the presumption of no predictable removal or substantial modification of the restriction has been rebutted, but where the restriction nevertheless retains some future life and has some effect on present value, the assessor may consider, in addition to all other legally permissible information, representative sales of comparable lands that are not under restriction but upon which natural limitations have substantially the same effect as restrictions.

(f) For the purposes of this section the following definitions apply:

(1) "Comparable lands" are lands that are similar to the land being valued in respect to legally permissible uses and physical attributes.

(2) "Representative sales information" is information from sales of a sufficient number of comparable lands to give an accurate indication of the full cash value of the land being valued.

(g) It is hereby declared that the purpose and intent of the Legislature in enacting this section is to provide for a method of determining whether a sufficient amount of representative sales information is available for land under use restriction in order to ensure the accurate assessment of that land. It is also hereby declared that the further purpose and intent of the Legislature in enacting this section and Section 1630 is to avoid an assessment policy which, in the absence of special circumstances, considers uses for land that legally are not available to the owner and not contemplated by government, and that these sections are necessary to implement the public policy of encouraging and maintaining effective land use planning. Nothing in this statute shall be construed as requiring the assessment of any land at a value less than as required by Section 401 or as prohibiting the use of representative comparable sales information on land under similar restrictions when this information is available.

History.—Added by Stats. 1966, p. 658 (First Extra Session), in effect October 6, 1966. Stats. 1974, Ch. 857, p. 1823, in effect January 1, 1975, substituted the second sentence of the first paragraph for the former second sentence; established the former third sentence of the first paragraph as the second paragraph; added the sixth paragraph; and deleted "local" after "contemplated by" in the second sentence of the seventh paragraph. Stats. 1976, Ch. 1330, p. 6009, in effect January 1, 1977, added subsection (d) and relettered the former subsection (d) as subsection (e) in the second sentence of the first paragraph. Stats. 1977, Ch. 1155, in effect January 1, 1978 capitalized "Coastal" and "Commission" and removed the "s" from "Commissions", and added "and regional coastal commissions" in subdivision (c). Also added subdivision (e) and substituted "constraints" for "contraints" in subdivision (f). Substituted "with respect to which" for "where" in the fourth paragraph and added "which are" after "comparable land" in the fifth paragraph. Stats. 1989, Ch. 906, in effect January 1, 1990, added subdivision letters (a), (b), (c), (d), (e), (f) and (g); substituted "these" for "such" and added "all of the following" after "are not limited to", in the second sentence of, and substituted paragraph numerals (1), (2), (3), (4), (5) and (6) for former letters (a), (b), (c), (d), (e) and (f) in subdivision (a); substituted "Zoning." for "zoning;" in paragraph (1) of subdivision (a); substituted "Recorded" for "recorded " and replaced semi-colon with a period in paragraph (2) of subdivision (a); substituted "Permit" for "permit" and replaced semicolon with a period in paragraph (3) of subdivision (a); substituted "Development" for "development" and replaced semi-colon with a period in paragraphs (4) and (5) of subdivision (a); deleted "and" before "(6)" in paragraph (5) of subdivision (a); substituted "Environmental" for "environmental" in paragraph (6) of subdivision (a); added paragraph (7) to subdivision (a); added "the following definitions apply" after "section" in subdivision (f); renumbered former paragraphs (a) and (b) as (1) and (2) in subdivision (f); deleted "of the Revenue and Taxation Code" after "Section 1630", deleted "of this code" after "Section 401", and substituted "this" for "such" in subdivision (g). Stats. 1993, Ch. 1002, in effect January 1, 1994, added a comma after "limited to" in the second sentence of subdivision (a); substituted "(1)", "(2)", "(3)", "(4)", "(5)", "(6)" and "(7)" for "1.", "2.", "3.", "4.", "5.", "6.", and "7." in, and added paragraph (8) to, subdivision (a); substituted "lands that" for "land which" in subdivision (e), substituted "that" for "which" in paragraph (1) of subdivision (f); and substituted "that" for "such" after "assessment of" in the first sentence and substituted "that" for "which" after "land" in the second sentence of subdivision (g). Stats. 2002, Ch. 616 (SB 1864), in effect January 1, 2003, substituted "These" for "Those" before "restrictions shall include" and substituted "limited to," for "limited, to" after "but are not" in the first sentence of subdivision (a), and substituted "Sections 422 and 422.5" for "Section 422" after "those provided in" in the first sentence of paragraph (2) therein.

Note.—Section 2 of Stats. 1974, Ch. 857, p. 1825, provided that it is the intent of the Legislature in amending the section to clarify the status of recently enacted legislation with respect to the section and not to make a substantive change therein.

Construction.—The effect of the rebuttable presumption is to place upon the assessor the burden of proving the impermanence of the zoning restriction. To overcome the presumption the assessor must show by a preponderance of the evidence that the restriction will be lifted in the predictable future. Meyers v. Alameda County, 70 Cal.App.3d 799. For property zoned for agricultural use, in order to rebut the presumption, the assessor was required to show that the agricultural use restriction on the land would be lifted in the predictable future, and such did not occur where the property owner had asked the city to designate the property as agricultural preserve under the Williamson Act, he manifested no intent to have his property rezoned from agricultural use, and his property was entitled to agricultural preserve status. Borel v. Contra Costa County, 220 Cal.App.3d 521. In determining the fair market value of property, an assessor is only required to consider governmentally imposed land restrictions. The legislative purpose of this section is to allow an assessor to consider restrictions necessary to implement the public policy of encouraging and maintaining effective land use planning. Thus, the assessor properly refused to consider deed restrictions placed on a parcel of land when determining the value of the property where such restrictions were for the benefit of the seller, involved no public policy regarding land use planning, and in no way benefited the public. Carlson v. Assessment Appeals Board No. 1, 167 Cal.App.3d 1004. Rate protection provisions in a cable television franchise agreement are enforceable restrictions within the meaning of this section, which expressly states that its listed restrictions are not exclusive. CAT Partnership v. Santa Cruz County, 63 Cal.App.4th 1071.

The existence of a specific governmental enforcement order is not a prerequisite to a taxpayer's showing that land is subject to restrictions imposed by government that affect its value. Restrictions can be "imposed by government" by any of the methods mentioned in this section. The intent of the section is to consider what limitations apply to the property, whether or not such limitations produced immediate enforcement. Thus, regardless of whether the performance of cleanup projects ultimately benefits the surface landowner, annual environmental remediation costs incurred by the holder of an oil and gas lease in the property must be considered as necessary operation expenses because they are required by law. Dominguez Energy, L.P. v. Los Angeles County, 56 Cal.App.4th 839.

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402.2. Receipt of notice; reassessment. [Repealed by Stats. 1980, Ch. 411, in effect July 11, 1980, operative January 1, 1981.]

402.3. Restrictive covenants or restrictions. An assessor shall consider any restrictive covenant, easement, restriction, or servitude adopted pursuant to Section 25202.5, 25222.1, or 25355.5 of the Health and Safety Code or any restriction, easement, covenant, or servitude imposed pursuant to Section 25230 of the Health and Safety Code as an enforceable restriction, easement, covenant, or servitude subject to Section 402.1 and shall appropriately reassess any land, the use of which has been so restricted, at the lien date following the adoption or imposition of the covenant, easement, servitude, or restriction.

History.—Added by Stats. 1980, Ch. 1161, in effect January 1, 1981. Stats. 1989, Ch. 906, in effect January 1, 1990, added ", easement, restriction, or servitude" before "adopted", added ", 25222.1, or 25355.5 of the Health and Safety Code" after "Section 25205.5", added ", easement, covenant, or servitude" after "restriction", substituted "25230" for "25229", deleted "the provisions of" before "Section 402.1", deleted "of this code" after "Section 402.1", and added ", easement, servitude," after "covenant".

Note.—Section 9 of Stats. 1980, Ch. 1161, provided no payment by state to local governments because of this act, however, a local agency or school district may pursue other remedies to obtain reimbursement.

402.5. Comparable sales. When valuing property by comparison with sales of other properties, in order to be considered comparable, the sales shall be sufficiently near in time to the valuation date, and the properties sold shall be located sufficiently near the property being valued, and shall be sufficiently alike in respect to character, size, situation, usability, zoning or other legal restriction as to use unless rebutted pursuant to Section 402.1, to make it clear that the properties sold and the properties being valued are comparable in value and that the cash equivalent price realized for the properties sold may fairly be considered as shedding light on the value of the property being valued. "Near in time to the valuation date" does not include any sale more than 90 days after the lien date.

History.—Added by Stats. 1969, p. 1988, in effect November 10, 1969. Stats. 1972, p. 2014, in effect August 18, 1972, operative on the lien date in 1973, added " 'near in time to the lien date' does not include any sale more than 90 days after the lien date." Stats. 1980, Ch. 1081, in effect September 26, 1980, substituted "valuation" for "lien" before "date" in both the first and second sentences.

Generally.—Where all comparative sales available were considered, use of six such sales which complied with the criteria prescribed by the section was deemed sufficient to controvert a claim that a decision of county board of equalization was not supported by substantial evidence. Westlake Farms, Inc. v. Kings County, 39 Cal.App.3d 179.

Comparability can never be treated in absolute terms. Even relatively poor data can fairly be considered as shedding light on the value if it is the best or only data available. Midstate Theatres, Inc. v. Stanislaus County, 55 Cal.App.3d 864.

The purported use of this method of valuation is invalid when based upon sales of other properties which are not subject to the same limitation on use as the property in question. Jones v. Los Angeles County, 114 Cal.App.3d 999.

Accuracy.—Market data on recent sales of the property to be assessed and comparable properties, when such data is available, is the most accurate way of arriving at the assessed value of the property. Dennis v. Santa Clara County, 215 Cal.App.3d 1019; Los Angeles County v. McDonnell Douglas Corp., 219 Cal.App.3d 715.

Usability.—A classification based on topography and present use without additional evidence as to the highest and most profitable use will not support a finding of comparability. Dressler v. Alpine County, 64 Cal.App.3d 557. This valuation method was properly used to assess the value of commercial real estate for tax purposes because the cost approach was not the only approach available to value improvements. Olen Commercial Realty Corp. v. County of Orange (2005) 126 Cal.App.4th 1441.

Near in time.—The provision for exclusion of any sale more than 90 days after the lien date is restricted to fair market value assessments and does not apply to use of the capitalization of income method and evidence of income earned more than 90 days after the lien date. Bank of America v. Fresno County, 127 Cal.App.3d 295.

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402.9. Low-income housing; subsidy payments. In valuing property for persons of low and moderate income that is financed under Section 236 or Section 515 of the federal National Housing Act, since federal restrictions accompanying these programs substantially affect actual income and expenses of the property owner, the assessor shall not consider as income any interest subsidy payments made to a lender on that property by the federal government.

History.—Added by Stats. 1978, Ch. 737, in effect January 1, 1979. Stats. 1999, Ch. 941 (SB 1231), in effect January 1, 2000, substituted "that" for ", which" after "moderate income", added "or Section 515" after "Section 236", substituted "these" for "such" after "restrictions accompanying", and substituted "that" for "such" after "a lender on" in the first sentence.

402.95. Low-income housing; tax credits. In valuing property under the income method of appraisal, the assessor shall exclude from income the benefit from federal and state low-income housing tax credits allocated by the California Tax Credit Allocation Committee pursuant to Section 42 of the Internal Revenue Code and Sections 12206, 17058, and 23610.5.

History.—Added by Stats. 2004, Ch. 786 (AB 2846), in effect January 1, 2005.

403. Unpatented land. Land sold by the State for which no patent has been issued shall be assessed like other land, but the owner is entitled to a deduction from the assessed valuation of the amount due the State as principal on the purchase price.

404. Assessing agency. All taxable property, except State assessed property, shall be assessed by the assessing agency of the taxing agency where the property is situated.

Situs.—See Constitution, Article XIII, Section 14 and annotations to former Article XIII, Section 10 thereunder.

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405. Assessee. (a) Annually, the assessor shall assess all the taxable property in his county, except state-assessed property, to the persons owning, claiming, possessing, or controlling it on the lien date.

The assessor may assess the property on the secured roll to the person owning, claiming, possessing or controlling it for the ensuing fiscal year.

(b) The assessor may assess all taxable property in his county on the unsecured roll jointly to both the lessee and lessor of such property.

(c) Notices of assessment and tax bills relating to jointly assessed property on the unsecured roll shall be mailed to both the lessee and the lessor at their latest addresses known to the assessor.

History.—Stats. 1941, p. 3111, in effect September 13, 1941, revised wording. Stats. 1966, p. 659 (First Extra Session), in effect October 6, 1966, first operative for the 1967–68 assessment year, substituted "on the lien date" for "at 12 o'clock meridian of the first Monday in March" and deleted "The assessor shall ascertain such property between the first Mondays in March and July." Stats. 1973, Ch. 786, p. 1405, in effect January 1, 1974, added the subdivision letters and subdivisions (b) and (c). Stats. 1981, Ch. 261, in effect January 1, 1982, added the second paragraph to subdivision (a).

Construction.—This section specifically permits assessment of all the taxable property to the persons owning, claiming, possessing, or controlling it on the lien date and does not limit the assessment to the fee owner. Thus, while the uniform practice of assessors in California has been to make but one assessment of land covering the value of all interests and estates in that land, such practice is only a general rule, and the section clearly authorizes assessors to assess otherwise. Cox Cable San Diego, Inc. v. San Diego County, 185 Cal.App.3d 368.

Assessment date.—This section and Section 8 of Article XIII of the Constitution fix the taxable status of property as of the first Monday in March, and property which is not taxable on that day is not taxable for the year. Dodge v. Nevada National Bank, 109 F. 726. See also East Bay Municipal Utility District v. Garrison, 191 Cal. 680, 692.

Duty of payment.—Primarily the duty of paying taxes rests upon the person who holds the legal title. Three G Distillery Corp. v. Los Angeles County, 46 Cal.App.2d 498. Cf, Purkieser v. Fogler, 11 Cal.App.2d 144, holding that a vendee of real estate in possession under an executory contract of sale making no provision for the payment of taxes may not compel the vendor to pay the taxes.

Assessment to claimant, possessor, etc.—Property in a warehouse is not assessable to the warehouseman as the person in possession. In such a case, if the owner is not known, the property should be assessed to unknown owners and the tax collected by seizure and sale. Weyse v. Crawford, 85 Cal. 196. An assessment to the legal owner of an automobile registered in the name of another person is likewise invalid. San Diego County v. Davis, 1 Cal.2d 145. An assessment of personal property to a consignee for sale (S. & G. Gump Co. v. San Francisco, 18 Cal.2d 129), conditional vendee (Houser etc. Mfg. Co. v. Hargrove, 129 Cal. 90), surviving partner in possession of the property (Thompson v. Board of Supervisors, 13 Cal.App.2d 134), lessee in possession (RCA Photophone Inc. v. Huffman, 5 Cal.App.2d 401), or escrow holder (Title Guaranty, etc., Co. v. Los Angeles County, 3 Cal.App. 619) is valid.

Minor components of installed burglar alarm systems were taxable to the installer, even though they were fixtures permanently attached to subscribers' premises, where the installer owned or controlled them and also owned the major components of the systems. And since the major and minor components of the systems were not severable for ad valorem property taxation purposes, the values of the entire systems were taxable to the installer as real property under subdivision (a). Morse Signal Devices v. Los Angeles County, 161 Cal.App.3d 570.

An assessment of the value of the possessory right in leased land, owned by the state to the sublessee in possession is valid. Tilden v. Orange County, 89 Cal.App.2d 586.

Component parts of a steam boiler plant purchased by a contractor from manufacturers in accordance with its contract to construct the plant for a city and delivered directly to the city-owned jobsite were not assessable to the contractor notwithstanding that on the assessment date the parts were not attached to the boiler structure, where, under a reasonable construction of the contract beneficial possession and complete control was in the city and the contractor had no interest in the parts other than the obligation to assemble them. C. C. Moore & Co. v. Quinn, 149 Cal.App.2d 666.

Canning machinery and equipment under agreement to sell was assessed to the seller where the risk or loss remained in the seller until closing and where the consideration had not passed and certain conditions had not been performed as of the lien date. Francis H. Leggett & Co. v. Los Angeles County, 235 Cal.App.2d 752. Vessel under agreement to sell was assessed to the seller where entire consideration had not passed and certain conditions had not been performed as of the lien date. In Re Western States Wire Corp., 490 F.2d 1065.

No provision is made for declaring or assessing a possessory interest in tax-exempt personal property. General Dynamics Corp. v. Los Angeles County, 51 Cal.2d 59.

An assessment of improvements to the lessee in possession and control was not erroneous even though the land was assessed to the landlord and he owned the improvements. Valley Fair Fashions, Inc. v. Valley Fair, 245 Cal.App.2d 614.

Lessee-bank owning trade fixtures attached to landlord's realty was proper assessee. Ventura County v. Channel Islands State Bank, 251 Cal.App.2d 240.

A permanently affixed interior household connection to a cable television system installed by the system owner who neither owns nor controls the connection constitutes a fixture and is assessable to the owner of the realty rather than to the system owner. Tele-Vue Systems, Inc. v. Contra Costa County, 25 Cal.App.3d 340.

Extent of assessor's duty.—In ascertaining the taxable property in the county the assessor's duties are limited to those prescribed in the succeeding article, and he is not required to search the records for the purpose of discovering property that has escaped assessment. Consequently, the supervisors may properly engage a private individual to perform such work. Skidmore v. Amador County, 7 Cal.2d 37.

Where the board of supervisors entered into a contract to have a third party perform a valuation of assessable property within the county, which the assessor is legally bound to do, and where the valuation is not to assist the board of supervisors but to afford the assessor additional compensation during his term in office other than that provided by law, the contract is void. Tax Factors, Inc. v. Marin County, 20 Cal.App.2d 79. See also Forward v. San Diego County, 189 Cal. 704.

A county assessor must give school districts information of the value of tax-assessed property within districts by May 15, as required by Education Code Section 20811, although information regarding property assessed by the State Board of Equalization is unavailable by reason of the board not being required to complete its work thereon until the first Monday of August and although taxpayers may file property statements upon which property assessments are partially based between the first Monday of March and the last Monday in May. Board of Education v. Watson, 63 Cal.2d 829.

Assessor's refusal to assess contiguous parcels separately when so assessing similar nearby property is within discretion of assessor and does not deprive taxpayer of equal protection of the law. Millbrook Farm v. Watson, 264 Cal.App.2d 512.

Extent of assessor's rights.—The county assessor is a tax official of the state within the meaning of section 19286 of this code and may inspect income tax returns to assist him in assessing taxpayer's property. Lyons v. Estes, 6 Cal.App.3d 979.

Description.—A failure to change the description or valuation of a lot after a conveyance of a portion thereof justifies a holding that the assessment is invalid. Mallman v. Kneeben, 11 Cal.App.2d 484.

Gas and oil rights.—While gas and oil rights held in separate ownership may be separately assessed, the inclusion of their value in the assessment to the owners of the balance of the fee does not render the assessment invalid. When there is no separate assessment to such rights and the assessments of the balance of the fee show no reduction because of such separate ownership, it must be presumed that their value has been included in the assessments of the balance of the fee, and a tax deed based on such an assessment includes the gas and oil rights. McCracken v. Hummel, 43 Cal.App.2d 302.

Easements.—The law does not require an appurtenant easement to be separately assessed. McMorris v. Pagano, 63 Cal.App.2d 446.

Aircraft.—An airplane which was purchased by an interstate air carrier for the exclusive purpose of adding it to its fleet of aircraft flying in interstate commerce, was delivered to and accepted by the air carrier in this state, and on the first Monday in March had not made a flight in interstate commerce but was engaged in "shakedown and crew familiarization" flights preparatory thereto, was properly assessable as part of the air carrier's fleet on an apportionment basis and not as a separate item of property. Slick Airways, Inc. v. Los Angeles County, 140 Cal.App.2d 311.

An airplane under a levy of attachment by the county sheriff before and on the tax lien date was properly assessable to the owner of the airplane and not to the sheriff. United States Overseas Airlines v. Alameda County, 235 Cal.App.2d 348.

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405.1. Tax-deeded or publicly owned property. [Repealed by Stats. 1985, Ch. 316, effective January 1, 1986.]

405.5. Periodic appraisal. The assessor shall periodically appraise all property not subject to the provisions of Article XIII A of the Constitution to substantiate the judgment of its full cash value or, when provided for by law, its restricted value for uniform assessment purposes.

History.—Added by Stats. 1966, p. 659 (First Extra Session), in effect October 6, 1966. Stats. 1972, p. 1526, in effect March 7, 1973, operative on the lien date in 1973, substituted "its full cash value or, when provided for by law, its restricted value" for "full cash value" in the first sentence. Stats. 1980, Ch. 1081, in effect September 26, 1980, added "not subject to the provisions of Article XIII A of the Constitution" after "property" and substituted "the" for "his" before "judgment".

405.6. Orderly, sequential, cyclical appraisal or reappraisal.[Repealed by Stats. 1980, Ch. 1081, in effect September 26, 1980.]

406. Tax-sold property. [Repealed by Stats. 1988, Ch. 830, in effect January 1, 1989.]

407. Statistical statement. Annually, on the second Monday in July, the assessor shall transmit a statistical statement to the board, supplying any statistical information which the board may require, and shall supply from time to time any other information required by the board.

History.—Stats. 1979, Ch. 242, in effect July 10, 1979, added second sentence. Stats. 1986, Ch. 608, effective January 1, 1987, deleted the former second sentence pertaining to requirements for the 1979–80 fiscal year.

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408. Assessor's records. (a) Except as otherwise provided in subdivisions (b), (c), (d), and (e), any information and records in the assessor's office that are not required by law to be kept or prepared by the assessor, disabled veterans' exemption claims, and homeowners' exemption claims, are not public documents and shall not be open to public inspection. Property receiving the homeowners' exemption shall be clearly identified on the assessment roll. The assessor shall maintain records which shall be open to public inspection to identify those claimants who have been granted the homeowners' exemption.

(b) The assessor may provide any appraisal data in his or her possession to the assessor of any county.

The assessor shall disclose information, furnish abstracts, or permit access to all records in his or her office to law enforcement agencies, the county grand jury, the board of supervisors or their duly authorized agents, employees, or representatives when conducting an investigation of the assessor's office pursuant to Section 25303 of the Government Code, the county recorder when conducting an investigation to determine whether a documentary transfer tax is imposed, the Controller, employees of the Controller for property tax postponement purposes, probate referees, employees of the Franchise Tax Board for tax administration purposes only, staff appraisers of the Department of Financial Institutions, the Department of Transportation, the Department of General Services, the State Board of Equalization, the State Lands Commission, the State Department of Social Services, the Department of Child Support Services, the Department of Water Resources, and other duly authorized legislative or administrative bodies of the state pursuant to their authorization to examine the records. Whenever the assessor discloses information, furnishes abstracts, or permits access to records in his or her office to staff appraisers of the Department of Financial Institutions, the Department of Transportation, the Department of General Services, the State Lands Commission, or the Department of Water Resources pursuant to this section, the department shall reimburse the assessor for any costs incurred as a result thereof.

(c) Upon the request of the tax collector, the assessor shall disclose and provide to the tax collector information used in the preparation of that portion of the unsecured roll for which the taxes thereon are delinquent. The tax collector shall certify to the assessor that he or she needs the information requested for the enforcement of the tax lien in collecting those delinquent taxes. Information requested by the tax collector may include social security numbers, and the assessor shall recover from the tax collector his or her actual and reasonable costs for providing the information. The tax collector shall add the costs described in the preceding sentence to the assessee's delinquent tax lien and collect those costs subject to subdivision (e) of Section 2922.

(d) The assessor shall, upon the request of an assessee or his or her designated representative, permit the assessee or representative to inspect or copy any market data in the assessor's possession. For purposes of this subdivision, "market data" means any information in the assessor's possession, whether or not required to be prepared or kept by him or her, relating to the sale of any property comparable to the property of the assessee, if the assessor bases his or her assessment of the assessee's property, in whole or in part, on that comparable sale or sales. The assessor shall provide the names of the seller and buyer of each property on which the comparison is based, the location of that property, the date of the sale, and the consideration paid for the property, whether paid in money or otherwise. However, for purposes of providing market data, the assessor may not display any document relating to the business affairs or property of another.

(e) (1) With respect to information, documents, and records, other than market data as defined in subdivision (d), the assessor shall, upon request of an assessee of property, or his or her designated representative, permit the assessee or representative to inspect or copy all information, documents, and records, including auditors' narrations and workpapers, whether or not required to be kept or prepared by the assessor, relating to the appraisal and the assessment of the assessee's property, and any penalties and interest thereon.

(2) After enrolling an assessment, the assessor shall respond to a written request for information supporting the assessment, including, but not limited to, any appraisal and other data requested by the assessee.

(3) Except as provided in Section 408.1, an assessee, or his or her designated representative, may not be permitted to inspect or copy information and records that also relate to the property or business affairs of another, unless that disclosure is ordered by a competent court in a proceeding initiated by a taxpayer seeking to challenge the legality of the assessment of his or her property.

(f) (1) Permission for the inspection or copying requested pursuant to subdivision (d) or (e) shall be granted as soon as reasonably possible to the assessee or his or her designated representative.

(2) If the assessee, or his or her designated representative, requests the assessor to make copies of any of the requested records, the assessee shall reimburse the assessor for the reasonable costs incurred in reproducing and providing the copies.

(3) If the assessor fails to permit the inspection or copying of materials or information as requested pursuant to subdivision (d) or (e) and the assessor introduces any requested materials or information at any assessment appeals board hearing, the assessee or his or her representative may request and shall be granted a continuance for a reasonable period of time. The continuance shall extend the two-year period specified in subdivision (c) of Section 1604 for a period of time equal to the period of continuance.

History.—Added by Stats. 1941, p. 2051, in effect June 6, 1941. Stats. 1961, p. 2809, in effect September 15, 1961, added "(a) Except as otherwise provided in subdivision (b)" and subdivision (b). Stats 1966, p. 659 (First Extra Session), in effect October 6, 1966, added the reference to subdivision (c) to subdivision (a), added the last clause referring to court order to subdivision (b), and added subdivision (c). Stats. 1969, p. 2481, in effect November 10, 1969, applicable to equalization proceedings for the 1970–71 assessment year and thereafter, added "provide any market data in his possession to an assessee" and the references to designated representative in subdivision (b), and added subdivision (d). Stats. 1970, p. 1141, in effect November 23, 1970, substituted "may provide any market data in his possession to the assessor of any county and shall provide such data" for "shall provide any market data in his possession" in the first sentence of subdivision (b). Stats. 1971, p. 2163, in effect March 4, 1972, revised subdivision (b) to allow the assessor to provide "appraisal data" to the assessor of any county and revised the requirement for the assessee or his designated representative to obtain a court order to situations involving information and records "other than market data which also relate to the property or business affairs of another". Stats. 1974, Ch. 1107, p. 2369, in effect September 23, 1974, added ", and homeowners' exemption claims," after "assessor" in the first sentence, and added the second and third sentences of subdivision (a); and added "the State Controller," after "Government Code" in subdivision (c). Stats. 1976, Ch. 671, p. 1658, in effect January 1, 1977, added "Except as provided in Section 408.1," at the beginning of the third sentence of subdivision (b). Stats. 1978, Ch. 1388, in effect September 30, 1978, added "inheritance tax referees" to subdivision (c). Stats. 1984, Ch. 1641, in effect January 1, 1985, added "or hers" after "his" throughout the section; and added "staff appraisers of the Department of Transportation" after "referees," in the first sentence, and added the second sentence to subdivision (c). Stats. 1985, Ch. 200, effective January 1, 1986, added a comma after "(c)" in subdivision (a), and deleted "State" before "Controller", added "employees of the Franchise Tax Board for tax administration purposes only," after "referees", added a comma after "Equalization", and substituted "the" for "such" after "examine" in the first sentence of subdivision (c). Stats. 1986, Ch. 1457, effective January 1, 1987, substituted "probate" for "inheritance tax" after "Controller," and added "and the Department of General Services" after "Department of Transportation" in the first sentence, and added "or the Department of General Services" after "Department of Transportation" in the second sentence of subdivision (c). Stats. 1987, Ch. 1162, effective September 26, 1987, added "employees of the Controller for property tax postponement purposes" after "Controller" in the first sentence of subdivision (c), and added "the Department of Savings and Loan," after "appraisers of" and added "," after "Transportation" in the first and second sentences thereof. Stats. 1992, Ch. 523, in effect January 1, 1993, substituted the comma for "and" after "(b)", and added "and (d)" after "(c)", in the first sentence of subdivision (a); added subdivision (d); and relettered former subdivision (d) as subdivision (e). Stats. 1993, Ch. 876, Section 29, in effect October 6, 1993, deleted "and" after "Transportation," and added "the State Department of Social Services," after "Equalization," in the first sentence of subdivision (c). Stats. 1993, Ch. 876, Section 30, in effect October 6, 1993, operative January 1, 1994, deleted "and" after "(c),", and added "and (e)" after "(d)" in the first sentence of subdivision (a); deleted the balance of the first sentence in subdivision (b) after "county", and substantially restated the deleted portion in subdivision (e); deleted former subdivision letter (c) before "The assessor" to establish a second paragraph in subdivision (b); relettered former subdivisions (d) and (e) as (c) and (d), respectively; added the first sentence, substituted "subdivision" for "section" after "this" in the second sentence, and substituted ". However," for ", but" in the third sentence, thereby establishing the fourth sentence of subdivision (d); and added subdivisions (e) and (f). Stats. 1995, Ch. 498, in effect January 1, 1996, added paragraph designation "(1)", added paragraph (2), and created paragraph (3) from former second sentence in subdivision (e); and added paragraph (3) in subdivision (f). Stats. 1996, Ch. 667, in effect September 20, 1996, substituted "that" for "which" after "assessor's office", and substituted "that" for "which" after "maintain records" in subdivision (a); deleted "probate referees" after "tax postponement purposes," substituted "Department of Financial Institutions" for "Department of Savings and Loan" after "staff appraisers of the", and added "the Department of Water Resources," after "Social Services" in the first sentence, substituted "Department of Financial Institutions" for "Department of Savings and Loan" after "staff appraisers of the", deleted "or" after "Department of Transportation", and added ", or the Department of Water Resources" after "General Services" in the second sentence of subdivision (b). Stats. 1996, Ch. 1064, in effect January 1, 1997, operative July 1, 1997, substituted "which" for "that" after "maintain records" in subdivision (a); substituted "Department of Financial Institutions" for "Department of Savings and Loan" after "staff appraisers of the" in the first and second sentences, and added "or" after "Transportation," in the second sentence of subdivision (b). Stats. 1997, Ch. 940 (SB 1105), in effect January 1, 1998, deleted "or" after "Department of Transportation," in the second sentence of the second paragraph of subdivision (b) and deleted "assessor's" before "tax lien" in the second sentence of subdivision (c). Stats. 2000, Ch. 647 (SB 2170), in effect January 1, 2001, added "the State Lands Commission," after "Equalization," in the first sentence and added "the State Lands Commission," after "General Services," in the second sentence of the second paragraph of subdivision (b). Stats. 2002, Ch. 759 (AB 3033), in effect January 1, 2003, added "the Department of Child Services," after "Department of Social Services," in the first sentence of the second paragraph of subdivision (b). Stats. 2003, Ch. 62 (SB 600), in effect January 1, 2004, substituted "may not" for "shall not" after "the assessor" in the fourth sentence of subdivision (d) and substituted "may not" for "shall not" after "designated representative," in the first sentence of paragraph (3) of subdivision (e). Stats. 2006, Ch. 677 (SB 1637), in effect January 1, 2007, added "disabled veterans' exemption claims," after "by the assessor," in the first sentence of subdivision (a). Stats. 2009, Ch. 622 (SB 816), in effect January 1, 2010, added "the county recorder when conducting an investigation to determine whether a documentary transfer tax is imposed," after "Government Code," in the first sentence of the second paragraph of subdivision (b).

Note.—Section 17 of Stats. 1974, Ch. 1107, p. 2372, provided that it is the intent of the Legislature in amending the section that homeowners' property tax exemption claims and the data contained on these claims, such as the social security numbers of claimants, not be public documents or open to public inspection, but that properties receiving the exemption be so identified on the local assessment roll in order that the public continues to have access to information as to which properties are receiving the exemption. Further, the amendments to the section are to apply to all homeowners' property tax exemption claims in the possession of the assessor on the effective date thereof or in the future.

Note.—Section 2 of Stats. 1984, Ch. 1641, provided no appropriation is made by this act because this act provides for reimbursement to local agencies for the program or level of service mandated by this act.

Note.—Section 6 of Stats. 1985, Ch. 200, provided reimbursement to local governments for costs mandated by the State pursuant to this act.

Note.—Section 35(b) of Stats. 1987, Ch. 1162, provided that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because self-financing authority is provided in subdivision (c) of Section 408 of the Revenue and Taxation Code to cover any costs to county assessors that may be incurred in carrying on any program or performing any service required to be carried on or performed by this act.

Note.—Section 6 of Stats. 2006, Ch. 677 (SB 1637) provided that: The Legislature finds and declares that Section 5 of this act, which amends Section 408 of the Revenue and Taxation Code, imposes limitations on the public's right of access to the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:

(a) Claims filed for the disabled veterans' exemption contain taxpayer sensitive personal information, including social security numbers and home addresses. Notwithstanding Section 3 of Article I of the California Constitution, county assessors have a responsibility and an obligation to safeguard from public access a taxpayer's personal information with which it has been entrusted.

(b) The right to privacy is a personal and fundamental right protected by Section 1 of Article I of the California Constitution and by the United States Constitution. All individuals have a right of privacy in information pertaining to them.

(c) This state has previously recognized, in Sections 63.1, 69.5, and 408.2 of the Revenue and Taxation Code, the importance of protecting the confidentiality and privacy of an individual's personal and financial information contained in homeowners' exemption claims, property statements, change in ownership exclusion applications, and change of ownership statements filed with county assessors for property tax purposes.

(d) In addition to the right of privacy, there is a need to protect from public disclosure personal information due to the growing prevalence and debilitating nature of identity theft.

Construction.—The words "kept or prepared" in this section are not synonymous, and even though not prepared by the assessor, an affidavit submitted to claim a welfare exemption which is retained in the assessor's records is "kept" by the assessor for the purposes of this section and is open to public inspection. Gallagher v. Boller, 231 Cal.App.2d 482. There is no inconsistency between this section and section 1606; either method is available to a taxpayer who appeals his assessment. This section was intended to broaden the taxpayer's right to information. The assessor may avoid any eleventh hour demand by invoking the exchange procedure under section 1606. Henderson v. Bettis, 53 Cal.App.3d 486.

Information relating to affairs of another.—"Market data", as used in the section, is narrowly defined in subdivision (d), and both subdivisions (b) and (d) make it clear that market data and other assessor's records relating to a taxpayer's assessment are not to be construed to require disclosure of information relating to the business affairs of another taxpayer. Thus, information furnished to an assessor by an oil company on its acquisition of certain property did not constitute market data and was not subject to disclosure by the assessor in defending his assessment against taxpayer oil company. Chanslor-Western Oil and Development Co. v. Cook, 101 Cal.App.3d 407.

Examination by State Board.—Assessor's records, including those relating to assessment of specific properties, are subject to inspection by State Board of Equalization, State Board of Equalization v. Watson, 68 Cal.2d 307.

Assessors' working papers not required by law to be prepared are not open to public inspection.—Plaintiff sought to inspect the documents and records used to update the assessment roll such as photocopies of deeds and papers identifying sales transactions. Plaintiff contended that these papers were essential to performance of the assessor's duties and therefore should be considered as information and records required by law to be kept by the assessor and hence open to inspection under this section. The court rejected the contention because it would render all papers in the assessor's office open to inspection and thus render the section meaningless. No provision of law required the assessor to obtain, use, or file the papers in question, therefore, they are not open to inspection. Statewide Homeowners, Inc. v. Williams, 30 Cal.App.3d 567.

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408.1. List of transfers. [Repealed by Stats. 1976, Ch. 671, in effect January 1, 1977, operative May 1, 1980.]

408.1. List of transfers. (a) The assessor shall maintain a list of transfers of any interest in property, other than undivided interests, within the county, which have occurred within the preceding two-year period.

(b) The list shall be divided into geographical areas and shall be revised on the 30th day of each calendar quarter to include all such transactions which are recorded as of the preceding quarter.

