Text of Proposed Laws

TEXT OF PROPOSED LAWS PROPOSITION 18 CONTINUED

vote in any primary or special election that occurs

before the next general election in which the citizen

would be eligible to vote if at least 18 years of age.

PROPOSITION 19

This amendment proposed by Assembly Constitutional

Amendment 11 of the 2019–2020 Regular Session

(Resolution Chapter 31, Statutes of 2020) expressly

amends the California Constitution by adding sections

thereto; therefore, new provisions proposed to be

added are printed in italic type to indicate that they

are new.

PROPOSED AMENDMENTS TO ARTICLE XIII A

First—This measure shall be known, and may be

cited, as the Home Protection for Seniors, Severely

Disabled, Families, and Victims of Wildﬁre or Natural

Disasters Act.

Second—That Section 2.1 is added to Article XIII A

thereof, to read:

SEC. 2.1. (a) Limitation on Property Tax Increases

on Primary Residences for Seniors, the Severely

Disabled, Wildﬁre and Natural Disaster Victims, and

Families. It is the intent of the Legislature in

proposing, and the people in adopting, this section to

do both of the following:

(1) Limit property tax increases on primary residences

by removing unfair location restrictions on

homeowners who are severely disabled, victims of

wildﬁres or other natural disasters, or seniors over 55

years of age that need to move closer to family or

medical care, downsize, ﬁnd a home that better ﬁts

their needs, or replace a damaged home and limit

damage from wildﬁres on homes through dedicated

funding for ﬁre protection and emergency response.

(2) Limit property tax increases on family homes used

as a primary residence by protecting the right of

parents and grandparents to pass on their family home

to their children and grandchildren for continued use

as a primary residence, while eliminating unfair tax

loopholes used by East Coast investors, celebrities,

wealthy non-California residents, and trust fund heirs

to avoid paying a fair share of property taxes on

vacation homes, income properties, and beachfront

rentals they own in California.

(b) Property Tax Fairness for Seniors, the Severely

Disabled, and Victims of Wildﬁre and Natural

Disasters. Notwithstanding any other provision of this

Constitution or any other law, beginning on and after

April 1, 2021, the following shall apply:

(1) Subject to applicable procedures and deﬁnitions

as provided by statute, an owner of a primary

residence who is over 55 years of age, severely

disabled, or a victim of a wildﬁre or natural disaster

may transfer the taxable value of their primary

residence to a replacement primary residence located

anywhere in this state, regardless of the location or

value of the replacement primary residence, that is

purchased or newly constructed as that person’s

principal residence within two years of the sale of the

original primary residence.

(2) For purposes of this subdivision:

(A) For any transfer of taxable value to a replacement

primary residence of equal or lesser value than the

original primary residence, the taxable value of the

replacement primary residence shall be deemed to be

the taxable value of the original primary residence.

(B) For any transfer of taxable value to a replacement

primary residence of greater value than the original

primary residence, the taxable value of the

replacement primary residence shall be calculated by

adding the difference between the full cash value of

the original primary residence and the full cash value

of the replacement primary residence to the taxable

value of the original primary residence.

(3) An owner of a primary residence who is over 55

years of age or severely disabled shall not be allowed

to transfer the taxable value of a primary residence

more than three times pursuant to this subdivision.

(4) Any person who seeks to transfer the taxable value

of their primary residence pursuant to this subdivision

shall ﬁle an application with the assessor of the

county in which the replacement primary residence is

located. The application shall, at minimum, include

information comparable to that identiﬁed in paragraph

(1) of subdivision (f) of Section 69.5 of the Revenue

and Taxation Code, as that section read on January 1,

2020.

Notwithstanding any other provision of this

Constitution or any other law, beginning on and after

February 16, 2021, the following shall apply:

(1) For purposes of subdivision (a) of Section 2, the

terms “purchased” and “change in ownership” do not

include the purchase or transfer of a family home of

the transferor in the case of a transfer between

parents and their children, as deﬁned by the

Legislature, if the property continues as the family

home of the transferee. This subdivision shall apply to

both voluntary transfers and transfers resulting from a

court order or judicial decree. The new taxable value

of the family home of the transferee shall be the sum

of both of the following:

(A) The taxable value of the family home, subject to

adjustment as authorized by subdivision (b) of Section

2, determined as of the date immediately prior to the

date of the purchase by, or transfer to, the transferee.

(B) The applicable of the following amounts:

(i) If the assessed value of the family home upon

purchase by, or transfer to, the transferee is less than

the sum of the taxable value described in

Text of Proposed Laws

TEXT OF PROPOSED LAWS PROPOSITION 19 CONTINUED

subparagraph (A) plus one million dollars

($1,000,000), then zero dollars ($0).

