- CALL TO ACTION – HELP DEFEAT ONEROUS TAX MEASURE IN SF
- PROP 13 REFORM REJECTED BY LEGISLATURE AND SPLIT ROLL PROPONENTS
- THERE IS NO LOOPHOLE IN PROPOSITION 13
- SALES TAXES ON SERVICES SB 993 STALLS – FOR NOW
- CALIFORNIA WATERFIX FORMS JOINT POWERS AUTHORITY
- CALIFORNIA BENCHMARKING WEBINAR AND RESOURCES
- STATE MANDATES SOLAR ON NEW HOMES
- CALIFORNIA COMMERCIAL REAL ESTATE SUMMIT JUNE 19-20, 2018
- CBPA 2018 CALENDAR
CALL TO ACTION – HELP DEFEAT ONEROUS TAX MEASURE IN SF
There are two onerous tax measures on the San Francisco ballot in June that could decimate the commercial real estate industry in that city. We are looking to all members of the business community to contribute to help defeat them.
Our local team at BOMA San Francisco is fighting hard against the measure and has done recent polling that shows they do have the opportunity to push back the threats, and they are working with a professional team and a broad range of business allies.
They are asking for your immediate help – these taxes are exportable, and your city may be next! BOMA San Francisco’s PAC, BOMA International, BOMA Greater Los Angeles, NAIOP SF, and many other investors and owners of commercial real estate have contributed to this effort.
Please find a remit here and more information about the campaign via the links below. They need to raise $1.5 million+ – and with commitments have raised $1 million+ to date – to defeat the two measures that would massively impact building value and tenants directly.
The campaign is going strong – here are the links to the campaign website, Facebook page and videos that are airing strategically on cable. There are also mail pieces/window signs and a social media/internet strategy component.
For direct information as to how you can help, please contact John Bozeman, BOMA San Francisco’s Director of Government and Industry Affairs at firstname.lastname@example.org.
PROP 13 REFORM REJECTED BY LEGISLATURE AND SPLIT ROLL PROPONENTS
“The defeat of SB 1237 is another sad example of politics over policy – a roadblock to providing local government with resources to meet their many needs,” stated Res Hime, President and CEO of California Business Properties Association when the bill that would have “fixed” an issue pointed to by proponents of split roll property tax as the reason the Prop. 13 needs to be repealed.
According to the author Senate Republican Leader Patricia Bates (R-Laguna Niguel), SB 1237 would revise the definition of “change of ownership” in the Revenue and Tax Code for purposes of determining the property tax base value of commercial property. The bill is designed to prevent a repeat like the 2006 purchase of a hotel in Santa Monica where the purchaser realized he could structure the transaction without any one entity owning a 50 percent majority share in the property as defined currently under “change of ownership.”
Even though 100 percent of the original ownership of the hotel changed hands, the property was not reassessed, resulting in a tax loss to Los Angeles County of over a million dollars annually.
Senator Bates authored a nearly identical bill in 2016, which won bipartisan support from the Senate Governance and Finance Committee, only to be killed quietly by the Democrat-controlled Senate Appropriations Committee.
A similar bill authored by former Assembly Members Tom Ammiano (D-San Francisco) and Raul Bocanegra (D-Pacoima) earned bipartisan support in 2014 and cleared the Assembly, only to die in the Senate.
Click here for a story from our friends at Fox & Hounds.
Below is more information on the bill.
THERE IS NO LOOPHOLE IN PROPOSITION 13
Patricia Bates, the California Senate’s Republican leader and Jon Coupal, president of the Howard Jarvis Taxpayers Association, explain why there is no so-called “loophole” in the Prop. 13.
There is an ambiguity that could be clarified – and CBPA sponsored a measure in the past to do just that. Senator Bates is attempting that fix again. Last time it was attempted the author of the measure – a Democrat – found the rug pulled-out from under him as advocates for eliminating Prop. 13 killed the bill so as not to take away an effective cudgel for their effort.
The bill, SB 1237 will be heard next week in the Senate Governance and Finance Committee.
Click here to read the article.
SALES TAX ON SERVICES SB 993 STALLS – FOR NOW
Purportedly to help “provide tax relief to middle-income and low-income Californians,” SB 993 (Hertzberg; D-Van Nuys), would impose a 3-percent tax on services purchased by businesses. This policy would have a major impact on commercial real estate as everything from accounting to landscaping could see a cost increase under the measure.
A press release from Hertzberg’s office, notes that the services targeted for the tax include “high-end business services, such as those provided by lawyers, consultants, and accountants for corporations and other high-income businesses.”