(c) The list shall contain the following information:

(1) Transferor and transferee, if available;

(2) Assessor's parcel number;

(3) Address of the sales property;

(4) Date of transfer;

(5) Date of recording and recording reference number;

(6) Where it is known by the assessor, the consideration paid for such property; and

(7) Additional information which the assessor in his discretion may wish to add to carry out the purpose and intent of this section. Other than sales information, the assessor shall not include information on the list which relates to the business or business affairs of the owner of the property, information concerning the business carried on upon the subject property, or the income or income stream generated by the property.

(d) The list shall be open to inspection by any person. The assessor may require the payment of a nonrefundable fee equal to an amount which would reimburse local agencies for their actual administrative costs incurred in such inspections or ten dollars ($10), whichever is the lesser amount.

(e) The provisions of this section shall not apply to any county with a population of under 50,000 people, as determined by the 1970 federal decennial census.

(f) Pursuant to Section 481, the assessor shall not include information on the list which was furnished in the change in ownership statement by the transferee and is not otherwise public information.

History.—Added by Stats. 1980, Ch. 1349, in effect January 1, 1981.

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408.2. Public records open to public inspection. (a) Except as otherwise provided in Sections 63.1, 69.5, 451, and 481 of this code and in Section 6254 of the Government Code, any information and records in the assessor's office which are required by law to be kept or prepared by the assessor, other than homeowners' exemption claims, are public records and shall be open to public inspection. Property receiving the homeowners' exemption shall be clearly identified on the assessment roll. The assessor shall maintain records which shall be open to public inspection to identify those claimants who have been granted the homeowners' exemption.

(b) The assessor may provide any appraisal data in his or her possession to the assessor of any county and shall provide any market data in his or her possession to an assessee of property or his or her designated representative upon request. The assessor shall permit an assessee of property or his or her designated representative to inspect at the assessor's office any information and records, whether or not required to be kept or prepared by the assessor, relating to the appraisal and the assessment of his or her property. Except as provided in Section 408.1, an assessee or his or her designated representative, however, shall not be provided or permitted to inspect information and records, other than market data, which also relate to the property or business affairs of another person, unless that disclosure is ordered by a competent court in a proceeding initiated by a taxpayer seeking to challenge the legality of his or her assessment.

(c) The assessor shall disclose information, furnish abstracts, or permit access to all records in his or her office to law enforcement agencies, the county grand jury, the board of supervisors or their duly authorized agents, employees or representatives when conducting an investigation of the

assessor's office pursuant to Section 25303 of the Government Code, the Controller, probate referees, employees of the Franchise Tax Board for tax administration purposes only, the State Board of Equalization, and other duly authorized legislative or administrative bodies of the state pursuant to their authorization to examine the records.

(d) For purposes of this section, "market data" means any information in the assessor's possession, whether or not required to be prepared or kept by him or her, relating to the sale of any property comparable to the property of the assessee, if the assessor bases his or her assessment of the assessee's property, in whole or in part, on that comparable sale or sales. The assessor shall provide the names of the seller and buyer of each property on which the comparison is based, the location of that property, the date of the sale, and the consideration paid for the property, whether paid in money or otherwise, but for purposes of providing market data, the assessor shall not display any document relating to the business affairs or property of another.

(e) This section applies only to a county with a population that exceeds 4,000,000.

History.—Added by Stats. 1981, Ch. 523, in effect January 1, 1982. Stats. 1984, Ch. 678, in effect January 1, 1985, substituted "probate" for "inheritance tax" before "referees" in subdivision (c); and deleted former subdivision (f) which would have repealed this section of the code on January 1, 1985. Stats. 1985, Ch. 200, effective January 1, 1986, added "or her" after each "his" and substituted "that" for "such" after "unless" in the third sentence of subdivision (b); added a comma after "abstracts", added "employees of the Franchise Tax Board for tax administration purposes only," after "referees,", and substituted "the" for "such" after "examine" in subdivision (c); and added "or her" after each "him" and "his", substituted "that" for "such" after "on" in first sentence, and substituted "that" for "such" after "location of" and deleted "such" after "providing" in second sentence of subdivision (d). Stats. 2005, Ch. 264 (SB 555), in effect January 1, 2006, added "63.1, 69.5," after "in Sections" and added a comma after "451" in the first sentence of subdivision (a) and substituted "applies" for "shall apply" after "This section" and substituted "that" for "which" after "with a population" in the first sentence of subdivision (e).

Note.—Section 3 of Stats. 1981, Ch. 523, which added Sections 408.2 and 409, provided that the Legislature finds and declares that a special law is necessary and that a general law cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of unique circumstances in Los Angeles County which are not common to other counties. The assessor's office in Los Angeles County has expended considerable time and funds developing a data base from which details concerning properties within the county can be generated. The assessor's office receives numerous requests for specified information available from the data base, but because current law only permits the assessor to charge any party making such a request the cost of duplicating information, the assessor's office must absorb considerable costs in filing such request. This act is necessary to permit the assessor of Los Angeles County to recover the cost of providing information which he is not by law required to prepare or keep.

Note.—Section 6 of Stats. 1985, Ch. 200, provided reimbursement to local governments for costs mandated by the State pursuant to this act.

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408.3. Property characteristics information; public records. (a) Except as otherwise provided in Sections 451 and 481 and in Section 6254 of the Government Code, property characteristics information maintained by the assessor is a public record and shall be open to public inspection.

(b) For purposes of this section, "property characteristics," includes, but is not limited to, the year of construction of improvements to the property, their square footage, the number of bedrooms and bathrooms of all dwellings, the property's acreage, and other attributes of or amenities to the property, such as swimming pools, views, zoning classifications or restrictions, use code designations, and the number of dwelling units of multiple family properties.

(c) Notwithstanding Section 6257 of the Government Code or any other provision of law, if the assessor provides property characteristics information at the request of any party, the assessor may require that a fee reasonably related to the actual cost of developing and providing the information be paid by the party receiving the information.

The actual cost of providing the information is not limited to duplication or production costs, but may include recovery of developmental and indirect costs, as overhead, personnel, supply, material, office, storage, and computer costs. All revenue collected by the assessor for providing information under this section shall be used solely to support, maintain, improve, and provide for the creation, retention, automation, and retrieval of assessor information.

(d) The Legislature finds and declares that information concerning property characteristics is maintained solely for assessment purposes and is not continuously updated by the assessor. Therefore, neither the county nor the assessor shall incur any liability for errors, omissions, or approximations with respect to property characteristics information provided by the assessor to any party pursuant to this section. Further, this subdivision shall not be construed to imply liability on the part of the county or the assessor for errors, omissions, or other defects in any other information or records provided by the assessor pursuant to the provisions of this part.

History.—Added by Stats. 1986, Ch. 1511, effective January 1, 1987. Stats. 1995, Ch. 527, in effect January 1, 1996, deleted "of this code" after "and 481" in subdivision (a); deleted "such" after "indirect costs," in the first sentence of the second paragraph in subdivision (c); deleted former subdivision (e) which read: "Except as provided in subdivision (f), this section shall apply only to a county with a population which exceeds 715,000."; and deleted former subdivision (f) which read: "In any county with a population of 715,000 or less, the assessor may make property characteristic information open to public inspection."

Note.—Section 2 of Stats. 1986, Ch. 1511, provided that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act.

409. Fee for actual cost of developing and providing information. (a) Notwithstanding Section 6257 of the Government Code or any other statutory provision, if the assessor, pursuant to the request of any party, provides information or records that the assessor is not required by law to prepare or keep, the county may require that a fee reasonably related to the actual cost of developing and providing that information be paid by the party receiving the information.

The actual cost of providing the information is not limited to duplication or reproduction costs, but may include recovery of developmental and indirect costs, such as overhead, personnel, supply, material, office, storage, and computer costs.

It is the intent of this section that the county may impose this fee for information and records maintained for county use, as well as for information and records not maintained for county use.

Nothing herein shall be construed to require an assessor to provide information to any party beyond that which he or she is otherwise statutorily required to provide.

(b) For purposes of this section, "market data," as defined in Section 408.1, shall be deemed to be information the assessor is required by law to prepare or keep when requested by the assessee or a designated representative of the assessee.

(c) This section shall not apply to requests of the State Board of Equalization for information.

History.—Added by Stats. 1981, Ch. 523, in effect January 1, 1982. Stats. 1983, Ch. 116, in effect January 1, 1984, deleted former subdivision (d), which limited the applicability of the section to a county with a population in excess of 4,000,000, and relettered former subdivision (e) as subdivision (d). Stats. 1984, Ch. 678, in effect January 1, 1985, deleted former subdivision (d).

Note.—Section 3 of Stats. 1981, Ch. 523, provided that the Legislature finds and declares that a special law is necessary and that a general law cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of unique circumstances in Los Angeles County which are not common to other counties. The assessor's office in Los Angeles County has expended considerable time and funds developing a data base from which details concerning properties within the county can be generated. The assessor's office receives numerous requests for specified information available from the data base, but because current law only permits the assessor to charge any party making such a request the cost of duplicating information, the assessor's office must absorb considerable costs in filing such request. This act is necessary to permit the assessor of Los Angeles County to recover the cost of providing information which he is not by law required to prepare or keep.

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Article 1.3. Assessment of Implements of Husbandry*

* Article 1.3 was added by Stats. 1970, p. 1744, in effect November 23, 1970.

410. Legislative intent. It is the intent of the Legislature in enacting this article to provide for a uniform system of assessment of all implements of husbandry in this state, regardless of where located.

410.10. Intercounty pipelines; full cash value. [Renumbered as 401.10 by Stats. 1997, Ch. 17, in effect January 1, 1998.]

411. "Implement of husbandry." For the purposes of this article, "implement of husbandry" includes, but is not limited to, any tool, machine, equipment, appliance, device or apparatus used in the conduct of agricultural operations, except where such implements are intended for sale in the ordinary course of business.

"Implement of husbandry" also includes those implements of husbandry as defined in the Vehicle Code.

412. Assessment. The assessor of the county in which the implement of husbandry is located shall assess the implement as provided in this article.

413. Valuation. In assessing the implement of husbandry, the county assessor shall determine the value of the implement in accordance with standards and guides to the full cash value.

414. Owner's statement; contents. Upon request of the assessor of the county in which an implement of husbandry is located, the owner shall file with him a statement setting forth the make, model and year of manufacture of the implement.

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Article 1.5. Valuation of Open-Space Land Subject to an Enforceable Restriction*

* Stats. 1969, p. 1930, in effect November 10, 1969, repealed Section 4 of Stats. 1967, p. 3651, which made Article 1.5 operative only until the 61st day following adjournment of the Regular Session of the 1970 Legislature.

421. Definitions. For the purposes of this article:

(a) "Agricultural preserve" means an agricultural preserve created pursuant to the California Land Conservation Act of 1965 (Williamson Act) (Chapter 7 (commencing with Section 51200) of Part 1 of Division 1 of Title 5 of the Government Code).

(b) "Contract" means a contract executed pursuant to the California Land Conservation Act.

(c) "Agreement" means an agreement executed pursuant to the California Land Conservation Act prior to the 61st day following the final adjournment of the 1969 Regular Session of the Legislature and that, taken as a whole, provides restrictions, terms and conditions that are substantially similar or more restrictive than those required by statute for a contract.

(d) "Scenic restriction" means any interest or right in real property acquired by a city or county pursuant to Chapter 12 (commencing with Section 6950) of Division 7 of Title 1 of the Government Code, where the deed or other instrument granting such right or interest imposes restrictions that, through limitation of their future use, will effectively preserve for public use and enjoyment, the character of open spaces and areas as defined in Section 6954 of the Government Code.

A scenic restriction shall be for an initial term of 10 years or more, and shall provide for either of the following:

(1) A method whereby the term may be extended by mutual agreement of the parties.

(2) That the initial term shall be subject to annual automatic one-year extensions as provided for contracts in Sections 51244, 51244.5, and 51246 of the Government Code, unless notice of nonrenewal is given as provided in Section 51245 of the Government Code.

A scenic restriction may not be terminated prior to the expiration of the initial term, and any extension thereof, except as provided for cancellation of contracts in Sections 51281, 51282, 51283 and 51283.3 of the Government Code, and subject to the provisions therein for payment of the cancellation fee.

(e) "Open-space easement" means an open-space easement granted to a county or city pursuant to Chapter 6.5 (commencing with Section 51050) of Part 1 of Division 1 of Title 5 of the Government Code if the easement is acquired prior to January 1, 1975, or an open-space easement granted to a county, city, or nonprofit organization pursuant to Chapter 6.6 (commencing with Section 51070) of Part 1 of Division 1 of Title 5 of the Government Code if the easement is acquired after January 1, 1975, or an open-space easement granted to a regional park district, regional park and open-space district, or regional open-space district under Article 3 (commencing with Section 5500) of Chapter 3 of Division 5 of the Public Resources Code.

(f) "Wildlife habitat contract" means any contract or amended contract or covenant involving, except as provided in Section 423.8, 150 acres or more of land entered into by a landowner with any agency or political subdivision of the federal or state government limiting the use of lands for a period of 10 or more years by the landowner to habitat for native or migratory wildlife and native pasture. These lands shall, by contract, be eligible to receive water for waterfowl or waterfowl management purposes from the federal government.

(g) "Open-space land" means any of the following:

(1) Land within an agricultural preserve and subject to a contract or an agreement.

(2) Land subject to a scenic restriction.

(3) Land subject to an open-space easement.

(4) Land that has been restricted by a political subdivision or an entity of the state or federal government, acting within the scope of its regulatory or other legal authority, for the benefit of wildlife, endangered species, or their habitats.

(h) "Typical rotation period" means a period of years during which different crops are grown as part of a plant cultural program. Typical rotation period does not mean the rotation period of timber.

(i) "Wildlife" means waterfowl of every kind and any other undomesticated mammal, fish, or bird, or any reptile, amphibian, insect, or plant.

(j) "Endangered species" means any species or subcategory thereof, as defined in the California Endangered Species Act (Chapter 1.5 (commencing with Section 2050) of Division 3 of the Fish and Game Code) or the federal Endangered Species Act (16 U.S.C. Sec. 1531 et seq.), that has been classified and protected as an endangered, threatened, rare, or candidate species by any entity of the state or federal government.

History.—Added by Stats. 1969, p. 1702, operative March 1, 1970. Stats. 1973, Ch. 1165, p. 2424, in effect January 1, 1974, added subdivision (f), relettered former subdivision (f) to (g) and former subdivision (g) to (h), and added subdivision (i). Stats. 1974, Ch. 1003, p. 2159, in effect January 1, 1975, added the balance of subdivision (e) after first "Government Code". Stats. 1977, Ch. 1178, in effect January 1, 1978, added "nonprofit organization" in subdivision (e), and substituted "Landowner" for "Landowners" and "or" for "of" after "10" in the first sentence of subdivision (f). Stats. 1982, Ch. 71, in effect March 1, 1982, added ", or an open-space easement granted to a regional park district regional park and open-space district, or regional open-space district under Article 3 (commencing with Section 5500) of Chapter 3 of Division 5 of the Public Resources Code" after "after January 1, 1975" in subdivision (e). Stats. 1996, Ch. 997, in effect September 27, 1996, substituted "that" for "which" twice, and deleted the comma after "terms" in subdivision (c); substituted "that" for "which" after "imposes restrictions" in the first sentence of the first paragraph of subdivision (d) and substituted "provide for either of the following:" for "either:" in the second paragraph of subdivision (d); substituted "A method" for "Provide a method", and substituted "the parties." for "the parties, or" in paragraph (1), and substituted "That the initial" for "Provide that the initial" in paragraph (2) of subdivision (d); added ",except as provided in Section 423.8," after "or covenant involving" in the first sentence, and substituted "These" for "Such" in the second sentence of subdivision (f); added paragraph (4) of subdivision (g); added ", or any reptile, amphibian, insect, or plant" after "bird" in subdivision (i); and added subdivision (j).

Note.—Stats. 1971, p. 130, in effect May 25, 1971, provided:

Section 1. (a) For purposes of subdivision (c) of Section 421 of the Revenue and Taxation Code, an agreement, when taken as a whole, shall be deemed to provide restrictions, terms and conditions which are substantially similar to, or more restrictive than, those required by statute for a contract if at the time of its execution:

(1) The agreement had an initial term of seven years or more.

(2) The agreement could be canceled only by reason of condemnation of all or part of the property subject to the agreement or by reason of the death of an owner of the property subject to the agreement.

(3) The agreement provided that cancellation of the agreement must be approved by the board of supervisors or city council.

(b) The provisions of this section shall not be construed to provide the exclusive terms of validation for agreements executed pursuant to the California Land Conservation Act and shall apply to assessments for the 1971–1972 fiscal year only. The provisions of this section shall not be deemed to permit any reduction in the restrictions, terms, and conditions heretofore imposed by agreement.

Sec. 2. Notwithstanding any other provision of law to the contrary, the assessment procedures specified under Section 423 of the Revenue and Taxation Code shall be effective with respect to land subject to taxation for the 1971–1972 fiscal year only, if such land is subject to an instrument meeting the requirements set by Section 1 of this act.

Note.—Section 10 of Stats. 1974, Ch. 1003, p. 2161, provided no payment by state to local governments because of this act. Sec. 11 thereof provided that the provisions of this act shall be given prospective application only and shall not be construed in a manner which would impair the obligation of any existing open-space easement or scenic restriction entered into prior to January 1, 1975. Land subject to any such easement or restriction on such date shall continue to be assessed under Article 1.5 (commencing with Section 421) of Chapter 3 of Part 2 of Division 1 of the Revenue and Taxation Code so long as such land otherwise qualifies for assessment under such article and qualifies under Chapter 6.5 (commencing with Section 51050) of Part 1 of Division 1 of Title 5 of, or under Chapter 12 (commencing with Section 6950) of Division 7 of Title 1 of, the Government Code.

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421.5. Definitions. For purposes of this article, the following terms have the following meaning:

(a) "Agricultural conservation easement" shall have the same meaning as defined in Section 10211 of the Public Resources Code.

(b) "Open-space land" includes land subject to an agricultural conservation easement.

History.—Added by Stats. 1995, Ch. 931, in effect January 1, 1996. Stats. 2002, Ch. 616 (SB 1864), in effect January 1, 2003, deleted "a conservation easement, as" after "same meaning as" and substituted "Section 10211 of the Public Resources Code" for "Section 815.1 of the Civil Code" after "defined in" in the first sentence of subdivision (a).

422. Enforceable restriction defined. For the purposes of this article and within the meaning of Section 8 of Article XIII of the Constitution, open-space land is "enforceably restricted" if it is subject to any of the following:

(a) A contract;

(b) An agreement;

(c) A scenic restriction entered into prior to January 1, 1975;

(d) An open-space easement; or

(e) A wildlife habitat contract.

For the purposes of this article no restriction upon the use of land other than those enumerated in this section shall be considered to be an enforceable restriction.

History.—Added by Stats. 1969, p. 1703, operative March 1, 1970. Stats. 1973, Ch. 1165, p. 2425, in effect January 1, 1974, added subsection (e). Stats. 1974, Ch. 1003, p. 2160, in effect January 1, 1975, added the balance of subsection (c) after "restriction". Stats. 1975, Ch. 224, p. 603, in effect January 1, 1976, substituted "Section 8 of Article XIII" for "Article XXVIII", deleted "State" before "Constitution", and substituted "open-space land is 'enforceably restricted' if it is subject to" for " 'enforceable restriction' " in the first sentence of the first paragraph.

Note.—Stats. 1971, p. 1446, in effect August 24, 1971, provided:

Section 1. A contract which at the time of its execution contained any or all of the requirements contained in this section shall be deemed to provide an enforceable restriction for purposes of Section 422 of the Revenue and Taxation Code and shall be entitled to assessment under Section 423, 423.5 or 429 of such code, provided that such contract otherwise conforms to the statutory requirements of the California Land Conservation Act of 1965, as contained in Chapter 7 (commencing with Section 51200) of Part 1 of Division 1 of Title 5 of the Government Code.

(a) If such contract provides for its nullification upon the filing of a condemnation of an interest in all or any part of the property subject to the contract and the board of supervisors of the county or city council of the city having jurisdiction over the land subject to such contract passes an ordinance interpreting such provision, in the case of a condemnation of less than a fee interest, to mean the nullification operates for purposes of establishing value for condemnation purposes but that any termination of the contract is to be pursuant to Article 5 (commencing with Section 51280) of Chapter 7 of Part 1 of Division 1 of Title 5 of the Government Code; or

(b) If such contract provides that the remaining portion of land after an action or acquisition by condemnation is determined by the board of supervisors of the county or city council of the city having jurisdiction over the land subject to the contract to be impaired to such extent as to make it unsuitable for those uses legally available to the owner under terms of his contract and the board of supervisors of the county or city council of the city having jurisdiction over the land subject to such contracts passes an ordinance stating that in administering such portion of a contract it will apply Article 5 (commencing with Section 51280) of Chapter 7 of Part 1 of Division 1 of Title 5 of the Government Code; or

(c) If such contract provides for any waiver of a cancellation payment provided that such waiver is in the best interest of the program to conserve agricultural land and the board of supervisors of the county or city council of the city having jurisdiction over the land subject to such contract passes an ordinance stating that in administering such portion of a contract, it will apply subdivision (c) of Section 51283 of the Government Code.

Note.—Stats. 1971, p. 23, in effect March 25, 1971, provided:

Section 1. Notwithstanding any other provision of law to the contrary, the assessment procedures specified under Sections 423 and 423.5 of the Revenue and Taxation Code shall be effective with respect to land subject to taxation for the 1971–1972 fiscal year, if such land is subject to an instrument meeting the requirements of Section 422 of the Revenue and Taxation Code and such instrument is signed or accepted and recorded on or before May 15, 1971; provided, that prior to 5 o'clock p.m. on March 1, 1971, either the land which is subject to a contract was included in a proposal to establish an agricultural preserve submitted to the planning commission or planning department or the matter of accepting an open-space easement or scenic restriction had been referred to such commission or department.

Note.—Stats. 1971, p. 258, in effect June 25, 1971, contained substantially identical provisions.

Note.—Stats. 1972, p. 866, in effect July 28, 1972, provided:

Notwithstanding any other provision of law to the contrary, the assessment procedures specified under Sections 423 and 423.5 of the Revenue and Taxation Code shall be effective with respect to land subject to taxation for the 1972–1973 fiscal year, if such land is subject to an instrument meeting the requirements of Section 422 of the Revenue and Taxation Code and such instrument is signed and recorded on or before May 25, 1972; provided, that prior to 5 o'clock p.m. on March 1, 1972, either the land which is subject to a contract was included in a proposal to establish an agricultural preserve submitted to the planning commission or planning department or the matter of accepting an open-space easement or scenic restriction had been referred to such commission or department.

Generally.—Agreements concluded under the Land Conservation Act of 1965 will not be invalid under later amendments to the act if the restrictive conditions are substantially similar to the amended provisions. Marin County v. Assessment Appeals Board, 64 Cal.App.3d 319.

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422.5. Open-space land; "enforceably restricted." For the purposes of this article, open-space land is "enforceably restricted" within the meaning of Section 8 of Article XIII of the California Constitution if it is subject to an agricultural conservation easement.

History.—Added by Stats. 1995, Ch. 931, in effect January 1, 1996.

423. Factors to be considered in valuation. Except as provided in Sections 423.7 and 423.8, when valuing enforceably restricted open-space land, other than land used for the production of timber for commercial purposes, the county assessor shall not consider sales data on lands, whether or not enforceably restricted, but shall value these lands by the capitalization of income method in the following manner:

(a) The annual income to be capitalized shall be determined as follows:

(1) Where sufficient rental information is available the income shall be the fair rent which can be imputed to the land being valued based upon rent actually received for the land by the owner and upon typical rentals received in the area for similar land in similar use, where the owner pays the property tax. Any cash rent or its equivalent considered in determining the fair rent of the land shall be the amount for which comparable lands have been rented, determined by average rents paid to owners as evidenced by typical land leases in the area, giving recognition to the terms and conditions of the leases and the uses permitted within the leases and within the enforceable restrictions imposed.

(2) Where sufficient rental information is not available, the income shall be that which the land being valued reasonably can be expected to yield under prudent management and subject to applicable provisions under which the land is enforceably restricted. There shall be a rebuttable presumption that "prudent management" does not include use of the land for a recreational use, as defined in subdivision (n) of Section 51201 of the Government Code, unless the land is actually devoted to that use.

(3) Notwithstanding any other provision herein, if the parties to an instrument which enforceably restricts the land stipulate therein an amount which constitutes the minimum annual income per acre to be capitalized, then the income to be capitalized shall not be less than the amount so stipulated.

For the purposes of this section, income shall be determined in accordance with rules and regulations issued by the board and with this section and shall be the difference between revenue and expenditures. Revenue shall be the amount of money or money's worth, including any cash rent or its equivalent, which the land can be expected to yield to an owner-operator annually on the average from any use of the land permitted under the terms by which the land is enforceably restricted, including, but not limited to, that from the production of salt and from typical crops grown in the area during a typical rotation period, as evidenced by historic cropping patterns and agricultural commodities grown. When the land is planted to fruit-bearing or nut-bearing trees, vines, bushes, or perennial plants, the revenue shall not be less than the land would be expected to yield to an owner-operator from other typical crops grown in the area during a typical rotation period, as evidenced by historic cropping patterns and agricultural commodities grown. Proceeds from the sale of the land being valued shall not be included in the revenue from the land.

Expenditures shall be any outlay or average annual allocation of money or money's worth that has been charged against the revenue received during the period used in computing that revenue. Those expenditures to be charged against revenue shall be only those that are ordinary and necessary in the production and maintenance of the revenue for that period. Expenditures shall not include depletion charges, debt retirement, interest on funds invested in the land, interest on funds invested in trees and vines valued as land as provided by Section 429, property taxes, corporation income taxes, or corporation franchise taxes based on income. When the income used is from operating the land being valued or from operating comparable land, amounts shall be excluded from the income to provide a fair return on capital investment in operating assets other than the land, to amortize depreciable property, and to fairly compensate the owner-operator for his operating and managing services.

(b) The capitalization rate to be used in valuing land pursuant to this article shall not be derived from sales data and shall be the sum of the following components:

(1) An interest component to be determined by the board and announced no later than October 1 of the year preceding the assessment year, which is the arithmetic mean, rounded to the nearest 1/4 percent, of the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board as of September 1, and the corresponding yield rates for those bonds, as most recently published by the Federal Reserve Board as of each September 1 immediately prior to each of the four immediately preceding assessment years.

(2) A risk component that shall be a percentage determined on the basis of the location and characteristics of the land, the crops to be grown thereon and the provisions of any lease or rental agreement to which the land is subject.

(3) A component for property taxes that shall be a percentage equal to the estimated total tax rate applicable to the land for the assessment year times the assessment ratio. The estimated total tax rate shall be the cumulative rates used to compute the state's reimbursement of local governments for revenues lost on account of homeowners' property tax exemptions in the tax rate area in which the enforceably restricted land is situated.

(4) A component for amortization of any investment in perennials over their estimated economic life when the total income from land and perennials other than timber exceeds the yield from other typical crops grown in the area.

(c) The value of the land shall be the quotient for the income determined as provided in subdivision (a) divided by the capitalization rate determined as provided in subdivision (b).

(d) Unless a party to an instrument which creates an enforceable restriction expressly prohibits such a valuation, the valuation resulting from the capitalization of income method described in this section shall not exceed the lesser of either the valuation that would have resulted by calculation under Section 110, or the valuation that would have resulted by calculation under Section 110.1, as though the property was not subject to an enforceable restriction in the base year.

In determining the 1975 base year value under Article XIII A of the California Constitution for any parcel for comparison, the county may charge a contractholder a fee limited to the reasonable costs of the determination not to exceed twenty dollars ($20) per parcel.

(e) If the parties to an instrument that creates an enforceable restriction expressly so provide therein, the assessor shall assess those improvements that contribute to the income of land in the manner provided herein. As used in this subdivision "improvements which contribute to the income of the land" shall include, but are not limited to, wells, pumps, pipelines, fences, and structures which are necessary or convenient to the use of the land within the enforceable restrictions imposed.

History.—Stats. 1969, p. 1703, operative March 1, 1970, completely revised this section. Stats. 1970, p. 1591, in effect November 23, 1970, added the rebuttable presumption in subsection (a)(2). Stats. 1971, p. 3617, in effect March 4, 1972, substituted "the following" for "three" in subdivision (b) of the fourth paragraph and added (4) to subsection (b). Stats. 1972 p. 2191, in effect March 7, 1973, combined the second and third paragraphs in subsection (b)(2). Stats. 1973, Ch. 1165, p. 2425, in effect January 1, 1974, added "Except as provided in Section 423.7" at the beginning of the first paragraph, Stats. 1974, Ch. 311, p. 604, in effect January 1, 1975, substituted "enforceably restricted open-space land" for "open-space land subject to an enforceable restriction", and substituted "enforceably restricted" for "subject to an enforceable restriction" in the first sentence of the first paragraph; substituted "provisions under which the land is enforceably restricted" for "enforceable restrictions" in the second sentence of subsection (a)(1) and in the first sentence of subsection (b)(1); and substituted "by which the land is enforceably restricted" for "of the enforceable restriction" in the second sentence of the second paragraph. Stats. 1976, Ch. 423, p. 1083, in effect July 1, 1976, added subsection (a)(3), and deleted the former fourth paragraph which required that the board and the assessor impute income to land in certain cases. Stats. 1978, Ch. 1120, in effect January 1, 1979, substituted the second sentence for the former second sentence of subdivision (a)(1) which read "When the land being valued is actually encumbered by a lessee, any cash rent or its equivalent considered in determining the fair rent of the land shall be the amount for which the land would be expected to rent were the rental payment to be renegotiated in the light of current conditions including applicable provisions under which the land is enforceably restricted", substituted "5120" for "51201" after "Section" in subdivision (a)(2), substituted "as evidenced by historic cropping patterns and agricultural commodities grown" for "not to exceed six years including the tax year and the next succeeding five years" after "period" in the second and third sentences of the second paragraph, deleted "expected to be" after "revenue" in the first sentence of the third paragraph, added the second sentence to subsection (b)(3), and added subdivisions (e) and (f). Stats. 1979, Ch. 1075, in effect September 28, 1979, applicable to the 1979–80 fiscal year and thereafter substituted "51201" for "5120" in the second sentence of the subdivision (a)(2), substituted subdivision (e) for the former subdivision (e), and substituted "subdivision" for "subsection" in the second sentence of subdivision (f). Stats. 1981, Ch. 261, in effect January 1, 1982, deleted "one-quarter" before and the parentheses surrounding "1/4" in subsection (1) of subdivision (b), deleted subdivision (d), and relettered former subdivisions "(e)" and "(f)" as "(d)" and "(e)", respectively. Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "the board for purposes of surveys required by Section 1815 of this code . . . and " after "purposes," in the first sentence. Stats. 1987, Ch. 144, in effect January 1, 1988, substituted "these" for "such" after "value" in the first sentence; substituted "that" or "the" for "such" in paragraphs (a)(2), (a)(3) and (d); in (a)(3) substituted "." for "; and" after "subject" in subdivision (b)(2); added "the lesser of either" after "exceed" and added "by calculation under Section 110, or the valuation that would have resulted" after "resulted" in the first sentence of the first paragraph of subdivision (d), deleted the former second paragraph thereof, which provided that "The county assessor shall notify annually the parties to an instrument which creates an enforceable restriction that unless either party expressly prohibits such a valuation, the valuation resulting from the capitalization of income method shall not exceed the valuation that would have resulted by calculation under Section 110.1, as though such property was not subject to an enforceable restriction in the base year", and substituted "contractholder" for "contract holder" after "charge a" in the first sentence of the third paragraph thereof. Stats. 1992, Ch. 247, in effect January 1, 1993, substituted ", which is the . . . 1/4 percent, of" for "and which was" after "assessment year", and substituted "and the corresponding yield rates . . . preceding assessment years" for "rounded to the nearest 1/4 percent" after "Federal Reserve Bank" in the first sentence of paragraph (1) of subdivision (b); added the second sentence of paragraph (A) of subdivision (b), and added subparagraphs (A), (B), (C), (D), and (E) to paragraph (1) of subdivision (b). Stats. 1996, Ch. 997, in effect September 27, 1996, substituted "Sections 423.7 and 423.8" for "Section 423.7" after "Except as provided in" in the first sentence. Stats. 2003, Ch. 471(SB 1062), in effect January 1, 2004, substituted "October 1" for "September 1" after "no later than" and added "as of September 1" after "Federal Reserve Board" in the first sentence of paragraph (1) of subdivision (b), and deleted the former second sentence thereof which provided that " The interest component defined by this paragraph shall be implemented in phases and shall be: (A) For the 1993–94 assessment year, the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board, rounded to the nearest 1/4 percent. (B) For the 1994–95 assessment year, the arithmetic mean, rounded to the nearest 1/4 percent, of the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board, and the corresponding yield rate for those bonds, as most recently published by the Federal Reserve Board as of the September 1 immediately prior to the 1993–94 assessment year. (C) For the 1995–96 assessment year, the arithmetic mean, rounded to the nearest 1/4 percent, of the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board, and the corresponding yield rates for those bonds, as most recently published by the Federal Reserve Board as of each September 1 immediately prior to the 1993–94 and 1994–95 assessment years. (D) For the 1996–97 assessment year, the arithmetic mean, rounded to the nearest 1/4 percent, of the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board, and the corresponding yield rates for those bonds, as most recently published by the Federal Reserve Board as of each September 1 immediately prior to the 1993–94, 1994–95, and 1995–96 assessment years. (E) For the 1997–98 assessment year, and each fiscal year thereafter, the arithmetic mean, rounded to the nearest 1/4 percent, of the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board, and the corresponding yield rates for those bonds, as most recently published by the Federal Reserve Board as of each September 1 immediately prior to the four immediately preceding assessment years."; and substituted "that" for "which" throughout the text.

Note.—Stats. 1968, p. 875, in effect June 28, 1968, provides that the assessment procedures specified under Section 423 shall be effective with respect to land for the 1968–69 fiscal year if the land is subject to an instrument, meeting the requirements of Section 422, which was signed and recorded on or before June 15, 1968. Stats. 1969, p. 60, in effect February 25, 1969, and Stats. 1970, p. 14, in effect February 27, 1970, similarly provide for the 1969–70 and 1970–71 fiscal years respectively. Section 4 of Stats. 1979, Ch. 1075, provided that notwithstanding Section 2231 or 2234 of the Revenue and Taxation Code, no appropriation is made by this act pursuant to these sections because local government entities have the option to prohibit computation of the lower of Williamson Act values determined according to capitalization rates or Article XIII A, and thus, this act does not itself impose additional duties or result in loss of revenues.

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423.3. Valuation of enforceably restricted lands. Any city or county may allow land subject to an enforceable restriction under the Williamson Act or a migratory waterfowl habitat contract to be assessed in accordance with one or more of the following:

(a) Land specified in subdivision (a) of Section 16142 of the Government Code shall be assessed at the value determined as provided in Section 423, but not to exceed a uniformly applied percentage of its base year value pursuant to Section 110.1, adjusted to reflect the percentage change in the cost of living not to exceed 2 percent per year. In no event shall that percentage be less than 70 percent.

(b) Prime commercial rangeland shall be assessed at the value determined as provided in Section 423, but not to exceed a uniformly applied percentage of its base year value pursuant to Section 110.1, adjusted to reflect the percentage change in the cost of living not to exceed 2 percent per year. In no event shall that percentage be less than 80 percent.

For purposes of this subdivision "prime commercial rangeland" means rangeland which meets all of the following physical-chemical parameters:

(1) Soil depth of 12 inches or more.

(2) Soil texture of fine sandy loam to clay.

(3) Soil permeability of rapid to slow.

(4) Soil with at least 2.5 inches of available water holding capacity in profile.

(5) A slope of less than 30 percent.

(6) A climate with 80 or more frost-free days per year.

(7) Ten inches or more average annual precipitation.

(8) When managed at potential, the land generally requires less than 17 acres to support one animal unit per year.

Property owners of land specified in this subdivision, shall demonstrate that their land falls within the above definition when requested by the city or county.

(c) Land specified in subdivision (b) of Section 16142 of the Government Code shall be assessed at the value determined as provided in Section 423, but not to exceed a uniformly applied percentage of its base year value pursuant to Section 110.1, adjusted to reflect the percentage change in the cost of living not to exceed 2 percent per year. In no event shall that percentage be less than 90 percent.

(d) Waterfowl habitat shall be assessed at the value determined as provided in Section 423.7 but not to exceed a uniformly applied percentage of its base year value pursuant to Section 110.1, adjusted to reflect the percentage change in the cost of living not to exceed 2 percent per year. In no event shall that percentage be less than 90 percent.

