Property taxation: delinquent penalties and costs: cancellation: public health orders.
The bill aims to provide relief to taxpayers struggling due to the financial impact of the COVID-19 pandemic, by mitigating the penalties associated with late property tax payments. It introduces the idea that local agencies have the discretion to assess documented hardships and respond accordingly. This change is expected to lessen the financial burden on small businesses and individual property owners who are financially impacted by circumstances beyond their control. However, it also imposes a new responsibility on local governments to evaluate these circumstances, thus potentially increasing their administrative workload.
Senate Bill 219, introduced by Senator McGuire, proposes amendments to Section 4985.2 of the Revenue and Taxation Code related to property taxation. This bill focuses on allowing the cancellation of penalties, costs, or other charges that arise from property tax delinquencies under certain circumstances. Specifically, it empowers the county auditor or tax collector to cancel these penalties when a taxpayer fails to make timely payments due to documented hardships stemming from shelter-in-place orders—an aspect that is particularly relevant in the context of the ongoing COVID-19 pandemic. The payment must be made no later than June 30 of the fiscal year when the payment first became delinquent, provided there was a legitimate documented hardship.
The sentiment around SB 219 appears generally supportive among taxpayers, especially those affected by hardships due to the pandemic. Advocacy for the bill highlights its potential to prevent economic distress caused by stringent tax penalties during a time of widespread financial instability. However, there may be concerns among local agencies regarding the increased administrative responsibilities and the potential for inconsistency in how hardships are evaluated and applied, leading to calls for guidelines and standards in enforcement.
Notable points of contention include the burden placed on local auditors and tax collectors to assess and determine documented hardships ensuing from the COVID-19 pandemic. Critics may argue that while the bill provides necessary relief, it does not clearly address the systemic implications or additional resources needed to effectively implement these measures. Furthermore, there may be debates surrounding the appropriateness of expanding local governments' responsibilities in regulating tax penalties, particularly in the context of urgency mandates during public health crises.