439. For the purposes of this article and within the meaning of
Section 8 of Article XIII of the Constitution, property is
"enforceably restricted" if it is subject to an historical property
contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the
Government Code.
439.1. For purposes of this article "restricted historical property"
means qualified historical property, as defined in Section 50280.1
of the Government Code, that is subject to a historical property
contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the
Government Code. For purposes of this section, "qualified historical
property" includes qualified historical improvements and any land on
which the qualified historical improvements are situated, as
specified in the historical property contract. If the historical
property contract does not specify the land that is to be included,
"qualified historical property" includes only that area of reasonable
size that is used as a site for the historical improvements.
439.2. When valuing enforceably restricted historical property, the
county assessor shall not consider sales data on similar property,
whether or not enforceably restricted, and shall value that
restricted historical property by the capitalization of income method
in the following manner:
(a) The annual income to be capitalized shall be determined as
follows:
(1) Where sufficient rental information is available, the income
shall be the fair rent that can be imputed to the restricted
historical property being valued based upon rent actually received
for the property by the owner and upon typical rentals received in
the area for similar property in similar use where the owner pays the
property tax. When the restricted historical property being valued
is actually encumbered by a lease, any cash rent or its equivalent
considered in determining the fair rent of the property shall be the
amount for which the property would be expected to rent were the
rental payment to be renegotiated in the light of current conditions,
including applicable provisions under which the property is
enforceably restricted.
(2) Where sufficient rental information is not available, the
income shall be that which the restricted historical property being
valued reasonably can be expected to yield under prudent management
and subject to applicable provisions under which the property is
enforceably restricted.
(3) If the parties to an instrument that enforceably restricts the
property stipulate therein an amount that constitutes the minimum
annual income to be capitalized, then the income to be capitalized
shall not be less than the amount so stipulated.
For purposes of this section, income shall be determined in
accordance with rules and regulations issued by the board and with
this section and shall be the difference between revenue and
expenditures. Revenue shall be the amount of money or money's worth,
including any cash rent or its equivalent, that the property can be
expected to yield to an owner-operator annually on the average from
any use of the property permitted under the terms by which the
property is enforceably restricted.
Expenditures shall be any outlay or average annual allocation of
money or money's worth that can be fairly charged against the revenue
expected to be received during the period used in computing the
revenue. Those expenditures to be charged against revenue shall be
only those that are ordinary and necessary in the production and
maintenance of the revenue for that period. Expenditures shall not
include depletion charges, debt retirement, interest on funds
invested in the property, property taxes, corporation income taxes,
or corporation franchise taxes based on income.
(b) The capitalization rate to be used in valuing owner-occupied
single family dwellings pursuant to this article shall not be derived
from sales data and shall be the sum of the following components:
(1) An interest component to be determined by the board and
announced no later than October 1 of the year preceding the
assessment year and that was the yield rate equal to the effective
rate on conventional mortgages as most recently published by the
Federal Housing Finance Board as of September 1, rounded to the
nearest one-fourth of 1 percent.
(2) A historical property risk component of 4 percent.
(3) A component for property taxes that shall be a percentage
equal to the estimated total tax rate applicable to the property for
the assessment year times the assessment ratio.
(4) A component for amortization of the improvements that shall be
a percentage equivalent to the reciprocal of the remaining life.
(c) The capitalization rate to be used in valuing all other
restricted historical property pursuant to this article shall not be
derived from sales data and shall be the sum of the following
components:
(1) An interest component to be determined by the board and
announced no later than October 1 of the year preceding the
assessment year and that was the yield rate equal to the effective
rate on conventional mortgages as determined by the Federal Housing
Finance Board as of September 1, rounded to the nearest one-fourth of
1 percent.
(2) A historical property risk component of 2 percent.
(3) A component for property taxes that shall be a percentage
equal to the estimated total tax rate applicable to the property for
the assessment year times the assessment ratio.
(4) A component for amortization of the improvements that shall be
a percentage equivalent to the reciprocal of the remaining life.