History.—Added by Stats. 1980, Ch. 1273, in effect January 1, 1981. Stats. 1982, Ch. 1366, in effect January 1, 1983, substituted "a uniformly applied percentage" for "70 percent" in subdivision (a), for "75 percent" in subdivision (b), for "80 percent" in subdivision (c), and for "90 percent" in subdivisions (d) and (e) after "exceed", added the second sentence to the first paragraphs of subdivisions (a) through (e), and deleted former subdivisions (f) and (g). Stats. 1998, Ch. 689 (SB 1362), in effect January 1, 1999, deleted "or (b)" before "of Section 16142" in subdivision (a); deleted former subdivision (b) which provided that "Land specified in subdivision (c) of Section 16142 of the Government Code shall be assessed at the value determined as provided in Section 423, but not to exceed a uniformly applied percentage of its base year value pursuant to Section 110.1, adjusted to reflect the percentage change in the cost of living not to exceed 2 percent per year. In no event shall that percentage be less than 75 percent."; relettered former subdivisions (c), (d), and (e) as (b), (c), and (d), respectively; substituted "(b)" for "(d)" after "subdivision" in the first sentence of subdivision (c); and added "determined" after "the value" in the first sentence of subdivision (d).

Note.—Section 2 of Stats. 1980, Ch. 1273, provided the Board of Equalization shall conduct a study of the costs associated with this act and shall report to the Legislature on or before December 31, 1982. Section 3 thereof provided no payment by state to local governments because of this act, however, a local agency or school district may pursue other remedies to obtain reimbursement.

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423.4. Farmland security zone. Land subject to a farmland security zone contract specified in Section 51296.1 of the Government Code shall be valued for assessment purposes at 65 percent of the value under Section 423 or 65 percent of the value under Section 110.1, whichever is lower.

History.—Added by Stats. 1998, Ch. 353 (SB 1182), in effect August 24, 1998. Stats. 2002, Ch. 616 (SB 1864), in effect January 1, 2003, substituted "Section 51296.1" for "Section 51296" after "contract specified in" in the first sentence.

Note.—Section 10 of Stats. 1998, Ch. 383 provided that this act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:

In order to provide the benefits of this act to private property owners at the earliest possible time and enhance the preservation of agricultural land, it is necessary that this act take effect immediately.

423.5. Valuation of timberland. When valuing open-space land which is enforceably restricted and used for the production of timber for commercial purposes, the county assessor shall not consider sales data on lands, whether or not enforceably restricted, but shall determine the value of such timberland to be the present worth of the income which the future harvest of timber crops from the land and the income from other allowed compatible uses can reasonably be expected to yield under prudent management. The value of timberland pursuant to this section shall be determined in accordance with rules and regulations issued by the board. In determining the value of timberland pursuant to this section, the board and the county assessor shall use the capitalization rate derived pursuant to subdivision (b) of Section 423. The ratio prescribed in Section 401 shall be applied to the value of the land determined in accordance with this section to obtain its assessed value.

For the purposes of this section, the income of each acre of land shall be presumed to be no less than two dollars ($2), and the present worth of this income shall not be reduced by the value of any exempt timber on the land.

There shall be a rebuttable presumption that "prudent management" does not include use of the land for recreational use, as defined in subdivision (n) of Section 51201 of the Government Code, unless the land is actually devoted to such use.

History.—Added by Stats. 1969, p. 1705, operative March 1, 1970. Stats. 1970, p. 2877, in effect November 23, 1970, added "and the present worth of the income attributable to other allowed compatible uses of the land" to the first sentence and added the third paragraph. Stats. 1973, Ch. 369, p. 811, in effect January 1, 1974, added "and the income from other allowed compatible uses" after "timber crops from the land", deleted "and the present worth of the income attributable to other allowed compatible uses of the land" and added "under prudent management" after "yield" in the first paragraph; and substituted the second paragraph for the former second paragraph dealing with conditions for imputing a two-dollar-per-acre minimum income. Stats. 1974, Ch. 311, p. 606, in effect January 1, 1975, substituted "which is enforceably restricted" for "subject to an enforceable restriction", and substituted "enforceably restricted" for "subject to an enforceable restriction" in the first sentence of the first paragraph. Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "the board, for purposes of surveys required by section 1815, and" after "purposes" in the first sentence.

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423.7. Valuation of land subject to a wildlife habitat contract. (a) When valuing open-space land subject to a wildlife habitat contract, as defined in subdivision (f) of Section 421, the board, for purposes of surveys required by Section 15640 of the Government Code, and all assessors shall value that land by using the average current per-acre value based on recent sales including the sale of an undivided interest therein, of lands subject to a wildlife habitat contract within the same county. Whenever ownership of open-space land is held by a corporation and the principal underlying asset of that corporation is represented by those lands, the price received for each bona fide sale of shares of stock in those corporations or certificates of membership in nonprofit corporations shall be treated as a sale of open-space land by the assessor in determining average value for open-space lands within the meaning of this section.

(b) In the valuation of open-space land subject to a wildlife habitat contract as defined in subdivision (f) of Section 421, irrespective of the number of parcels represented by a single ownership, the assessor shall use sales of less than 150 acres in determining the average value of those lands only if the sale is of an undivided interest of land subject to a wildlife habitat contract as defined in subdivision (f) of Section 421. The assessor shall not use any other sale of less than 150 acres of land.

(c) In the event of sales of corporate stock or membership, as referred to in subdivision (a), the assessor shall determine the average per-acre sales price and multiply such sales price by the number of acres held under the single ownership from which the land was sold, in order to determine the current total value of the single ownership.

(d) The assessor shall then determine the average current per-acre value of that land subject to a wildlife habitat contract, as defined in subdivision (f) of Section 421, by adding the current value of all those lands including corporate sales as set forth in subdivision (c), of which there has been a recent sale, and then dividing the total current value by the total number of acres of all that land of which there has been a recent sale.

(e) Whenever less than 10 years remain to the expiration of a wildlife habitat contract, the value of land determined under subdivision (a) shall be modified pursuant to this subdivision. If the full cash value of that land as determined under Section 110.1 is greater than the value determined under subdivision (a) of this section, a pro rata share of the amount of that difference shall be added in annual equal installments to the value determined pursuant to subdivision (a) over the remaining term of the wildlife habitat contract.

(f) Owners of open-space land subject to a wildlife habitat contract which has been used exclusively for habitat by native or migratory wildlife, recreation, and native pasture shall report the sale of that land, or an interest therein, to the county assessor within 30 days of the sale.

(g) In the event that a wildlife habitat contract is canceled upon the application of an owner of the land covered by the contract, a penalty equal to 6 percent of the full cash value of the land as determined under Section 110.1 on the lien date next following cancellation shall be imposed. The penalty shall become delinquent on the December 10 next following that lien date and shall be treated in all respects as a delinquent penalty imposed under Section 2617 or 2704. This subdivision shall not apply when a wildlife habitat contract is canceled without the consent of an owner of the land affected.

(h) The provisions of Section 426 shall not apply to any lands valued for assessment purposes pursuant to the provisions of this section.

(i) The assessor shall not value any land under a single ownership under this section unless the owners of that land have provided the assessor with a schedule of sales of that land that have occurred during the previous four years.

(j) If there are no prior sales within the county of open-space land subject to a wildlife contract and used exclusively for habitat by native or migratory wildlife, recreation, and native pasture, the assessor shall value the land pursuant to Section 110.1.

(k) Unless a party to an instrument which creates an enforceable restriction expressly prohibits such a valuation, the valuation resulting from the method described in this section shall not exceed the valuation that would have resulted by calculation under Section 110.1, as though the property was not subject to an enforceable restriction in the base year.

History.—Added by Stats. 1973, Ch. 1165, p. 2427, in effect January 1, 1974, Sec. 5 thereof provided for state payment to local government for revenue lost because of this act. Stats. 1980, Ch. 802, in effect January 1, 1981, added subdivision (l). Stats. 1982, Ch. 1465, in effect January 1, 1983, in addition to making a number of grammatical changes throughout the section, substituted "110.1" for "405" after "Section" in the second sentence of subdivision (e), in the first sentence of subdivision (g), and in the first sentence of subdivision (j); deleted former subdivision (g); and renumbered former subdivisions "(h)" as "(g)," "(i)" as "(h)," "(j)" as "(i)," "(k)" as "(j)," and "(l)" as "(k)", respectively. Stats. 1983, Ch. 1281, in effect September 30, 1983, substituted "section 15640 of the Government Code" for "Section 1815" after "required by" in the first sentence of subdivision (a), and substituted "that" for "such a" after "prohibits" in subdivision (k).

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423.8. Wildlife habitat contract. (a) Notwithstanding the acreage requirement specified in subdivision (f) of Section 421, both of the following apply with respect to enrollment in a wildlife habitat contract:

(1) Any open-space land that has been restricted as wildlife or endangered species habitat by a political subdivision of the state or entity of state government shall, upon the request of the owner of that land, be enrolled in a wildlife habitat contract with the political subdivision of the state or entity of state government that has so restricted the subject open-space land.

(2) Any open-space land that has been restricted as wildlife or endangered species habitat by an agency of the federal government shall, upon the request of the landowner, be enrolled in a wildlife habitat contract with the city or county having jurisdiction over the restricted open-space land. For any open-space land eligible for valuation under Section 422.5, 423, 423.3, 423.5, 426, or 435, that has also been enrolled in a wildlife habitat contract pursuant to this section, the controlling value of the land shall, except as otherwise provided in the following sentence, be the lower of the values determined for that land pursuant to those sections or Section 402.1. Other lands enrolled in a wildlife habitat contract pursuant to this section shall be assessed at the value determined as provided in Section 402.1.

(b) In no event shall this section or Section 421 be construed to authorize a political subdivision or any entity of the state or federal government to restrict the otherwise lawful use of property by designating all or part of that property as wildlife habitat or endangered species habitat without the consent of the owner of that property.

(c) It is the intent of the Legislature in adding this section to establish a nonexclusive alternative method of recognizing, for purposes of property taxation, the existence of certain governmental restrictions on the use of property. Neither this section nor Section 402.1 shall be construed or applied to require the existence of a wildlife habitat contract, as described in this section, as a necessary condition for recognizing the effect upon the taxable value of property of any enforceable restriction that is recognized under Section 422, 422.5, or 402.1 and is legally established by statute, regulation, or any action or classification by a governmental entity, for the benefit of wildlife, endangered species, or their habitats.

History.—Added by Stats. 1996, Ch. 997, in effect September 27, 1996. Stats. 2002, Ch. 616 (SB 1864), in effect January 1, 2003, added "the" after "government to restrict" in the first sentence of subdivision (b) and added ", 422.5," after "under Section 422" in the second sentence of subdivision (c).

423.9. Valuation of land zoned as timberland production. Land which is zoned as timberland production pursuant to Chapter 6.7 (commencing with Section 51100) of Part 1 of Division 1 of Title 5 of the Government Code and which is not under an open-space contract pursuant to Section 51240 of the Government Code shall be valued pursuant to Section 435.

History.—Added by Stats. 1976, Ch. 176, p. 319, in effect May 24, 1976. Stats. 1982, Ch. 1489, in effect January 1, 1983, substituted "production" for "preserve" after "timberland."

424. Modification of existing agreements and deeds. Parties to existing agreements and scenic easement deeds may modify such agreements and deeds to the requirements of Section 422.

426. Valuation where restriction will be terminated. (a) Notwith-standing any provision of Section 423 to the contrary, if either the county, city, or nonprofit organization or the owner of land subject to contract, agreement, scenic restriction, or open-space easement has served notice of nonrenewal as provided in Section 51091, 51245, or 51296.9 of the Government Code, and the county assessors shall, unless the parties shall have subsequently rescinded the contract pursuant to Section 51254 or 51255 of the Government Code, value the land as provided in this section.

(b) If the owner of land serves notice of nonrenewal or the county, city, or nonprofit organization serves notice of nonrenewal and the owner fails to protest as provided in Section 51091, 51245, or 51296.9 of the Government Code, subdivision (c) shall apply immediately. If the county, city, or nonprofit organization serves notice of nonrenewal and the owner does protest as provided in Section 51091, 51245, or 51296 of the Government Code, subdivision (c) shall apply when less than six years remain until the termination of the period for which the land is enforceably restricted.

(c) Where any of the conditions in subdivision (b) apply, the board or assessor in each year until the termination of the period for which the land is enforceably restricted shall do all of the following:

(1) Determine the value of the land pursuant to Section 110.1. If the land is not subject to Section 110.1 when the restriction expires, the value shall be determined pursuant to Section 110 as if it were free of contractual restriction. If the land will be subject to a use for which this code provides a special restricted assessment, the value shall be determined as if it were subject to the new restriction.

(2) Determine the value of the land by capitalization of income as provided in Section 423 and without regard to the existence of any of the conditions in subdivision (b).

(3) Subtract the value determined in paragraph (2) of subdivision (c) by capitalization of income from the full value determined in paragraph (1).

(4) Using the rate announced by the board pursuant to paragraph (1) of subdivision (b) of Section 423, discount the amount obtained in paragraph (3) for the number of years remaining until the termination of the contract, agreement, scenic restriction, or open-space easement.

(5) Determine the value of the land by adding the value determined by capitalization of income as provided in paragraph (2) and the value obtained in paragraph (4).

(6) Apply the ratio prescribed in Section 401 to the value of the land determined in paragraph (5) to obtain its assessed value.

History.—Added by Stats. 1969, p. 1191, in effect November 10, 1969. Stats. 1974, Ch. 1003, p. 2160, in effect January 1, 1975, substituted the first paragraph and subdivision (a) for the former first sentence and subdivision (a)(1), (2), (3), (4), and (5). Stats. 1975, Ch. 224, p. 603, in effect January 1, 1976, added "scenic restriction," after "agreement," in the first sentence of the first paragraph, substituted "the termination of the period for which the land is enforceably restricted" for "the expiration of the enforceable restriction" in the second sentence of subdivision (a), substituted "the period for which the land is enforceably restricted" for "the enforceable restriction" in subdivisions (b) and (b)(4), and substituted "enforceably restricted" for "subject to enforceable restriction" in subdivision (b)(1). Stats. 1977, Ch. 1178, in effect January 1, 1978, added "nonprofit organization" and deleted "s" from "Section" before "51091" in the first paragraph and in subdivision (a), added ", unless the parties have subsequently rescinded such contract pursuant to Section 51254 or 51255 of the Government Code," to the first paragraph, and deleted "subject to" after "not" in subdivision (b)(1). Stats. 1982, Ch. 1366, in effect January 1, 1983, in addition to making a number of grammatical changes throughout this section, added "do all of the following" after "shall" in the first sentence of subdivision (b), deleted "full cash" before "value" and substituted "pursuant to Section 110.1 of the Revenue and Taxation Code" for "as if it were not enforceably restricted" after "land" in the first sentence, and added the second and third sentences in paragraph (1), deleted "cash" after "full" in paragraph (3), and deleted "of this section" before "for the", and substituted "contract, agreement, scenic restriction, or open-space easement" for "period for which the land is enforceably restricted" in paragraph (4) of subdivision (b). Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "the board, for purposes of surveys required by Section 1815," after "51245 of the Government Code." in the first paragraph. Stats. 1998, Ch. 353 (SB 1182), in effect August 24, 1998, substituted "Section 51091, 51245, or 51296" for "Section 51091 or 51245" after "provided in" in the first sentence, and substituted "Section 51091, 51245, or 51296" for "Section 51091 or 51245" after "provided in" twice, in the first and second sentence of subdivision (a). Stats. 2002, Ch. 616 (SB 1864), in effect January 1, 2003, substituted "51296.9" for "51296" after "in Section 51091, 51245, or" twice, in the first sentence of the first paragraph and in the first sentence of subdivision (a). Stats. 2003, Ch. 62 (SB 600), in effect January 1, 2004, designated the first paragraph as subdivision (a); relettered former subdivision (a) as subdivision (b), and substituted "subdivision (c)" for "subdivision (b)" after "Government Code," in the first sentence and in the second sentence therein; relettered former subdivision (b) as subdivision (c), and substituted "subdivision (b)" for "subdivision (a)" after "the conditions in" in the first sentence, and deleted "of the Revenue and Taxation Code" after "Section 110.1" in the first and second sentences, deleted "of the Revenue and Taxation Code" after "Section 110" in the second sentence, and substituted "this code" for "the Revenue and Taxation Code" after "use for which" in the third sentence in paragraph (1), substituted "subdivision (b)" for "subdivision (a)" after "the conditions in" in the first sentence of paragraph (2), substituted "subdivision (c)" for "subdivision (b)" after "paragraph (2) of" and deleted "of subdivision (b)" after "in paragraph (1)" in the first sentence of paragraph (3), deleted "of subdivision (b)" after "in paragraph (3)" in the first sentence of paragraph (4), deleted "of subdivision (b)" after "in paragraph (2)" and deleted "of subdivision (b)" after "in paragraph (4)" in the first sentence of paragraph (5), and deleted "of subdivision (b)" after "in paragraph (5)" in the first sentence of paragraph (6) therein.

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427. Consideration of minerals, etc. Nothing in this article shall prevent the board or the assessor, in valuing open-space land for assessment purposes from taking into consideration the existence of any mines, minerals and quarries in or upon the land being valued, including, but not limited to oil, gas, and other hydrocarbon substances.

History.—Added by Stats. 1969, p. 1705, operative March 1, 1970.

428. Not applicable to residence or site. The provisions of this article shall not apply to any residence, including any agricultural laborer housing facility as provided for in Sections 51220, 51231, 51238, and 51282.3 of the Government Code, on the land being valued or to an area of reasonable size used as a site for such a residence.

History.—Added by Stats. 1969, p. 1705, operative March 1, 1970. Stats. 1985, Ch. 186, effective January 1, 1986, added ", including any . . . Code," after "residence" and added "a" after "such."

429. Valuation of trees and vines. Notwithstanding the provisions of Section 105(b) of this code, in valuing land enforceably restricted pursuant to this article, fruit-bearing or nut-bearing trees and vines on the land and not exempt from taxation shall be valued as land. Any income shall include that which can be expected to be derived from such trees and vines and no other value shall be given such trees and vines for the purpose of assessment.

History.—Added by Stats. 1969, p. 1705, operative March 1, 1970. Stats. 1974, Ch. 311, p. 607, in effect January 1, 1975, substituted "enforceably restricted" for "subject to an enforceable restriction" in the first sentence.

430. Rebuttable presumption; agricultural usage. There shall be a rebuttable presumption that the present use of open-space land which is enforceably restricted and devoted to agricultural use is its highest and best agricultural use.

History.—Added by Stats. 1970, p. 1896, in effect November 23, 1970. Stats. 1974, Ch. 311, p. 607, in effect January 1, 1975, substituted "open-space land which is enforceably restricted" for "open land subject to an enforceable restriction". Stats. 1976, Ch. 176, p. 320, in effect May 24, 1976, renumbered the section which was formerly numbered 431.

430.5. Enforceable restriction required. No land shall be valued pursuant to this article unless an enforceable restriction meeting the requirements of Section 422 is signed, accepted, and recorded on or before the lien date for the fiscal year to which the valuation would apply. To provide counties and cities with time to meet the requirement of this section, the land that is to be subject to a contract shall have been included in a proposal to establish an agricultural preserve submitted to the planning commission or planning department, or the matter of accepting an open-space easement or scenic restriction shall have been referred to that commission or department on or before October 15 preceding the lien date to which the contract, easement or restriction is to apply.

History.—Added by Stats. 1974, Ch. 253, p. 468, in effect May 15, 1974, operative with respect to assessments for the 1975–76 fiscal year and thereafter. Stats. 1976, Ch. 176, p. 320, in effect May 24, 1976, renumbered the section which was formerly numbered 432. Stats. 1997, Ch. 941 (SB 542), in effect January 1, 1998, substituted "provide" for "assure" before "counties", added "with" before "time", substituted "that" for "which" after "land", substituted "that" for "such" before the second "commission" and substituted "October 15" for "December 15" before "preeceding" in the second sentence.

Note.—Section 2 thereof provided that notwithstanding any other provision of law to the contrary, the assessment procedures specified under Sections 423 and 423.5 of the Revenue and Taxation Code shall be effective with respect to land subject to taxation for the 1974–1975 fiscal year, if such land is subject to an instrument meeting the requirements of Section 422 of the Revenue and Taxation Code and such instrument is signed and recorded on or before May 15, 1974; provided, that prior to 5 o'clock p.m. on March 1, 1974, either the land which is subject to a contract was included in a proposal to establish an agricultural preserve submitted to the planning commission or planning department or the matter of accepting an open-space easement or scenic restriction had been referred to such commission or department. This section does not apply to land valued pursuant to Section 423.7 of the Revenue and Taxation Code. Section 4 thereof provided that land assessed pursuant to the provisions of Section 2 shall be included for purposes of computing subventions to local government pursuant to Chapter 3 (commencing with Section 16140) of Part 1 of Division 4 of Title 2 of the Government Code for losses due to such assessment procedures for the 1974–1975 fiscal year. Such subventions to local government satisfy the requirements of Section 2229 of the Revenue and Taxation Code.

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Article 1.7. Valuation of Timberland and Timber*

* Article 1.7 was added by Stats. 1976, Ch. 176, p. 320, in effect May 24, 1976. Secs. 20 and 21 thereof provided no payment by state to local governments because of this act. Sec. 22 thereof provided that the property tax assessment provisions shall be applicable to assessments for the 1977–78 fiscal year and thereafter.

431. Definitions. For purposes of this article, the following terms have the following meaning:

(a) "Timber" means trees of any species maintained for eventual harvest for forest products purposes, whether planted or of natural growth, standing or down, on privately or publicly owned lands, including Christmas trees, but does not mean nursery stock.

(b) "Timberland" means land zoned pursuant to Chapter 6.7 (commencing with Section 51100) of Part 1 of Division 1 of Title 5 of the Government Code.

(c) "Timber Advisory Committee" means a standing committee appointed by the board composed of one representative of the Board of Equalization, one representative of the State Board of Forestry and Fire Protection, five assessors from the rate adjustment counties defined in Section 38105, and one member representing small-scale timber owners, and one member representing large-scale timber owners.

History.—Stats. 1998, Ch. 972 (SB 989), in effect January 1, 1999, added ", the following terms have the following meaning" after "article" in the first sentence, and substituted "State Board of Forestry and Fire Protection," for "Board of Forestry," before "five assessors" in the first sentence of subdivision (c).

432. Adoption of rules or regulations. Any rule or regulation required to be adopted pursuant to this article shall be in compliance with procedures set forth for adoption of rules under the Administrative Procedure Act.

433. Notation of zoning on assessment roll. When land is zoned as timberland production a notation of such zoning shall be made on the assessment rolls by the words "Timberland Production Zone" or the initials "T.P.Z."

History.—Stats. 1982, Ch. 1489, in effect January 1, 1983, substituted "production" for "preserve" after "timberland" and after "Timberland".

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434. Instructions for grading timberland; grading. On or before September 1, 1976, the board, after consultation with the Timber Advisory Committee, shall prepare instructions setting forth temporary criteria and procedures for grading timberland on the basis of its site quality and operability. Five general site quality classes shall be established. These classes shall be the same as those adopted by the State Board of Forestry and Fire Protection pursuant to subdivision (d) of Section 4528 of, and Section 4551 of, the Public Resources Code. Within each of the five site quality classes, appropriate classes of operability shall be established, based on factors, such as accessibility, topography, and legislative or administrative restraints. On or before December 31, 1979, these classes shall be designated as operative or inoperative. Commencing with January 1, 1980, the board shall determine appropriate designations of operability. On or before March 1, 1977, each assessor shall grade all timberland within the county on the basis of these instructions. The assessor's grading is subject to the appeals procedure established by law for other assessments, as provided in Chapter 4 (commencing with Section 721) of Part 2 and Chapter 1 (commencing with Section 1601) of Part 3.

History.—Stats. 1983, Ch. 1281, in effect September 30, 1983, substituted "factors such" for "such factors" after "based on" in the fourth sentence, and substituted "721)" for "751" before "of Part 2" and deleted "of this division" after "Part 3" in the eighth sentence. Stats. 1998, Ch. 972 (SB 989), in effect January 1, 1999, substituted "State Board of Forestry and Fire Protection" for "Board of Forestry" after "adopted by the" and added "of," after "Section 4528" in the third sentence.

434.1. Rules for grading timberland; grading. (a) On or before March 1, 1977, the board after consultation with the Timber Advisory Committee shall adopt rules setting forth final procedures for grading timberland on the basis of its site quality and operability. Such rules shall follow the format set forth in Section 434.

(b) On or before March 1, 1978, each assessor in accordance with rules set forth in subdivision (a) shall grade all timberland in his county. The assessor's grading is subject to the appeals procedure established by law for other assessments as provided in Chapter 1 (commencing with Section 1601) of Part 3.

434.2. Timber advisory committee. Within 30 days of the effective date of this section, the board shall appoint the timber advisory committee as defined in subdivision (c) of Section 431.

434.5. Value of timberland. (a) On March 1, 1984, for the Redwood Region and Pine-Mixed Conifer Region, and on January 1, 1985, for the Whitewood Subzone of the Redwood Region, and January 1 of each year thereafter, the value per acre of timberland zoned under the provisions of Section 51110 or Section 51113 of the Government Code shall be determined from the following schedule:

Redwood Region

Site I

$180

Site II

$150

Site III

$160

Site IV

$114

Site V (and inoperable)

$ 35

Pine-Mixed Conifer Region

Site I

$ 98

Site II

$ 69

Site III

$ 56

Site IV

$ 39

Site V (and inoperable)

$ 23

Whitewood Subzone of the Redwood Region

Site I

$ 130

Site II

$ 95

Site III

$ 80

Site IV

$ 60

Site V (and inoperable)

$ 30

For purposes of this section:

(1) "Redwood Region" means all those timberlands located in Del Norte, Humboldt, Sonoma, Marin, Monterey, Santa Cruz, and San Mateo Counties and that portion of Mendocino County which lies west and south of the main Eel River.

(2) "Whitewood Subzone of the Redwood Region" means that timberland located within the Redwood Region within which the assessor has determined that redwood did not exist as a species in the composition of the original timber stand, or which has not been replanted with redwood for commercial purposes.

(3) "Pine-Mixed Conifer Region" means all other timberlands outside the Redwood Region.

When the assessor, pursuant to Section 434, designates a timberland parcel or portion thereof as inoperable, that timberland parcel or portion thereof shall be valued as if it is Site V.

(b) In 1985, the board shall determine the current value of timberland by the following process:

(1) For each fiscal year between July 1, 1979, and June 30, 1984, divide the total value of all timber harvested within the state, less miscellaneous forest products not reported by board foot volume, by the total volume of timber harvested, as reported pursuant to Section 38402. Average the five fiscal year values to obtain the five-year periodic immediate harvest value.

(2) For each fiscal year between July 1, 1978, and June 30, 1983, follow the same procedure as described in paragraph (1).

(3) Divide the value obtained by paragraph (1) by the value obtained by paragraph (2) to obtain the percentage change, rounded to the nearest one-tenth of 1 percent.

(4) Increase or decrease to the nearest dollar the full market values contained in subdivision (a) by one-half of the percentage change determined by paragraph (3).

(c) Beginning January 1, 1986, and each year thereafter, the board shall determine the current value of timberland using the same procedure as described in subdivision (b), except that this adjustment shall be made to the prior year's adjusted values, and the five-year periodic immediate harvest values shall be successively one year more recent.

(d) The board shall certify the values determined pursuant to this section to the county assessors by November 30 of each year.

(e) The Legislature finds and declares that the foregoing values are consistent with the taxation of timberland used primarily for growing timber and that these values are consistent with the intent of subdivision (j) of Section 3 of Article XIII of the Constitution.

History.—Stats. 1977, Ch. 940, in effect January 1, 1978, substituted "subdivision (j) of Section 3 " for "Section 3j" in the third paragraph of subdivision (a). Stats. 1978, Ch. 1109, in effect September 26, 1978, substituted "for the 1977–78 fiscal year" for "and March 1 of each year thereafter, up to and including March 1, 1979," in the first paragraph of subdivision (a), and deleted the former third paragraph thereof; substituted subdivision (b) for former subdivision (b); added subdivisions (c), (d), and (e); relettered former subdivisions (c), (d), (e), (f), and (g) as (f), (g), (h), (i), and (j), respectively; and added subdivisions (k) and (l). Stats. 1979, Ch. 242, in effect July 10, 1979, substituted "and March 1 of each year thereafter, up to and including March 1, 1979" for "for the 1977–78 fiscal year", and added "per acre" after "valued" in subdivision (a); deleted former subdivisions (b), (c) and (d); and relettered subdivisions (e), (f), (g), (h), (i), (j), (k), and (l) as (b), (c), (d), (e), (f), (g), (h), and (i), respectively. Stats. 1982, Ch. 1489, in effect January 1, 1983, in addition to making a number of grammatical changes throughout this section, substituted "production" for "preserve" before each "zone", deleted "the provisions of" after "pursuant to" in the third sentence of subdivision (b), substituted "production" for "preserve" after "timberland" in the second sentence of subdivision (d)(2), and deleted "of this subdivision" after "paragraph (2)" in the second paragraph of subdivision (f). Stats. 1983, Ch. 1198, in effect January 1, 1984, substituted the first sentence of subdivision (a) and increased schedule values for "On March 1, 1977, and March 1 of each year thereafter, up to including March 1, 1979, timberland shall be valued per acre according to the following schedule:" and previous schedule values; substituted subdivisions (b), (c), and (d) for former subdivisions (b), (c), (d), (e), (f), (g), and (h); and relettered former subdivision (i) as subdivision (e). Stats. 1984, Ch. 634, in effect January 1, 1985, added "for the Redwood Region and Pine-mixed Conifer Region, and on January 1, 1985, for the Whitewood subzone of the Redwood Region," after "March 1, 1984," in the first sentence of subdivision (a); substituted "new schedule of values" for former values for Redwood Region and for Pine-mixed Conifer Region; added "For purposes of this section:" and subsections (1), (2) and (3) thereafter. Stats. 1997, Ch. 940 (SB 1105), in effect January 1, 1998, substituted "January 1" for "March 1" before "of each year" in the first sentence of subdivision (a), substituted "this" for "such" after "except that" in the first sentence of subdivision (c), and substituted "November 30" for "January 10" in the first sentence of subdivision (d).

Note.—Secs. 2 and 3 of Stats. 1984, Ch. 634, provided no payment by state to local governments because of this act.

Modified productivity approach.—As used in subdivision (f)(3), "immediate harvest value" refers to both young growth and old growth, and "20 quarters" means 20 quarters. Thus, property tax rule 1025 was valid insofar as certain timberland values for the pine-mixed conifer region were based upon an immediate harvest value of both young growth and old growth, but it was invalid to the extent that such values were based upon such an immediate harvest value averaged for the previous 10 rather than 20 quarters. Soper-Wheeler Co. v. State Board of Equalization, 124 Cal.App.3d 913.

Unit valuation.—The phrase, "the same legal ownership" as used in property tax rule 41A(1) may be broadly interpreted so that various timber tracts recorded to different owners may be assessed as a unit once a parol partnership of the different record owners is factually established. Cochran v. Board of Supervisors, 85 Cal.App.3d 75.

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434.6. Overpayments of property taxes; refunds or credits. [Repealed by Stats. 1991, Ch. 646, in effect January 1, 1992.]

435. Valuation of timberland. (a) In preparing the assessment roll for the 1984–85 fiscal year and each fiscal year thereafter, the assessor shall use as the value of each parcel of timberland the appropriate site value pursuant to Section 434.5 plus the value, if any, attributable to existing, compatible, nonexclusive uses of the land. Assessments of values attributable to compatible uses determined in accordance with this part are subject to the appeals procedure established by law for other assessments.

(b) Nothing in this article shall prevent the assessor in valuing timberland from taking into consideration the existence of any mines, minerals, and quarries in or upon the land being valued, including, but not limited to, geothermal resources and oil, gas, and other hydrocarbon substances.

(c) The provisions of this article shall not apply to any structure on the land being valued or to an area of reasonable size used as a site for approved compatible uses.

History.—Stats. 1977, Ch. 853, in effect September 17, 1977, added the subdivision letters, added second sentence to subdivision (a), and substituted "the sum of the values derived for each parcel pursuant to this section, to obtain the assessed value of each parcel" after "401 to" for "obtain its assessed value. Assessments of values attributable to compatible uses determined in accordance with this part are subject to the appeals procedure established by law for other assessments in subdivision (d)." Stats. 1978, Ch. 1207, in effect January 1, 1979, operative January 1, 1981, deleted subdivision (d). Stats. 1983, Ch. 1198, in effect January 1, 1984, substituted "1984–85" for "1977–78" before "fiscal" and "site value" for "grade value certified to him by the board," after "appropriate" in the first sentence of subdivision (a).

436. Timber exempt from property taxation. On the lien date for the 1977–78 fiscal year and thereafter, all timber on both privately and publicly owned lands shall be exempt from property taxation, including possessory interest taxation, and shall not be assessed for taxation purposes. Nothing herein shall preclude the assessment of trees standing on land not zoned as timberland production under this article for purposes of property taxation based on their aesthetic or amenity value.

History.—Stats. 1982, Ch. 1489, in effect January 1, 1983, substituted "production" for "preserve" after "timberland" in the second sentence.

437. Addition to assessed value of a taxing agency. Whenever the debt limit of a taxing agency is based wholly or in part on the assessed value of the agency, there shall be added to such assessed value the assessed valuation equivalents of revenue amounts certified pursuant to Section 27423 of the Government Code.

The assessed valuation equivalents for revenue amounts certified pursuant to Section 27423 of the Government Code shall be derived by multiplying such amounts by a factor of 100 and dividing the product by the secured tax rate for the prior year.

History.—Stats. 1977, Ch. 853, in effect September 17, 1977, substituted "38905" for "38906" in the first paragraph. Stats. 1980, Ch. 1208, in effect January 1, 1981, substituted "38906" for "38905" after the second "Section" in the first paragraph and added the last paragraph. Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "and distributed pursuant to Section 38906 of the Revenue and Taxation Code" after "Government Code" in the first paragraph; deleted "and distributed pursuant to Section 38905 of the Revenue and Taxation Code" after "Government Code" in the second paragraph; and deleted the former third paragraph.

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Article 1.9. Historical Property*

* Article 1.9 was added by Stats. 1977, Ch. 1040, in effect January 1, 1978. Purpose of this article is to implement Proposition 7 (Res. Ch. 198, Stats. 1974) on ballot for the Primary Election of June 8, 1976 which amended Section 8 of Article XIII of the California Constitution.

Note.—Section 6, Stats. 1977, Ch. 1040, provided that the state shall not be required to provide subventions for revenues lost to a city, county, and county by reason of such city, county or city and county acting pursuant to the provisions of this act. Sec. 7 provided Bd. of Equal. to report to Legislature on or before December 31, 1980 evaluating the effect of this act.

439. "Enforceably restricted" defined. For the purposes of this article and within the meaning of Section 8 of Article XIII of the Constitution, property is "enforceably restricted" if it is subject to an historical property contract executed pursuant to Article 12 (commencing with Section 50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code.

439.1. "Restricted historical property" defined. For purposes of this article "restricted historical property" means qualified historical property, as defined in Section 50280.1 of the Government Code, that is subject to a historical property contract executed pursuant to Article 12 (commencing with Section 50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code. For purposes of this section, "qualified historical property" includes qualified historical improvements and any land on which the qualified historical improvements are situated, as specified in the historical property contract. If the historical property contract does not specify the land that is to be included, "qualified historical property" includes only that area of reasonable size that is used as a site for the historical improvements.

History.—Stats. 1985, Ch. 965, substituted ", as defined in Section 50280.1 of the Government Code," for "meeting the requirements of Article 3 (commencing with Section 5031) of Chapter 1 of Division 5 of the Public Resources Code after "property", and substituted "a" for "an" after "subject to". Stats. 1993, Ch. 831, in effect October 6, 1993, substituted "that" for "which" after "Code," in the first sentence, and added the second and third sentences.

439.2. Valuing enforceably restricted historical property. When valuing enforceably restricted historical property, the county assessor shall not consider sales data on similar property, whether or not enforceably restricted, and shall value that restricted historical property by the capitalization of income method in the following manner:

(a) The annual income to be capitalized shall be determined as follows:

(1) Where sufficient rental information is available, the income shall be the fair rent that can be imputed to the restricted historical property being valued based upon rent actually received for the property by the owner and upon typical rentals received in the area for similar property in similar use where the owner pays the property tax. When the restricted historical property being valued is actually encumbered by a lease, any cash rent or its equivalent considered in determining the fair rent of the property shall be the amount for which the property would be expected to rent were the rental payment to be renegotiated in the light of current conditions, including applicable provisions under which the property is enforceably restricted.

