May 1, 2008
 

The task force was appointed in February 2007 with the following charge:  
 
Mission Statement:

1. Assess the political viability of addressing the issue of Property Tax Basis Portability, and if feasible, then

a.  Determine whether expanding the ability of homeowners to transfer their property tax basis to a new property will increase the availability of housing
b.  Determine whether homeowners should be allowed to transfer their property tax basis when they purchase homes that are more expensive than their current homes

c.  Examine the tax revenue impact to government.

2. Become familiar with the current program which allows seniors (55 and over) to transfer their existing property tax basis to another home within the same county or to another county that has elected to participate in the program, and review the options available for expanding that ability to more homeowners.

3. Make recommendations as to what, if any, actions (legislative or otherwise) C.A.R. should take with regard to property tax basis portability and report to the C.A.R. Board of Directors at their June 2007 Board meeting.
 
Task Force Members: 
 Deborah Ritchey, Chair

Toby Bradley

Cynthia Carley

Judy Ellis

Robert Kevane

Peter Morris

Mark Peterson

Michael Roberts

Suzanne Yost 
 
Meetings of the Task Force:

March 21, 2007, Sacramento.  The task force heard from the following speakers regarding the political feasibility of expanding property tax basis portability:

Jon Coupal, President, Howard Jarvis Taxpayers Association

Colin Grinnell, Consultant, Senate Revenue and Taxation Committee

Lenny Goldberg, Executive Director, California Tax Reform Association

Richard Temple, Senior Vice President, McNally Temple Associates
 
April 30, 2007, Sacramento.  The task force received a presentation from the C.A.R. Economics and Research Department regarding the demographics of homeownership.
 
October 10, 2007, Anaheim.  At the June 2007 C.A.R. meetings, $20,000 was appropriated for the task force to conduct survey research to determine the extent to which an expansion of property tax basis portability could be implemented.  The task force met and received an update on research being conducted under the auspices of C.A.R.'s Economics Department relating to the fiscal impact to government of property tax basis portability.  The task force was also addressed by Joel Singer, C.A.R. Executive Vice President, with regard to how to gauge the cost to government of portability based on studying sales transaction records.  Finally, the task force discussed options for amending Propositions 60 and 90, as well as the process for amending the property tax basis portability law.
 
January 23, 2008, Indian Wells.  The task force received a briefing from C.A.R. Research and Economics Department on the results of the revenue impact research contracted for by C.A.R.'s Economics Department.  The conclusion drawn from the analysis of the survey of property transactions is that property tax basis portability provision will be revenue positive only if it triggers additional transactions that would otherwise not have occurred. It is estimated that a sales increase of between 13 and 17 percent among owners over the age of 55 would be needed to offset the revenue loss incurred by full utilization of the property tax basis portability provision.  The task force then discussed the next step of surveying homeowners to determine what changes are needed to sufficiently increase the utilization of property tax basis portability.
 
Status/Summary

The task force has been working for the last couple of months on refining a survey instrument drafted by the Economics and Research Department with input from the task force that will provide the information needed to determine what constitutional/statutory changes are needed to increase property tax basis portability.  It is hoped that the survey will be "put into the field" in May with preliminary, if not final results, available by the June C.A.R. meeting in Sacramento.
 
Note : Three measures relating to property tax base year value portability have been introduced this year: 
 
Assembly Bill 2579 (Niello) Property Tax Base Year Value Transfer Claimants - Currently, married homeowners can transfer their property tax base year value to another home if one of the spouses qualifies for the benefit; however, the non-qualifying spouse forevermore losses their ability to transfer the property tax base year value to a home they own to another home.  This measure addresses this inequity by amending the existing statute so that the non-qualifying spouse is not considered a "claimant" of the Proposition 60 benefit.
 
Senate Constitutional Amendment 24/Senate Bill 1610 (Dutton) Transfer of Basis to a More Expensive Home - These measures would allow senior homeowners to transfer their property tax base year value to a home of greater value. The measure would eliminate the fiscal impact to government by adding the difference in the values between the original and new homes to the base year value.