(d) Unless a party to an instrument that creates an enforceable
restriction expressly prohibits the valuation, the valuation
resulting from the capitalization of income method described in this
section shall not exceed the lesser of either the valuation that
would have resulted by calculation under Section 110, or the
valuation that would have resulted by calculation under Section
110.1, as though the property was not subject to an enforceable
restriction in the base year.
(e) The value of the restricted historical property shall be the
quotient of the income determined as provided in subdivision (a)
divided by the capitalization rate determined as provided in
subdivision (b) or (c).
(f) The ratio prescribed in Section 401 shall be applied to the
value of the property determined in subdivision (d) to obtain its
assessed value.
439.3. Notwithstanding any provision of Section 439.2 to the
contrary, if either the county or city or the owner of restricted
historical property subject to contract has served notice of
nonrenewal as provided in Section 50282 of the Government Code, the
county assessor shall value that restricted historical property as
provided in this section.
(a) Following the hearing conducted pursuant to Section 50285 of
the Government Code, subdivision (b) shall apply until the
termination of the period for which the restricted historical
property is enforceably restricted.
(b) The board or assessor in each year until the termination of
the period for which the property is enforceably restricted shall do
all of the following:
(1) Determine the full cash value of the property pursuant to
Section 110.1. If the property is not subject to Section 110.1 when
the restriction expires, the value shall be determined pursuant to
Section 110 as if the property were free of contractual restriction.
If the property will be subject to a use for which this chapter
provides a special restricted assessment, the value of the property
shall be determined as if it were subject to the new restriction.
(2) Determine the value of the property by the capitalization of
income method as provided in Section 439.2 and without regard to the
fact that a notice of nonrenewal or cancellation has occurred.
(3) Subtract the value determined in paragraph (2) of this
subdivision by capitalization of income from the full cash value
determined in paragraph (1).
(4) Using the rate announced by the board pursuant to paragraph
(1) of subdivision (b) of Section 439.2, discount the amount obtained
in paragraph (3) for the number of years remaining until the
termination of the period for which the property is enforceably
restricted.
(5) Determine the value of the property by adding the value
determined by the capitalization of income method as provided in
paragraph (2) and the value obtained in paragraph (4).
(6) Apply the ratios prescribed in Section 401 to the value of the
property determined in paragraph (5) to obtain its assessed value.
439.4. No property shall be valued pursuant to this article unless
an enforceable restriction meeting the requirements of Section 439 is
signed, accepted and recorded on or before the lien date for the
fiscal year in which the valuation would apply.
439. For the purposes of this article and within the meaning of
Section 8 of Article XIII of the Constitution, property is
"enforceably restricted" if it is subject to an historical property
contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the
Government Code.
439.1. For purposes of this article "restricted historical property"
means qualified historical property, as defined in Section 50280.1
of the Government Code, that is subject to a historical property
contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the
Government Code. For purposes of this section, "qualified historical
property" includes qualified historical improvements and any land on
which the qualified historical improvements are situated, as
specified in the historical property contract. If the historical
property contract does not specify the land that is to be included,
"qualified historical property" includes only that area of reasonable
size that is used as a site for the historical improvements.
439.2. When valuing enforceably restricted historical property, the
county assessor shall not consider sales data on similar property,
whether or not enforceably restricted, and shall value that
restricted historical property by the capitalization of income method
in the following manner:
(a) The annual income to be capitalized shall be determined as
follows:
(1) Where sufficient rental information is available, the income
shall be the fair rent that can be imputed to the restricted
historical property being valued based upon rent actually received
for the property by the owner and upon typical rentals received in
the area for similar property in similar use where the owner pays the
property tax. When the restricted historical property being valued
is actually encumbered by a lease, any cash rent or its equivalent
considered in determining the fair rent of the property shall be the
amount for which the property would be expected to rent were the
rental payment to be renegotiated in the light of current conditions,
including applicable provisions under which the property is
enforceably restricted.
