AB 2063 Would Help Address California’s Escalating Affordable Housing Crisis
Contact: Susan Kennedy
916-319-2022 (W) 925-437-2510 (C)
Mullin Legislation Addresses Property Value Tax Exemption Cap for Non-Profits and Religious Organizations
Sacramento – In an effort to help non-profit organizations fulfill their mission to provide affordable housing, Assembly Speaker pro Tem Kevin Mullin has introduced AB 2063.
“Lack of affordable housing is an issue that continues to plague California,” Speaker pro Tem Mullin stated. “It is particularly serious in places like the Bay Area, in part due to high property values. Existing requirements are placing some non-profits and religious organizations who provide low-income housing in a position where they may no longer be able to be part of the solution. AB 2063 will address that issue. ”
Currently, nonprofits with affordable housing property, whose assessed value exceeds $20 million, must pay property taxes on the amount exceeding $20 million. This cap does not apply to hospitals, universities, libraries or churches. In the Bay Area, the value of multi-family properties can exceed that cap quite easily and as a result, some charities are finding it difficult to continue to provide much needed affordable housing, since the rent they collect is often less than the annual property tax bill.
California has 26 nonprofits who fundraise privately to provide affordable housing in their communities. Collectively, these nonprofits own 75 properties that are subject to the existing cap and only one, the St. Francis Center in Redwood City owns property whose value exceeds the existing cap. (St. Francis currently owns/operates 135 apartment units for low/very low-income residents.) AB 2063 would raise the assessed value cap from $20 million to $100 million and lower the percentage of low-income residents required in a given property from 90% to 50% in order to be eligible for tax relief on a pro-rata basis, helping to alleviate the immediate displacement that can result when a charity purchases a building with existing tenants.
“We cannot afford to lose a single unit of existing housing and must do everything possible to create more”, Mullin emphasized. “When charities like the St. Francis Center are committed to providing low-income families with a place where they can live in dignity and become self-supporting members of their community, we must find ways to support that effort, not thwart it. AB 2063 will allow them to continue to grow and expand their much needed efforts.”
Kevin Mullin represents the 22nd Assembly District and is the Speaker pro Tempore of the California
State Assembly. He chairs the Select Committee on Biotechnology and serves on the following
committees: Budget, Budget Subcommittee #3 on Resources and Transportation, Business and
Professions, Elections and Redistricting, Revenue and Taxation and the Select Committee on Intellectual and Developmental Disabilities. The 22nd district includes the cities of Belmont, Brisbane, Burlingame, Foster City, Hillsborough, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, portions of South San Francisco and the San Mateo County Coastside communities of Montara and Moss Beach