(ii) If the assessed value of the family home upon

purchase by, or transfer to, the transferee is equal to

or more than the sum of the taxable value described

in subparagraph (A) plus one million dollars

($1,000,000), an amount equal to the assessed value

of the family home upon purchase by, or transfer to,

the transferee, minus the sum of the taxable value

described in subparagraph (A) and one million dollars

($1,000,000).

(2) Paragraph (1) shall also apply to a purchase or

transfer of the family home between grandparents and

their grandchildren if all of the parents of those

grandchildren, who qualify as children of the

grandparents, are deceased as of the date of the

purchase or transfer.

(3) Paragraphs (1) and (2) shall also apply to the

purchase or transfer of a family farm. For purposes of

this paragraph, any reference to a “family home” in

paragraph (1) or (2) shall be deemed to instead refer

to a “family farm.”

(4) Beginning on February 16, 2023, and every other

February 16 thereafter, the State Board of

Equalization shall adjust the one million dollar

($1,000,000) amount described in paragraph (1) for

inﬂation to reﬂect the percentage change in the House

Price Index for California for the prior calendar year,

as determined by the Federal Housing Finance

Agency. The State Board of Equalization shall

calculate and publish the adjustments required by

this paragraph.

(5) (A) Subject to subparagraph (B), in order to

receive the property tax beneﬁt provided by this

section for the purchase or transfer of a family home,

the transferee shall claim the homeowner’s exemption

or disabled veteran’s exemption at the time of the

purchase or transfer of the family home.

(B) A transferee who fails to claim the homeowner’s

exemption or disabled veteran’s exemption at the time

of the purchase or transfer of the family home may

receive the property tax beneﬁt provided by this

section by claiming the homeowner’s exemption or

disabled veteran’s exemption within one year of the

purchase or transfer of the family home and shall be

entitled to a refund of taxes previously owed or paid

between the date of the transfer and the date the

transferee claims the homeowner’s exemption or

disabled veteran’s exemption.

(d) Subdivision (h) of Section 2 shall apply to any

purchase or transfer that occurs on or before February

15, 2021, but shall not apply to any purchase or

transfer occurring after that date. Subdivision (h) of

Section 2 shall be inoperative as of February 16,

2021.

(e) For purposes of this section:

Text of Proposed Laws

(1) “Disabled veteran’s exemption” means the

exemption authorized by subdivision (a) of Section 4

of Article XIII.

(2) “Family farm” means any real property which is

under cultivation or which is being used for pasture or

grazing, or that is used to produce any agricultural

commodity, as that term is deﬁned in Section 51201

of the Government Code as that section read on

January 1, 2020.

(3) “Family home” has the same meaning as

“principal residence,” as that term is used in

subdivision (k) of Section 3 of Article XIII.

(4) “Full cash value” has the same meaning as

deﬁned in subdivision (a) of Section 2.

(5) “Homeowner’s exemption” means the exemption

provided by subdivision (k) of Section 3 of Article XIII.

(6) “Natural disaster” means the existence, as

declared by the Governor, of conditions of disaster or

extreme peril to the safety of persons or property

within the affected area caused by conditions such as

ﬁre, ﬂood, drought, storm, mudslide, earthquake, civil

disorder, foreign invasion, or volcanic eruption.

(7) “Primary residence” means a residence eligible

for either of the following:

(A) The homeowner’s exemption.

(B) The disabled veteran’s exemption.

(8) “Principal residence” as used in subdivision (b)

has the same meaning as that term is used in

subdivision (a) of Section 2.

(9) “Replacement primary residence” has the same

meaning as “replacement dwelling,” as that term is

deﬁned in subdivision (a) of Section 2.

(10) “Taxable value” means the base year value

determined in accordance with subdivision (a) of

Section 2 plus any adjustment authorized by

subdivision (b) of Section 2.

(11) “Victim of a wildﬁre or natural disaster” means

the owner of a primary residence that has been

substantially damaged as a result of a wildﬁre or

natural disaster that amounts to more than 50 percent

of the improvement value of the primary residence

immediately before the wildﬁre or natural disaster. For

purposes of this paragraph, “damage” includes a

diminution in the value of the primary residence as a

result of restricted access caused by the wildﬁre or

natural disaster.

(12) “Wildﬁre” has the same meaning as deﬁned in

subdivision (j) of Section 51177 of the Government

Code, as that section read on January 1, 2020.

