Laws, Regulations & Annotations
Property Taxes Law Guide – Revision 2017
Revenue and Taxation Code
Part 0.5. Implementation of Article XIII A of the California Constitution
Chapter 3.5. Change in Ownership and New Construction After the Lien Date
Article 2. Assessments on the Supplemental Roll
(1) (A) The date upon which the new construction is available for use by the owner, unless the owner does not intend to occupy or use the property. The owner shall notify the assessor prior to, or within 30 days of, the date of commencement of construction that he or she does not intend to occupy or use the property. If the owner does not notify the assessor as provided in this subdivision, the date shall be conclusively presumed to be the date of completion.
(B) Notwithstanding subparagraph (A), an owner is not required to provide the notice described in subparagraph (A) and it is rebuttably presumed that a supplemental assessment is not required on property described in clauses (i) to (iii), inclusive, if the owner's property meets all of the following conditions:
(i) The property is subdivided into five or more parcels in accordance with the Subdivision Map Act (Division 2 (commencing with Section 66410) of Title 7 of the Government Code), or any successor to that law.
(ii) A map describing the parcels has been recorded.
(iii) Zoning regulations that are applicable to the parcels or building permits for the parcels require that, except for parcels dedicated for public use, single-family residences will be constructed on the parcels.
(2) If the owner does not intend to occupy or use the property, the date the property is occupied or used with the owner's consent.
(3) If the property cannot be functionally used or occupied on the date it is available for use considering the type of property and any special facts and circumstances affecting use or occupancy, the date the property can be functionally used or occupied.
(b) For the purposes of this section:
(1) "Occupy or use" means the occupancy or use by the owner, including the rental or lease of the property, except as provided in paragraph (2).
(2) Property shall not be considered occupied or used by the owner or with the owner's consent if the occupancy or use is incidental to an offer for a change of ownership, including, but not limited to, use of the property as a model home.
(c) The board, after consultation with the California Assessors Association, shall adopt rules and regulations defining the date of completion of new construction in accordance with this section. The rules and regulations shall not define the date of completion in a manner that the date of completion of all new construction is postponed until the following lien date.
(d) Nothing in this section shall preclude the reassessment of that property on the assessment roll for January 1 following the date of completion.
(e) The owner of any property who notifies the assessor pursuant to subparagraph (A) of paragraph (1) of subdivision (a) that he or she does not intend to occupy or use the property and the owner of any property that meets all of the conditions under subparagraph (B) of paragraph (1) of subdivision (a) shall notify the assessor within 45 days of the earliest date that any of the following occur:
(1) The property changes ownership pursuant to an unrecorded contract of sale.
(2) The property is leased or rented.
(3) The property is occupied or used by the owner for any purpose other than provided in subdivision (b).
(4) The property is occupied or used with the owner's consent for any purpose other than provided in subdivision (b).
(f) The failure to provide the assessor the notice required by subdivision (e), whether requested or not, shall result in a penalty in the amount specified in Section 482.
History.—Repealed and added by Stats. 1984, Ch. 946, in effect September 10, 1984. Stats. 1985, Ch. 542, effective September 9, 1985, deleted the former second paragraph of subdivision (c), which provided that rules and regulations adopted pursuant to the section would not be subject to review and approval of the Office of Administration Law. Stats. 1995, Ch. 449, in effect January 1, 1996, operative January 1, 1997, deleted "such" after "completion in" in subdivision (c), substituted "that" for "any such" after "reassessment of", and substituted "January" for "March" after "roll for" in subdivision (d). Stats. 2005, Ch. 264 (SB 555), in effect January 1, 2006, designated former paragraph (1) of subdivision (a) as subparagraph (A) thereof and added subparagraph (B) thereto. Stats. 2013, Ch. 607 (SB 825), in effect January 1, 2014, added "subparagraph (A) of paragraph (1) of" after "pursuant to" and added "and the owner of any property that meets all of the conditions under subparagraph (B) of paragraph (1) of subdivison (a)" after "use the property" in the first sentence of subdivision (e).
Note.—See note following Section 75.
Construction.—The provisions of this section do not violate Article XIII A, Section 1 of the Constitution, since the Legislature may distinguish or defer assessment in favor of a particular class to promote a legitimate state interest. Neither do they violate the equal protection clauses of the federal and state Constitutions, since the Legislature has broad power in making classifications and drawing lines to implement a reasonable system of taxation Shafer v. State Board of Equalization, 174 Cal.App.3d 423. Local ordinances, such as the date of a property's final inspection, do not conclusively establish the date of completion of new construction or that an addition is "available for use." If new construction cannot be functionally used or occupied on the date that it is otherwise available for use, the date of its availability for use does not establish the date of completion even if a final inspection from the county has been approved. Rather, the property is not considered complete until it is functionally usable or when outward appearances clearly indicate that the new construction is immediately usable for the purposes intended. Georgie v. County of Santa Clara, 151 Cal.App.4th 1428.