(2) Where sufficient rental information is not available, the income shall be that which the restricted historical property being valued reasonably can be expected to yield under prudent management and subject to applicable provisions under which the property is enforceably restricted.

(3) If the parties to an instrument that enforceably restricts the property stipulate therein an amount that constitutes the minimum annual income to be capitalized, then the income to be capitalized shall not be less than the amount so stipulated.

For purposes of this section, income shall be determined in accordance with rules and regulations issued by the board and with this section and shall be the difference between revenue and expenditures. Revenue shall be the amount of money or money's worth, including any cash rent or its equivalent, that the property can be expected to yield to an owner-operator annually on the average from any use of the property permitted under the terms by which the property is enforceably restricted.

Expenditures shall be any outlay or average annual allocation of money or money's worth that can be fairly charged against the revenue expected to be received during the period used in computing the revenue. Those expenditures to be charged against revenue shall be only those that are ordinary and necessary in the production and maintenance of the revenue for that period. Expenditures shall not include depletion charges, debt retirement, interest on funds invested in the property, property taxes, corporation income taxes, or corporation franchise taxes based on income.

(b) The capitalization rate to be used in valuing owner-occupied single family dwellings pursuant to this article shall not be derived from sales data and shall be the sum of the following components:

(1) An interest component to be determined by the board and announced no later than October 1 of the year preceding the assessment year and that was the yield rate equal to the effective rate on conventional mortgages as most recently published by the Federal Housing Finance Board as of September 1, rounded to the nearest one-fourth of 1 percent.

(2) A historical property risk component of 4 percent.

(3) A component for property taxes that shall be a percentage equal to the estimated total tax rate applicable to the property for the assessment year times the assessment ratio.

(4) A component for amortization of the improvements that shall be a percentage equivalent to the reciprocal of the remaining life.

(c) The capitalization rate to be used in valuing all other restricted historical property pursuant to this article shall not be derived from sales data and shall be the sum of the following components:

(1) An interest component to be determined by the board and announced no later than October 1 of the year preceding the assessment year and that was the yield rate equal to the effective rate on conventional mortgages as determined by the Federal Housing Finance Board September 1, rounded to the nearest one-fourth of 1 percent.

(2) A historical property risk component of 2 percent.

(3) A component for property taxes that shall be a percentage equal to the estimated total tax rate applicable to the property for the assessment year times the assessment ratio.

(4) A component for amortization of the improvements that shall be a percentage equivalent to the reciprocal of the remaining life.

(d) Unless a party to an instrument that creates an enforceable restriction expressly prohibits the valuation, the valuation resulting from the capitalization of income method described in this section shall not exceed the lesser of either the valuation that would have resulted by calculation under Section 110, or the valuation that would have resulted by calculation under Section 110.1, as though the property was not subject to an enforceable restriction in the base year.

(e) The value of the restricted historical property shall be the quotient of the income determined as provided in subdivision (a) divided by the capitalization rate determined as provided in subdivision (b) or (c).

(f) The ratio prescribed in Section 401 shall be applied to the value of the property determined in subdivision (d) to obtain its assessed value.

History.—Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "the board for purposes of surveys required by Section 1815 of this code and" after "property," in the first sentence. Stats. 1993, Ch. 831, in effect October 6, 1993, substituted "that" for "such" and "that" for "which" throughout text; substituted "the" for ''such" after "computing" in the first sentence of the third paragraph of paragraph (3) of subdivision (a); substituted "A" for "An" before "historical" in paragraphs (2) of subdivision (b) and (c); added subdivision (d); and relettered former subdivisions (d) and (e) as (e) and (f), respectively. Stats. 1996, Ch. 1087, in effect January 1, 1997, substituted "Federal Housing Finance Board" for "Federal Home Loan Bank Board" after "determined by the" in paragraph (1) of subdivisions (b) and (c). Stats. 2003, Ch. 471 (SB 1062), in effect January 1, 2004, substituted "October 1" for "September 1" after "no later than", substituted "most recently published" for "determined" after "conditional mortgages as", added "as of September 1" after "Housing Finance Board", and substituted "one-fourth of 1" for "1/4" after "to the nearest" in the first sentence of paragraph (1) of subdivision (b); and substituted "October 1" for "September 1" after "no later than", added "as of September 1" after "Housing Finance Board", and substituted "one-fourth of 1" for "1/4" after "to the nearest" in the first sentence of paragraph (1) of subdivision (c).

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439.3. Valuing enforceably restricted historical property where notice of nonrenewal given. Notwithstanding any provision of Section 439.2 to the contrary, if either the county or city or the owner of restricted historical property subject to contract has served notice of nonrenewal as provided in Section 50282 of the Government Code, the county assessor shall value that restricted historical property as provided in this section.

(a) Following the hearing conducted pursuant to Section 50285 of the Government Code, subdivision (b) shall apply until the termination of the period for which the restricted historical property is enforceably restricted.

(b) The board or assessor in each year until the termination of the period for which the property is enforceably restricted shall do all of the following:

(1) Determine the full cash value of the property pursuant to Section 110.1. If the property is not subject to Section 110.1 when the restriction expires, the value shall be determined pursuant to Section 110 as if the property were free of contractual restriction. If the property will be subject to a use for which this chapter provides a special restricted assessment, the value of the property shall be determined as if it were subject to the new restriction.

(2) Determine the value of the property by the capitalization of income method as provided in Section 439.2 and without regard to the fact that a notice of nonrenewal or cancellation has occurred.

(3) Subtract the value determined in paragraph (2) of this subdivision by capitalization of income from the full cash value determined in paragraph (1).

(4) Using the rate announced by the board pursuant to paragraph (1) of subdivision (b) of Section 439.2, discount the amount obtained in paragraph (3) for the number of years remaining until the termination of the period for which the property is enforceably restricted.

(5) Determine the value of the property by adding the value determined by the capitalization of income method as provided in paragraph (2) and the value obtained in paragraph (4).

(6) Apply the ratios prescribed in Section 401 to the value of the property determined in paragraph (5) to obtain its assessed value.

History.—Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "the board, for purposes of surveys required by Section 1815 and" after "Code," in the first sentence. Stats. 1993, Ch. 831, in effect October 6, 1993, substituted "that" for "such" after "value" in the first sentence; added "do all of the following:" after "shall" in subdivision (b); substituted "pursuant to Section 110.1." for "as if it were not subject to an enforceable restriction;" after "property" in paragraph (1) of subdivision (b); and added the second and third sentences thereto; substituted "." for ";" after "occurred" in paragraph (2) of subdivision (b); substituted "." for "of this subdivision;" after "(1)" in paragraph (3) of subdivision (b); deleted "of this subdivision" after "(3)" and substituted "." for ";" after "restricted" in paragraph (4) of subdivision (b); deleted "of this subdivision" after "(2)" and substituted "." for "of this subdivision; and" after "(4)" in paragraph (5) of subdivision (b); and deleted "of this subdivision" after "(5)" in paragraph (6) of subdivision (b).

439.4. Valuing property under this article. No property shall be valued pursuant to this article unless an enforceable restriction meeting the requirements of Section 439 is signed, accepted and recorded on or before the lien date for the fiscal year in which the valuation would apply.

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Article 2. Information From Taxpayer

441. Property statement; other information. (a) Each person owning taxable personal property, other than a manufactured home subject to Part 13 (commencing with Section 5800), having an aggregate cost of one hundred thousand dollars ($100,000) or more for any assessment year shall file a signed property statement with the assessor. Every person owning personal property that does not require the filing of a property statement or real property shall, upon request of the assessor, file a signed property statement. Failure of the assessor to request or secure the property statement does not render any assessment invalid.

(b) The property statement shall be declared to be true under the penalty of perjury and filed annually with the assessor between the lien date and 5 p.m. on April 1. The penalty provided by Section 463 applies for property statements not filed by May 7. If May 7 falls on a Saturday, Sunday, or legal holiday, a property statement that is mailed and postmarked on the next business day shall be deemed to have been filed between the lien date and 5 p.m. on May 7. If, on the dates specified in this subdivision, the county's offices are closed for the entire day, that day is considered a legal holiday for purposes of this section.

(c) The property statement may be filed with the assessor through the United States mail, properly addressed with postage prepaid. For purposes of determining the date upon which the property statement is deemed filed with the assessor, the date of postmark as affixed by the United States Postal Service, or the date certified by a bona fide private courier service on the envelope containing the application, shall control. This subdivision shall be applicable to every taxing agency, including, but not limited to, a chartered city and county, or chartered city.

(d) (1) At any time, as required by the assessor for assessment purposes, every person shall make available for examination information or records regarding his or her property or any other personal property located on premises he or she owns or controls. In this connection details of property acquisition transactions, construction and development costs, rental income, and other data relevant to the determination of an estimate of value are to be considered as information essential to the proper discharge of the assessor's duties.

(2) (A) This subdivision shall also apply to an owner-builder or an owner-developer of new construction that is sold to a third party, is constructed on behalf of a third party, or is constructed for the purpose of selling that property to a third party.

(B) The owner-builder or owner-developer of new construction described in subparagraph (A), shall, within 45 days of receipt of a written request by the assessor for information or records, provide the assessor with all information and records regarding that property. The information and records provided to the assessor shall include the total consideration provided either by the purchaser or on behalf of the purchaser that was paid or provided either, as part of or outside of the purchase agreement, including, but not limited to, consideration paid or provided for the purchase or acquisition of upgrades, additions, or for any other additional or supplemental work performed or arranged for by the owner-builder or owner-developer on behalf of the purchaser.

(e) In the case of a corporate owner of property, the property statement shall be signed either by an officer of the corporation or an employee or agent who has been designated in writing by the board of directors to sign the statements on behalf of the corporation.

(f) In the case of property owned by a bank or other financial institution and leased to an entity other than a bank or other financial institution, the property statement shall be submitted by the owner bank or other financial institution.

(g) The assessor may refuse to accept any property statement he or she determines to be in error.

(h) If a taxpayer fails to provide information to the assessor pursuant to subdivision (d) and introduces any requested materials or information at any assessment appeals board hearing, the assessor may request and shall be granted a continuance for a reasonable period of time. The continuance shall extend the two-year period specified in subdivision (c) of Section 1604 for a period of time equal to the period of the continuance.

(i) Notwithstanding any other provision of law, every person required to file a property statement pursuant to this section shall be permitted to amend that property statement until May 31 of the year in which the property statement is due, for errors and omissions not the result of willful intent to erroneously report. The penalty authorized by Section 463 does not apply to an amended statement received prior to May 31, provided the original statement is not subject to penalty pursuant to subdivision (b). The amended property statement shall otherwise conform to the requirements of a property statement as provided in this article.

(j) This subdivision shall apply to the oil, gas, and mineral extraction industry only. Any information that is necessary to file a true, correct, and complete statement shall be made available by the assessor, upon request, to the taxpayer by mail or at the office of the assessor by February 28. For each business day beyond February 28 that the information is unavailable, the filing deadline in subdivision (b) shall be extended in that county by one business day, for those statements affected by the delay. In no case shall the filing deadline be extended beyond June 1 or the first business day thereafter.

(k) The assessor may accept the filing of a property statement by the use of electronic media. In lieu of the signature required by subdivision (a) and the declaration under penalty of perjury required by subdivision (b), property statements filed using electronic media shall be authenticated pursuant to methods specified by the assessor and approved by the board. Electronic media includes, but is not limited to, computer modem, magnetic media, optical disk, and facsimile machine.

(l) (1) After receiving the notice required by Section 1162, the manager in control of a fleet of fractionally owned aircraft shall file with the lead county assessor's office one signed property statement for all of its aircraft that have acquired situs in the state, as described in Section 1161.

(2) Flight data required to compute fractionally owned aircraft allocation under Section 1161 shall be segregated by airport.

(m) (1) After receiving the notice required by paragraph (5) of subdivision (b) of Section 1153.5, a commercial air carrier whose certificated aircraft is subject to Article 6 (commencing with Section 1150) of Chapter 5 shall file with the lead county assessor's office designated under Section 1153.5 one signed property statement for its personal property at all airport locations and fixtures at all airport locations.

(2) Each commercial air carrier may file one schedule for all of its certificated aircraft that have acquired situs in this state under Section 1151.

(3) Flight data required to compute certificated aircraft allocation under Section 1152 and subdivision (g) of Section 202 of Title 18 of the California Code of Regulations shall be segregated by airport location.

(4) Beginning with the 2006 assessment year, a commercial air carrier may file a statement described in this subdivision electronically by means of the California Assessor's Standard Data Record (SDR) network. If the SDR is not equipped to accept electronic filings for the 2006 assessment year, an air carrier may file a printed version of its property statement for that year with its lead county assessor's office.

(5) This subdivision shall remain in effect only until December 31, 2010, and as of that date is repealed.

History.—Stats. 1947, p. 1701, in effect September 19, 1947, substituted "May" for "June." Stats. 1963, p. 4075, in effect September 20, 1963, added subdivision (b). Stats. 1966, p. 660 (First Extra Session), in effect October 6, 1966, added "upon request of the assessor," substituted "the lien date" for "noon on the first Monday in March", and deleted the last sentence providing for the furnishing of information, in subdivision (a), and added subdivisions (c), (d), and (e). Stats. 1967, p. 3401, in effect November 8, 1967, substituted everything down to subdivision (b) for prior subdivision (a). Stats. 1968, p. 2144, in effect November 13, 1968, revised and relettered the subdivisions; and, added the second sentence of subdivision (b) referring to Section 463, added subdivision (b)(1), and added "of nonreceipt of the property statement within the appointed time" in subdivision (b)(2), Stats. 1970, p. 1028, in effect November 23, 1970, substituted "shall file a signed property statement with the assessor" for "other than household furnishings and personal effects, shall file a written property statement, reporting such other property," in the first sentence; deleted "written" before the first "property"; substituted "signed" for "written" before the second "property" in the second sentence; added the third sentence to the first paragraph; deleted a second paragraph defining household furnishings; and substituted "declared to be true under penalty of perjury and filed" for "filed under oath" in subdivision (a). Stat. 1971, p. 3455, in effect March 4, 1972, substituted "Friday" for "Monday" in subdivisions (a) and (b). Stats. 1980, Ch. 285, in effect June 30, 1980, operative July 1, 1980, added ", other than a mobilehome subject to Part 13 (commencing with Section 5800)," after "personal property" in the first sentence of paragraph one. Stats. 1981, Ch. 361, in effect January 1, 1982, deleted "o'clock" before "p.m." in the second sentence of, added ", or by first-class mail, properly addressed with postage

prepaid," after "registered mail" and added the second sentence in subsection 2 of, and added the balance of subsection (3) after the first "notice," in subdivision (b). Stats. 1990, Ch. 126, in effect June 11, 1990, added "all of the following apply" after "if" in subdivision (b), substituted a period for "; and" in paragraphs 1 and 2 of subdivision (b), substituted "the" for "such" before "notice" twice in paragraph (2) and three times in paragraph (3) of subdivision (b), added "or her" after "his" and added "or any other . . . controls" after "her property" in the first sentence of subdivision (d), and added "or she" after "he" in subdivision (f). Stats. 1992, Ch. 523, in effect January 1, 1993, substituted "any" for "such" after "lien date and" in subdivision (a); added subdivision (f); and relettered former subdivision (f) as subdivision (g). Stats. 1993, Ch. 173, in effect January 1, 1994, substituted "Each" for "Every" before "person owning" and added "for the initial assessment year . . . subsequent assessment year" after "or more" in the first sentence of the first paragraph; and substituted "the" for "such" after "sign" in subdivision (e). Stats. 1995, Ch. 498, in effect January 1, 1996, added subdivision (h). Stats. 1996, Ch. 1087, in effect January 1, 1997, deleted "thirty thousand dollars ($30,000) or more for the initial assessment year or an aggregate cost of", after "an aggregate cost of", and deleted "subsequent" after "any" in the first sentence of subdivision (a). Stats. 1999, Ch. 334 (AB 704), in effect January 1, 2000, lettered the former first paragraph as subdivision (a) and substituted "that" for "which" before "does not", added a comma after "shall", and added a comma after "assessor" in the second sentence therein; relettered former subdivision (a) as subdivision (b), added "annually" after "and filed", and deleted "the last Friday in May, annually, or between the lien date and any earlier time as the assessor may appoint" after "5 p.m. on" in the first sentence therein; deleted former subdivision (b), which provided that "If the assessor appoints a time other than the last Friday in May, it shall be no earlier than April 1. In this event the penalty provided by Section 463 shall apply if the property statement is not filed with the assessor by 5 p.m. on the last Friday in May or if all of the following apply: (1) The property statement is not filed within the time appointed by the assessor. (2) The assessor has given notice by certified or registered mail, or by first-class mail, properly addressed with postage prepaid, no earlier than 15 days after the time appointed by the assessor of nonreceipt of the property statement within the appointed time. If the notice is given by first-class mail, the assessor shall obtain a certificate of mailing issued by the United States Postal Service verifying the fact and date of mailing of the notice. (3) The property statement has not been filed with the assessor within 15 days following the date of receipt of the notice, if the notice is given by certified or registered mail, or within 20 days following the date shown on the certificate of mailing, if the notice is given by first-class mail."; added subdivision (b); added the second sentence in subdivision (c); and added subdivisions (i) and (j). Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003, substituted "manufactured home" for "mobilehome" after "other than a" in the first sentence, and added subdivision (k). Stats. 2003, Ch. 316 (AB 1744), in effect January 1, 2004, designated the first paragraph of subdivision (d) as paragraph (1) and added paragraph (2) thereto and substituted "does" for "shall" after "by Section 463" in the second sentence of subdivision (i). Stats. 2005, Ch. 699 (AB 964), in effect October 7, 2005, added subdivision (l). Stats. 2007, Ch. 180 (SB 87), in effect August 24, 2007, relettered former subdivision (l) as subdivision (m) and added subdivision (l).

Note.—Stats. 1971, p. 3455, provided that the act shall apply for the 1972–1973 assessment year and assessment years thereafter.

Note.—Section 22 of Stats. 1980, Ch. 285, provided no payment by state to local governments because of this act.

Note.—Section 3 of Stats. 1999, Ch. 334 (AB 704), provides that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because this act provides for offsetting savings to local agencies or school districts that result in no net costs to the local agencies or school districts, within the meaning of Section 17556 of the Government Code.

Note.—Stats. 2005, Ch. 699 (AB 964); see note after Section 401.17.

Note.—Section 1 of Stats. 2007, Ch. 180 (SB 87), provided that the Legislature finds and declares the following:

(a) A substantial portion of business aviation aircraft is now owned and operated under fractional ownership programs.

(b) Aircraft in fractional ownership programs have a significant presence in California.

(c) The size of some fractional ownership program fleets is quite large and the mix of ownership interests and unscheduled usage imposes a significant burden on both taxpayers and county assessors to assess and tax these fleets on an aircraft-by-aircraft basis; in order to reduce this burden, a simplified assessment approach is warranted.

(d) Section 1 of Article XIII of the California Constitution specifies that all nonexempt property is taxable. Therefore, fractionally owned aircraft are constitutionally required to be assessed.

(e) The purpose of Sections 2 and 4 of this act is to establish a simplified procedure for assessing fractionally owned aircraft that is appropriate and fair, that allocates assessed value among counties in a reasonable manner, and that reduces the administrative burden on taxpayers and county assessors.

Section 7 thereof provided that this act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to timely and properly implement the Budget Act of 2007.

Construction.—The language "other data relevant to the determination of an estimate of value are to be considered as information essential to the proper discharge of the assessor's duty" in subdivision (d) is a broad grant of power to the assessor to demand information and does not support any distinction between raw and interpretative data, particularly in the context of the assessment and appraisal of oil and gas interests whose values are constantly changing. "Essential" does not mean strict necessity; in the context of the statute, it is used in an expansive sense. Roberts v. Gulf Oil Corp., 147 Cal.App.3d 770.

Informality.—A letter written by a receiver to the assessor describing the property in his hands may form the basis of a valid assessment. City of Los Angeles v. Los Angeles City Water Co., 137 Cal. 699.

Valuation not required.—The taxpayer is not required to affix a valuation to any part of his property. Clunie v. Siebe, 112 Cal. 593.

Failure to furnish statement.—The mailing of a letter by a taxpayer enclosing a statement of his property does not relieve him of neglect to furnish a statement if the presumption that the letter was received in due course is overcome by the testimony of the assessor that the statement was never received. Grade v. Mariposa County, 132 Cal. 75.

Property omitted from statement.—The power of the assessor is not limited by the taxpayer's verified statement but he may assess upon discovery property omitted therefrom, independently of the power given him by other sections to make penal assessments (see Sections 501 and 503, post) and without first subpoenaing and examining the taxpayer under Section 454. People v. National Bank of D. O. Mills, 123 Cal. 53; Savings & Loan Society v. San Francisco, 131 Cal. 356; San Francisco v. La Societe etc., 131 Cal. 612; Kern Valley Water Co. v. Kern County, 137 Cal. 511. If the statement has been filed by the taxpayer, the assessor perhaps cannot penally assess any property unless the taxpayer has been subpoenaed. See People v. National Bank of D. O. Mills, supra at 58. The power and duty of the assessor to assess newly discovered property exists as long as the assessment roll is under his control. San Francisco v. La Societe, etc. supra. Absent physical evidence, an assessor is not required to accept a valuation formula approximating the proper value of fixtures to be reported on the statement which he has no way of verifying. May Department Stores Co. v. Los Angeles County, 196 Cal.App.3d 755.

Assessment appeal hearing.—As counties are expressly authorized to adopt rules for assessment appeal hearings, a county rule consistent with this section is not preempted by state law; and an assessor may prepare for such a hearing by demanding information from the taxpayer pursuant to subdivision (d) hereof. State Board of Equalization v. Ceniceros, 63 Cal.App.4th 122.

Statement as evidence.—Although the statement is not evidence of the value of the property (San Jose etc., R. R. Co. v. Mayne, 83 Cal. 566), it is admissible as evidence of what property was then claimed to be owned by the party making the statement. Woolridge v. Boardman, 115 Cal. 74. The description in an assessment is presumed to be identical with that furnished in the statement unless the contrary is alleged. Dear v. Varnum, 80 Cal. 86.

Copyright.—There can be no copyright of any particular arrangement of the matter which the assessor is required to deliver to each person as a blank form of property statement. Carlisle v. Colusa County, 57 F. 979.

Inadequate description.—There is no presumption, in a quiet title action brought by a property owner against a purchaser at a tax sale, that an inadequate description in an assessment and tax deed were furnished by the property owner under this article, nor is the property owner estopped from asserting the invalidity of the assessment and tax deed. Sinai v. Mull, 80 Cal.App.2d 277.

Extent of assessor's duty.—A county assessor must give school districts information of the value of tax-assessed property within districts by May 15, as required by Education Code section 20811, although information regarding property assessed by the State Board of Equalization is unavailable by reason of the board not being required to complete its work thereon until the first Monday of August and although taxpayers may file property statements upon which property assessments are partially based between the first Monday of March and the last Monday in May. Board of Education v. Watson, 63 Cal.2d 829.

Owners of aircraft.—See Section 5365.

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441.1. Property statement; life insurance company. (a) Prior to July 1, 1996, each domestic life insurance company that owns real property in the county in a separate account established pursuant to Section 10506 of the Insurance Code, and each foreign life insurance company that owns real property in the county in a separate account established pursuant to the corresponding insurance laws of its state of domicile, shall file a property statement with the assessor that does all of the following:

(1) Identifies all real property in the county that is held on January 1, 1996, by the insurance company in separate accounts and all of the separate accounts in which the real property is held.

(2) Describes the parties to, the date of, and the amount paid with respect to, any transfer of a property interest to or from a separate account. In complying with the preceding sentence, the person shall indicate the name, address, and contact person of the relevant separate account, and shall supply any other information, as may be requested by the assessor, that is relevant to the assessment function and is information of a type described in subdivision (b) of Section 480.7. The property statement shall include a description, as required by this paragraph, of any transfer of a real property interest that occurred on or after January 1, 1985, and before January 1, 1996.

(b) (1) A property statement filed pursuant to subdivision (a) shall be declared to be true under penalty of perjury and shall be signed by either an officer of the filing life insurance company, or by an employee or agent of that insurance company who has been designated in writing by the company's board of directors to sign the statement on the company's behalf.

(2) A property statement filed pursuant to subdivision (a) shall be filed with the assessor either in person or through the United States mail, properly addressed with the postage prepaid.

(3) Any life insurance company required by subdivision (a) to file a property statement that fails to file that statement by July 1, 1996, shall be subject to a penalty of one thousand dollars ($1,000) in addition to any other penalty prescribed by law.

(4) On or before July 1, 1998, the assessor shall compile a list of life insurance companies that have filed a property statement pursuant to subdivision (a). The list shall consist of the name of each company and the date of filing. Notwithstanding Section 408 or 451, or any other provision of law, the list shall be a public record under the provisions of the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).

(c) This section shall remain in effect only until January 1, 2004, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2004, deletes or extends that date.

History.—Added by Stats. 1995, Ch. 933, in effect January 1, 1996. Stats. 1997,Ch. 94 (SB 76) in effect January 1, 1998, added paragraph (4) of subdivision (b) and substituted "remain . . . as of that date" for "become inoperative on July 1, 1997, and, as of January 1, 1998," after "shall", substituted "is enacted" for "becomes operative on or" after "statute, that", substituted "2004" for "1998" after "before January 1," and substituted "that date." for "the dates on which it becomes inoperative and is repealed." after "extends" in the first sentence of subdivision (c).

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441.5. Property statement; attachments. (a) In lieu of completing the property statement as printed by the assessor pursuant to Section 452, the assessor may accept the information required of the taxpayer deletionby any of the following methods:

(1) Attachments to the property statement provided that the attachments shall be in a format as specified by the assessor anddeletion one copy of the property statement, as printed by the assessor, is signed by the taxpayer and carries appropriate reference to the data attacheddeletion.

(2) An electronically deletionfiled property statement that is authenticated as provided in subdivision (k) of Section 441.

(3) A property statement that is substantially similar to the property statement as printed by the assessor that is signed by the taxpayer.

(b) The assessor may consider information provided by any of the methods specified in subdivision (a) as the property statement for purposes of this division.

History.—Added by Stats. 1982, Ch. 7, in effect January 1, 1983. Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003, substituted ": (a)" for "that" after "by the assessor and", substituted "signed" for "executed" after "the assessor is", and substituted "; or (b) the statement . . . Section 441" for a period after "to the data attached" in the first sentence of the first paragraph. Stats. 2009, Ch. 204 (SB 822), in effect January 1, 2010, designated the former first paragraph as subdivision (a), created the first sentence therein with a portion of the former first sentence up to "attachments" and added "the assessor may accept" after "to Section 452," and substituted "by any of the following methods:" for "may be furnished to the assessor as attachments" after "of the taxpayer" therein, created paragraph (1) thereof with the balance of the former first sentence after "Attachments", added a comma after "property statement", deleted ": (a)" after "assessor and", and created paragraph (2) thereof, with the balance of the former first sentence after "data attached" and substituted "An electronically filed property statement that is" for "; or (b) the statement is filed" before "authenticated as" therein, and added paragraph (3) thereto; and added subdivision (b).

442. Contents of statement. (a) The property statement shall show all taxable property owned, claimed, possessed, controlled, or managed by the person filing it and required to be reported thereon.

Every person owning, claiming, possessing, controlling or managing property shall furnish any required information or records to the assessor for examination at any time.

(b) The requirements of this article shall be satisfied with respect to property belonging to others for which the declarer has contractual property tax obligations if the declarer includes that property in the property statement, submits the statement timely, and includes in the statement all information required in the statement pertaining to property belonging to others.

(c) Property that is the subject of a contract designated as a lease that provides that the lessee has the option of acquiring the property at the end of the lease term for one dollar ($1), or any other nominal consideration, shall be reported by the lessor on the lessor's property statement. If that property qualifies for the property tax exemption provided for by subdivision (d) or (e) of Section 3 of Article XIII of the California Constitution, that property shall be regarded as owned by the lessee and shall not be required to be shown on any property statement of the lessor.

History.—Stats. 1970, p. 1029, in effect November 23, 1970, revised this section to include references to firms, corporations and corporate officers. Stats. 1982, Ch. 7, in effect January 1, 1983, added the third paragraph. Stats. 1987, Ch. 703, in effect January 1, 1988, added the fourth paragraph. Stats. 2003, Ch. 316 (AB 1744), in effect January 1, 2004, added the subdivision letter designations; substituted "that is" for "which is now and hereafter" after "Property", subsituted "that provides that" for "wherein the property being leased qualifies for the property tax exemption provided for by subdivision (d) or (e) of Section 3 of Article XIII of the California Constitution, and" after "as a lease" and substituted "reported by the lessor on the lessor's property statement" for "regarded as owned by the lessee and shall not be required to be shown on any property statement of the lessor" after "consideration, shall be" in the first sentence, and added the second sentence therein.

Construction.—The language "any required information or records" is a broad grant of power to the assessor to demand information and does not support any distinction between raw and interpretative data, particularly in the context of the assessment and appraisal of oil and gas interests whose values are constantly changing. Roberts v. Gulf Oil Corp., 147 Cal.App.3d 770.

Failure to furnish information.—It is the duty of a person possessing property for safe keeping to furnish the assessor with any information in his possession which will enable the assessor to determine the owner of the property, failing which, the assessor may assess the property to the holder as agent of the unknown parties. S. W. Straus & Co. v. Los Angeles County, 128 Cal.App. 386.

An assessor may demand of a warehouseman who has in his possession personal property of another the name of the owner and a description of the property, and upon his refusal to give such information an injunction to prevent the assessment of the property to him is properly denied. Bode v. Holtz, 65 Cal. 106.

Cf. Weyse v. Crawford, 85 Cal. 196, in which the warehouseman furnished an unsworn statement of the property in storage and of the persons to whom warehouse receipts were originally issued. It was held that the property was not assessable to the warehouseman. Cf. Bank of Willows v. Glenn County, 155 Cal. 352, 358, to the effect that former Political Code Section 3629 had reference only to the return required of the taxpayer and not to the duty of the assessor in making the assessment.

Managing agent.—A mine superintendent is equivalent to a managing agent and may be required to make a return of the property of his company. Lake County v. Sulphur Bank etc. Co., 68 Cal. 14.

Possessory interests in personal property.—No provision is made for declaring or assessing a possessory interest in tax-exempt personal property. General Dynamics Corp. v. Los Angeles County, 51 Cal.2d 59.

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443. Situs. The property statement shall also show:

(a) The county where the property is taxable.

(b) If taxable in the county where the statement is made, any city or revenue district where it is situated.

443.1. Filing duplicate statement. If the property statement is timely filed in duplicate with a request that the assessor mark on the duplicate statement opposite each category of property reported on the statement, the full value of such category of property as determined by the assessor, the assessor shall perform such service and shall return the duplicate to the person filing it no later than July 15 of the year in which it was filed.

History.—Added by Stats. 1969, p. 1716, in effect November 10, 1969. Stats. 1974, Ch. 311, p. 607, in effect January 1, 1975, substituted "full value" for "full cash value".

445. Property statements; contents. The property statement shall show a description of property, in the detail required. Such required detail may include the cost of the property if the information is within the knowledge of the assessee or is available to him from his own or other records.

History.—Stats. 1959, p. 3246, in effect September 18, 1959, deleted "also" following "shall" and added the last sentence. Stats. 1970, p. 1029, in effect November 23, 1970, deleted "personal" before the second "property" in the first sentence and before "property" in the second sentence, and deleted "by the assessor. Except as to the household furnishings and personal effects of householders," between the present first and second sentences.

448. Tax day. The property statement shall show all information as of 12:01 a.m. on the lien date.

History.—Stats. 1967, p. 2243, operative January 1, 1968, changed time from "noon" to "12:01" and substituted "lien date" for "first Monday in March."

Note.—Section 43002 of the Government Code, as amended in 1967, provides that lien date is first day of March.

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451. Information held secret. All information requested by the assessor or furnished in the property statement shall be held secret by the assessor. The statement is not a public document and is not open to inspection, except as provided in Section 408.

History.—Stats. 1966, p. 661 (First Extra Session), in effect October 6, 1966, deleted "public" before the word "inspection", and added "except as provided in Section 408." Stats. 1971, p. 3519, in effect March 4, 1972, substituted "requested" for "required" in the first sentence.

Exceptions.—The primary exceptions to the rule of confidentiality are "market data" (§ 408(b)), the assessor's public list of transfers of property interests (§ 408.1), and information ordered disclosed by a court in a proceeding initiated by a taxpayer to challenge the legality of his assessment (§ 408(b)). Chanslor-Western Oil and Development Co. v. Cook, 101

Cal.App.3d 407. An affidavit submitted to an assessor to claim a welfare exemption is voluntarily submitted, is a document separate from the property statement, and is not confidential under this section. Gallagher v. Boller, 231 Cal.App.2d 482.

Disclosure in response to subpoena.—This section probably precludes the disclosure of information or the production of the property statement in response to a subpoena as well as in other ways. See Code of Civil Procedure, Section 1881, subdivision (5), and in re Valencia Condensed Milk Co., 240 F. 310.

452. Property statement forms. (a) For the assessment year beginning in 1968 and each assessment year thereafter, the board shall prescribe in detail the content of property statements, including the specific wording, to be used by all assessors in the several counties, and cities and counties, and shall notify assessors of those specifications no later than the August 31 prior to the tax lien date on which they become effective. Each assessor shall incorporate the specifications on the exact form he or she proposes to use and submit that form to the board for approval prior to use. The property statement shall not include any question that is not germane to the assessment function.

(b) (1) For property statements to be filed in the 2008 assessment year and each assessment year thereafter, the board shall prescribe that the property statement also include the following:

(A) A brief statement noting the obligation to pay use tax on taxable purchases for which sales tax was not applicable.

(B) Information regarding payment of use tax, which information may be limited to the board's phone number and a Web site address at which specific information and forms for use tax payment may be obtained.

(C) A statement advising the taxpayer that information provided on a property statement may be shared with the board.

(2) The board shall implement paragraph (1) in a manner that does not increase local costs.

History.—Stats. 1966, p. 661 (First Extra Session), in effect October 6, 1966, deleted "The board shall prescribe the forms of blanks for property statements.", and added all of the present language. Stats. 1998, Ch. 591 (SB 2237), in effect January 1, 1999, substituted "those specifications no later than August 31" for "such specifications at least six months" after "assessors of" in the first sentence; added "or she" after "he" and substituted "that" for "such" after "submit" in the second sentence; and substituted "that" for "which" after "question" in the third sentence. Stats. 2007, Ch. 180 (SB 87), in effect August 24, 2007, designated the former first paragraph as subdivision (a) and added subdivision (b).

Note.—Section 7 of the Stats. 2007, Ch. 180 (SB 87), provided that this act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to timely and properly implement the Budget Act of 2007.

453. Affidavits. The assessor may request any person found within his county to make and subscribe an affidavit, showing his name, place of residence or place of business, and whether he is the owner of any taxable property.

History.—Stats. 1971, p. 3519, in effect March 4, 1972, substituted "request" for "require" in the first sentence.

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454. Examinations. The assessor may subpena and examine any person in relation to:

(a) any statement furnished him, or

(b) any statement disclosing property assessable in his county that may be stored with, possessed, or controlled by the person.

He may do this in any county where the person may be found, but shall not require the person to appear before him in any other county than that in which the subpena is served.

455. Parcels; sold to the state. The assessor shall not combine parcels into a single assessment when any of those parcels have been declared to be tax defaulted for delinquent taxes. This section does not apply to subdivided land reverted to acreage in accordance with provisions of the Subdivision Map Act and local ordinances.

History.—Added by Stats. 1980, Ch. 411, in effect July 11, 1980, operative January 1, 1981. Stats. 1985, Ch. 316, effective January 1, 1986, substituted "of those" for "such" after "any", and substituted "declared to be tax defaulted" for "sold to the state" in the first sentence.

456. Demand for description. If the assessor has not received from the owner of a tract of land a legal description or a description which geographically locates the property, he may require such a description from the owner or his agent, or, in case they cannot be found or are unknown, the person in possession. Such legal description may be by reference to the assessor's map and parcel number.

History.—Stats. 1970, p. 1029, in effect November 23, 1970, deleted "the property statement" after "received" and substituted "a legal . . . the property he" for "or if the statement does not legally describe the land, the assessor" in the first sentence. Stats. 1971, p. 3519, in effect March 4, 1972, substituted "request" for "demand" in the first sentence. Stats. 1973, Ch. 1190, p. 2503, in effect January 1, 1974, substituted "require" for "request" in the first sentence, and added the second sentence. Stats. 1974, Ch. 186, p. 374, in effect January 1, 1975, corrected clerical error.