Third—That Section 2.2 is added to Article XIIIA

thereof, to read:

SEC. 2.2. (a) Protection of Fire Services,

Emergency Response, and County Services. It is the

intent of the Legislature in proposing, and the people

TEXT OF PROPOSED LAWS PROPOSITION 19 CONTINUED

in adopting, this section and Section 2.3 to do both of

the following:

(1) Dedicate revenue for ﬁre protection and

emergency response, address inequities in

underfunded ﬁre districts, ensure all communities are

protected from wildﬁres, and safeguard the lives of

millions of Californians.

(2) Protect county revenues and other vital local

services.

(b) (1) The California Fire Response Fund is hereby

created within the State Treasury.

(2) The County Revenue Protection Fund is hereby

created within the State Treasury. Moneys in the

County Revenue Protection Fund are continuously

appropriated, without regard to ﬁscal year, for the

purpose of reimbursing eligible local agencies that

incur a negative gain, and paying the administrative

costs of the California Department of Tax and Fee

Administration, in accordance with Section 2.3.

Moneys in the fund shall only be expended as provided

in Section 2.3.

Section 8 of Article XVI, moneys in the California Fire

Response Fund and the County Revenue Protection

Fund shall be deemed to be General Fund revenues

which may be appropriated pursuant to Article XIII B.

(d) The Director of Finance shall do the following, as

applicable:

(1) On or before September 1, 2022, and on or before

each subsequent September 1 through September 1,

2027, calculate the additional revenues and savings

that accrued to the state from the implementation of

Section 2.1, including, but not limited to, any

increase in state income tax revenues and net savings

to the state arising from any reduction in the state’s

funding obligation under Section 8 of Article XVI,

during the immediately preceding ﬁscal year ending

on June 30. In making the calculation required by this

paragraph, the Director of Finance shall use actual

data or best available estimates where actual data is

not available. The calculation shall be ﬁnal and shall

not be adjusted for any subsequent changes in the

underlying data. The Director of Finance shall certify

the results of the calculation to the Legislature and

the Controller no later than September 1 of each year.

(2) On or before September 1, 2028, and each

subsequent September 1 thereafter, calculate the

additional revenues and savings that accrued to the

state from the implementation of Section 2.1,

including, but not limited to, any increase in state

income tax revenues and net savings to the state

arising from any reduction in the state’s funding

obligation under Section 8 of Article XVI during the

immediately preceding ﬁscal year ending on June 30

by multiplying the amount from the immediately

preceding ﬁscal year ending on June 30 by the rate of

increase in property tax revenues allocated to local

agencies in that ﬁscal year. In making the calculation

required by this paragraph, the Director of Finance

shall use actual data or best available estimates where

actual data is not available. The calculation shall be

ﬁnal and shall not be adjusted for any subsequent

changes in the underlying data. The Director of

Finance shall certify the results of the calculation to

the Legislature and the Controller no later than

September 1 of each ﬁscal year.

(e) No later than September 15, 2022, and each

subsequent September 15 thereafter, the Controller

shall do both of the following:

(1) Transfer from the General Fund to the California

Fire Response Fund an amount equal to 75 percent of

the amount calculated by the Director of Finance

pursuant to subdivision (d) for the applicable year.

(2) Transfer from the General Fund to the County

Revenue Protection Fund an amount equal to 15

percent of the amount calculated by the Director of

Finance pursuant to subdivision (d) for the applicable

year. Moneys transferred to the County Revenue

Protection Fund pursuant to this paragraph shall be

used to reimburse eligible local agencies with a

negative gain, as provided in Section 2.3.

(f) Moneys in the California Fire Response Fund shall

be appropriated by the Legislature in each ﬁscal year

exclusively for the purposes of this section and, except

as otherwise provided in subdivision (g), shall not be

appropriated for any other purpose. Moneys in the

California Fire Response Fund may be used upon

appropriation without regard to ﬁscal year and shall be

used to expand ﬁre suppression stafﬁng, as set forth

in paragraphs (1) to (4), inclusive, and not to supplant

existing state or local funds utilized for those

purposes.

(1) Twenty percent of the moneys in the California

Fire Response Fund shall be appropriated to the

Department of Forestry and Fire Protection to fund ﬁre

suppression stafﬁng.

(2) Eighty percent of the moneys in the California Fire

Response Fund shall be deposited in the Special

District Fire Response Fund, which is hereby created

as a subaccount within the California Fire Response

Fund, and appropriated to special districts that

provide ﬁre protection services in accordance with the

following criteria:

(A) Fifty percent of the amount described in this

paragraph shall be used to fund ﬁre suppression

stafﬁng in underfunded special districts that provide

ﬁre protection services, were formed after July 1,

1978, and employ full-time or full-time-equivalent

station-based personnel who are immediately available

to comprise at least 50 percent of an initial full alarm

assignment.