(2) Where sufficient rental information is not available, the
income shall be that which the restricted historical property being
valued reasonably can be expected to yield under prudent management
and subject to applicable provisions under which the property is
enforceably restricted.
(3) If the parties to an instrument that enforceably restricts the
property stipulate therein an amount that constitutes the minimum
annual income to be capitalized, then the income to be capitalized
shall not be less than the amount so stipulated.
For purposes of this section, income shall be determined in
accordance with rules and regulations issued by the board and with
this section and shall be the difference between revenue and
expenditures. Revenue shall be the amount of money or money's worth,
including any cash rent or its equivalent, that the property can be
expected to yield to an owner-operator annually on the average from
any use of the property permitted under the terms by which the
property is enforceably restricted.
Expenditures shall be any outlay or average annual allocation of
money or money's worth that can be fairly charged against the revenue
expected to be received during the period used in computing the
revenue. Those expenditures to be charged against revenue shall be
only those that are ordinary and necessary in the production and
maintenance of the revenue for that period. Expenditures shall not
include depletion charges, debt retirement, interest on funds
invested in the property, property taxes, corporation income taxes,
or corporation franchise taxes based on income.
(b) The capitalization rate to be used in valuing owner-occupied
single family dwellings pursuant to this article shall not be derived
from sales data and shall be the sum of the following components:
(1) An interest component to be determined by the board and
announced no later than October 1 of the year preceding the
assessment year and that was the yield rate equal to the effective
rate on conventional mortgages as most recently published by the
Federal Housing Finance Board as of September 1, rounded to the
nearest one-fourth of 1 percent.
(2) A historical property risk component of 4 percent.
(3) A component for property taxes that shall be a percentage
equal to the estimated total tax rate applicable to the property for
the assessment year times the assessment ratio.
(4) A component for amortization of the improvements that shall be
a percentage equivalent to the reciprocal of the remaining life.
(c) The capitalization rate to be used in valuing all other
restricted historical property pursuant to this article shall not be
derived from sales data and shall be the sum of the following
components:
(1) An interest component to be determined by the board and
announced no later than October 1 of the year preceding the
assessment year and that was the yield rate equal to the effective
rate on conventional mortgages as determined by the Federal Housing
Finance Board as of September 1, rounded to the nearest one-fourth of
1 percent.
(2) A historical property risk component of 2 percent.
(3) A component for property taxes that shall be a percentage
equal to the estimated total tax rate applicable to the property for
the assessment year times the assessment ratio.
(4) A component for amortization of the improvements that shall be
a percentage equivalent to the reciprocal of the remaining life.
(d) Unless a party to an instrument that creates an enforceable
restriction expressly prohibits the valuation, the valuation
resulting from the capitalization of income method described in this
section shall not exceed the lesser of either the valuation that
would have resulted by calculation under Section 110, or the
valuation that would have resulted by calculation under Section
110.1, as though the property was not subject to an enforceable
restriction in the base year.
(e) The value of the restricted historical property shall be the
quotient of the income determined as provided in subdivision (a)
divided by the capitalization rate determined as provided in
subdivision (b) or (c).
(f) The ratio prescribed in Section 401 shall be applied to the
value of the property determined in subdivision (d) to obtain its
assessed value.
439.3. Notwithstanding any provision of Section 439.2 to the
contrary, if either the county or city or the owner of restricted
historical property subject to contract has served notice of
nonrenewal as provided in Section 50282 of the Government Code, the
county assessor shall value that restricted historical property as
provided in this section.
(a) Following the hearing conducted pursuant to Section 50285 of
the Government Code, subdivision (b) shall apply until the
termination of the period for which the restricted historical
property is enforceably restricted.
(b) The board or assessor in each year until the termination of
the period for which the property is enforceably restricted shall do
all of the following:
(1) Determine the full cash value of the property pursuant to
Section 110.1. If the property is not subject to Section 110.1 when
the restriction expires, the value shall be determined pursuant to
Section 110 as if the property were free of contractual restriction.