457. Citation. If the owner, agent, or person in possession neglects to furnish the assessor with the description within 10 days after the request, the assessor shall cite him to appear before the superior court of the county where the land is situated within five days after service of the citation. On the day named in the citation, to the exclusion of all other business, the court shall proceed to hear his return and answer to the citation.

History.—Stats. 1971, p. 3519, in effect March 4, 1972, substituted "request" for "demand" in the first sentence.

458. Survey on court order. If the court finds the land has not been surveyed or divided so that it can be legally described, the court shall, by order duly entered in open court, direct the county surveyor to make a survey, and define the boundaries and location of the land by parcels not exceeding 640 acres each, and deliver it to the assessor.

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459. Expense of survey. The expense of making the survey and description by the county surveyor is a lien on the land, and, when approved by the superior court, shall be certified by it to the board of supervisors who shall, by resolution, direct the auditor to add the expense to the taxes on the land, to be collected like other taxes.

History.—Original section provided that court certify expense to tax collector and that the same be added to the taxes. Stats. 1941, p. 3111, in effect September 13, 1941, amended section to read as at present.

459.5. Applicability of Sections 457, 458, and 459. Sections 457, 458, and 459 are applicable when the owner, his agent, or person in possession neglects to furnish the assessor of any taxing agency, including a taxing agency having its own system for the levying and collection of taxes or assessments, with a requested description of any tract of land.

History.—Added by Stats. 1947, p. 2729, in effect September 19, 1947. Stats. 1970, p. 1030, in effect November 23, 1970, substituted "a requested" for "the legal" in the first sentence.

460. Unknown owners. If the owner or claimant of any property, not listed by another person, is absent or unknown, the assessor shall estimate its value.

461. False statement. Every person who willfully states anything which he knows to be false in any oral or written statement, not under oath, required or authorized to be made as the basis of imposing any tax or assessment, is guilty of a misdemeanor and upon conviction thereof may be punished by imprisonment in the county jail for a period not exceeding six months or by a fine not exceeding one thousand dollars ($1,000), or by both.

History.—Stats. 1966, p. 661 (First Extra Session), in effect October 6, 1966, added the last clause following "misdemeanor." Stats. 1983, Ch. 1092, in effect September 27, 1983, operative January 1, 1984, substituted "one thousand dollars ($1,000)" for "five hundred dollars ($500)" after "exceeding".

462. Refusal to give information. Every person is guilty of a misdemeanor who, after written request by the assessor, does any of the following:

(a) Refuses to make available to the assessor any information which is required by subdivision (d) of Section 441 of this code.

(b) Gives a false name.

(c) Willfully refuses to give his true name.

Upon conviction of any offense in this section, the defendant may be punished by imprisonment in the county jail for a period not exceeding six months or by a fine not exceeding one thousand dollars ($1,000), or by both.

If the defendant is a corporation, it may be punished by an additional fine of two hundred dollars ($200) for each day it refuses to comply with the provisions of this section, up to a maximum of twenty thousand dollars ($20,000).

History.—Stats. 1966, p. 661 (First Extra Session), in effect October 6, 1966, substituted "written demand" for "proper demand", changed subdivisions (a), (b), (c), and (d), deleted former subdivision (b), and added the last two paragraphs. Stats. 1971, p. 3520, in effect March 4, 1972, substituted "request" for "demand" in the first sentence. Stats. 1983, Ch. 1092, in effect September 27, 1983, operative January 1, 1984, substituted "one thousand dollars ($1,000)" for "five hundred dollars ($500)." After "exceeding" in the second paragraph, and substituted "two hundred dollars ($200)" for "one hundred dollars ($100)" after "fine of" and "twenty thousand dollars ($20,000)" for "ten thousand dollars ($10,000)" after "maximum of" in the third paragraph.

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463. Penalty for failure to file statement. If any person who is required by law or is requested by the assessor to make an annual property statement fails to file an annual property statement within the time limit specified by Section 441 or make and subscribe the affidavit respecting his or her name and place of residence, a penalty of 10 percent of the assessed value of the unreported taxable tangible property of that person placed on the current roll shall be added to the assessment made on the current roll.

Notice of any penalty added to the secured roll pursuant to this section shall be mailed by the assessor to the assessee at his or her address as contained in the official records of the county assessor.

If the assessee establishes to the satisfaction of the county board of equalization or the assessment appeals board that the failure to file the property statement within the time required by Section 441 was due to reasonable cause and not due to willful neglect, it may order the penalty abated, provided the assessee has filed with the county board written application for abatement of the penalty within the time prescribed by law for the filing of applications for assessment reductions.

If the penalty is abated it shall be canceled or refunded in the same manner as an amount of tax erroneously charged or collected.

History.—Added by Stats. 1967, p. 3336, in effect November 8, 1967. Stats. 1968, p. 2145, in effect November 13, 1968, completely revised this section, converting it to a penalty for failure to file and adding the second and third paragraphs. Stats. 1971, p. 3520, in effect March 4, 1972, substituted "request" for "demand" in the first sentence. Stats. 1973, Ch. 842, p. 1507, in effect January 1, 1974, substituted "Friday" for "Monday" in the first paragraph. Stats. 1999, Ch. 334 (AB 704), in effect January 1, 2000, deleted "it with the assessor by 5 p.m. on the last Friday in May, or if, after written request by the assessor, any person fails to file," after "fails to file", added "or her" after "respecting his", and substituted "that" for "such" after "tangible property of" in the first sentence of the first paragraph, and added "or her" after "assessee at his" in the first sentence of the second paragraph.

Note.—Section 3 of Stats. 1999, Ch. 334 (AB 704), provides that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because this act provides for offsetting savings to local agencies or school districts that result in no net costs to the local agencies or school districts, within the meaning of Section 17556 of the Government Code.

464. Disposition. All moneys recovered by the assessor under Section 463 shall be paid into the county treasury.

History.—Stats. 1966, p. 662 (First Extra Session), in effect October 6, 1966, substituted "All moneys" for "One-half of all moneys" and deleted the last clause permitting the assessor to retain the remainder of the moneys recovered.

465. Destroying documents. (a) Except as provided in subdivision (b), the assessor may destroy any document when six years have elapsed since the lien date for the tax year for which that document was obtained. Documents may be destroyed when three years have elapsed since the lien date described in the preceding sentence, if the documents have been microfilmed, microfiched, imaged, or otherwise preserved on a medium that provides access to the documents.

(b) Affidavits claiming an exemption, for the first time, pursuant to Sections 254.5, 257, and 277 may be destroyed by the assessor as follows:

(1) Six years after the lien date of the tax year for which the exemption was last granted.

(2) Three years after the lien date described in paragraph (1) if the documents have been microfilmed, microfiched, imaged, or otherwise preserved on a medium that provides access to the documents.

History.—Stats. 1966, p. 662 (First Extra Session), in effect October 6, 1966, substituted "seven years" for "four years." Stats. 1968, p. 1462, in effect November 13, 1968, added proviso allowing destruction after three years. Stats. 1998, Ch. 583 (SB 1103), in effect January 1, 1999, substituted "six" for "seven" after "taxpayers when", substituted "that" for "such" after "for which", deleted ", provided, however, that such" after "obtained"; and created the second sentence with the balance of the former first sentence after "obtained", substituted "the lien date if the" for "such lien date when such" after "elapsed since" and added ", microfiched, imaged, or otherwise preserved on a medium that provides access to the documents" after "microfilmed" therein. Stats. 2002, Ch. 214 (SB 2086), in effect January 1, 2003, designated the former first paragraph as subdivision (a); substituted "Except as provided in subdivision (b), the" for "The" before "assessor", deleted "containing information obtained from taxpayers" after "any document", substituted "tax year" for "taxes" after "date for the", and substituted "document" for "information" after "that" in the first sentence therein; substituted "Documents" for "Those documents" before "may be destroyed", and added "described in the preceding sentence," after "lien date" in the second sentence therein; and added subdivision (b).

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467. Taxing agencies to file statements. Annually, on or before March 20th, every taxing agency shall file with the assessor of the county in which the property is located statements containing legal descriptions of:

(a) All real estate which it has conveyed by deed to any person during the assessment year ending on the last day of December.

(b) All real estate owned by it on the preceding lien date and which it has agreed by contract in writing to sell and convey to any person. The statement covering property sold by contract shall show for each parcel of real estate the name and address of the purchaser, the consideration for the sale and conveyance thereof, and the amount of the consideration paid as of the lien date.

History.—Added by Stats. 1941, p. 2051 in effect June 6, 1941. Stats. 1967, p. 2243, in effect November 8, 1967, substituted "last day of February" for "first Monday in March" in subsection (a), and "lien date" for "first Monday in March" in subsection (b). Stats. 1995, Ch. 499, in effect January 1, 1996, added a colon after "descriptions of" in the first paragraph; and substituted "December" for "February" after "last day of" in subdivision (a).

468. Failure to furnish information; assessor's remedy. In addition to any other remedies described in this article, if any person fails to furnish any information or records required by this article upon request by the assessor, the assessor may apply to the superior court of the county for an order requiring the person who failed to furnish such information or records to appear and answer concerning his property before such court at a time and place specified in the order. The court may so order in any county where the person may be found, but shall not require the person to appear before the court in any other county than that in which the subpoena is served.

History.—Added by Stats. 1966, p. 662 (First Extra Session), in effect October 6, 1966. Stats. 1971, p. 3520, in effect March 4, 1972, substituted "request" for "demand" in the first sentence.

469. Audit of profession, trade, or business. (a) The assessor shall annually conduct a significant number of audits of the books and records of taxpayers engaged in a profession, trade, or business who own, claim, possess, or control locally assessable trade fixtures and business tangible personal property in the county to encourage the accurate and proper reporting of property as required by this article. The assessor shall conduct an audit of those taxpayers as provided by subdivision (b).

(1) For purposes of this section, "significant number of audits" means at least 75 percent of the fiscal year average of the total number of audits the assessor was required to have conducted during the 2002–03 fiscal year to the 2005–06 fiscal year, inclusive, on those taxpayers in the county that had a full value of four hundred thousand dollars ($400,000) or more of locally assessable trade fixtures and business tangible personal property.

(2) The assessor is not required to audit a taxpayer that is fully exempt from property taxation under other provisions of law for purposes of the requirements of this section.

(3) If the board audits a taxpayer because the taxpayer's assessment was selected in a sampling of assessments from the local assessment rolls pursuant to Section 15640 of the Government Code, that audit may be deemed an audit by the assessor for purposes of the requirements of this section.

(b) Each year the audits required by subdivision (a) shall be conducted in the following manner:

(1) Fifty percent of the audits required by subdivision (a) shall be performed on taxpayers selected from a pool of those taxpayers that have the largest assessments of locally assessable trade fixtures and business tangible personal property in the county.

(A) This pool of taxpayers shall be determined as follows:

(i) The assessor shall rank all of the taxpayers in the county in descending order by the total locally assessed value of both trade fixtures and business tangible personal property.

(ii) The assessor shall select a qualified number of those taxpayers with the largest assessments for inclusion in the pool. The qualified number shall be that number equal to 50 percent of the audits required by subdivision (a) multiplied by four.

(B) Taxpayers in the pool shall be audited at least once within each four-year period following the latest fiscal year covered by a preceding audit and the audit may combine multiple fiscal years. The assessor is relieved of the requirement to audit the taxpayer at least once every four years if the assessor determines that the taxpayer's assessments are no longer large enough for inclusion in the pool.

(2) The remaining 50 percent of the required audits, as determined by paragraph (1) of subdivision (a), shall be selected in a manner that is fair and equitable to all taxpayers and may be based on evidence of underreporting as determined by the assessor.

(3) Nothing in this subdivision is intended to prohibit the audit of any taxpayer more frequently than once every four years.

(c) With respect to any audit of the books of a profession, trade, or business, regardless of the full value of the trade fixtures and business tangible personal property owned, claimed, possessed, or controlled by the taxpayer, the following shall apply:

(1) Upon completion of an audit of the taxpayer's books and records, the taxpayer shall be given the assessor's findings in writing with respect to data that would alter any previously enrolled assessment.

(2) Equalization of the property by a county board of equalization or assessment appeals board pursuant to Chapter 1 (commencing with Section 1601) of Part 3 of this division shall not preclude a subsequent audit and shall not preclude the assessor from levying an escape assessment in appropriate instances, but shall preclude an escape assessment being levied on that portion of the assessment that was the subject of the equalization hearing.

(3) If the result of an audit for any year discloses property subject to an escape assessment, then the original assessment of all property of the assessee at the location of the profession, trade, or business for that year shall be subject to review, equalization and adjustment by the county board of equalization or assessment appeals board pursuant to Chapter 1 (commencing with Section 1601) of Part 3 of this division, except in those instances when the property had previously been equalized for the year in question.

(4) If the audit for any particular tax year discloses that the property of the taxpayer was incorrectly valued or misclassified for any cause, to the extent that this error caused the property to be assessed at a higher value than the assessor would have entered on the roll had the incorrect valuation or misclassification not occurred, then the assessor shall notify the taxpayer of the amount of the excess valuation or misclassification, and the fact that a claim for cancellation or refund may be filed with the county as provided by Sections 4986 and 5096.

History.—Added by Stats. 1966, p. 662 (First Extra Session), in effect October 6, 1966. Stats. 1969, p. 2192, in effect November 10, 1969, added "before October 6, 1971, and" and "thereafter", Stats. 1970, p. 1070, in effect November 23, 1970, added the second sentence. Stats. 1973, Ch. 678, p. 1233, in effect January 1, 1974, added the last paragraph. Stats. 1974, Ch. 311, p. 608, in effect January 1, 1975, substituted "full value" for "full cash value" in the first sentence of the first paragraph. Stats. 1976, Ch. 357, p. 1007, in effect January 1, 1977, substituted "one hundred thousand dollars ($100,000)"for "fifty thousand dollars ($50,000)", and substituted "at least once each four years" for "before October 6, 1971, and at least once each four years thereafter" in the first sentence of the first paragraph; and deleted "or Chapter 1.5 (commencing with Section 1750)" after "Chapter 1 (commencing with Section 1601)" in the first sentence of the second paragraph. Stats. 1978, Ch. 732, in effect January 1, 1979, added the third and fourth paragraphs. Stats. 1979, Ch. 518, in effect January 1, 1980, added "trade fixtures and" after "assessable", and substituted "two" for "one" and "$200,000" for "$100,000" in the first sentence of the first paragraph. Stats. 1984, Ch. 678, in effect January 1, 1985, substituted "Section 15640 of the Government Code," for "Chapter 2 (commencing with Section 1815) of Part 3 of this division" after "pursuant to" in the second sentence of the first paragraph. Stats. 1991, Ch. 1148, in effect October 14, 1991, added a comma after "possessed", substituted "three hundred thousand dollars ($300,000)" for "two hundred thousand dollars ($200,000)" after "full value of", and substituted "that" for "such" after "records of" in the first sentence of the first paragraph; substituted "that" for "such" after "Code," in the second sentence of the first paragraph; substituted "the" for "any such" after "portion of", substituted "that" for "which" after "assessment", and substituted "the" for "any such" after "subject of" in the second paragraph; substituted "the" for "such" after "instances when" in the third paragraph; and substituted "the" for "such" after "roll had" in the fourth paragraph. Stats. 1995, Ch. 498, in effect January 1, 1996, added "Upon completion of . . . previously enrolled assessment." as the second paragraph. Stats. 2000, Ch. 613 (SB 1844), in effect January 1, 2001, substituted "four" for "three" after "full value of" and substituted "($400,000)" for "($300,000)" after "thousand dollars" in the first sentence of the first paragraph. Stats. 2001, Ch. 238 (AB 645), in effect January 1, 2002, designated the first paragraph as subdivision (a), and added subdivision (b) and numbered the former second, third, fourth and fifth paragraphs as paragraphs (1), (2), (3) and (4), respectively, therein. Stats. 2005, Ch. 264 (SB 555), in effect January 1, 2006, added "that is not fully exempt from property taxation under other provisions of law and that is" after "by a taxpayer" in the first sentence of subdivision (a). Stats. 2008, Ch. 297 (AB 550), in effect January 1, 2009, deleted former subdivision (a) which read "In any case in which locally assessable trade fixtures and business tangible personal property owned, claimed, possessed, or controlled by a taxpayer that is not fully exempt from property taxation under other provisions of law and that is engaged in a profession, trade, or business has a full value of four hundred thousand dollars ($400,000) or more, the assessor shall audit the books and records of that profession, trade, or business at least once each four years. If the board determines the value of property pursuant to Section 15640 of the Government Code, that determination may be deemed an audit by the assessor for purposes of this section."; added subdivisions (a) and (b); and relettered former subdivision (b) as subdivision (c).

Note.—Section 3 of Stats. 1991, Ch. 1148, provided that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act.

Note.—Section 3 of Stats. 2001, Ch. 238 (AB 645) 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.

Note.—Section 1 of Stats. 2009, Ch. 297 (AB 550), provided that the Legislature finds and declares all of the following:

(a) Businesses having an aggregate cost of one hundred thousand dollars ($100,000) or more in personal property are required to file annually a statement with the assessor identifying the property to facilitate its proper and uniform assessment.

(b) Existing law requires assessors to conduct audits to encourage accurate reporting.

(c) Therefore, it is the intent of the Legislature in enacting this act to provide assessors with discretion in selecting which business taxpayers to audit, thereby adding an element of unpredictability to the audit process and ultimately advancing the policy goals of the audit process, and furthering the constitutional requirement of equal and uniform assessment.

Construction.—A taxpayer is entitled to administrative review if an audit reveals property that was underassessed or unassessed and hence, exposed to further taxation, regardless of whether or not an escape assessment is actually made. Heavenly Valley v. El Dorado County Board of Equalization, 84 Cal.App.4th 1323. Where the assessor initiated an audit for four years but issued a "Notice of Proposed Escape Assessment" for only one year, under applicable regulations the assessor, on finding a discrepancy or irregularity for one year, must audit the other years for which the statute of limitations has not run. The assessor may not forgo these audits based upon his unilateral interpretation of a stipulation of the parties that the property has already been equalized. Apple Computer, Inc. v. Assessment Appeals Board, 105 Cal.App.4th 1355. Under subdivision (b)(3) of Section 469, an otherwise untimely appeal of an original assessment following an escape assessment is allowed to protect the taxpayer from a misallocation of the total assessment. County of Los Angeles v. Raytheon Co., 159 Cal.App.4th 27.

Leaseholds.—Where the lessee under a 55-year lease filed an action against the county seeking a refund on property taxes paid, the Court of Appeal concluded that the lessee had standing to pursue the refund claim under Sections 469(b)(3), 1603(f), and 5140 of the Revenue and Taxation Code. As a tenant under a long-term lease that extended over 35 years, and the party who paid the property taxes for the years at issue, the lessee was considered the beneficial owner of the property for property tax purposes and an affected party. Los Angeles County v. Raytheon Co., 159 Cal. App.4th 27.

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470. Business records. (a) Upon request of an assessor, a person owning, claiming, possessing or controlling property subject to local assessment shall make available at his or her principal place of business, principal location or principal address in California or at a place mutually agreeable to the assessor and the person, a true copy of business records relevant to the amount, cost and value of all property that he or she owns, claims, possesses, or controls within the county.

(b) In the case of a taxpayer that has its principal place of business outside of California and has been requested to make business records available pursuant to subdivision (a), that taxpayer may, as an alternative to making the requested business records available pursuant to the terms of that subdivision, pay the county the amount of reasonable and ordinary expenses for food, lodging, transportation, and other related items incurred by the assessor's representative, in traveling to the place outside California where the requested business records are available for examination and performing his or her official duties with respect to the examination of those records.

History.—Added by Stats. 1966, p. 662 (First Extra Session), in effect October 6, 1966. Stats. 1991, Ch. 1148, in effect October 14, 1991, added subdivision letter (a) before "Upon request", added "or her" after "his", added "or she" after "he", and added a comma after "possesses" in subdivision (a); and added subdivision (b).

Note.—Section 3 of Stats. 1991, Ch. 1148, provided that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act.

Construction.—The words "business records relevant to the amount, cost and value of all property" are broad grants of power to the assessor to demand information and do not support any distinction between raw and interpretative data. "Business records" is not limited to the meaning of the term in the Evidence Code as an exception to the hearsay rule. Roberts v. Gulf Oil Corp., 147 Cal.App.3d 770.

471. False statement; homeowners' exemption. [Repealed by Stats. 1981, Ch. 261, in effect January 1, 1982.]

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Article 2.5. Change in Ownership Reporting*

* Article 2.5 was added by Stats. 1979, Ch. 242, in effect July 10, 1979.

Note.—Section 44 of Stats. 1979, Ch. 242, provided no payment by state to local governments because of this act.

480. Change in ownership statement. [Repealed by Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982.]

480. Change in ownership statement. (a) Whenever there occurs any change in ownership of real property or of a manufactured home that is subject to local property taxation and is assessed by the county assessor, the transferee shall file a signed change in ownership statement in the county where the real property or manufactured home is located, as provided for in subdivision (c). In the case of a change in ownership where the transferee is not locally assessed, no change in ownership statement is required.

(b) The personal representative shall file a change in ownership statement with the county recorder or assessor in each county in which the decedent owned real property at the time of death that is subject to probate proceedings. The statement shall be filed prior to or at the time the inventory and appraisal is filed with the court clerk. In all other cases in which an interest in real property is transferred by reason of death, including a transfer through the medium of a trust, the change in ownership statement or statements shall be filed by the trustee (if the property was held in trust) or the transferee with the county recorder or assessor in each county in which the decedent owned an interest in real property within 150 days after the date of death.

(c) Except as provided in subdivision (d), the change in ownership statement as required pursuant to subdivision (a) shall be declared to be true under penalty of perjury and shall give that information relative to the real property or manufactured home acquisition transaction as the board shall prescribe after consultation with the California Assessors' Association. The information shall include, but not be limited to, a description of the property the parties to the transaction, the date of acquisition, the amount, if any, of the consideration paid for the property, whether paid in money or otherwise, and the terms of the transaction. The change in ownership statement shall not include any question that is not germane to the assessment function. The statement shall contain a notice informing the transferee of the property tax relief available under Section 69.5. The statement shall contain a notice that is printed, with the title in at least 12-point boldface type and the body in at least 8-point boldface type, in the following form:

"Important Notice"

"The law requires any transferee acquiring an interest in real property or manufactured home subject to local property taxation, and that is assessed by the county assessor, to file a change in ownership statement with the county recorder or assessor. The change in ownership statement must be filed at the time of recording or, if the transfer is not recorded, within 45 days of the date of the change in ownership, except that where the change in ownership has occurred by reason of death the statement shall be filed within 150 days after the date of death or, if the estate is probated, shall be filed at the time the inventory and appraisal is filed. The failure to file a change in ownership statement within 45 days from the date of a written request by the assessor results in a penalty of either: (1) one hundred dollars ($100), or (2) 10 percent of the taxes applicable to the new base year value reflecting the change in ownership of the real property or manufactured home, whichever is greater, but not to exceed two thousand five hundred dollars ($2,500) if that failure to file was not willful. This penalty will be added to the assessment roll and shall be collected like any other delinquent property taxes, and be subject to the same penalties for nonpayment."

(d) The change in ownership statement may be attached to or accompany the deed or other document evidencing a change in ownership filed for recording, in which case the notice, declaration under penalty of perjury, and any information contained in the deed or other transfer document otherwise required by subdivision (c) may be omitted.

(e) If the document evidencing a change in ownership is recorded in the county recorder's office, then the statement shall be filed with the recorder at the time of recordation. However, the recordation of the deed or other document evidencing a change in ownership shall not be denied or delayed because of the failure to file a change of ownership statement, or filing of an incomplete statement, in accordance with this subdivision. If the document evidencing a change in ownership is not recorded or is recorded without the concurrent filing of a change in ownership statement, then the statement shall be filed with the assessor no later than 45 days from the date the change in ownership occurs, except that where the change in ownership has occurred by reason of death the statement shall be filed within 150 days after the date of death or, if the estate is probated, shall be filed at the time the inventory and appraisal is filed.

(f) Whenever a change in ownership statement is filed with the county recorder's office, the recorder shall transmit, as soon as possible, the original statement or a true copy thereof to the assessor along with a copy of every recorded document as required by Section 255.7.

(g) The change in ownership statement may be filed with the assessor through the United States mail, properly addressed with the postage prepaid.

(h) In the case of a corporation, the change in ownership statement shall be signed either by an officer of the corporation or an employee or agent who has been designated in writing by the board of directors to sign those statements on behalf of the corporation. In the case of a partnership, limited liability company, or other legal entity, the statement shall be signed by an officer, partner, manager, or an employee or agent who has been designated in writing by the partnership, limited liability company, or legal entity.

(i) No person or entity acting for or on behalf of the parties to a transfer of real property shall incur liability for the consequences of assistance rendered to the transferee in preparation of any change in ownership statement, and no action may be brought or maintained against any person or entity as a result of that assistance.

Nothing in this section shall create a duty, either directly or by implication, that the assistance be rendered by any person or entity acting for or on behalf of parties to a transfer of real property.

History.—Added by Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982. Stats. 1987, Ch. 186, in effect July 23, 1987, added the fourth sentence of subdivision (c). Stats. 1988, Ch. 1199, in effect January 1, 1989, substituted "personal representative" for "administrator or executor" after "the" in the first sentence, and substituted "appraisal" for "appraisement" after "inventory and" and added "clerk" after "court" in the second sentence of subdivision (b). Stats. 1994, Ch. 1222, in effect September 30, 1994, added "there occurs" after "Whenever", substituted "manufactured home that is" for "mobilehome", deleted comma after "taxation", deleted "which" after "taxation and", deleted "occurs," after "assessor," and substituted "manufactured home" for "mobilehome" after "property or" in the first sentence of subdivision (a); substituted "in which" for "where" after "county", and added "that is . . . proceedings" after "death" in the first sentence of subdivision (b); added "prior to or" after "filed" and added the third sentence in subdivision (b); substituted "that" for "such" after "shall give" and substituted "manufactured home" for "mobilehome" in the first sentence of the first paragraph of subdivision (c), substituted "that" for "which" after "question" in the third sentence of the first paragraph of subdivision (c), substituted "manufactured home" for "mobilehome" after "property or" and substituted "that" for "which" in the first sentence of the second paragraph of subdivision (c), added ", except that . . . filed" after "ownership" in the second sentence of the second paragraph of subdivision (c), substituted "manufactured home" for "mobilehome" after "property or" and substituted "that" for "such" after "($2,500) if" in the third sentence of the second paragraph of subdivision (c); substituted "the" for "such" after "case" in subdivision (d); added ", except that . . . filed" after "occurs" in the third sentence of subdivision (e); substituted "those" for "such" after "to sign" in the first sentence of subdivision (h), added ", limited liability company," after "partnership" twice, and added "manager," after "partner," in the second sentence of subdivision (h); deleted "such" after "against any" and substituted "that" for "such" after "result of" in the first paragraph of subdivision (i); and substituted "the" for "such" after "implication, that" in the second paragraph of subdivision (i).

Note.—Section 14 of Stats. 1981, Ch. 1141, provided the provisions of this act shall take immediate effect and shall apply to any change in ownership occurring on or after March 1, 1975. However, all changes in value shall be made effective commencing with the 1982–83 fiscal year. No escape assessments shall be levied and no refund shall be made for any years prior to the 1982–83 fiscal year for any increases or decreases in value made for the 1982–83 fiscal year or fiscal years thereafter as the result of the enactment of this act.

It is also the intent of the Legislature that any penalty imposed pursuant to subdivision (j) of Section 480 of the Revenue and Taxation Code prior to the enactment of this act shall be canceled or refunded, unless a written request was made by the assessor or Board of Equalization to file a change in ownership statement and the requested person or legal entity failed to file that statement within 45 days from the date of request.

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480.1. Change in ownership statement; change in control of entity. (a) Whenever there is a change in control of any corporation, partnership, limited liability company, or other legal entity, as defined in subdivision (c) of Section 64, a signed change in ownership statement as provided for in subdivision (b), shall be filed by the person or legal entity acquiring ownership control of deletionthe corporation, partnership, limited liability company, or other legal entity with the board at its office in Sacramento within 45 days from the date of the change in control of the corporation, partnership, limited liability company, or other legal entity. The statement shall list all counties in which the corporation, partnership, limited liability company, or legal entity owns real property.

(b) The change in ownership statement as required pursuant to subdivision (a), shall be declared to be true under penalty of perjury and shall give such information relative to the ownership control acquisition transaction as the board shall prescribe after consultation with the California Assessors' Association. The information shall include, but not be limited to, a description of the property owned by the corporation, partnership, limited liability company, or other legal entity, the parties to the transaction, and the date of the ownership control acquisition. The change in ownership statement shall not include any question which is not germane to the assessment function. The statement shall contain a notice that is printed, with the title at least 12-point boldface type and the body in at least 8-point boldface type, in the following form:

"Important Notice"

"The law requires any person or legal entity acquiring ownership control in any corporation, partnership, limited liability company, or other legal entity owning real property in California subject to local property taxation to complete and file a change in ownership statement with the State Board of Equalization at its office in Sacramento. The change in ownership statement must be filed within 45 days from the date of the change in control of a corporation, partnership, limited liability company, or other legal entity. The law further requires that a change in ownership statement be completed and filed whenever a written request is made therefor by the State Board of Equalization, regardless of whether a change in control of the legal entity has occurred. The failure to file a change in ownership statement within 45 days from the earlier of the date of the change in control of the corporation, partnership, limited liability company, or other legal entity, or the date of a written request by the State Board of deletionEqualization results in a penalty of 10 percent of the taxes applicable to the new base year value reflecting the change in control of the real property owned by the corporation, partnership, limited liability company, or legal entity (or 10 percent of the current year's taxes on that property if no change in control occurred). This penalty will be added to the assessment roll and shall be collected like any other delinquent property taxes, and be subject to the same penalties for nonpayment."

(c) In the case of a corporation, the change in ownership statement shall be signed either by an officer of the corporation or an employee or agent who has been designated in writing by the board of directors to sign such statements on behalf of the corporation. In the case of a partnership, limited liability company, or other legal entity, the statement shall be signed by an officer, partner, manager, or an employee or agent who has been designated in writing by the partnership, limited liability company, or legal entity.

(d) No person or entity acting for or on behalf of the parties to a transfer of real property shall incur liability for the consequences of assistance rendered to the transferee in preparation of any change in ownership statement, and no action may be brought or maintained against any deletionperson or entity as a result of deletionthat assistance.

Nothing in this section shall create a duty, either directly or by implication, that such assistance be rendered by any person or entity acting for or on behalf of parties to a transfer of real property.

(e) The board or assessors may inspect any and all records and documents of a corporation, partnership, limited liability company, or legal entity to ascertain whether a change in control as defined in subdivision (c) of Section 64 has occurred. The corporation, partnership, limited liability company, or legal entity shall upon request, make deletionthose documents available to the board during normal business hours.

History.—Added by Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982. Stats. 1984, Ch. 678, in effect January 1, 1985, added "complete and" after "taxation to" in the first sentence, added the third sentence, and deleted "either: (1) one hundred dollars ($100), or (2)" after "penalty of" and deleted ", whichever is greater" after "occurred)" in the fourth sentence of the notice in subdivision (b). Stats. 1994, Ch. 1200, in effect September 30, 1994, added all references to limited liability company throughout text, and added "manager," after "partner," in the second sentence of subdivision (c). Stats. 2009, Ch. 622 (SB 816), in effect January 1, 2010, substituted "the" for "such" after "ownership control of" and added "within 45 days from the date of the change in control of the corporation, partnership, limited liability company, or other legal entity" after "in Sacramento" in the first sentence of subdivision (a); added "the earlier of the date of the change in control of the corporation, partnership, limited liability company, or other legal entity, or" after "45 days from" in the fourth sentence of the second paragraph of subdivision (b); deleted "such" after "against any" and substituted "that" for "such" after "result of" in the first sentence of the first paragraph of subdivision (d); and substituted "those" for "such" after "request, make" in the second sentence of subdivision (e).

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480.2. Change in ownership occasioned by death. [Repealed by Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982.]

480.2. Change in ownership statement; change in ownership of entity. (a) Whenever there is a change in ownership of any corporation, partnership, limited liability company, or other legal entity, as defined in subdivision (d) of Section 64, a signed change in ownership statement as provided in subdivision (b) shall be filed by deletionthe corporation, partnership, limited liability company, or other legal entity with the board at its office in Sacramento within 45 days from the date of the change in ownership of the corporation, partnership, limited liability company, or other legal entity. The statement shall list all counties in which the corporation, partnership, limited liability company, or legal entity owns real property.

(b) The change in ownership statement required pursuant to subdivision (a) shall be declared to be true and under penalty of perjury and shall give such information relative to the ownership interest acquisition transaction as the board shall prescribe after consultation with the California Assessors' Association. The information shall include, but not be limited to, a description of the property owned by the corporation, partnership, limited liability company, or other legal entity, the parties to the transaction, the date of the ownership interest acquisition, and a listing of the "original coowners" of the corporation, partnership, limited liability company, or other legal entity prior to the transaction. The change in ownership statement shall not include any question which is not germane to the assessment function. The statement shall contain a notice that is printed, with the title in at least 12-point boldface type and the body in at least 8-point boldface type, in the following form:

"Important Notice"

"The law requires any corporation, partnership, limited liability company, or other legal entity owning real property in California subject to local property taxation and transferring shares or other ownership interest in such legal entity which constitute a change in ownership pursuant to subdivision (d) of Section 64 of the Revenue and Taxation Code to complete and file a change in ownership statement with the State Board of Equalization at its office in Sacramento. The change in ownership statement must be filed within 45 days from the date that shares or other ownership interests representing cumulatively more than 50 percent of the total control or ownership interests in the entity are transferred by any of the original coowners in one or more transactions. The law further requires that a change in ownership statement be completed and filed whenever a written request is made therefor by the State Board of Equalization, regardless of whether a change in ownership of the legal entity has occurred. The failure to file a change in ownership statement within 45 days from the earlier of the date of the change in ownership of the corporation, partnership, limited liability company, or other legal entity, or the date of a written request by the Board of Equalization, results in a penalty of 10 percent of the taxes applicable to the new base year value reflecting the change in ownership of the real property owned by the corporation, partnership, limited liability company, or legal entity (or 10 percent of the current year's taxes on that real property if no change in ownership occurred). This penalty will be added to the assessment roll and shall be collected like any other delinquent property taxes, and be subject to the same penalties for nonpayment."

(c) In the case of a corporation, the change in ownership statement shall be signed either by an officer of the corporation or an employee or agent who has been designated in writing by the board of directors to sign such statements on behalf of the corporation. In the case of a partnership, limited liability company, or other legal entity, the statement shall be signed by an officer, partner, manager, or an employee or agent who has been designated in writing by the partnership, limited liability company, or legal entity.

(d) No person or entity acting for or on behalf of the parties to a transfer of real property shall incur liability for the consequences of assistance rendered to the transferee in preparation of any change in ownership statement, and no action may be brought or maintained against any deletionperson or entity as a result of deletionthat assistance.

Nothing in this section shall create a duty, either directly or by implication, that such assistance be rendered by any person or entity acting for or on behalf of parties to a transfer of real property.

(e) The board or assessors may inspect any and all records and documents of a corporation, partnership, limited liability company, or legal entity to ascertain whether a change in ownership as defined in subdivision (d) of Section 64 has occurred. The corporation, partnership, limited liability company, or legal entity shall upon request, make deletionthose documents available to the board during normal business hours.

History.—Added by Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982. Stats. 1984, Ch. 678, in effect January 1, 1985, added "complete and" after "Code to" in the first sentence, added the third sentence, and deleted "either: (1) one hundred dollars ($100), or (z)" after "penalty of" and deleted ", whichever is greater after "occurred)" in the fourth sentence of the notice in subdivision (b). Stats. 1994, Ch. 1200, in effect September 30, 1994, added all references to limited liability company throughout text, and added "manager," after "partner," in the second sentence of subdivision (c). Stats. 2009, Ch. 622 (SB 816), in effect January 1, 2010, substituted "the" for "such" after "filed by" and added "within 45 days from the date of the change in ownership of the corporation, partnership, limited liability company, or other legal entity" after "in Sacramento" in the first sentence of subdivision (a); added "the earlier of the date of the change in ownership of the corporation, partnership, limited liability company, or other legal entity, or" after "45 days from" in the fourth sentence of the second paragraph of subdivision (b); deleted "such" after "against any" and substituted "that" for "such" after "result of" in the first sentence of the first paragraph of subdivision (d); and substituted "those" for "such" after "request, make" in the second sentence of subdivision (e).

