Personal Income Tax Law: Corporation Tax Law: credits: cleanup costs.
The bill aims to alleviate financial pressures on businesses from the burden of cleaning up unauthorized encampments. By providing tax credits for cleanup costs defined in the bill, including waste removal, property restoration, security, and preventative measures, it seeks to ensure properties remain safe and accessible. The measures included in the tax credit aim to encourage timely cleanup so that properties do not become sites of illegal dumping and encampments, which can lead to further financial loss and safety issues for businesses in California.
Assembly Bill 1435, introduced by Assembly Member Nguyen, proposes a tax credit system to assist businesses with cleanup costs associated with unauthorized encampments and illegal dumping from January 1, 2026, to January 1, 2031. The bill aims to support qualified taxpayers – defined as business entities managing real properties affected by these issues – by allowing them to claim credits for costs incurred in the removal and disposal of debris from their properties. This move comes as a response to the increasing burden on property owners due to these situations, especially following the U.S. Supreme Court ruling that allowed stricter enforcement of no-camping ordinances on public properties, causing unhoused individuals to seek refuge on private lands.
A notable point of contention surrounding Assembly Bill 1435 involves the implications of defining what constitutes 'qualified cleanup expenditures' and the accountability measures required from taxpayers. The bill mandates that businesses must certify cleanup costs under penalty of perjury, requiring detailed verification of expenses. Critics may argue that the rigorous documentation and perjury implications could pose burdens on small business owners who might not have the necessary resources to validate their claims effectively. Moreover, the bill does not provide reimbursement for local agencies and school districts for added costs incurred through this act, raising questions about potential unfunded mandates on local governments.