Income taxes: credit: seismic retrofits.
The introduction of this bill is expected to mitigate seismic risks faced by California's aging infrastructure by encouraging property owners to invest in necessary retrofitting. The incentives are designed not only to enhance the safety of hazardous structures but also to leverage private investments effectively. A total cap of $12 million per year is established for the credits, ensuring that the program remains financially sustainable while promoting a broader economic impact through direct support for construction and engineering sectors.
Assembly Bill 234, introduced by Assembly Member Nazarian, proposes a new tax credit system for seismic retrofitting of buildings in California. Set to be effective for taxable years beginning on or after January 1, 2020, and prior to January 1, 2025, the bill allows a credit equal to 30% of qualified costs related to seismic retrofit constructions on designated at-risk properties. This initiative responds to the urgent need for improving the safety of buildings vulnerable to earthquakes, particularly those classified as hazardous and at risk of collapse. Specific buildings targeted include soft story buildings and nonductile concrete residential structures.
Despite the positive outlook, there are points of contention associated with the implementation of the tax credits. Some critics argue that the strict eligibility requirements, such as the need for certification from local building code authorities, may limit participation. Additionally, there are concerns about the program's effectiveness in truly mitigating seismic risks as opposed to merely providing tax relief. The necessity for detailed data collection and performance indicators is emphasized within the bill, but it raises questions regarding the adequacy of such measures in assessing the program's impact on public safety and economic growth. Overall, the efficacy of AB234 will depend on its execution and the cooperation of local authorities in facilitating the necessary certifications.