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480.3. Change of ownership forms and fees. (a) Each county assessor and recorder shall make available, without charge and upon request, a form entitled "Preliminary Change of Ownership Report," which transferees of real property shall complete and may file with the recorder concurrent with the recordation of any document effecting a change in ownership. The form shall be signed by the transferee or an officer of the transferee deletioncertifying that the information provided on the form is, to the best of his or her knowledge and belief, true, correct, and complete. The form shall not be signed by an agent acting for a transferee.

(b) If a document evidencing a change in ownership is presented to the recorder for recordation without the concurrent filing of a preliminary change in ownership report, the recorder may charge an additional recording fee of twenty dollars ($20).

(c) Noncompliance with this section by the transferee shall not delay or preclude the recordation of documents if the additional fee specified in subdivision (b) is tendered.

(d) The authority to obtain information pursuant to this section is in addition to, and not in lieu of, any existing authority the assessor has under this article.

(e) In cases where the county tax collector files purchaser's deeds with respect to a sale for defaulted taxes, the information given to the assessor pursuant to Sections 3716 and 3811 shall be deemed to constitute compliance with this section.

(f) The filing of a preliminary change of ownership report or the payment of an additional recording fee shall not be required of any intermediate transferee of property, or of any trustee issuing a trustee's deed to the mortgagee or beneficiary of a mortgage or deed of trust, or his or her assignees, pursuant to the exercise of a power of sale contained in a deed of trust or mortgage pursuant to Chapter 2 (commencing with Section 2920) of Title 14 of Part 4 of Division 3 of the Civil Code. For purposes of this subdivision, "intermediate transferee" means any transferee who is acting as both a transferee and the transferor of the same property as part of a series of simultaneous transfers which affect that property and who records the transfer documents and any other recorded documents related to the transfer in consecutive order at one time.

(g) Except as prescribed in subdivisions (e) and (f), this section shall apply to changes of ownership occurring on or after July 1, 1985.

History.—Added and repealed by Stats. 1984, Ch. 1237, in effect January 1, 1985. Stats. 1986, Ch. 1420, effective January 1, 1987, deleted former subdivision (e), added subdivisions (e), (f), and (g), and relettered former subdivision (f) as subdivision (h). Stats. 1990, Ch. 1546, in effect January 1, 1991, substituted "shall" for "may" after "property" and added "may" after "complete and" in the first sentence, and added the second sentence to subdivision (a); deleted the former second sentence in subdivision (b), which provided, "The additional fee shall not be charged if the document is accompanied by an affidavit that the transferee is not a resident of California."; and deleted former subdivision (h) which provided, "This section shall remain in effect only until January 1, 1991, and as of that date is repealed, unless a later enacted statute, which is enacted before January 1, 1991, deletes or extends that date." Stats. 1991, Ch. 199, in effect January 1, 1992, substituted "in" for "of" after "change" in the first sentences of subdivisions (a) and (b); and added ", or any trustee . . . of the Civil Code" after "property" in the first sentence of subdivision (f). Stats. 2009, Ch. 67 (SB 824), in effect January 1, 2010, substituted "certifying that the information provided on the form is, to the best of his or her knowledge and belief, true, correct, and complete." for "and" after the second "the transferee" in the second sentence and created the third sentence by adding "The form" to the balance of the former second sentence before "shall not be" in subdivision (a).

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480.4. Preliminary change of ownership report forms. (a) The preliminary change of ownership report referred to in Section 480.3 shall deletiongive information relative to the transfer. The information shall include, but not be limited to, a description of the property, the parties to the transaction, the date of acquisition, the amount, if any, of the consideration paid for the property, whether paid in money or otherwise, and the terms of the transaction. The preliminary change in ownership report shall not include any question that is not germane to the assessment function.

deletion(b) The State Board of Equalizationdeletion, after consultation with the California Assessors' Association and interested parties, shall prescribe the preliminary change of ownership reportdeletion for the purpose of maintaining statewide uniformity in the contents of the report.

deletionHistory.—Added by Stats. 1990, Ch. 1546, in effect January 1, 1991, operative July 1, 1991. Stats. 1995, Ch. 499, in effect January 1, 1996, operative January 1, 1997, substituted "January" for "March" after "property on" in the first sentence and after "occurs after" in the fifth sentence of the NOTICE: section in subdivision (a). Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003, substituted "manufactured home" for "mobilehome" throughout the text. Stats. 2009, Ch. 67 (SB 824), in effect January 1, 2010, substituted "give information relative to the transfer." for "be in substantially the following form:" after "Section 480.3 shall" in the first sentence, added the second and third sentences, and deleted the image of the Preliminary Change of Ownership Report in subdivision (a); substituted ", after consultation with the California Assessors' Association and interested parties, shall prescribe" for "may revise" after "Equalization" and deleted ", as necessary," after "ownership report" in the first sentence of subdivision (b); and deleted subdivision (c), which provided that "This section shall become operative on July 1, 1991."

480.5. Real property usage reports. (a) Every owner of tax-exempt real property shall report to the local assessor the creation, renewal, sublease, or assignment of any lease, sublease, license, use permit, or other document which conveys the right to use that real property within 60 days of the transaction. The report shall include all of the following:

(1) The name and address of the owner.

(2) The names and addresses of all other parties to the transaction, including an identification of each party and of his or her possessory interest.

(3) The type of transaction, whether creation, renewal, sublease, or assignment.

(4) A description of the property.

(5) The date of the transaction.

(6) The terms of the transaction, including all of the following:

(A) The consideration for the possessory interest, whether paid in money or otherwise.

(B) The term of the possessory interest, including any renewal or extension options.

(C) If a sublease, the original term, the remaining term, and the consideration paid for the master lease.

(D) If an assignment, the original term, the remaining term, and the consideration paid for the underlying lease.

(b) This section shall be applicable only in those counties in which the board of supervisors, by ordinance or resolution, specifically elects to have this section applicable in the county.

History.—Added by Stats. 1984, Ch. 872, in effect January 1, 1985. Stats. 1985, Ch. 106, effective January 1, 1986, renumbered the section which was formerly numbered 480.4. Stats. 1990, Ch. 892, in effect January 1, 1991, deleted "This section shall remain in effect only until January 1, 1991, and as of that date is repealed, unless a later enacted statute which is chaptered on or before January 1, 1991, deletes or extends that date." in subdivision (b).

Note.—Section 2 of Stats. 1984, Ch. 872 provided no payment by state to local governments because of this act, however, a local agency or school district may pursue any remedies to obtain reimbursement.

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480.6. Change in ownership statement; possessory interest. (a) Notwithstanding any other provision of law, a holder of a possessory interest in real property that is owned by a state or local governmental entity is not required to file a preliminary change in ownership report or change in ownership statement with respect to any renewal of that possessory interest. Instead, every state or local governmental entity that is the fee owner of real property in which one or more taxable possessory interests have been created shall either file any preliminary change in ownership report or change in ownership statement otherwise required to be filed with respect to any renewal of a possessory interest, or annually file with the county assessor, no later than the 15th day of the first month following the month in which the lien date occurs, a real property usage report. The report shall include all of the following information:

(1) The name and address of the fee owner of the real property.

(2) The name and address of each holder of a possessory interest in the real property.

(3) The types of transactions in which the holders of the possessory interests acquired those interests, whether creations, renewals, subleases, or assignments.

(4) The description of the subject real property.

(5) The date of each transaction in which a holder of a possessory interest in the real property acquired that interest.

(6) The terms of each transaction described in paragraph (5), including all of the following:

(A) The consideration given for the possessory interest, whether paid in money or otherwise.

(B) The terms of the possessory interest, including any renewal or extension option.

(C) For any subleases, the original term and remaining term of the sublease, and the consideration paid for the master lease.

(D) For any assignments, the original term and remaining term of the assignment, and the consideration paid for the underlying lease.

(b) The failure of a state or local governmental entity to comply with this filing requirement shall not give rise to any interest or penalties assessed against the holder of the possessory interest.

History.—Added by Stats. 1995, Ch. 498, in effect January 1, 1996. Stats. 1996, Ch. 171, in effect July 17, 1996, added subdivision letter designation (a) before "Notwithstanding any other", substituted "is not be required" for "shall not be required" after "governmental entity" in the first sentence, substituted the second sentence for the former second sentence, which stated "Any preliminary change in ownership report or change in ownership statement that is required to be filed with respect to a possessory interest as described in the preceding sentence shall be filed in accordance with this article by the state or local governmental entity that is the fee owner of the property in which the relevant possessory interest has been created.", and added the third sentence, and the balance of subdivision (a); and added subdivision letter designation (b) before the former third sentence commencing with "The failure of".

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480.7. Change in ownership statement; life insurance company. (a) On or after January 1, 1996, in addition to any filing required to be made pursuant to Section 441, 480, 480.1, or 480.2, any domestic life insurance company that has established a separate account pursuant to Section 10506 of the Insurance Code, or any foreign life insurance company that has established a separate account pursuant to the corresponding insurance laws of its state of domicile, shall file with the assessor a signed statement of transfer as described in subdivision (b) with respect to any transfer of real property, located within the county, to or from that separate account.

(b) The statement of transfer required to be filed by subdivision (a) shall comply with all of the following conditions:

(1) The statement of transfer shall be subscribed under penalty of perjury.

(2) The statement of transfer shall identify all of the following:

(A) The separate account to which or from which the real property was transferred.

(B) The parties to the transfer.

(C) The date of transfer and the amount, if any, of consideration given with respect to the transfer, whether paid in the form of money or otherwise.

(D) The name and address of a contact person for any questions with respect to the separate account.

(E) Any other information with respect to the transfer as prescribed by the State Board of Equalization, after consultation with the California Assessor's Association.

(3) The statement of transfer shall not be required to include any information that is not relevant to the assessment function.

(4) The statement of transfer shall be signed by either an officer of the filing life insurance company, or by an employee or agent of that insurance company who has been designated in writing by the company's board of directors to sign the statement of transfer on the company's behalf.

(5) The statement of transfer shall be filed with the assessor either in person or through the United States mail, properly addressed with the postage prepaid.

(c) Any life insurance company required by subdivision (a) to file a statement of transfer that fails to file that statement within 45 days from the date of the subject transfer of real property shall be subject to a penalty of one thousand dollars ($1,000), in addition to any other penalty prescribed by law.

History.—Added by Stats. 1995, Ch. 933, in effect January 1, 1996.

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480.8. Consolidated ownership report; residential co-operative housing projects. (a) (1) For purposes of complying with the change in ownership provisions of Section 65.1 and subdivision (i) of Section 61, upon a written request of the county assessor, the owners of a cooperative housing corporation, community apartment project, condominium, planned unit development, or other residential subdivision complex with common areas or facilities in which units or lots are transferred without the use of recorded deeds, shall file an ownership report on or before the first February 1 that follows an assessor request, and on or before each February 1 thereafter. The ownership report shall include all of the following information:

(A) The full name and mailing address of each owner, stockholder, or holder of an ownership interest in the property and a copy of the stock certificate, or other document that evidences an interest in the unit or lot. Copies of stock certificates and other documents evidencing an interest in an individual unit or lot that were provided to the county assessor in a previous ownership report are not required to be provided in subsequent ownership reports.

(B) The situs address, including the number, of each unit or lot.

(C) The date that an ownership interest in the property was acquired and the acquisition price of that interest.

(2) The ownership report described in paragraph (1) applies to units or lots of residential property for which the individual units or lots consist of dwellings that could be eligible for homeowners' exemption if occupied as a principal place of residence.

(b) (1) If the ownership report request described in subdivision (a) is not complied with, the assessor may send a change in ownership statement to every owner, tenant-shareholder, or occupant of each individual unit or lot. If the assessor sends a change in ownership statement pursuant to this paragraph, a notice shall be included with that statement informing occupants who do not have an ownership interest in the unit or lot to forward the statement to the owner or shareholder of the unit or lot.

(2) Failure to file the change in ownership statement described in paragraph (1) shall result in the penalty described in subdivision (a) of Section 482 for each individual unit or lot whose owner or shareholder fails to independently file the change in ownership statement.

History.—Added by Stats. 2007, Ch. 450 (AB 402), in effect January 1, 2008.

481. Information held secret. All information requested by the assessor or the board pursuant to this article or furnished in the change in ownership statement shall be held secret by the assessor and the board. All information furnished in either the preliminary change in ownership statement or the change in ownership statement shall be held secret by those authorized by law to receive or have access to this information. These statements are not public documents and are not open to inspection, except as provided in Section 408.

History.—Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982, added "or the board" after the first "assessor", and "and the board" after the second "assessor" in the first sentence. Stats. 1985, Ch. 200, effective January 1, 1986, added second sentence and substituted "These statements . . . and are" for "The statement is not a public document and is" before "not" in the third sentence.

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482. Failure to file statement. (a) If a person or legal entity required to file a statement described in Section 480 fails to do so within 45 days from the date of a written request by the assessor, a penalty of either: (1) one hundred dollars ($100), or (2) 10 percent of the taxes applicable to the new base year value reflecting the change in ownership of the real property or manufactured home, whichever is greater, but not to exceed two thousand five hundred dollars ($2,500) if the failure to file was not willful, shall, except as otherwise provided in this section, be added to the assessment made on the roll. The penalty shall apply for failure to file a complete change in ownership statement notwithstanding the fact that the assessor determines that no change in ownership has occurred as defined in Chapter 2 (commencing with Section 60) of Part 0.5. The penalty may also be applied if after a request the transferee files an incomplete statement and does not supply the missing information upon a second request.

(b) If a person or legal entity required to file a statement described in Section 480.1 or 480.2 fails to do so within 45 days from the earlier of (1) the date of the change in control or the change in ownership of the corporation, partnership, limited liability company, or other legal entity, or (2) the date of a written request by the State Board of Equalization, a penalty of 10 percent of the taxes applicable to the new base year value reflecting the change in control or change in ownership of the real property owned by the corporation, partnership, or legal entity, or 10 percent of the current year's taxes on that property if no change in control or change in ownership occurred, shall be added to the assessment made on the roll. The penalty shall apply for failure to file a complete statement notwithstanding the fact that the board determines that no change in control or change in ownership has occurred as defined in subdivision (c) or (d) of Section 64. The penalty may also be applied if after a request the person or legal entity files an incomplete statement and does not supply the missing information upon a second request. That penalty shall be in lieu of the penalty provisions of subdivision (a).deletion

(c) The penalty for failure to file a timely statement pursuant to Sections 480, 480.1, and 480.2 for any one transfer may be imposed only one time, even though the assessor may initiate a request as often as he or she deems necessary.

(d) The penalty shall be added to the roll in the same manner as a special assessment and treated, collected, and subject to the same penalties for the delinquency as all other taxes on the roll in which it is entered.

(1) When the transfer to be reported under this section is of a portion of a property or parcel appearing on the roll during the fiscal year in which the 45-day period expires, the current year's taxes shall be prorated so the penalty will be computed on the proportion of property which has transferred.

(2) Any penalty added to the roll pursuant to this section between January 1 and June 30 may be entered either on the unsecured roll or the roll being prepared. After January 1, the penalty may be added to the current roll only with the approval of the tax collector.

(3) If the property is transferred or conveyed to a bona fide purchaser for value or becomes subject to a lien of a bona fide encumbrancer for value after the transfer of ownership resulting in the imposition of the penalty and before the enrollment of the penalty, the penalty shall be entered on the unsecured roll in the name of the transferee whose failure to file the change in ownership statement resulted in the imposition of the penalty.

(e) When a penalty imposed pursuant to this section is entered on the unsecured roll, the tax collector may immediately file a certificate authorized by Section 2191.3.

(f) Notice of any penalty added to either the secured or unsecured roll pursuant to this section shall be mailed by the assessor to the transferee at his or her address contained in any recorded instrument or document evidencing a transfer of an interest in real property or manufactured home or at any address reasonably known to the assessor.

History.—Stats. 1979, Ch. 1161, in effect September 29, 1979, substituted the balance of the second sentence of the first paragraph after "added" for "to the current assessment roll and shall become a lien against the real property in the same manner as any other property tax, unless paid by the end of the month following the month in which it is enrolled. Thereafter, the lien shall be subject to interest and penalties as any other delinquent tax on real property". Stats. 1979, Ch. 1180, in effect January 1, 1980, added "or mobilehome" after "property" in the first sentence, and deleted "to the roll" after "added", and substituted "this chapter" for "Chapter 3 of Part 2 of Division 1 of the Revenue and Taxation Code" in the second sentence of the first paragraph. Stats. 1980, Ch. 1081, in effect September 26, 1980, added "(a)" and a new first sentence to the first paragraph; added "or, for property which is state assessed, by the board" after "mobilehome", "a written" before "request", "but not to exceed two thousand five hundred dollars ($2,500) if such failure was not willful" before and "except as otherwise provided in this section" after "shall" and "secured" after "current" in the second sentence of subdivision (a); substituted a new third sentence to subdivision (a); added subdivisions (b) through (e); added "(f)" before the last paragraph; and, substituted "either the secured or unsecured" for "the" before "roll" and "transferee" for "assessee" before "at his" and "transfer of an interest in real property or mobilehome" for "change in ownership" after "evidencing a" in subdivision (f). Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982, substituted subdivisions (a) and (b) for former subdivisions (a) and (b); and added "for failure . . . 480.2" after "penalty", substituted "may" for "can" after "transfer", and added "or she" after "he" in subdivision (c). Stats. 1983, Ch. 1224, in effect January 1, 1984, deleted "of Division 1" after "Part 0.5" in the second sentence of subdivision (a); added "State" before "Board" in the first sentence of subdivision (b); substituted "treated, collected, and" for "shall be treated and collected like, and shall be" before "subject" in subdivision (d), deleted the former second sentence in subsection (1) thereof, deleted "of any fiscal year" after "June 30" and substituted "the roll being prepared" for "on the current or subsequent year's secured roll as a lien against the property transferred" after "roll or" in the first sentence and added the second sentence of subsection (2) thereof, and substituted "the" for "such" after the second "penalty" in subsection (3) thereof; and added "or her" after "his" in subdivision (f). Stats. 1984, Ch. 678, in effect January 1, 1985, added the fifth sentence to subdivision (b). Stats. 1995, Ch. 499, in effect January 1, 1996, operative January 1, 1997, substituted "January" for "March" after "section between" in the first sentence and after "After" in the second sentence of subdivision (d)(2). Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003, substituted "manufactured home" for "mobilehome" throughout the text. Stats. 2009, Ch. 622 (SB 816), in effect January 1, 2010, added "the earlier of (1) the date of the change in control or the change in ownership of the corporation, partnership, limited liability company, or other legal entity, or (2)" after "45 days from" in the first sentence, and deleted the former fifth sentence of subdivision (b), which read: "However, the penalty added by this subdivision shall be automatically extinguished if the person or legal entity files a complete statement described in Section 480.1 or 480.2 no later than 60 days after the date on which the person or legal entity is notified of the penalty."

Note.—Section 22 of Stats. 1979, Ch. 1161, provided no payment by state to local governments because of this act. Section 18 of Stats. 1979, Ch. 1180, provided no payment by state to local governments because of this Act.

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482.1. Failure to file statement; successor. If there is a failure to file a change in ownership statement within the time required by subdivision (b) of Section 480, the successor in interest to the decedent's property shall be subject to the penalty provided in Section 482.

History.—Added by Stats. 1980, Ch. 1081, in effect September 26, 1980. Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982, substituted "subdivision (b) of Section 480" for "Section 480.1".

483. Excusable delay. (a) If the assessee establishes to the satisfaction of the county board of supervisors that the failure to file the change in ownership statement within the time required by subdivision (a) of Section 482 was due to reasonable cause and not due to willful neglect, and has filed the statement with the assessor, the county board of supervisors may order the penalty abated, provided the assessee has filed with the county board of supervisors a written application for abatement of the penalty no later than 60 days after the date on which the assessee was notified of the penalty.

If the penalty is abated it shall be canceled or refunded in the same manner as an amount of tax erroneously charged or collected.

(b) The provisions of subdivision (a) shall not apply in any county in which the board of supervisors adopts a resolution to that effect. In that county the penalty provided for in subdivision (a) of Section 482 shall be abated if the assessee files the change of ownership statement with the assessor no later than 60 days after the date on which the assessee was notified of the penalty.

If the penalty is abated it shall be canceled or refunded in the same manner as an amount of tax erroneously charged or collected.

(c) If a person or legal entity establishes to the satisfaction of the county board of supervisors that the failure to file the change in ownership statement within the time required by subdivision (b) of Section 482 was due to reasonable cause and not due to willful neglect, and has filed the statement with the deletionState Board of Equalization, the deletioncounty board of supervisors deletionmay order the penalty be abated, provided the person or legal entity has filed with the deletioncounty board of supervisors a written application for abatement of the penalty no later than 60 days after the date on which the person or legal entity was notified of the penalty by the assessor.

If the penalty is abated by the county board of supervisors, it shall be canceled or refunded in the same manner as an amount of tax erroneously charged or collected.

History.—Stats. 1981, Ch. 1141, in effect October 2, 1981, operative January 1, 1982, added the subdivision letters, substituted "subdivision (a) of Section 482" for "Section 480" in the first sentence of subdivision (a), and added subdivision (b). Stats. 1982, Ch. 1465, in effect January 1, 1983, added subdivision (b) and relettered former subdivision (b) as subdivision (c). Stats. 2009, Ch. 622 (SB 816), in effect January 1, 2010, added "county" before "board of supervisors" twice and added "a" before "written application" in the first sentence of the first paragraph of subdivision (a); and substituted "county board of supervisors" for "board" after "satisfaction of the", substituted "State Board of Equalization" for "board" after "statement with the", deleted "board may recommend to the" after "Equalization, the", substituted "may order" for "that" after the second "board of supervisors", substituted "county board of supervisors a" for "board" after "filed with the", and added "by the assessor" after the third "the penalty" in the first sentence of the first paragraph, and added "county" before "board of supervisors" in the first sentence of the second paragraph of subdivision (c).

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484. Applicability of Article 2. With the exception of the penalty provision of Section 463, the provisions of Article 2 (commencing with Section 441) shall be available to the assessor for the purposes of securing change in ownership information required for assessment purposes.

485. Assessment; failure to file statement. If, after written request by the assessor, any person fails to comply with any provision of law for furnishing information required by Section 480, the assessor, based upon information in his possession, shall estimate the value of the property and, based upon this estimate, promptly assess the property.

History.—Stats. 1981, Ch. 714, in effect January 1, 1982, substituted "assess" for "assesses" after "promptly".

487. Requirement to file application to Insurance Commissioner. Any life insurance company that completes a real property transaction for which approval was obtained from the Insurance Commissioner pursuant to Section 10506 of the Insurance Code shall, upon completing that transaction, file with the assessor of the county in which the real property is located a certified copy of the application that the insurance company filed with the Insurance Commissioner with respect to the transaction.

History.—Added by Stats. 1995, Ch. 933, in effect January 1, 1996.

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Article 3. Arbitrary and Penal Assessments

501. Failure to furnish information. If after written request by the assessor, any person fails to comply with any provision of law for furnishing information required by Sections 441 and 470, the assessor, based upon information in his possession, shall estimate the value of the property and, based upon this estimate, promptly assess the property.

History.—Stats. 1945, p. 2034, in effect September 15, 1945, deleted matter now covered by Section 505. Stats. 1966, p. 662 (First Extra Session), in effect October 6, 1966, substituted "fails" for "neglects or refuses", "furnishing" for "obtaining", "on taxable tangible property" for "from taxpayers," and "shall assess" for "may penally assess", and added the last clause relating to Articles 1 or 4. Stats. 1967, p. 3337, in effect November 8, 1967, substituted language shown for prior language from ". . . for furnishing information . . ." to the end. Stats. 1971, p. 3521, in effect March 4, 1972, substituted "request" for "demand" in the first sentence.

Constitutionality.—Under prior law, an arbitrary assessment after refusal of the taxpayer to file the property statement does not violate Article XIII, Section 9, of the Constitution. Orena v. Sherman, 61 Cal. 101.

Construction. Escape assessment on cattle and feed owned by taxpayer on the lien date upheld where the assessor determined the amount of cattle and feed based on a loan application filed by the taxpayer several weeks after the lien date and following taxpayer's refusal to furnish additional information to the assessor. Domenghini v. San Luis Obispo County, 40 Cal.App.3d 689. Escape assessment on addition to single family residence upheld where the assessor determined the additional square footage during the framing stages and where taxpayer later refused to allow the assessor to verify his measurements. The assessor has only to show that, based on information in his possession, he estimated the value of the property and based on this estimate arrived at the assessment. The burden then shifts to the taxpayer to show that the assessor's estimate of value is incorrect, and that as a result the taxpayer paid more taxes than he should have. Simms v. Pope, 218, Cal.App.3d 472.

502. Concealment, etc., of tangible personal property. If any person willfully conceals, fails to disclose, removes, transfers or misrepresents tangible personal property to evade taxation which results in an assessment lower than that which would otherwise be required by law, the assessor on discovery shall assess the property in the lawful amount and impose the penalty provided for in Section 504.

History.—Added by Stats. 1967, p. 3337, in effect November 8, 1967.

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503. Fraudulent act, collusion, causing escape of taxable tangible property. If any taxpayer or the taxpayer's agent through a fraudulent act or omission causes, or if any fraudulent collusion between the taxpayer or the taxpayer's agent and the assessor or any of the assessor's deputies causes, any taxable tangible property to escape assessment in whole or in part, or to be underassessed, the assessor shall assess the property in the lawful amount and add a penalty of 75 percent of the additional assessed value so assessed.

History.—Added by Stats. 1967, p. 3337, in effect November 8, 1967. Stats. 1996, Ch. 1087, in effect January 1, 1997, substituted "the taxpayer's agent" for "his agent" twice, substituted "the assessor's deputies" for "his deputies" after "assessor or any of", substituted "add a penalty of 75 percent of the additional assessed value so assessed." for "impose the penalty provided for in Section 504" after "the lawful amount and".

Construction.—Under prior law this section referred to the amount of property to be returned and did not impose a penalty for a false valuation, even though willfully made. Clunie v. Siebe, 112 Cal. 593.

Constitutionality.—Former section 503 did not violate the separation of powers or due process provisions of the constitution. L. B. Foster Co. v. Los Angeles County, 265 Cal.App.2d 24.

503.5. Reporting property for fiscal year 1967–68. [Repealed by Stats. 1981, Ch. 261, in effect January 1, 1982.]

504. Penalty assessments; amounts. There shall be added to any assessment made pursuant to Section 502, except those assessments as are placed on the current roll prior to the time it is originally completed and published, a penalty of 25 percent of the additional assessed value so assessed.

History.—Added by Stats. 1967, p. 3337, in effect November 8, 1967. Stats. 1994, Ch. 544, in effect January 1, 1995, added subdivision letter designation (a) before "There", substituted "Section 502" for "Sections 502 or 503" after "pursuant to", substituted "those" for "such" after "except", and substituted "on" for "in" after "placed" in the first paragraph; and added subdivision (b).Stats. 1996, Ch. 1087, in effect January 1, 1997, deleted subdivision letter designation (a) before "There", and deleted former subdivision (b) which provided that "There shall be added to any assessment made pursuant to Section 503, except those assessments as are placed on the current roll prior to the time it is originally completed and published, a penalty of 75 percent of the additional assessed value so assessed."

Constitutionality.—Former section 504 did not violate the separation of powers or due process provisions of the constitution. L. B. Foster Co. v. Los Angeles County, 265 Cal.App.2d 24.

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505. Entry by assessor. The assessor shall make an assessment subject to penalty by entering on the local roll the assessment and penalty in such form and manner as prescribed by the board.

History.—Added by Stats. 1945, p. 2034, in effect September 15, 1945. Stats. 1966, p. 663 (First Extra Session), in effect October 6, 1966, substituted "assessment subject to penalty" for "penal assessment" and the balance of the sentence after "local roll" for "opposite the name of the assessee the words 'Penal assessment.' "

506. Tax rate applicable, interest. The tax rate applicable to any assessment made pursuant to this article shall be the tax rate to which the property would have been subject if it appeared upon the roll in the year when it should have been lawfully assessed. To the tax there shall be added interest at the rate of three-fourths of 1 percent per month from the date or dates the taxes would have become delinquent if they had been timely assessed to the date the additional assessment is added to the assessment roll.

History.—Added by Stats. 1967, p. 3337, in effect November 8, 1967. Stats. 1980, Ch. 411, in effect July 11, 1980, operative January 1, 1981, substituted "three-fourths" for "one-half" in the second sentence.

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Article 4. Property Escaping Assessment

531. Escaped property. If any property belonging on the local roll has escaped assessment, the assessor shall assess the property on discovery at its value on the lien date for the year for which it escaped assessment. It shall be subject to the tax rate in effect in the year of its escape except as provided in Section 2905 of this code.

Property shall be deemed to have escaped assessment when its owner fails to file a property statement pursuant to the provisions of Section 441, to the extent that this failure results in no assessment or an assessment at a valuation lower than would have obtained had the property been properly reported. Escape assessments made as the result of an owner's failure to file a property statement as herein provided shall be subject to the penalty and interest imposed by Sections 463 and 506, respectively. This paragraph shall not constitute a limitation on any other provision of this article.

History.—Stats. 1941, p. 410, operative February 1,1941, rearranged section and added subdivision (b). Stats. 1959, p. 3246, in effect September 18, 1959, reworded section so as to make subdivisions (a) and (b) applicable only to real property. Stats. 1967, p. 3338, in effect November 8, 1967, inserted second sentence. Stats. 1968, p. 2146, in effect November 13, 1968, added "except as provided in Section 2905 of this code" and deleted language relating to real property which was reenacted as Section 531.2. Stats. 1973, Ch. 918, p. 1700, in effect January 1, 1974, added the second paragraph.

Delayed assessment.—An assessment entered by the assessor on July 31, after the regular assessment period for the tax year, was proper as an "escaped assessment" under this section where there was no indication either that the delayed assessment was caused by the assessor's negligence or that the taxpayer acted to its detriment in reliance on the fact that it was not assessed during the regular assessment period. De Luz Homes, Inc. v. San Diego County, 45 Cal.2d 546; Western Title Guaranty Co. v. Stanislaus County, 41 Cal.App.3d 733.

Assessment on land only does not prevent escape assessment on improvement subsequently discovered. Jensen v. Byram, 229 Cal.App.2d 651.

Where an assessor discovers property that has escaped assessment for a particular tax year, and subsequently issues an escape assessment for that property, the taxpayer may file an administrative appeal and challenge the assessment, not only with respect to the property that had escaped assessment, but also as to all personal and real property of the taxpayer assessed at the location during the same tax year. County of Los Angeles v. Raytheon Co., 159 Cal.App.4th 27.

Assessor's duty.—The assessor's duty to assure uniformity in taxation bestows upon him the power to impose escape assessments, regardless of the relative culpability of the parties. General Dynamics Corporation v. San Diego County, 108 Cal.App.3d 132. The assessor has the duty to assess all taxable property at a uniform ratio of its full cash value. To the extent that property has been assessed at an assessment ratio lower than the ratio properly established by the assessor for a particular year such property has escaped assessment, and upon discovery an escaped assessment must be made. The rule applies though the taxpayer has accurately reported the cost or value figures of the property. Bauer-Schweitzer Malting Co., Inc. v. San Francisco, 8 Cal.3d 942.

Assessor's mistake.—Under this section the assessor is empowered to effect a correct assessment where taxable property had been erroneously valued and it may be applied to situations in which there was mistake on the part of the assessor and is not limited to escape assessments involving official misconduct. Hewlett-Packard Co. v. Santa Clara County, 50 Cal.App.3d 74.

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531.05. Escape assessments; Nordlinger v. Hahn. [Repealed by Stats. 1995, Ch. 497, in effect January 1, 1996.]

531.1. Escaped property; incorrect exemption. Upon the termination of an exemption pursuant to Section 276.3, upon receipt of a notice pursuant to Section 284, or upon indication from any audit or other source that an exemption has been incorrectly allowed, the assessor shall make a redetermination of eligibility for the exemption. If an exemption or any portion of an exemption has been terminated or has been incorrectly allowed, an escape assessment in the amount of the exemption, or that portion of the exemption that has been terminated or erroneously allowed, with interest as provided in Section 506, shall be made; except that where the exemption was terminated pursuant to Section 276.3 or where the exemption or a portion of the exemption was allowed as the result of an assessor's error, the amount of interest shall be forgiven. If the exemption was incorrectly allowed because of erroneous or incorrect information submitted by the claimant with knowledge that the information was erroneous or incomplete, the penalty provided in Section 504 shall be added to the assessment.

History.—Added by Stats. 1967, p. 3338, in effect November 8, 1967. Stats. 1970, p. 1069, in effect November 23, 1970, added "or other source" after "auditor" in the first sentence of the first paragraph; deleted "veteran's" as it modified "exemption" throughout the first paragraph and substituted "an" for "a" as required; and added the provisions pertaining to "any portion of an (the) exemption" and the second clause of the second sentence of the first paragraph. Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003, added "Upon the termination of an exemption pursuant to Section 276.3," before "Upon receipt of" and added an "a" before "notice pursuant to" in the first sentence; added "terminated or has been" after "exemption has been" and added "terminated or" after "that has been" in the first clause, and added "was terminated pursuant to Section 276.3 or where the exemption" after "where the exemption" in the second clause of the second sentence; and substituted "the" for "such" after "with knowledge that" in the third sentence of the first paragraph.

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531.2. Escaped real property. (a) When the property is real property which subsequent to July 1 of the year of escape for purposes of this article, or subsequent to July 1 of the year in which the property should have been lawfully assessed, for purposes of Article 3 (commencing with Section 501), but prior to the date of that assessment and the showing thereof on the secured roll, with the date of entry specified thereon, has (1) been transferred or conveyed to a bona fide purchaser for value, or (2) become subject to a lien of a bona fide encumbrance for value, the escape assessment pursuant to either of these articles shall not create or impose a lien or charge on that real property, but shall be entered on the unsecured roll in the name of the person who would have been the assessee in the year in which it escaped assessment and shall thereafter be treated and collected like other taxes on that roll. The tax rate applicable shall be the secured tax rate of the year in which the property escaped assessment.

(b) If the real property escaped assessment as a result of an unrecorded change in ownership or change in control for which a change in ownership statement required by Section 480, 480.1, or 480.2, or a preliminary change in ownership report, pursuant to Section 480.3, is not filed, the assessor shall appraise the property as of the date of transfer and enroll the difference in taxable value for each of the subsequent years on the secured roll, with the date of entry specified thereon. However, if prior to the date of the assessment the property has (1) been transferred or conveyed to a bona fide purchaser for value, or (2) become subject to a lien of a bona fide encumbrance for value, the escape assessment pursuant to this paragraph shall not create or impose a lien or charge on that real property, but shall be entered on the unsecured roll in the name of the person who would have been the assessee in the year in which it escaped assessment and shall thereafter be treated and collected like other taxes on that roll. The tax rate applicable shall be the secured rate of the year in which the property escaped assessment. "Assessment year" means the period defined in Section 118.

In the event of a failure to file a change in ownership statement required by Section 480, 480.1, or 480.2, or a preliminary change in ownership report, pursuant to Section 480.3, the interest provided in Section 506 may, by the order of the board of supervisors, be added.

(c) (1) Taxes resulting from escape assessments shall be prorated pursuant to paragraphs (2) to (5), inclusive, only if the board of supervisors of a county has adopted a resolution specifying that taxes shall be prorated pursuant to this subdivision.

(2) When real property has been transferred or conveyed to a bona fide purchaser for value subsequent to July 1 of the year of escape for purposes of this article, or subsequent to July 1 of the year in which the property should have been lawfully assessed, for purposes of Article 3 (commencing with Section 501), taxes resulting from escape assessments pursuant to this section shall be prorated between the following:

(A) The person who would have been the assessee if the change in ownership had not occurred.

(B) The person who purchased the property.

(3) If the real property has been transferred or conveyed to a bona fide purchaser for value more than once during the year of escape or assessment, each owner of record during that period shall be liable for a pro rata share of taxes based on the length of time during that period each bona fide purchaser was the record owner of that real property.

(4) When the assessor has identified the fact and amount of the escape assessment, the assessor shall identify the owners of record during the year of escape or assessment and the dates of ownership for each owner.

(5) The auditor shall compute the respective prorated shares of taxes for each owner of record. The share of taxes of the current owner of the real property shall be placed on the secured roll as a lien on the parcel for which the escaped assessment was discovered. The share of taxes of any previous owner during the year of escape or assessment shall be entered on the unsecured roll.

