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  • Archive for July 7th, 2017

    Jul 7

    ****ALERT*** SENATE ABRUPTLY PASSES REAL ESTATE DOCUMENT TAX

    Posted by Crystal Whitfield | No Comments

    After stalling a few weeks ago for lack of the needed two-thirds vote majority, a bill that will authorize a tax on almost every recorded real estate document, was brought up with no notice and passed with all Democrat Senators voting for the new tax.

    SB 2 (Atkins; D-San Diego) authorizes a county to adopt an ordinance authorizing a fee for recording and indexing every instrument, paper, or notice required or permitted by law to be recorded.

    According to the Senate Appropriations committee analysis, this bill will result in a $200 million to $300 million tax on commercial and residential property owners and tenants.  These funds will be redirected to a number of government programs at the Department of Housing and Community Development (HCD) and the California Housing Finance Agency (CalHFA) focusing on affordable housing.

    Yes, upwards of a $300 million-dollar tax on real estate documents paid by you and your tenants.

    While we are sympathetic to the need for more affordable housing, and support many policies that will actually produce rooftops, we disagree with the way this bill is written.

    According to the County Recorders’ Association of California, this bill increases the minimum recording fee by 750% (i.e. from $10 to $75), which will impact small contractors recording mechanics liens or releases, customers releasing child support, tax or other liens to clear their credit; or a widow/widower recording an affidavit of their spouse’s death; building managers filing lease addendums, and many other recorded documents.

    Further, this bill creates administrative challenges for County Recorders.  The Inyo County Board of Supervisors argue that by exempting sales documents, this bill singles out those facing foreclosure and miners who are required to file annual proof of labor forms to keep their claims, but exempts the purchase of multi-million dollar homes.

    As an example, in order to address vocal opposition, this bill exempts certain transaction from the tax – if you buy a two million dollar home you don’t pay the tax; but if you record a simple lease addendum you do.

    We are asking that SB 2 be amended to focus on Governor Brown’s stated goals to address affordable housing of cutting red tape, delays, and unnecessary expenses to housing construction that would make housing more affordable to all Californians.  We also call on the legislature to address the thicket of environmental law known as CEQA which quashes many projects through cost and delays and unnecessary lawsuits, before a shovel is ever put in the ground.

    If more funds are needed, our industry is willing to accept a new tax as long as it is applied evenly, fairly, and transparently across the board and is accompanied by some of the reforms supported by Governor Brown.

    California needs more housing.  But simply creating a new tax and new government programs is not going to produce rooftops as it does not address the impediments to building more housing.

    This bill may be heard as early as Monday in the Assembly and we will keep you posted.

    Jul 7

    MAJOR LEGISLATIVE DEADLINE APPROACHES

    Posted by Crystal Whitfield | No Comments

    Our friends at CapitolTrack remind us that the next legislative deadline falls on July 14th and it requires all policy committees to pass fiscal bills on to their Appropriations Committees. With the Budget already enacted, the legislature is on schedule to adjourn for summer recess on July 21st.

    The next two weeks are going to be intense as many big issues including Cap-and-Trade and the Real Estate Document Tax may be taken up.

    Jul 7

    WATER BILL SAVINGS ACT

    Posted by Crystal Whitfield | No Comments

    Our industry supports SB 564 (D-Healdsberg) a bill that allows local agencies to issue bonds to fund the purchase and distribution of drought tolerant landscapes, upgrades to hot water systems, gray water systems, high efficiency toilets, and high efficiency showerheads at private property within their jurisdictions.

    SB 564 authorizes property owners and tenants to then repay the fixture upgrades over time through utility bills.  The ability to repay bonds with customer efficiency charges enables those who receive the benefit of reduced bills to pay for efficiency and create benefits to the water system at scale.

    The Water Bill Savings Act is a voluntary program and will create another tool for local governments and property owners to respond to drought that is regionally efficient, financially sustainable, and available to all municipal utilities, large and small.