But the bill would also tax day-to-day operational needs like janitorial services. While some of our largest companies can avoid paying the taxes by bringing some of those functions in house, smaller businesses won’t have that luxury.
We joined a large coalition of allies and worked hard to defeat the bill. It was heard in committee this week “without a vote,” meaning they listened to testimony but didn’t actually vote on the measure. That is a good sign. Because the bill is a tax increase, it requires a 2/3 vote majority and while normal legislative deadlines technically apply to the bill, if it “has the votes” can move by waiving the rules.
We will continue to follow this issue closely and keep pressure on the Legislature to abandon this ill-conceived tax increase.
CALIFORNIA WATERFIX FORMS JOINT POWERS AUTHORITY
The old adage goes that “in California whiskey is for drinking and water is for fighting.”
Uniting Southern and Northern California in a collaborative water supply reliability vision, the Metropolitan Water District of Southern California (MWD), Santa Clara Valley Water District (SCVWD) and Zone 7 Water Agency today announced their partnership and formation of the Delta Conveyance Design and Construction Joint Powers Authority (DCA) — the public agency that will be charged with the design and construction of California WaterFix.
On a parallel path, the California Department of Water Resources (DWR) has now created the Delta Conveyance Office (DCO), which will oversee the work of the DCA. More information is available here.
This is an encouraging sign that some of the fighting has waned… a tiny bit.
CALIFORNIA BENCHMARKING WEBINAR AND RESOURCES
NEW: Benchmarking Compliance Webinar Just Announced. May 29, 2018. Click here for more details and to sign up.
Several weeks ago, the State of California finalized the AB 1103/AB 802 Energy Benchmarking Regulations. This has been a long process and we have been involved every step of the way. The bottom line is that as of June 1, 2018, all buildings over 50,000 square feet – with some exemptions – need to be benchmarked and data shared with the Energy Commission.
However, the rollout of the regulation is still unfolding. The CEC is working on materials and communications to help with compliance, and we are helping them work through the issues and work out the bugs.
We have set up a resource page where you can find a FAQ, the adopted regulations, and a link to the CEC page with more information.
Click here for the CBPA CA Mandatory Benchmarking Resource Page.
Compliance deadline is June 1st so if you have not enrolled in Energy Star yet, you may want to begin the process.
STATE MANDATES SOLAR ON NEW HOMES
Our good friend Bob Raymer, California Building Industry Association’s State Technical Director made an appearance on national news this week to talk about the new state solar mandate. This is definitely worth the two minutes to watch!
Click here to watch the video.
Here is more information about the mandate:
The State of California, through the state’s Energy Commission, adopted a first in the nation policy that requires solar energy systems for all new homes. Starting in 2020, the building energy efficiency standards, are meant to reduce greenhouse gas emissions by an amount equivalent to taking 115,000 fossil fuel cars off the road
The commission believes the regulation will increase the cost of a home by a minimum of $9,500 but will save $19,000 in reduced utility bills over a 30-year period.
“With this adoption, the California Energy Commission has struck a fair balance between reducing greenhouse gas emissions while simultaneously limiting increased construction costs,” said California Building Industry Association CEO and President Dan Dunmoyer. “We thank the Commissioners and their staff for working with the building industry during the past 18 months and adopting a set of cost-effective standards that ensures homebuyers will recoup their money over the life of the dwelling.”
The Commission has indicated that the next round of energy regulations will focus primarily on the non-residential sector. So, your building is next!
CALIFORNIA COMMERCIAL REAL ESTATE SUMMIT JUNE 19-20, 2018
The California Commercial Real Estate Summit (CCRES) will be held at the California Chamber of Commerce Headquarters in Sacramento on June 19-20, 2018. This event is the one time of year that industry leaders from all sectors of the commercial, industrial, and retail real estate industry converge on California’s Capitol to meet with policymakers. The summit gives you an opportunity to meet other industry leaders from across the nation, high-level staff from Governor Brown’s Administration, and California State Legislators.
Click here to register!
CBPA has reserved a block of rooms at The Hyatt Regency Sacramento. Please contact the Hyatt Regency directly at 916-443-1234. Ask for the CBPA rate.
We encourage you to consider one of the sponsorship opportunities and to be a part of this exciting industry event. Click here for more information on becoming a sponsor!
We look forward to seeing you in June!
CBPA 2018 CALENDAR
June 19-20, 2018
California Commercial Real Estate Summit
& Annual Meeting
October 25, 2018
Industry Awards Dinner & Board Meeting
The Duke Hotel, Newport Beach
Please feel free to contact Melissa Stevens at email@example.com should you have any questions or require additional information about our events.