History.—Added by Stats. 1968, p. 2146, in effect November 13, 1968. This provision was formerly a part of Section 531, Stats. 1973, Ch. 1190, p. 2503, in effect January 1, 1974, substituted the present language for prior provision which was confined to a statement of when escapes for real property would lie. Stats. 1976, Ch. 156, p. 251, in effect January 1, 1977, substituted the balance of the first sentence after "such real property" and the second sentence for "but shall be collected as follows" and for former subsections (a) and (b). Stats. 1980, Ch. 1081, in effect September 26, 1980, added the second paragraph. Stats. 1981, Ch. 1141, in effect January 1, 1982, added "or change in control" after "change in ownership" and added ", 480.1, or 480.2" after "480" in the first sentence, and added "or change in control" after "changes in ownership" in the third sentence of the second paragraph. Stats. 1987, Ch. 537, in effect January 1, 1988, deleted "of this chapter" after "Section 501)", in the first sentence of the first paragraph; substituted "that" or "these" for "such" or "said" throughout text; and substituted "changes" for "change" after "ownership or" in the third sentence, and added the fourth sentence of the second paragraph. Stats. 1990, Ch. 126, in effect June 11, 1990, substituted "that" for "such" after "date of" in the first sentence of the first paragraph substituted ". However," for ", provided, however, that" after "thereon", substituted "the" for "such" after "date of", substituted "that" for "such" after "charge on", and added a comma between "property" and "but" in the former first sentence of the second paragraph, and added the third paragraph. Stats. 1990, Ch. 723, in effect January 1, 1991, added subdivision letters (a) and (b), and added subdivision (c). Stats. 1994, Ch. 544, in effect January 1, 1995, deleted former fourth sentence of subdivision (b) which read, "Notwithstanding the provisions of Section 532, escaped assessments resulting from these unrecorded changes in ownership or changes in control shall be made within eight years after July 1 of the assessment year in which the real property escaped taxation or was underassessed." Stats. 1999, Ch. 941 (SB 1231), in effect January 1, 2000, added ", or a preliminary change in ownership report, pursuant to Section 480.3," after "480.1, or 480.2" in the first sentence of the first paragraph and added "or a preliminary change in ownership report, pursuant to Section 480.3," after "480.1, or 480.2," in the first sentence of the second paragraph of subdivision (b).

Note.—Section 1(b) of Stats. 1987, Ch. 537, provided that the Legislature further finds and declares that the provisions of law relating to escape assessments are in no way inconsistent with Article XIII A of the California Constitution. An escape assessment merely reflects the amount by which the property has been underassessed and is a mechanism which permits the correction of the effects of that underassessment. The amount of the underassessment must be determined, however, in accordance with the applicable statutory valuation standards. Thus, an escape assessment is merely a mechanism for implementing existing property tax law and cannot be in conflict with it. Accordingly, the amendments to Sections 531.2 and 532 of the Revenue and Taxation Code made by this act are necessary to make clear that an escape assessment resulting from the correction of an error in a base-year value may be made within four, six, or eight years, as applicable, after the first day of July of the assessment year, as defined in Section 118 of the Revenue and Taxation Code, in which the property either wholly escaped taxation or was underassessed, as determined by applying the applicable Article XIII A valuation standards.

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531.3. Escaped personal property; failure to report cost accurately. If the assessor requires an assessee to describe personal property in such detail as shows the cost thereof but the assessee omits to report the cost of the property accurately, notwithstanding that this information is available to the assessee, to the extent that this omission on the part of the assessee causes the assessor not to assess the property or to assess it at a lower valuation than he would enter upon the roll were the cost reported to him accurately, that portion of the property as to which the cost is unreported, in whole or in part, shall be assessed as required by law. If the omission is willful or fraudulent, the penalty and interest provided in Sections 504 and 506 shall be added to the additional assessment; otherwise only the interest provided in Section 506 shall be so added.

History.—Stats. 1969, p. 3164, in effect November 10, 1969, renumbered the section which was formerly numbered 507.

Inaccurate reporting not a prerequisite to escape assessment.—The fact that escape assessments are allowed under this section because of inaccurate reporting does not impliedly exclude escape assessments when cost has been correctly reported. Taxable property must be assessed and a previous underassessment cannot be sustained although all parties acted in good faith. Ex-Cell-O Corp. v. Alameda County, 32 Cal.App.3d 135.

Inaccurate report.—A standard cost accounting system utilizing variance accounts carrying certain expenses not recorded as costs comes under the provisions of this section and results in the addition of the interest provided by section 506 and disallowance of the section 219 inventory exemption for escape assessments made hereunder. Beckman Instruments, Inc. v. Orange County, 53 Cal.App.3d 767.

531.4. Escaped business property; inaccurate statement or report. When an assessee files with the assessor a property statement or report on a form prescribed by the board with respect to property held or used in a profession, trade or business and the statement fails to report any taxable tangible property accurately, regardless of whether this information is available to the assessee, to the extent that this failure causes the assessor not to assess the property or to assess it at a lower valuation than he would enter on the roll if the property had been reported to him accurately, that portion of the property which is not reported accurately, in whole or in part, shall be assessed as required by law. If the failure to report the property accurately is willful or fraudulent, the penalty and interest provided in Sections 504 and 506 shall be added to the additional assessment; otherwise only the interest provided in Section 506 shall be added.

History.—Added by Stats. 1969, p. 3164, in effect November 10, 1969.

Construction.—The word "shall" in this section must be construed as mandatory so that mandamus will lie to compel immediate performance of the assessor's duty in order to avoid loss due to the running of the statute of limitations. Knoff v. San Francisco, 1 Cal.App.3d 184.

Right to recover accrues on lien date.—The right to recover taxes on business inventories escaping assessment as a result of inaccuracies in the taxpayer's property statements accrued on the lien date of the fiscal year in which the escape occurred and the law as it then existed must govern the assessment. The statutory scheme for escape assessments embodies the principle that the right to taxes on escape property accrues on the lien date, not on the date of entry on the tax roll. California Computer Products, Inc. v. Orange County, 107 Cal.App.3d 731; General Dynamics Corporation v. San Diego County, 108 Cal.App.3d 132.

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531.5. Escaped property; business inventory exemption. If a business inventories exemption has been incorrectly allowed because of erroneous or incorrect information submitted by the taxpayer or his agent misclassifying as business inventories property not includible in "business inventories," as that term is defined in Section 129, an escape assessment in the amount of the exemption shall be made on discovery of the error. Interest shall be added to the assessment in the amount and manner provided by Section 506. If the exemption was incorrectly allowed because of erroneous or incorrect information submitted by the taxpayer or his agent with knowledge that such information was erroneous or incorrect, the penalty provided in Section 504 shall be added to the assessment.

History.—Added by Stats. 1969, p. 630, in effect June 27, 1969. Stats. 1969, p. 3119, in effect September 6, 1969, substituted "one-half of 1" for "1/2" percent. Stats. 1981, Ch. 261, in effect January 1, 1982, deleted "at the rate of one-half of 1 percent per month, computed" after "assessment" and added "amount and" before "manner" in the second sentence.

531.6. Escaped real property; homeowners' exemption. The taxpayer who has filed a claim for the homeowners' exemption which has not been denied by the assessor is responsible for notifying the assessor when the property is no longer eligible for the exemption.

Upon any indication that a homeowners' exemption has been incorrectly allowed, the assessor shall make a redetermination of eligibility for the homeowners' exemption. If the assessor determines that the property is no longer eligible for the exemption, he shall immediately cancel the exemption on the property.

If a homeowners' exemption has been incorrectly allowed, an escape assessment as allowed by Section 531.1 in the amount of the exemption with interest as provided in Section 506 shall be made, except that where the exemption was allowed as the result of an assessor's error, the amount of interest shall be forgiven. If the exemption was incorrectly allowed because of erroneous or incorrect information submitted by the claimant with knowledge that such information was erroneous or incomplete or because the claimant failed to notify the assessor in a timely manner that the property was no longer eligible for the exemption, the penalty provided in Section 504 shall be added to the assessment. If the property subject to this paragraph has been transferred or conveyed to a bona fide purchaser for value during the period commencing with the lien date and ending July 1 of the fiscal year for which such exemption was incorrectly allowed, and the claimant is not the purchaser, any amount of penalty provided by Section 504 or any amount of interest provided by Section 506 imposed pursuant to the escape assessment due to such incorrect homeowners' exemption shall be forgiven.

History.—Added by Stats. 1974, Ch. 60, p. 132, in effect March 12, 1974. Stats. 1974, Ch. 1107, p. 2370, in effect September 23, 1974, operative with respect to the 1974–75 fiscal year and thereafter, substituted "which has not been denied by the assessor" for ", once granted," in the first sentence of the first paragraph; and added the balance of the first sentence after "made", and added "in a timely manner" after "assessor" in the second sentence of the third paragraph. Stats. 1978, Ch. 1126, in effect January 1, 1979 substituted "Section 531.1" for "Section 531.2" in the first sentence, and added the third sentence to the third paragraph. Stats. 1979, Ch. 242, in effect July 10, 1979, substituted the balance of the third sentence of the third paragraph after "value" for "or becomes subject to a lien of a bona fide encumbrance for value, the provisions of Section 531.2 shall apply".

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531.7. Escaped tax deeded real property. If property has not been legally assessable on the local secured roll for any year because the property has been tax deeded to a taxing agency other than the state, the property shall be deemed to have escaped assessment for that year and shall be subject to this article if any of the following circumstances apply:

(a) The property has not been declared tax defaulted for delinquent taxes.

(b) The property has been redeemed from the tax sale and deeded to the taxing agency.

(c) The tax deed to the taxing agency has been held to be invalid and has been canceled; provided, however, that the statute of limitations provided for in Section 532 shall not apply.

History.—Added by Stats. 1979, Ch. 242, in effect July 10, 1979. Stats. 1985, Ch. 316, effective January 1, 1986, substituted "the" for "such" after "because" and substituted "that" for "such" after "for" in the first sentence, substituted "declared tax defaulted" for "sold to the state" after "been" in subsection (a), and deleted "of this Code" after "532" in subsection (c). Stats. 2006, Ch. 538 (SB 1852), in effect January 1, 2007, deleted "the provisions of" after "be subject to" and added " any of the following circumstances apply" after "this article if" in the first sentence, substituted a period for ", and," after "for delinquent taxes" in the first sentence of subsection (a), and substituted "deeded" for "deed" after "tax sale and" and substituted a period for ", or" after "to the taxing agency" in the first sentence of subsection (b).

Note.—Section 20 of Stats. 1985, Ch. 186, provided that it is the intent of the Legislature in enacting Sections 11 and 11.3 of this act, which amend Sections 110.1 and 532.3 of the Revenue and Taxation Code, to clarify the application of these provisions to property which existed on the 1975 lien date, but escaped taxation entirely and was not identified and placed on the roll prior to June 30, 1980 (or June 30, 1981, in the case of counties over four million in population). In these cases, it is the intent of the Legislature that any of these properties which escaped taxation shall be placed on the current roll even though the property was not discovered until after the dates of June 30, 1980, and June 30, 1981. Sec. 21 thereof provided reimbursement to local governments for costs mandated by the State pursuant to this act.

531.8. Notice of Proposed Escape Assessment. No escape assessment shall be enrolled under this article before 10 days after the assessor has mailed or otherwise delivered to the affected taxpayer a "Notice of Proposed Escape Assessment" with respect to one or more specified tax years. The notice shall prominently display on its face the following heading:

"NOTICE OF PROPOSED ESCAPE ASSESSMENT"

The notice shall contain all of the following:

(a) The amount of the proposed escape assessments for each tax year at issue.

(b) The telephone number of the assessor's office to allow a taxpayer to contact that office with respect to the proposed escape assessment or assessments.

History.—Added by Stats. 1993, Ch. 387, in effect January 1, 1994. Stats. 1999, Ch. 941 (SB 1231), in effect January 1, 2000, substituted "enrolled" for "levied" after "assessment shall be" in the first sentence of first paragraph, and substituted "telephone" for "phone" after "The name and" in the first sentence of subdivision (b). Stats. 2003, Ch. 604 (SB 1059), in effect January 1, 2004, substituted "The telephone number of the assessor's office to allow a taxpayer to contact that office" for "The name and telephone number of a person at the assessor's office who is knowledgeable" before "with respect to" and deleted "and may be contacted with any questions with respect to the proposed assessment or assessments" after "assessment or assessments" in the first sentence of subdivision (b).

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531.9. Escape assessment; low value exemption. A county board of supervisors may, by ordinance, prohibit an assessor from making an escape assessment of an appraisal unit where that assessment would result in an amount of taxes due which is less than the cost of assessing and collecting them. In no event may the ordinance apply to any escape assessment of an appraisal unit if the amount of taxes resulting from the escape assessment would exceed fifty dollars ($50).

History.—Added by Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003.

532. Statute of limitations. (a) Except as provided in subdivision (b), any assessment made pursuant to either Article 3 (commencing with Section 501) or this article shall be made within four years after July 1 of the assessment year in which the property escaped taxation or was underassessed.

(b) (1) Any assessment to which the penalty provided for in Section 504 must be added shall be made within eight years after July 1 of the assessment year in which the property escaped taxation or was underassessed.

(2) Any assessment resulting from an unrecorded change in ownership for which either a change in ownership statement, as required by Section 480 or a preliminary change in ownership report, as required by Section 480.3, is not timely filed with respect to the event giving rise to the escape assessment or underassessment shall be made within eight years after July 1 of the assessment year in which the property escaped taxation or was underassessed. For purposes of this paragraph, an "unrecorded change in ownership" means a deed or other document evidencing a change in ownership that was not filed with the county recorder's office at the time the event took place.

(3) Notwithstanding paragraphs (1) and (2), in the case where property has escaped taxation, in whole or in part, or has been underassessed, following a change in ownership or change in control and either the penalty provided for in Section 503 must be added or a change in ownership statement, as required by Section 480.1 or 480.2 was not filed with respect to the event giving rise to the escape assessment or underassessment, an escape assessment shall be made for each year in which the property escaped taxation or was underassessed.

(c) For purposes of this section, "assessment year" means the period defined in Section 118.

History.—Added by Stats. 1966, p. 663 (First Extra Session), in effect October 6, 1966, Stats. 1967, p. 3338, in effect November 8, 1967, substituted present language from beginning of the section to ". . . shall not create . . ." in the first sentence of the second paragraph. Stats. 1968, p. 1238, in effect November 13, 1968, substituted "July 1 of the assessment year" for "the lien date" in the first and second sentences of the first paragraph. Stats. 1969, p. 2192, in effect November 10, 1969, added "provided . . . October 6, 1971" in the first paragraph. Stats. 1970, p. 1072, in effect November 23, 1970, substituted "(commencing with Section 501) of this chapter, or pursuant to this article" for "or Article 4 of this Chapter 3", and substituted "for the fiscal years . . ." for "in an assessment year commencing on July 1, 1966, and ending on June 30, 1967, such assessment shall be made on or before October 6, 1971," in the first paragraph. Stats. 1971, p. 1540, in effect March 4, 1972, added the fourth and fifth sentences commencing with "Assessments made pursuant . . ." in the second paragraph. Stats. 1973, Ch. 1190, p. 2504, in effect January 1, 1974, deleted former second, third and fourth paragraphs referring to an escape where the property has been transferred to or encumbered by a bona fide purchaser for value; the latter provisions were transferred with changes to section 531.2. Stats. 1981, Ch. 261, in effect January 1, 1982, deleted the balance of the second sentence, pertaining to property which had escaped taxation in the 1966–67 and 1967–68 fiscal years, after "underassessed". Stats. 1987, Ch. 537, in effect January 1, 1988, deleted "of this chapter" after "Section 501)" in the second sentence, and added the third sentence. Stats. 1994, Ch. 544, in effect January 1, 1995, substituted "(a) Except . . . any" for "Any" before "assessment", substituted "and any" for ". Any" after "underassessed", added "either" after "pursuant to", deleted comma after "501)", and substituted a comma for "pursuant to" after "or" in the first sentence of subdivision (a); deleted former third sentence of subdivision (a) which provided, " 'Assessment year' means the period defined in Section 118."; and added subdivisions (b) and (c). Stats. 1995, Ch. 497, in effect January 1, 1996, added "either" after "in which" and added "or a preliminary change in ownership report, as required by Section 480.3," after "or 480.2," in subdivision (b). Stats. 2000, Ch. 647 (SB 2170), in effect January 1, 2001, deleted "to which the penalty provided for in Section 504 must be added shall be made within six years after July 1 of the assessment year in which the property escaped taxation or was underassessed and any other assessment" after "any assessment" and deleted a comma after "or" in the first sentence of subdivision (a); deleted former subdivision (b) which provided, "In the case where property has escaped taxation, in whole or in part, or has been underassessed, following a change in ownership, the applicable limitations period specified in subdivision (a) shall not commence until July 1 of the assessment year in which either a change in ownership statement, as required by Section 480, 480.1, or 480.2, or a preliminary change in ownership report, as required by Section 480.3, is filed with respect to the event giving rise to the escape assessment or underassessment.", and added new subdivision (b). Stats. 2001, Ch. 613 (SB 1184), in effect January 1, 2002, substituted "eight" for "six" after "within" in the first sentence of paragraph (1) and added "or change in control" after the first "ownership" in the first sentence of paragraph (3) of subdivision (b). Stats. 2003, Ch. 471 (SB 1062), in effect January 1, 2004, deleted "or change in control" after "change in ownership" and added "timely" after "480.3 is not" in the first sentence and deleted "or change in control" after "change in ownership" in the second sentence of paragraph (2) of subdivision (b).

Note.—Section 1(b) of Stats. 1987, Ch. 537, provided that the Legislature further finds and declares that the provisions of law relating to escape assessments are in no way inconsistent with Article XIII A of the California Constitution. An escape assessment merely reflects the amount by which the property has been underassessed and is a mechanism which permits the correction of the effects of that underassessment. The amount of the underassessment must be determined, however, in accordance with the applicable statutory valuation standards. Thus, an escape assessment is merely a mechanism for implementing existing property tax law and cannot be in conflict with it. Accordingly, the amendments to Sections 531.2 and 532 of the Revenue and Taxation Code made by this act are necessary to make clear that an escape assessment resulting from the correction of an error in a base-year value may be made within four, six, or eight years, as applicable, after the first day of July of the assessment year, as defined in Section 118 of the Revenue and Taxation Code, in which the property either wholly escaped taxation or was underassessed, as determined by applying the applicable Article XIII A valuation standards.

Note.—Section 5 of Stats. 2001, Ch. 613 (SB 1184) provided that notwithstanding Section 2229 of the Revenue and Taxation Code, no appropriation is made by this act and the state shall not reimburse any local agency for any property tax revenues lost by it pursuant to this act. Sec. 6 therein 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.

Construction.—The fact that section 532 provides two periods of limitation, a six-year period where there has been fraud and a shorter period in the absence of fraud, indicates the legislative intent to set a six-year limit irrespective of the time of discovery; therefore, there can be no implied extension of the period of undiscovered fraud. Silver v. Watson, 26 Cal.App.3d 905. As the result of Article XIII A of the Constitution, "assessment year" as used in this section must be construed as the year when the base value of the property was determined. Thus, where the base year value of a newly constructed warehouse was determined as of March 1, 1976, any error giving rise to an escape assessment is deemed to have occurred at that time, and to be timely the escape assessment had to have been made before March 1, 1980. Dreyer's Grand Ice Cream, Inc. v. Alameda County, 178 Cal.App.3d 1174.

This section does not conflict with Article XIII A of the Constitution. Under this section, escape assessments must be made within four years of July 1 of the assessment year, as defined in Section 118, in which property escaped taxation or was underassessed. Thus, escape assessments levied before July 1, 1987, based upon a change in ownership which resulted from a corporate reorganization on July 31, 1982, were made within four years of July 1, 1983, and hence, were not barred by the statute of limitations. Blackwell Homes v. Santa Clara County, 226 Cal.App.3d 1009. The provisions governing time limitations for supplemental assessments do not affect the existing statutes of limitations for making escape assessments. Thus, even if supplemental assessments are barred as untimely, escape assessments may be made within the time limitations of this section. Montgomery Ward & Co. Inc. v. Santa Clara County, 47 Cal.App.4th 1122.

The four-year limit did not bar a possessory interest assessment against a cable television company for the 1982 base year, notwithstanding that the county assessor had never acted to levy such an assessment for that year, where in 1982 and 1983 the company had received statements for taxes attributed to its possessory interests and paid those taxes, and where, although in 1985 the county board of supervisors had adopted a resolution to delete possessory interest assessments levied against the company for 1982 through 1985, the company had not received a corresponding refund. Stanislaus County v. Assessment Appeals Board, 213 Cal.App.3d 1445.

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532.1. Pre 1971–1972 possessory interest in timber lands. [Repealed by Stats. 1981, Ch. 261, in effect January 1, 1982.]

532.1. Extension of time for making escape assessment. (a) If, before the expiration of the period specified in Section 532 for making an escape assessment, the taxpayer and the assessor have agreed in writing to extend the time for making an assessment, correction, or claim for refund, the assessment may be made at any time prior to the expiration of the period agreed upon. The period may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.

(b) If the assessor mails or otherwise delivers a "Notice of Proposed Escape Assessment" under Section 531.8 as to any assessment year for which the period for making an escape assessment, including any extension pursuant to subdivision (a), will expire in less than 90 days after the date of mailing or delivery of that notice, then that period, and any limitations period on the filing of a refund claim with respect to the same assessment year, shall be extended to the 90th day after the date of mailing or delivery. Subsequent mailings or deliveries of a "Notice of Proposed Escape Assessment" for the same assessment year shall not establish any further extension.

History.—Added by Stats. 1983, Ch. 1224, in effect January 1, 1984. Stats. 1993, Ch. 387, in effect January 1, 1994, added subdivision letter (a) before first paragraph, and added subdivision (b).

532.2. Escaped property, possessory interests of Zoological Society. [Repealed by Stats. 1981, Ch. 261 in effect January 1, 1982.]

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532.2. Escaped real property; welfare exemption. Notwithstanding Section 532, the assessor shall assess as escaped property any property for which a welfare exemption was granted while that property was "in the course of construction," as defined in Section 214.2, if either of the following occurs:

(a) Construction is abandoned.

(b) Upon completion of the construction, the property is used other than exclusively for religious, hospital, or charitable purposes. If, upon completion of construction, a portion of the property is used other than exclusively for religious, hospital, or charitable purposes, the assessor shall assess as escaped property only that portion of the property so used.

History.—Added by Stats. 1991, Ch. 897, in effect January 1, 1992. Stats. 1992, Ch. 1180, in effect January 1, 1993, substituted "shall" for "may" after "assessor" in the first paragraph; and added "If, upon . . . so used." after "purposes" as the second sentence of subdivision (b).

532.3. Escape assessments. [Repealed by Stats. 1995, Ch. 497, in effect January 1, 1996.]

532.5. Assessor's error; penalties and payments. [Repealed by Stats. 1983, Ch. 1224, in effect January 1, 1984.]

533. Entry on roll. If an escape assessment is made as a result of an audit that discloses that property assessed to the party audited has been incorrectly assessed either for a past tax year for which taxes have been paid and a claim for refund is not barred by Section 5097 or for any tax year for which the taxes are unpaid, the tax refunds resulting from the incorrect assessments shall be an offset against proposed tax liabilities, including accumulated penalties and interest, resulting from escaped assessments for any tax year covered by the audit.

(b) If a tax refund, authorized under this section exceeds any proposed tax liabilities, including accumulated penalties and interest, the party audited shall be notified by the tax collector of the amount of the excess and of the fact that a claim for cancellation or refund may be filed with the county as provided by Section 5096 or 5096.7.

History.—Stats. 1967, p. 3339, in effect November 8, 1967, substituted present language from beginning of the section to ". . . shall be entered . . ." and added clause beginning ". . . pursuant to Sections . . ." at end. Stats. 1970, p. 1036, in effect November 23, 1970, added the second paragraph. Stats. 1978, Ch. 732, in effect January 1, 1979, deleted in the first sentence of the second paragraph the words "erroneously or illegally" and replaced them with "incorrectly". Also added the words "covered by the audit" to the end of that sentence. In the second sentence of the second paragraph deleted the word "the" and replaced it with "any"; and also deleted the words "for this year" and replaced them with "and the State Controller". Also the last sentence of the second paragraph was added. Stats. 1979, Ch. 518, in effect January 1, 1980, substantially revised second paragraph to allow offsets against any proposed tax liability resulting from audit rather than limiting offsets to proposed escapes. Stats. 1980, Ch. 411, in effect July 11, 1980, operative January 1, 1981, substituted "for the current assessment year as defined in Section 118" for "prepared or being prepared in the assessment year when it is so discovered" and "the property" for "it" before "escaped" in the first paragraph, and, deleted "4986" after "Section" and added "or 5096.7" after "5096" in the second sentence of the second paragraph. Stats. 1980, Ch. 1208, in effect January 1, 1981, added the third paragraph. Stats. 2003, Ch. 604 (SB 1059), in effect January 1, 2004, designated the former first paragraph as paragraph (1) of subdivision (a) and added paragraph (2); designated the former second paragraph as paragraph (1) of subdivision (b) and substituted "that" for "which" after "of an audit" in the first sentence therein, designated the former third paragraph as paragraph (2) thereof, designated the former fourth paragraph as paragraph (3) thereof and substituted "If these" for "If such" before "tax refunds exceed" in the first sentence and substituted "If" for "In the event that" before "the assessment caused" and substituted "the" for "such" after "the amount of" in the second sentence. Stats. 2004, Ch. 200 (SB 1880), in effect January 1, 2005, deleted former subdivision (a) which provided that "(1) Assessments made pursuant to Article 3 (commencing with Section 501) of this chapter or pursuant to this article shall be entered on the roll for the current assessment year as defined in Section 118, and, if this is not the roll for the assessment year in which the property escaped assessment, the entry shall be followed with "Escaped assessment for year pursuant to Sections of the Revenue and Taxation Code." (2) The assessor may make the entries described in paragraph (1) on either the hard copy of the roll or the electronic version of the roll, as determined by the assessor."; created new subdivision (a) with former paragraph (1) of former subdivision (b) and substituted "If an escape assessment is" for "If the assessments are" before "made as a result" in the first sentence therein and deleted former paragraph (2) which provided that "(2) Beginning with the 1981–82 fiscal year, assessment for the current and prior year shall be entered using a 100 percent assessment ratio and the tax rate for years prior to the 1981–82 fiscal year will be divided by four."; created new subdivision (b) with former paragraph (3) of former subdivision (b) and substituted "If a tax refund, authorized under this section exceeds" for "If these tax refunds exceed" before "any proposed tax" in the first sentence and deleted the former second sentence which provided that "If the assessment caused an excess payment of taxes and therefore resulted in an overpayment by the state for property tax relief as provided by Section 219, then subsequent subventions for property tax relief shall be reduced by the amount of the overpayment." therein.

Failure to make entry on roll.—Where the assessor treated city-owned water rights as having escaped assessment but did not make the entry on the roll as required by this section, the court did not decide the matter on that basis but, based upon the evidence, held that the method used by the assessor was incorrect and resulted in an excessive assessment of those rights. City of Los Angeles v. County of Inyo, 167 Cal.App.2d 736.

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534. Procedure after assessment. (a) Assessments made pursuant to Article 3 (commencing with Section 501) or this article shall be treated like, and taxed at the same rate applicable to, property regularly assessed on the roll on which it is entered, unless the assessment relates to a prior year and then the tax rate of the prior year shall be applied, except that the tax rate for years prior to the 1981–82 fiscal year shall be divided by four.

(b) No assessment described in subdivision (a) shall be effective for any purpose, including its review, equalization and adjustment by the Board of Equalization, until the assessee has been notified thereof personally or by United States mail at his or her address as contained in the official records of the county assessor. For purposes of Section 532, the assessment shall be deemed made on the date on which it is entered on the roll pursuant to Section 533, if the assessee is notified of the assessment within 60 days after the statute of limitations or the placing of the escape assessment on the assessment roll. Otherwise the assessment shall be deemed made only on the date the assessee is so notified.

(c) The notice given by the assessor pursuant to this section shall include all of the following:

(1) The date the notice was mailed.

(2) Information regarding the assessee's right to an informal review and the right to appeal the assessment, and except in a case in which paragraph (3) applies, that the appeal shall be filed within 60 days of the date of mailing printed on the notice or the postmarked date therefor, whichever is later. For the purposes of equalization proceedings, the assessment shall be considered an assessment made outside of the regular assessment period as provided in Section 1605.

(3) For counties in which the board of supervisors has adopted a resolution in accordance with subdivision (c) of Section 1605, and the County of Los Angeles, receipt by the assessee of a tax bill based on that assessment shall suffice as notice under this section if the tax bill advises the assessee of the right to appeal the assessment, and that the appeal shall be filed within 60 days of the date of mailing printed on the tax bill or the postmark therefor, whichever is later. For the purposes of equalization proceedings, the assessment shall be considered an assessment made outside of the regular assessment period as provided in Section 1605.

(4) A description of the requirements, procedures, and deadlines with respect to an application for the reduction of an assessment pursuant to Section 1605.

(d) (1) The notice given by the assessor under this section shall be on a form approved by the board.

(2) Giving of the notice required by Section 531.8 shall not satisfy the requirements of this section.

History.—Stats. 1961, p. 4229, in effect September 15, 1961, added the phrase "and taxed at the same rate applicable to." In Sec. 6 of Stats. 1961. p. 4230, the Legislature stated that the 1961 amendment to this section did not constitute a change in, but was declaratory of, the pre-existing law, and that said amendment shall apply to escape assessments made prior to its effective date. Stats. 1967, p. 3339, in effect November 8, 1967, revised section so that only portion in first sentence beginning ". . . shall be treated . . ." and ending ". . . on which it is entered . . ." of prior section was retained. Stats. 1978, Ch. 732, in effect January 1, 1979, added the last sentence to the second paragraph. Stats. 1979, Ch. 518, in effect January 1, 1980, deleted last sentence of second paragraph relating to assessments being subject to provisions of §§ 499 and 1605. Stats. 1980, Ch. 1208, in effect January 1, 1981, added "except that the tax rate for years prior to the 1981–82 fiscal year shall be divided by four" after "applied" in the first paragraph. Stats. 1981, Ch. 462, in effect January 1, 1982, added the second sentence to the second paragraph. Stats. 2000, Ch. 647 (SB 2170), in effect January 1, 2001, added subdivision designation (a) to the former first paragraph, and deleted "of this chapter" after "Section 501)" and deleted "pursuant to" after "or" in the first sentence therein; added subdivision designation (b) to the former second paragraph, deleted "such" after "No", added "described in subdivision (a)" after the first "assessment", and added "or her" after "his" in the first sentence, substituted "the" for "such" after "Section 532," added a comma after "Section 533", and substituted a period for a semicolon after "assessment roll" in the second sentence, created a third sentence with the balance of the former second sentence commencing with "otherwise", and substituted "Otherwise the" for "otherwise, such" before "assessment shall" therein, and deleted the former third sentence which provided, "Receipt of the assessee of a tax bill based on such assessment shall suffice as such notice."; and added subdivisions (c) and (d). Stats. 2001, Ch. 744 (SB 1182), in effect January 1, 2002, deleted "supplemental" before the first "assessment" in the second sentence of paragraph (2), and added "and the County of Los Angeles," after "Section 1605," in the first sentence and deleted "supplemental" before the first "assessment" in the second sentence of paragraph (3) of subdivision (c). Stats. 2003, Ch. 471 (SB 1062), in effect January 1, 2004, substituted "approved" for "prescribed" after "on a form" in the first sentence of paragraph (1) of subdivision (d). Stats. 2005, Ch. 264 (SB 555), in effect January 1, 2006, substituted "receipt by the assessee of a tax bill based on that assessment shall suffice as notice under this section if the tax bill advises" for "the notice shall advise" after "of Los Angeles," in the first sentence of paragraph (3) of subdivision (c).

Note.—Section 10 of Stats. 2001, Ch. 744 (SB 1182) 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.

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534.5. Certain tax payments payable over three years. [Repealed by Stats. 1983, Ch. 1224, in effect January 1, 1984.]

535. Intangibles. This article does not apply to intangibles.

536. State reimbursement of local taxing agencies. Any amount paid by the state to reimburse local taxing agencies for loss of revenue resulting from incorrectly allowed exemptions, if not repaid to the state, shall be deducted under Section 12419.5 of the Government Code from the next reimbursement to such agencies.

The county auditor shall notify the State Controller of all incorrectly allowed exemptions for which local taxing agencies have been reimbursed by the state for loss of revenue, and all escape assessments made because thereof.

History.—Added by Stats. 1970, p. 1070, in effect November 23, 1970. Stats. 1971, p. 3531, in effect March 4, 1972, operative January 1, 1972, added the second paragraph.

537. Incorrect payment. [Repealed by Stats. 1981, Ch. 261, in effect January 1, 1982.]

538. Assessors required to bring suit. (a) If the assessor believes that a specific provision of the Constitution of the State of California, of this division, or of a rule or regulation of the board is unconstitutional or invalid, and as a result thereof concludes that property should be assessed in a manner contrary to such provision, or the assessor proposes to adopt general interpretation of a specific provision of the Constitution of the State of California, or this division, or of a rule or regulation of the board, that would result in a denial to five or more assessees in that county of an exemption, in whole or in part, of their property from property taxation, the assessor shall, in lieu of making such an assessment, bring an action for declaratory relief against the board under Section 1060 of the Code of Civil Procedure. The court shall allow intervention in such action by potential assessees and other assessors under Section 387 of the Code of Civil Procedure to the greatest extent practicable.

(b) If the assessor obtains judgment in such action upholding the validity of such assessment, the assessor shall correct the roll in accordance with Section 4831 consistent with such judgment within 60 days of the date upon which the judgment becomes final, regardless of the time limit otherwise provided in Section 4831. The assessor shall not levy an assessment based upon the subject matter of the action under any other section of this division.

(c) Within 60 days of notice of such assessment, a person assessed under subdivision (b) may file a claim for refund relating to the assessment of any of the person's property for the fiscal year to which the assessment under subdivision (b) relates regardless of the time limit otherwise provided in Section 5097.

History.—Added by Stats. 1978, Ch. 1188, in effect September 26, 1978.

Assessment contrary to rule.—An assessor disagreeing with property tax rule 4 should have brought a declaratory relief action against the Board pursuant to this section rather than making an assessment against real property without following the dictates of the rule. Since he did not do so, attorneys fees were properly awarded under Section 5152. Prudential Insurance Co. v. City and County of San Francisco, 191 Cal.App.3d 1142.

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Article 5. Tax-deeded Property

565. Assessing redeemed property. [Repealed by Stats. 1985, Ch. 316, effective January 1, 1986.]

566. Valuation for unassessed years. [Repealed by Stats. 1985, Ch. 316, effective January 1, 1986.]

567. Assessment of redeemed property. [Repealed by Stats. 1985, Ch. 316, effective January 1, 1986.]

568. Assessment of property tax deeded to state. [Repealed by Stats. 1980, Ch. 411, in effect July 11, 1980, operative January 1, 1981.]

568. Assessment of property tax deeded to state. (a) All property which has been declared tax defaulted, whether or not subject to a power of sale by the tax collector for defaulted taxes, shall be assessed. The assessment shall be entered, in the name of the assessee on the secured roll.

(b) All property which was tax-deeded to the state prior to the enactment of Chapter 988 of the Statutes of 1984 and was unassessed because of the tax deed to the state shall be assessed as if the tax deed was never issued.

History.—Added by Stats. 1980, Ch. 411, in effect July 11, 1980, operative January 1, 1981. Stats. 1985, Ch. 316, effective January 1, 1986, added "(a)" before "All", substituted "which has been declared tax defaulted, . . . defaulted taxes" for "tax deeded to the state" after "property", and deleted "as though the property were subject to taxation" after "assessed" in the first sentence; substituted "assessee on the secured roll" for "state, and taxes extended on either:" and former subsections (a) and (b) after "the" in the second sentence; and substituted subdivision (b) for the former second paragraph which provided "Assessments made under this section are for the purpose of facilitating tax accounting in connection with determining the amounts necessary to redeem tax-deeded property and the distribution of proceeds received from the sale of tax-deeded property. The property shall be treated for all other purposes as though not subject to taxation."

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Article 6. Assessment Roll

601. Preparation of roll. The assessor shall prepare an assessment roll, as directed by the board, in which shall be listed all property within the county which it is the assessor's duty to assess.

602. Contents. This local roll shall show:

(a) The name and address, if known, of the assessee. The assessor is not required to maintain electronic mail addresses.

(b) Land, by legal description.

(c) A description of possessory interests sufficient to identify them.

(d) Personal property. A failure to enumerate personal property in detail does not invalidate the assessment.

(e) The assessed value of real estate, except improvements.