    SB 564 will help people save money on water while reducing wasted water and provide a voluntary tool to meet state conservation mandate.

    Jul 7

    ADA BILL HEADS TO GOVERNOR

    Posted by Crystal Whitfield | No Comments

    A bill our industry is strongly supporting that would continue the State’s reform of ADA laws in an effort to increase accessibility while decreasing frivolous lawsuits passed the Legislature on a bipartisan vote and is headed to the Governor’s Desk.

    AB 1148 (Steinorth; R-Rancho Cucamonga) passed its final vote in the Assembly 62-0. AB 1148 would clarify issues related to CASp inspection lease disclosures by defining the types of properties that must disclose. Basically, all properties that will be leased as a public accommodation must comply but certain properties that are not open to the public will be exempt.

    We will ask the Governor to sign the bill and will keep you posted.

    Jul 7

    CA SUPREME COURT UPHOLDS DOCUMENTARY TRANSFER TAX

    Posted by Crystal Whitfield | No Comments

    The California Supreme Court, in a 6-1 decision, has held that a city or county may impose documentary transfer tax on the transfer of the ownership interests in a legal entity that owns real property located in the locality. In 926 North Ardmore Avenue, LLC v. County of Los Angeles, the court held that the documentary transfer tax applies to a written instrument conveying an interest in a legal entity that owns real property. This approach adopts the “change in ownership” regime for property tax purposes and applies it to the documentary transfer tax.

    Click here to read more about the decision, and how it may impact your tax obligations.

    Jul 7

    SB 700 ENERGY STORAGE INITIATIVE

    Posted by Crystal Whitfield | No Comments

     We are in support of SB 700 (Wiener; D-San Francisco) a bill that will establish a statewide system of rebate programs to subsidize the cost of installation of customer-sited energy storage.

    SB 700 would authorize the Investor Owned Utilities to collect revenue for the Self-Generation Incentive Program (SGIP) for the ten-year period (2018-2027) to incentivize the installation of small-scale energy storage which will complement the increasing amount of renewable energy coming on-line.

    The power output of standard rooftop solar energy systems is the greatest between the hours of 10am to 3pm.  However, as the state moves towards Time-of-Use utility rates, the renewable energy produced during the middle of the day will be at the cheapest rate when demand for power is low while power used during the late-afternoon and early-evening will be at the highest rate when demand for power surges.

    Complementing the installation of distributed renewable energy systems with on-site or near-site energy storage systems will provide significant cost savings to the utility customer while offering the added benefit of providing for improved grid harmonization.

     

    SB 700 will help provide incentive funding to encourage the installation of these much needed energy storage systems.

     

    This bill will be heard next week and we will keep you posted on its progress.

     

    Click here for a recent op/ed on how this bill will enable property owners to use this technology to better meet energy and ghg requirements.

    Jul 7

    GOVERNOR BROWN ANNOUNCES GLOBAL CLIMATE ACTION SUMMIT

    Posted by Crystal Whitfield | No Comments

    California Governor Edmund G. Brown Jr. announced via video message at the Global Citizen Festival in Hamburg, Germany that the State of California will convene the world’s climate leaders in San Francisco, California in September 2018 for the Global Climate Action Summit.

    According to a press release from the Governor he stated, “It’s up to you and it’s up to me and tens of millions of other people to get it together to roll back the forces of carbonization and join together to combat the existential threat of climate change. That is why we’re having the Climate Action Summit in San Francisco, September 2018,” said Governor Brown in his remarks. “President Trump is trying to get out of the Paris Agreement, but he doesn’t speak for the rest of America. We in California and in states all across America believe it’s time to act, it’s time to join together and that’s why at this Climate Action Summit we’re going to get it done.”

    The press release goes on to state, “California will convene representatives from subnational governments, businesses, investors and civil society at the Global Climate Action Summit to demonstrate the groundswell of innovative, ambitious climate action from leaders around the world, highlight the economic and environmental transition already underway and spur deeper commitment from all parties, including national governments.”

    Click here for the full statement.