(B) Twenty-ﬁve percent of the amount described in

this paragraph shall be used to fund ﬁre suppression

stafﬁng in special districts that provide ﬁre protection

Text of Proposed Laws

TEXT OF PROPOSED LAWS PROPOSITION 19 CONTINUED

services, were formed before July 1, 1978, are

underfunded due to a disproportionately low share of

property tax revenue and an increase in service level

demands since July 1, 1978, and employ full-time or

full-time-equivalent station-based personnel who are

immediately available to comprise at least 50 percent

of an initial full alarm assignment.

this paragraph shall be used to fund ﬁre suppression

stafﬁng in underfunded special districts that provide

ﬁre protection services and employ full-time or full-

time-equivalent station-based personnel who are

immediately available to comprise at least 30 percent

but less than 50 percent of an initial full alarm

assignment.

(3) In determining whether a special district that

provides ﬁre protection services is underfunded for

purposes of paragraph (2), the Legislature shall take

into account the following factors, in order of priority:

(A) The degree to which the special district’s property

tax revenue is insufﬁcient to sustain adequate ﬁre

suppression, as measured against the population

density, size of the service area, and number of

taxpayers within the boundaries of the special district.

(B) Whether the special district, upon formation,

received a property tax allocation in accordance with

Chapter 282 of the Statutes of 1979.

(4) The allocation of moneys to a special district that

qualiﬁes pursuant to paragraph (2) shall be in the

form of grants, with a term of not less than 10 years,

in order to ensure that the special district can engage

in responsible budgeting and sustain adequate ﬁre

suppression services over the long term.

(g) Notwithstanding subdivision (f), if in any ﬁscal

year after the ﬁrst ﬁscal year for which moneys are

transferred from the General Fund to the California

Fire Response Fund pursuant to this section the

amount transferred exceeds the amount transferred in

the previous ﬁscal year by more than 10 percent, the

Controller shall not transfer the amount in excess of

that 10 percent, which shall be available for

appropriation from the General Fund for any purpose.

Fourth—That Section 2.3 is added to Article XIII A

thereof, to read:

SEC. 2.3. (a) Each county shall annually, no later

than the date speciﬁed by the California Department

of Tax and Fee Administration by regulations adopted

pursuant to this section, determine the gain for the

county and for each local agency in the county

resulting from implementation of Section 2.1 by

adding the following amounts:

(1) The revenue increase resulting from the sale and

reassessment of original primary residences for

outbound intercounty transfers pursuant to subdivision

(b) of Section 2.1.

Text of Proposed Laws

(2) The revenue decrease, which shall be expressed

as a negative number, resulting from the transfer of

taxable values of original primary residences located

in other counties to replacement primary residences

located within the county for inbound intercounty

transfers pursuant to subdivision (b) of Section 2.1.

(3) The revenue increase resulting from subdivision

(b) A county or any local agency in the county that

has a positive gain determined pursuant to subdivision

(a) shall not be eligible to receive reimbursement from

the County Revenue Protection Fund. A county or any

local agency in the county that has a negative gain

determined pursuant to subdivision (a) shall be

deemed to be an eligible local agency entitled to a

reimbursement from the County Revenue Protection

Fund.

Administration shall determine each eligible local

agency’s aggregate gain every three years, based on

the amounts determined pursuant to subdivision (a)

for each of those three years, and provide

reimbursement to each eligible local agency with a

negative gain from the moneys in the County Revenue

Protection Fund equal to that amount. If there are

insufﬁcient moneys in that fund to cover the total

amount of reimbursements under this section, the

California Department of Tax and Fee Administration

shall allocate a pro rata share of the moneys in the

fund to each eligible local agency based on the

amount of the eligible local agency’s reimbursement

relative to the total amount of reimbursements under

this section.

(d) At the end of each three-year period described in

subdivision (c), after the California Department of Tax

and Fee Administration has reimbursed each eligible

local agency that has experienced a negative gain

during that three-year period, the Controller shall

transfer the remaining balance, if any, in the County

Revenue Protection Fund to the General Fund, to be

available for appropriation for any purpose.

(e) The California Department of Tax and Fee

Administration shall promulgate regulations to

implement this section pursuant to the rulemaking

provisions of the Administrative Procedure Act

(Chapter 3.5 (commencing with Section 11340) of

Part 1 of Division 3 of Title 2 of the Government

Code), as may be amended from time to time by the

Legislature, or any successor to those provisions.

(f) For purposes of this section and Section 2.2, an

“eligible local agency” is a county, a city, a city and

county, a special district, or a school district as

determined pursuant to subdivision (o) of Section

42238.02 of the Education Code as it read on

January 8, 2020, that has a negative gain as

determined pursuant to this section.