(f) The assessed value of improvements on the real estate.

(g) The assessed value of improvements assessed to any person other than the owner of the land.

(h) The assessed value of possessory interests.

(i) The assessed value of personal property, other than intangibles.

(j) The revenue district in which each piece of property assessed is situated.

(k) The total taxable value of all property assessed, exclusive of intangibles.

(l) Any other things required by the board.

History.—Stats. 1967, p. 1636, in effect November 8, 1967, substituted "assessed" for "cash" in subdivisions (e) through (i). Stats. 1973, Ch. 842, p. 1508, in effect January 1, 1974, deleted former subdivision (l) dealing with solvent credits and relettered subdivision (l) as subdivision (l). Stats. 1979, Ch. 813, in effect January 1, 1980, operative July 1, 1980, added "full and complete" after "the" in subsection (a). Stats. 1981, Ch. 186, in effect January 1, 1982, deleted "full and complete" before "name" in subdivision (a). Stats. 1999, Ch. 941 (SB 1231), in effect January 1, 2000, added the second sentence to subdivision (a).

Note.—Section 3 of Stats. 1979, Ch. 813, provided notwithstanding Section 2231 or 2234 of the Revenue and Taxation Code, no appropriation is made by this act pursuant to those sections because the duties, obligations, or responsibilities imposed on local agencies or school districts by this act are such that related costs are incurred as part of their normal operating procedures. It is recognized, however, that a local agency or school district may pursue any remedies to obtain reimbursement available to it under Chapter 3 (commencing with Section 2201) of Part 4 of Division 1 of that code.

Identical ownership of several parcels.—When a person owns several parcels, it is sufficient if his name appears but once, followed by the description and valuation of each parcel, Gottstein v. Kelly, 206 Cal. 742; Davis v. Day, 98 Cal.App. 557.

Dollar mark.—The omission from the columns designed to show the value of the property and the amount of taxes of a dollar mark or other explanation to indicate the meaning of the figures listed renders the assessment void. Fox v. Townsend, 152 Cal. 51; Secombe v. Louis Phillips Estate, 162 Cal. 161. The mere absence of a dollar mark from a column in which is listed the value of a certain class of property is cured if the mark appears in the heading of the column showing the total value of all property. Knobloch v. Associated Oil Co., 170 Cal. 144. In an action to recover taxes paid under protest the fact that the dollar mark was omitted on the assessment roll is immaterial, H. & W. Pierce, Inc. v. Santa Barbara County, 40 Cal.App. 302.

Improvements.—No description of improvements is necessary; a description of the land sufficiently identifies the improvements. Lahman v. Hatch, 124 Cal. 1. The erroneous listing of improvements as personal property is cured by Section 24. California Domestic Water Co. v. Los Angeles County, 10 Cal.App. 185.

Surplusage.—The inclusion on the roll of matter not required to appear does not render an assessment invalid. Lake County v. Sulphur Banks Quicksilver Mining Co., 68 Cal. 14. Cf. San Francisco v. Phelan, 61 Cal. 617; Salisbury v. Shirley, 66 Cal. 223.

Personal property.—No segregation of value of cattle from value of feed is necessary; assessment on the combined property is proper. Domenghini v. San Luis Obispo County, 40 Cal.App.3d 689.

Land.—For requirements as to description of land see Chapter 2.

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603. Government-owned property. [Repealed by Stats. 1982, Ch. 468, in effect January 1, 1983.]

606. Land in multiple revenue districts. (a) Except as provided in subdivisions (b) and (c), when any tract of land is situated in two or more revenue districts, the part in each district shall be separately assessed.

(b) Where the owner of two or more contiguous parcels comprising the tract is identical, and the full value of any parcel is less than twenty-five thousand dollars ($25,000), that parcel may be combined with the contiguous parcel with the greatest assessed valuation.

(c) Where the owner of two or more contiguous parcels comprising the tract is identical, and the tract of land is being used for a single-family residence and constitutes 45,000 square feet or less, the smallest parcel may be combined with the largest contiguous parcel.

History.—Stats. 1978, Ch. 375, in effect January 1, 1979 added the balance of the sentence after "separately assessed". Stats. 1988, Ch. 560, in effect January 1, 1989, substituted "." for "; provided," after "assessed"; and substituted "However" for "however", substituted "two thousand" for "four hundred" after "than", substituted "$2,000" for "$400" after "dollars", and substituted "or that amount which is determined exempt pursuant to Section 155.20, that" for "such" after "($2,000)," in the second sentence. Stats. 1992, Ch. 663, in effect September 14, 1992, added "(a) Except . . . (c)," at the beginning of the first sentence; substituted "(b)" for "However," at the beginning of the second sentence, and substituted "five thousand dollars ($5,000)" for "two thousand dollars ($2,000), or that amount which is determined exempt pursuant to Section 155.20" after "than" therein; and added subdivision (c). Stats. 2001, Ch. 613 (SB 1184), in effect January 1, 2002, substituted "twenty-five" for "five" after "less than" and substituted "($25,000)" for "($5,000)" after "dollars" in the first sentence of subdivision (b), and substituted "45,000" for "15,000" after "constitutes" in the first sentence of subdivision (c).

Note.—Section 5 of Stats. 2001, Ch. 613 (SB 1184) provided that notwithstanding Section 2229 of the Revenue and Taxation Code, no appropriation is made by this act and the state shall not reimburse any local agency for any property tax revenues lost by it pursuant to this act. Sec. 6 therein 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.

607. Land and improvements. Land and improvements thereon shall be separately assessed.

Leasehold improvements.—Where lessee savings and loan association made improvements on leased buildings, such improvements were subject to assessment and tax. Citizens' Federal Savings & Loan Ass'n v. City and County of San Francisco, 202 Cal.App.2d 358.

A tenant, under a lease which does not provide for tax payment and which authorizes the tenant to construct improvements upon the property which the tenant may remove during the term of the lease, is liable for the increased taxes caused by the improvements. Lawrence v. F. W. Woolworth Co., 63 Cal.2d 119.

Delayed assessment.—Where a county assessor made a delayed assessment on improvements that he believed had escaped assessment, the delayed assessment was valid in that the improvements were to be assessed separately from the land itself. Jensen v. Byram, 229 Cal.App.2d 651.

Note.—See Constitution, Article XIII, Section 13.

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607.5. "Mining rights" or "mineral rights." In the event that a separate assessment of rights and privileges appertaining to mines or minerals and land is made, the descriptive words "mining rights" or "mineral rights" on the assessment roll shall include the right to enter in or upon the land for the exploration, development and production of minerals, including oil, gas, and other hydrocarbons.

History.—Added by Stats. 1955, p. 2057, in effect September 7, 1955.

Generally.—Without evidence of the existence of a reasonably probable market in certain tax years for the sale in separate form of an oil company's rights of surface entry for exploitation of its mineral rights, there was no support for an assessment which included, in an approximate $80 per acre assessment of the mineral rights, $58 per acre as the market value of the rights of surface entry. Union Oil Co. v. Ventura County, 41 Cal.App.3d 432. The conveyance of a mineral interest in land creates two separate estates in the land, each of which is subject to taxation and thus may be separately taxed. If the mineral interest is for so long as minerals can be extracted in paying quantities, the interest is perpetual and is considered to be a fee interest, which is a freehold estate. If the interest is for a term of years, it is considered to be a chattel real, but is nevertheless an estate in land that is subject to taxation separate from the remaining interests. Howard v. Amador County, 220 Cal.App.3d 962.

Valuation.—For property tax purposes, oil and gas leases, which involve income-producing properties, are ordinarily evaluated based on the income capitalization method of appraisal. Dominguez Energy, L.P. v. Los Angeles County, 56 Cal.App.4th 839.

608. Improvements. Improvements shall be assessed by the assessor by showing their value opposite the description of the parcel of land on which they are located, if they are assessed to the same assessee.

History.—Stats. 1947, p. 1871, in effect June 17, 1947, added last clause.

609. Improvements on exempt land. Taxable improvements on land exempt from taxation shall be shown like other real estate on the roll. Value shall not be assessed against the exempt land and the land does not become responsible for the assessment made against the taxable improvements.

610. Other claimants of property. (a) Land once described on the roll need not be described a second time, but any person, claiming and desiring to be assessed for it, may have his or her name inserted with that of the assessee.

(b) A person is "claiming" property for purposes of subdivision (a) only if he or she provides the assessor with one of the following supporting documents:

(1) A certified copy of a deed, judgment, or other instrument that creates or legally verifies that person's ownership interest in the property.

(2) A certified copy of a document creating that person's security interest in the property.

(3) His or her declaration, under penalty of perjury, that he or she currently has possession of the property and intends to be assessed for the property in order to perfect a claim in adverse possession.

History.—Stats. 1992, Ch. 395, in effect January 1, 1993, added the subdivision designation "(a)"; added "or her" after "his" in the first sentence of subdivision (a); and added subdivision (b).

611. Unknown owners. If the name of an absent owner is known to the assessor, or in the case of real property, if it appears of record in the office of the county recorder, the property shall be assessed to such owner; otherwise, the property shall be assessed to unknown owners.

History.—Stats. 1941, p. 1212, in effect April 22, 1941, restricted to real property the reference to county records.

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612. Owners' representatives. When a person is assessed as agent, trustee, bailee, guardian, conservator, executor, or administrator, his representative designation shall be added to his name, and the assessment entered separately from his individual assessment.

History.—Stats. 1979, Ch. 730, in effect January 1, 1980, operative January 1, 1981, added "conservator," after "guardian," in the first sentence of the first paragraph.

Designation of capacity.—When property is assessed to a person as administrator, it is immaterial whether he is a special or general administrator. City and County of San Francisco v. Pennie, 93 Cal. 465. When the assessor is not advised of the names of the principals until subsequent to the assessment, his failure to show the representative character of the assessee and to designate the principals does not invalidate the assessment, S. & G. Gump Co. v. City and County of San Francisco, 18 Cal.2d 129.

Liability of administrator.—The liability of an administrator is official and not personal, and such liability is assumed by his successor, City and County of San Francisco v. Pennie, supra. See also Los Angeles County v. Morrison, 15 Cal.2d 368.

Tax-exempt property.—If property held in the capacity of bailee is tax-exempt, any assessment of it would be self-defeating for the tax could not be assessed against the property or its possessor personally, at least where the bailee's interest in the property could not be transferred. General Dynamics Corp. v. Los Angeles County, 51 Cal.2d 59.

613. Mistake in owner's name. A mistake in the name of the owner or supposed owner of real estate does not render invalid an assessment or any deed to a purchaser at a tax sale.

A mistake in the name of an owner or supposed owner of property on the unsecured roll which does not prevent the person from reasonably ascertaining that he or she is the assessee does not render invalid an assessment or any tax sale.

History.—Stats. 1973, Ch. 675, p. 1230, in effect January 1, 1974, added the second paragraph. Stats. 1985, Ch. 316, effective January 1, 1986, added "deed to a purchaser at a" after "or any" in the first paragraph and added "or she" after "he" in the second paragraph.

Assessments.—A failure to state correctly the name of the owner is cured by this section, Interstate Realty etc. Co. v. Clark, 77 Cal.App. 558. When a portion of the land described in an assessment is not owned by the assessee, the defect is likewise cured by this section, Klumpke v. Baker, 131 Cal. 80. Contra, Teater v. Johnson, 95 Cal.App. 182. This section relieves the assessor of the obligation to avoid abbreviations in assessing realty. Markowitz v. Carpenter, 94 Cal.App.2d 667.

In view of this section the value of gas and oil rights held in separate ownership may be included in the assessment to the owner of the balance of the fee, and a tax deed based on such an assessment includes the gas and oil rights. McCracken v. Hummel, 43 Cal.App.2d 302.

An assessment is not invalid or irregular because not made in the name of the remainderman as well as in the name of the holder of the life estate. Clayton v. Schultz, 4 Cal.2d 425.

Not applicable to tax deed.—The failure of a tax deed to recite correctly the name of the assessee is not cured by this section. Henderson v. De Turk, 164 Cal. 296; Bruschi v. Cooper, 30 Cal.App. 682.

Special assessments.—This section has no application to an assessment by a reclamation district. Weinreich v. Hensley, 121 Cal. 647.

Jurisdictional defects.—This section states only that mistakes in an owner's name do not make an assessment or a tax deed invalid. This section is part of the article concerning preparation of the assessment roll and has been used to rescue tax assessments where taxes were mistakenly assessed in the name of someone other than the true owner or when the owner's name was misspelled. It has no application where a tax deed is void from the inception due to the jurisdictional defect caused when tax exempt property has been sold at a tax sale. L&B Real Estate v. Housing Authority of the County of Los Angeles, 149 Cal.App.4th 950.

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614. Tax-defaulted property. After each assessment of tax-defaulted property the assessor shall enter on the roll the fact that it is tax defaulted and the date of the declaration of default.

History.—Added by Stats. 1939, Ch. 154, effective January 1, 1940. Stats. 1985, Ch. 316, effective January 1, 1986, substituted "tax-defaulted" for "tax-sold" after "assessment of", substituted "is tax defaulted" for "has been sold for taxes" after "it" and substituted "declaration of default" for "sale" after "of the".

Sufficiency of recital—Noncompliance cured by tax deed.—Neither the date of the sale nor the exact words "sold for taxes" are necessary. Any language which notifies the owner of the sale is sufficient. Carter v. Osborne, 150 Cal. 620. In any event, under Section 3518, failure to comply with this section is cured by the tax deed. Bank of Lemoore v. Fulgham, 151 Cal. 234.

615. Index. The assessor shall prepare an index to the local roll, in the form prescribed by the board, showing the name of the assessee, each place therein where his assessment appears, and any other information required by the board. This index shall be delivered to the tax collector on or before the delivery of the extended roll.

History.—Stats. 1967, p. 1959, in effect November 8, 1967, changed "taxpayer" to "assessee" and deleted clause "or each assessment number under which his assessment appears" after ". . . where his assessment appears . . ." in the first sentence; and added the last sentence.

616. Assessor's affidavit. On or before July 1, annually, the assessor shall complete the local roll. He shall make and subscribe an affidavit on the roll substantially as follows:

"I, ______, Assessor of ______ County, swear that between the lien date and July 1, 19__, I have made diligent inquiry and examination to ascertain all the property within the county subject to assessment by me, and that it has been assessed on the roll, according to the best of my judgment, information, and belief, at its value as required by law; and that I have faithfully complied with all the duties imposed on the assessor under the revenue laws; and that I have not imposed any unjust or double assessment through malice, ill will, or otherwise; nor allowed anyone to escape a just and equal assessment through favor, reward, or otherwise."

The failure to make or subscribe this affidavit, or any affidavit, does not affect the validity of the assessment.

The assessor may require from any of his deputies an affidavit on the roll similar to his own.

History.—Stats. 1966, p. 664 (First Extra Session), in effect October 6, 1966, substituted "July 1" for "first Monday in July" in the first sentence, and "lien date" for "first Mondays in March" and "July 1" for "July" in the affidavit form.

617. Delivery to auditor. As soon as the assessor completes the local roll, he shall deliver it to the auditor.

History.—Stats. 1966, p. 665 (First Extra Session), in effect October 6, 1966, first operative for the 1967–68 assessment year, substituted "auditor" for "clerk of the board of supervisors, who is ex officio clerk of the county board."

Assessor not required to furnish additional information.—A contract by a city council with a private person for an abstract of the assessment rolls showing detailed data is not illegal as being part of the assessor's duties under this section. Maurer v. Weatherby, 1 Cal.App. 243.

Delivery of roll terminates assessor's power to make changes.—After delivery of the roll to the board of equalization the assessor has no power to change any assessments unless authorized by the board of supervisors or the district attorney under Sections 1611 and 4834. Savings & Loan Society v. San Francisco, 146 Cal. 673, 676.

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618. Contents of machine-prepared roll. Notwithstanding any other provisions of state law, when the assessment roll is a machine-prepared roll the contents of the roll and the arrangement of property on the roll may be prescribed by the board.

History.—Added by Stats. 1957, p. 963, in effect September 11, 1957. Stats. 1961 p. 4048, in effect September 15, 1961, substituted "of state law" for "of this article."

619. Notification of amount of assessment. [Repealed by Stats. 1997, Ch. 940 (SB 1105), in effect January 1, 1999.]

619. Notification of amount of assessment. (a) Except as provided in subdivision (f), the assessor shall, upon or prior to completion of the local roll, do either of the following:

(1) Inform each assessee of real property on the local secured roll whose property's full value has increased over its full value for the prior year of the assessed value of that property as it shall appear on the completed local roll.

(2) Inform each assessee of real property on the local secured roll, or each assessee on the local secured roll and each assessee on the unsecured roll, of the assessed value of his or her real property or of both his or her real and his or her personal property as it shall appear on the completed local roll.

(b) The information given by the assessor to the assessee pursuant to paragraph (1) or (2) of subdivision (a) shall include a notification of hearings by the county board of equalization, which shall include the period during which assessment protests will be accepted and the place where they may be filed. The information shall also include an explanation of the stipulation procedure set forth in Section 1607 and the manner in which the assessee may request use of this procedure.

(c) In the case of an increase in a property's full value that is determined pursuant to paragraph (1) of subdivision (a) over the property's full value determined for the prior year in accordance with paragraph (2) of subdivision (a) of Section 51, the information shall also include the base year value of the property, compounded annually from the base year to the current year by the appropriate inflation factors.

(d) The information shall be furnished by the assessor to the assessee by regular United States mail directed to him or her at his or her latest address known to the assessor.

(e) Neither the failure of the assessee to receive the information nor the failure of the assessor to so inform the assessee shall in any way affect the validity of any assessment or the validity of any taxes levied pursuant thereto.

(f) This section shall not apply to annual increases in the valuation of property which reflect the inflation rate, not to exceed 2 percent, pursuant to the authority of subdivision (b) of Section 2 of Article XIII A of the California Constitution, for purposes of property tax limitation determinations.

(g) This section does not apply to increases in assessed value caused solely by changes in the assessment ratio provided for in Section 401.

(h) This section shall become operative on January 1, 1999.

History.—Added by Stats. 1997, Ch. 940 (SB 1105), in effect January 1, 1998. Stats. 1998, Ch. 695 (SB 2235), in effect January 1, 1999, deleted "of Section 51" before "over the", substituted "subdivision (a) of Section 51" for "that same subdivision" after "paragraph (2) of" and substituted "base year value" for "full cash value base"after "include the" in the first sentence of subdivision (c).

Affecting validity of assessment.—Failure of the assessor to notify the assessee of an increase in assessed value as required by this section voided that portion of the tax based on the increased assessment in absence of the taxpayer's participation in an equalization proceeding. Gaumer v. Tehama County, 247 Cal.App.2d 548.

Failure of the assessor to notify the assessee of an increase in assessed value as required by this section voided that portion of the tax based on the increased assessment in absence of the taxpayer's participation in an equalization proceeding. Tamco Development Co. v. Del Norte County, 260 Cal.App.2d 929.

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619.1. Notification of assessment; address to which sent. [Repealed by Stats. 1984, Ch. 678, in effect January 1, 1985.]

619.2. Notification of assessment; personal property. Where the personal property on the secured roll of a person not required to file a property statement pursuant to Section 441 is assessed in excess of one thousand dollars ($1,000), excluding household furnishings and personal effects, the assessor, on or before July 15, may notify the assessee of the full value, the assessed value of such property, and the ratio used in the manner prescribed by Sections 619 and 619.1.

If the assessee does not receive notice of the assessment pursuant to this section, the assessee may pay taxes based upon such assessment under protest and obtain equalization of the assessment in the same manner as set forth in Section 620.

History.—Added by Stats. 1968, p. 2293, in effect November 13, 1968. Stats. 1969, p. 896, in effect November 10, 1969, added "not" in the first line of the second paragraph. Stats. 1974, Ch. 311, p. 609, in effect January 1, 1975, substituted "full value" for "full cash value" in the first sentence of the first paragraph. Stats. 1978, Ch. 1207, in effect January 1, 1979, operative January 1, 1981, substituted "one thousand dollars ($1,000)" for "two hundred fifty dollars ($250)" in the first paragraph.

619.15. Notification of possible reduction in assessment; deferment of payment. [Repealed by Stats. 1980, Ch. 1081, in effect June 30, 1982.]

620. Payment under protest. If the assessor does not send a notice pursuant to Section 619 or Section 621 to an assessee whose property was not on the prior year's secured roll, or to an assessee of real property on the local secured roll whose property's full value has increased, then such assessee may pay taxes under protest. If payments are made in installments, the protest need not be repeated with the second installment. Protests shall be made by filing with the tax collector, together with the payment of the taxes or their first installment, a petition for assessment reduction on the form prescribed by the county board, which form the collector is to forward to the clerk of the county board with the notation that taxes were paid under protest pursuant to this section. The county board may, after receipt of the petition for assessment reduction from the tax collector, hold a public hearing at the next regular board meeting, notice of time and place of which shall be sent to the person paying the tax under protest at the address stated in the protest or if no such address is stated, then to the address of the assessee according to the last equalized assessment roll. If the taxes are so paid and the assessee has not previously applied for a reduction of the assessment, the county board at its next annual meeting as an equalization board shall thereupon equalize such assessment in the manner prescribed by Article 1 (commencing with Section 1601) of Chapter 1 of Part 3 of this division.

The tax rate fixed for property on the roll on which the property so equalized appears at the time of its original assessment shall be applied to the amount of the equalized assessment, determined in accordance with the preceding paragraph. In the event that the resulting figure is less than the tax theretofore computed, the taxpayer shall be liable for tax only for the lesser amount, and the difference shall be canceled. If the taxpayer has already paid the tax previously computed, such difference shall be refunded to him pursuant to Chapter 5 (commencing with Section 5096) of Part 9 of this division, as an erroneously collected tax.

If any taxes are paid under protest pursuant to this section, the taxing agency to which the taxes are paid may, in accordance with Section 26906.1 of the Government Code, impound such taxes until the final disposition of the claim or action respecting the protest. No such impounding is required.

History.—Added by Stats. 1965, p. 4331, operative July 1, 1966. Stats. 1967, p. 2059, in effect July 11, 1967, substituted first sentence for previous one, and inserted the fourth sentence beginning "The county board may, . . ." Stats. 1968, p. 1119, in effect July 3, 1968, added "or to an assessee of real property on the local secured roll whose property's full cash value has increased." Stats. 1969, p. 1365, in effect November 10, 1969, added "or Section 622" in the first sentence of the first paragraph. Stats. 1970, p. 1074, in effect November 23, 1970, substituted "621" for "622" in the first sentence of the first paragraph, and substituted "of" for "," before "chapter" in the fifth sentence of the first paragraph. Stats. 1974, Ch. 311, p. 609, in effect January 1, 1975, substituted "full value" for "full cash value" in the first sentence of the first paragraph.

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620.5. Property acquired between lien date and beginning of fiscal year. [Repealed by Stats. 2002, Ch. 775 (SB 2092), in effect January 1, 2003.]

621. Notification by publication. In any county the assessor, with the approval of the board of supervisors, may give the information required by Section 619, and similar information with reference to personal property, as an alternative to giving the information by United States mail, by having published lists of assessments in newspapers, or both. In counties of more than 4 million population and counties of more than 1 million population, as determined by the July 1, 1965, Department of Finance revised estimate, which are contiguous to a county with more than 4 million population, the assessor, with the approval of the board of supervisors, may divide the county into publication areas not to exceed five in number. Within such areas the assessment listings may be grouped by assessment map books, by post office zones or by such other arrangements as may be determined by the assessor as most likely to give notice to assessees and as practicable for publication in local newspapers. The complete assessment data of one such area may be printed in one year, and for other areas in successive years as directed by him until the full county is covered. Each year at least all changes of assessment listings for all the areas shall be printed, together with a notice that no changes were made with regard to properties not on the list of changes, so that all changes will be on a current basis for the entire county. Newspapers for the publications shall be selected as they are for publication of the delinquent tax lists and the rate paid for the advertising shall be the same.

Neither the failure of the assessee to receive this information nor the failure of the assessor to so inform the assessee shall in any way affect the validity of any assessment or the validity of any taxes levied pursuant thereto.

History.—Added by Stats. 1966, p. 665 (First Extra Session), in effect October 6, 1966, first operative for the 1967–68 assessment year. Stats. 1969, p. 896, in effect November 10, 1969, added "the provisions for publication in counties of more than 4 million and 1 million population," in the first paragraph.

623. Single assessment for leased personal property. The assessor may place a single assessment on the roll for all leased personal property in the county that is assessed with respect to the same taxpayer. Any property assessed pursuant to this section shall, in the absence of evidence establishing otherwise, be deemed to be located at the taxpayer's primary place of business within the county.

History.—Added by Stats. 1995, Ch. 527, in effect January 1, 1996.

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Article 7. Information to Other Taxing Agencies

646. Inspection of records. The records of the assessor are at all times, during office hours, open to the inspection of any person charged with the duty of assessing property in the county for any taxing agency.

647. Copies of secured roll. (a) If any city or lighting, water, or irrigation district, or any district described in Section 2131, on behalf of which the county does the assessing, makes written request, on or before the lien date, for a certified copy of the portion of the secured roll pertaining to property within its limits, the assessor shall comply with the request on or before July 1. Such roll is at all times, during office hours, open to the inspection of any person representing any taxing agency or revenue district, or any district described in Section 2131.

(b) In counties of the first class, if any city or lighting, water or irrigation district, on behalf of which the county does the assessing, makes written request, on or before the lien date, for a certified copy of the portion of the secured roll pertaining to property within its limits, the assessor shall comply with the request on or before the third Monday in August.

History.—Stats. 1966, p. 666 (First Extra Session), in effect October 6, 1966, added "or any district described in Section 2131, on behalf of which the county does the assessing", substituted "lien date" for "first Monday in March" and "July 1" for "third Monday in July", and added the last sentence. Stats. 1974, Ch. 180, p. 355, in effect April 24, 1974, applicable to assessments made on and after the 1974 lien date, added the subdivision letters, and added subdivision (b).

648. Description from unsecured roll. If any city or lighting, water, or irrigation district makes a written request for a description of all property within its limits which is on the unsecured roll, its assessed value, the location of property as reported on a property statement filed pursuant to Section 441, and the name and address, by street and number, of each owner, the assessor shall comply with the request on the first Monday in each month. For purposes of this section, any property assessed pursuant to Section 623 is deemed to be located at the taxpayer's primary place of business within the county.

History—Stats. 1996, Ch. 88, in effect January 1, 1997, substituted "makes a written request" for "makes written request" after "irrigation district", added "the location of property as reported on a property statement filed pursuant to Section 441," after "its assessed value", and substituted "of each owner" for "of the owners" after "street and number," in the first sentence, and added the second sentence commencing with "For purposes of".

649. Cost. The assessor may charge other taxing agencies the actual cost for each copy of the secured roll or description from the unsecured roll furnished them.

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Article 8. Appraiser Qualifications*

* Article 8 was added by Stats. 1966 p. 667 (First Extra Session), in effect October 6, 1966, operative July 1, 1967.

670. Appraiser's certificate. (a) No person shall perform the duties or exercise the authority of an appraiser for property tax purposes as an employee of the state, any county or city and county, unless he or she is the holder of a valid appraiser's or advanced appraiser's certificate issued by the State Board of Equalization.

(b) The board shall provide for the examination of applicants for these certificates and may contract with the State Personnel Board to give the examinations. Examinations shall be prepared by the board with the advice and assistance of a committee of five assessors selected by the State Association of County Assessors for this purpose. No certificate shall be issued to any person who has not attained a passing grade in the examination and demonstrated to the board that he or she is competent to perform the work of an appraiser as that competency is defined in regulations duly adopted by the board. However, any applicant for a certificate who is denied the same shall have a right to a review of that denial in accordance with the State Administrative Procedure Act contained in Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.

(c) Passage of a civil service or merit system examination for appraiser given by the state, or any county or city and county shall suffice to meet the requirements of this section. The scope of the examination shall be approved by the State Board of Equalization.

(d) No employee of the state, or any county, or city and county shall perform the duties or exercise the authority of an auditor or an auditor-appraiser under Section 469 or Section 15624 of the Government Code, unless he or she holds a degree with a specialization in accounting from a recognized institution of higher education, or is a licensed accountant in the State of California, or has passed the state, or a county, or city and county, or city civil service or merit system examination regularly given for the position of accountant or auditor by the testing body, or holds the office of assessor.

(e) Except for persons holding the office of assessor, this section does not apply to elected officials.

(f) No charge shall be made to counties or to applicants for examinations and certifications under this section or for training conducted by the board under Section 671.

History.—Stats. 1967, p. 3111, in effect November 8, 1967, added subdivision (h). Stats. 1968, p. 1124, in effect November 13, 1968, added the references in subdivisions (a), (c), (d) and (e) to city employees. Stats. 1974, Ch. 1100, p. 2336, in effect January 1, 1975, added "or advanced appraiser's" after "appraiser's" in subdivision (a); substituted "State Association of County Assessors" for "assessors" in the first sentence of subdivision (b); deleted the former subdivision (d); relettered the former subdivision (e) as subdivision (d), and substituted "No" for "Except as permitted by subdivision (f), no" therein; deleted the former subdivision (f); relettered the former subdivision (g) as subdivision (e); and relettered the former subdivision (h) as subdivision (f). Stats. 1984, Ch. 678, in effect January 1, 1985, deleted "Section 1815.1 of this code, or under" after "Section 469" in subdivision (d). Stats. 1997, Ch. 940 (SB 1105), in effect January 1, 1998, deleted "or city, either general law or chartered," after "city and county" in the first sentence of subdivision (a); substituted "these" for "such" after "applicants for" and substituted "the" for "such" after "to give" in the first sentence, substituted "the" for "such" after "grade in", substituted "that" for "such" after "appraiser as" and deleted "; provided, however, that any" and added a period after "by the board" in the third sentence, added "However, any" which created a new fourth sentence with the balance of the former third sentence, and added "a" before "review" and substituted "that" for "such" after "review of" in the newly created fourth sentence of subdivision (b); added a comma after "state" and deleted "or city" before "shall suffice" in the first sentence, and substituted "the" for "such" after "scope of" and added "State" before "Board" in the second sentence of subdivision (c); added "or" after "state,", added "or" after the first "county", deleted ", or city," after the second "county", and added ", or holds . . . assessor" after "testing body" in the first sentence of subdivision (d); added "Except for . . . assessor," before "this section" in the first sentence of subdivision (e); and added "or she" after "he" throughout the text.

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671. Appraiser training. (a) In order to retain a valid appraiser's certificate every holder shall complete at least 24 hours of training conducted or approved by the State Board of Equalization in each one-year period.

Any excess in training time over the 24-hour minimum accumulated in any one year shall be carried over as credit for future training requirements with a limit of three years in which the carryover time may be credited.

Failure to receive such training shall constitute grounds for revocation of an appraiser's certificate; provided, however, that proceedings to revoke shall be conducted in accordance with the Administrative Procedure Act contained in Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.

Training shall include, but not be limited to, new developments in the case and statutory law and administrative rules.

(b) An advanced appraiser's certificate shall be issued by the board after an applicant has held an appraiser's certificate for at least three years and:

(1) Has successfully completed a course of study; or

(2) Has passed an advanced level examination; or

(3) Holds a valid professional designation from a recognized professional organization.

The board, with the advice and assistance of five assessors selected by the State Association of County Assessors of California, shall prescribe the course of study, prepare the advanced level examination, and approve the professional designation.

In order to retain a valid advanced appraiser's certificate, every holder shall complete at least 12 hours of training in each one-year period.

Any excess in training time for the advanced appraiser's certificate over the 12-hour minimum accumulated in any one year shall be carried over as a credit for future training requirements with a limit of two years in which the carryover time may be credited.

Failure to receive such training shall constitute grounds for revocation of an advanced appraiser's certificate; provided, however, that proceedings to revoke shall be conducted in accordance with the Administrative Procedure Act contained in Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.

Training to retain the advanced appraiser's certificate shall include, but not be limited to, new developments in the case and statutory law and administrative rules.

History—Stats. 1968, p. 317, in effect May 10, 1968, added "commencing July 1, 1968" to the first paragraph and added the second and fourth paragraphs. Stats. 1974, Ch. 1100, p. 2337, in effect January 1, 1975, added the subdivision letters; substituted "complete" for "be exposed to", and deleted ", commencing, July 1, 1968" after "period" in the first sentence of the first paragraph of subdivision (a); deleted the balance of the first sentence of the second paragraph of subdivision (a) after "credited" relating to training time accumulated prior to June 30, 1968; and added subdivision (b) (1), (2), (3), and the second, third, fourth, fifth, and sixth paragraphs of subdivision (b).

672. Disclosure of financial interest. At the time of certification, each applicant shall disclose, on forms provided by the Board of Equalization, his or her financial interest in any corporation. Thereafter, the form shall be completed annually.

If the applicant is also required to annually file with the Fair Political Practices Commission pursuant to Article 3 (commencing with Section 87300) of Chapter 7 of Title 9 of the Government Code, then a duplicate of that filing shall be deemed to meet the requirements of this section.

History.—Stats. 1982, Ch. 1465, in effect January 1, 1983, added "or her" after "his" in the first sentence of the first paragraph and added the second paragraph.

673. Temporary certificate. The State Board of Equalization may issue a temporary certificate to a person who is newly employed by the state, any county, city and county, or appraisal commission in order to afford the person the opportunity to apply for and take an examination the successful passage of which would qualify the person for an appraiser's certificate. A temporary certificate shall not be issued to exceed one year's duration and shall be issued only to a person who has demonstrated eligibility to take a civil service examination pursuant to subdivision (c) of Section 670, or who is found by the board to possess qualifications by reason of education and experience so that he or she may be reasonably expected to be competent to perform the work of an appraiser, or who has been duly elected or appointed to the office of assessor. A temporary certificate shall not be renewed.

History.—Stats. 1974, Ch. 1100, p. 2338, in effect January 1, 1975, substituted "an appraiser's" for "a" in the first sentence. Stats. 1997, Ch. 940 (SB 1105), in effect January 1, 1998, added "State" before "Board" and added a comma after the second "county" in the first sentence, added a comma after "Section 670", added "or she" after "he", and added the balance of the sentence after "an appraiser" in the second sentence.

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Article 9. Consultant Contracts

674. Requirements. (a) All contracts for the performance of appraisal work for assessors by any person who is not an employee of the state, any county, or any city shall be entered into only after at least two competitive bids and shall be entered into either on a fixed fee basis or on the basis of an hourly rate with a maximum dollar amount.

(b) In addition to any provision in the Real Estate Appraisers' Licensing and Certification Law (Part 3 (commencing with Section 11300) of Division 4 of the Business and Professions Code), a contractor shall maintain the confidentiality of assessee information and records as provided in Sections 408, 451, and 481 that is obtained in performance of the contract.

(1) A request for information and records from an assessee shall be made by the assessor. The assessor may authorize a contractor to request additional information or records, if needed. However, a contractor shall not request that information or records without the written authorization of the assessor.

(2) A contractor shall not provide appraisal data in his or her possession to the assessor or a contractor of another county who is not a party to the contract. An assessor may provide that data to the assessor of another county as provided in subdivision (b) of Section 408.

(c) A contractor may not retain information contained in, or derived from, an assessee's confidential information and records after the conclusion, termination, or nonrenewal of the contract. Within 90 days of the conclusion, termination, or nonrenewal of the contract, the contractor shall:

(1) Purge and return to the assessor any assessee records, whether originals, copies, or electronically stored, provided by the assessor or otherwise obtained from the assessee.

(2) Provide a written declaration to the assessor that the contractor has complied with this subdivision.

(d) All contracts entered into pursuant to subdivision (a) shall include a provision incorporating the requirements of subdivisions (b) and (c). This provision of the contract shall use language that is prescribed by the State Board of Equalization.

(e) For purposes of this section, a "contractor" means any person who is not an employee of the state, any county, or any city who performs appraisal work pursuant to a contract with an assessor.

History.—Added by Stats. 1988, Ch. 1534, in effect January 1, 1989. Stats. 2000, Ch. 647 (SB 2170), in effect January 1, 2001, designated the former first paragraph as subdivision (a) and substituted "person" for "individual" after "by any" in the first sentence therein; and added subdivisions (b), (c), (d), and (e).

Note.—Section 2 of Stats. 1988, Ch. 1534, provided that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution. Sec. 3 thereof provided that this act shall apply to contracts entered into on and after January 1, 1989. Sec. 4 thereof provided that it is the intent of the Legislature that the provisions of this act shall have no effect upon the constitutional, statutory, and regulatory mandates for determining "full cash value" and it shall remain the primary responsibility of assessors to ensure that appraisals and enrolled values are neither overstated nor understated.

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