(1) The California Constitution generally limits ad valorem taxes on real property to 1% of the full cash value of that property. For purposes of this limitation, "full cash value" is defined as the assessor's valuation of real property as shown on the 1975–76 tax bill under "full cash value" or, thereafter, the appraised value of that real property when purchased, newly constructed, or a change in ownership has occurred. Existing law defines "newly constructed" and "new construction" to mean any addition to real property since the last lien date and any alteration of land or of any improvement since the last lien date that constitutes a major rehabilitation thereof or that converts the property to a different use. Existing law, where real property has been damaged or destroyed by misfortune or calamity, excludes from the definition of "newly constructed" and "new construction" any timely reconstruction of the real property, or portion thereof, where the property after reconstruction is substantially equivalent to the property prior to damage or destruction. Existing law, pursuant to the authorization of the California Constitution, authorizes the transfer of the base year value of property that is substantially damaged or destroyed by a disaster, as declared by the Governor, to comparable replacement property within the same county that is acquired or newly constructed within 5 years after the disaster, as provided.
Existing law authorizes the owner of property substantially damaged or destroyed by a disaster, as declared by the Governor, to apply the base year value of that property to replacement property reconstructed on the same site of the damaged or destroyed property within 5 years after the disaster if the reconstructed property is comparable to the substantially damaged or destroyed property, determined as provided.
This bill would extend the 5-year time period described above by 3 years if the property was substantially damaged or destroyed by the wildfires in the County of Los Angeles and the County of Ventura in January 2025, including, but not limited to, the 2025 Palisades Fire, the 2025 Eaton Fire, the 2025 Hughes Fire, and the 2025 Kenneth Fire, on or after January 1, 2025, but before February 1, 2025. The bill would make these provisions applicable to the determination of base year values for the 2025–26 fiscal year and fiscal years thereafter. By imposing additional duties on local tax officials, the bill would create a state-mandated local program.
(2) The California Constitution authorizes the Legislature to authorize local governments to provide for the assessment or reassessment of taxable property physically damaged or destroyed after the lien date to which the assessment or reassessment relates. Existing property tax law authorizes the board of supervisors of a county, by ordinance, to provide that every assessee of any taxable property, or any person liable for the taxes thereon, whose property was damaged or destroyed without their fault, may apply for reassessment of that property, as provided. Existing property tax law requires, for property to be eligible for reassessment under these provisions, that the damage or destruction be caused by one of 3 specified occurrences, including a major misfortune or calamity in an area or region subsequently proclaimed by the Governor to be in a state of disaster if the property was damaged or destroyed by the misfortune or calamity that caused the Governor to proclaim the region to be in a state of disaster. Existing property tax law generally requires that an application for reassessment be filed within the latter of the time specified in the county's ordinance or within 12 months of the misfortune or calamity and be executed under penalty of perjury.
This bill would also authorize a local government to provide for the assessment or reassessment of taxable property damaged by a major misfortune or calamity in an area or regions subsequently proclaimed to be in a state of emergency, as specified. The bill would provide that the assessor shall have the discretion to determine the appropriate date of damage for the purposes of reassessment.
This bill would, in the case of property damaged by the wildfires in the County of Los Angeles and the County of Ventura in January 2025, including, but not limited to, the 2025 Palisades Fire, the 2025 Eaton Fire, the 2025 Hughes Fire, and the 2025 Kenneth Fire, extend the period to file for reassessment to the latter of the time specified in the county's ordinance or within 24 months of the fires. By expanding the crime of perjury, this bill would impose a state-mandated local program.
(3) Existing property tax law, in accordance with the California Constitution, provides for a "welfare exemption" for property used exclusively for religious, hospital, scientific, or charitable purposes and that is owned or operated by certain types of nonprofit entities, if certain qualifying criteria are met.
This bill, in the case of property impacted by the wildfires of January 2025, in the County of Los Angeles and the County of Ventura, as specified, would deem property to be eligible for a welfare exemption, as specified, if the property received a welfare exemption for the 2025 calendar year, and the property is no longer used for an exempt purpose due to damage from the fires. These provisions would apply until the property has been replaced, new construction has been completed on the property, or the property has returned to its prior use. The bill would make this provisions operative only for lien dates prior to January 1, 2033.
(4) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that with regard to certain mandates no reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.
(5) Existing law requires the state to reimburse local agencies annually for certain property tax revenues lost as a result of any exemption or classification of property for purposes of ad valorem property taxation.
This bill would provide that, notwithstanding those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill.
(6) This bill would make legislative findings and declarations as to the necessity of a special statute for the County of Los Angeles and the County of Ventura.
(7) This bill would declare that it is to take effect immediately as an urgency statute.

Statutes affected:
SB 663: 70.5 RTC, 170 RTC, 214 RTC
02/20/25 - Introduced: 70.5 RTC, 170 RTC, 214 RTC