If the property will be subject to a use for which this chapter
provides a special restricted assessment, the value of the property
shall be determined as if it were subject to the new restriction.
(2) Determine the value of the property by the capitalization of
income method as provided in Section 439.2 and without regard to the
fact that a notice of nonrenewal or cancellation has occurred.
(3) Subtract the value determined in paragraph (2) of this
subdivision by capitalization of income from the full cash value
determined in paragraph (1).
(4) Using the rate announced by the board pursuant to paragraph
(1) of subdivision (b) of Section 439.2, discount the amount obtained
in paragraph (3) for the number of years remaining until the
termination of the period for which the property is enforceably
restricted.
(5) Determine the value of the property by adding the value
determined by the capitalization of income method as provided in
paragraph (2) and the value obtained in paragraph (4).
(6) Apply the ratios prescribed in Section 401 to the value of the
property determined in paragraph (5) to obtain its assessed value.
439.4. No property shall be valued pursuant to this article unless
an enforceable restriction meeting the requirements of Section 439 is
signed, accepted and recorded on or before the lien date for the
fiscal year in which the valuation would apply.
439. For the purposes of this article and within the meaning of
Section 8 of Article XIII of the Constitution, property is
"enforceably restricted" if it is subject to an historical property
contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the
Government Code.
439.1. For purposes of this article "restricted historical property"
means qualified historical property, as defined in Section 50280.1
of the Government Code, that is subject to a historical property
contract executed pursuant to Article 12 (commencing with Section
50280) of Chapter 1 of Part 1 of Division 1 of Title 5 of the
Government Code. For purposes of this section, "qualified historical
property" includes qualified historical improvements and any land on
which the qualified historical improvements are situated, as
specified in the historical property contract. If the historical
property contract does not specify the land that is to be included,
"qualified historical property" includes only that area of reasonable
size that is used as a site for the historical improvements.
439.2. When valuing enforceably restricted historical property, the
county assessor shall not consider sales data on similar property,
whether or not enforceably restricted, and shall value that
restricted historical property by the capitalization of income method
in the following manner:
(a) The annual income to be capitalized shall be determined as
follows:
(1) Where sufficient rental information is available, the income
shall be the fair rent that can be imputed to the restricted
historical property being valued based upon rent actually received
for the property by the owner and upon typical rentals received in
the area for similar property in similar use where the owner pays the
property tax. When the restricted historical property being valued
is actually encumbered by a lease, any cash rent or its equivalent
considered in determining the fair rent of the property shall be the
amount for which the property would be expected to rent were the
rental payment to be renegotiated in the light of current conditions,
including applicable provisions under which the property is
enforceably restricted.
(2) Where sufficient rental information is not available, the
income shall be that which the restricted historical property being
valued reasonably can be expected to yield under prudent management
and subject to applicable provisions under which the property is
enforceably restricted.
(3) If the parties to an instrument that enforceably restricts the
property stipulate therein an amount that constitutes the minimum
annual income to be capitalized, then the income to be capitalized
shall not be less than the amount so stipulated.
For purposes of this section, income shall be determined in
accordance with rules and regulations issued by the board and with
this section and shall be the difference between revenue and
expenditures. Revenue shall be the amount of money or money's worth,
including any cash rent or its equivalent, that the property can be
expected to yield to an owner-operator annually on the average from
any use of the property permitted under the terms by which the
property is enforceably restricted.
Expenditures shall be any outlay or average annual allocation of
money or money's worth that can be fairly charged against the revenue
expected to be received during the period used in computing the
revenue. Those expenditures to be charged against revenue shall be
only those that are ordinary and necessary in the production and
maintenance of the revenue for that period. Expenditures shall not
include depletion charges, debt retirement, interest on funds
invested in the property, property taxes, corporation income taxes,
or corporation franchise taxes based on income.
(b) The capitalization rate to be used in valuing owner-occupied
single family dwellings pursuant to this article shall not be derived
from sales data and shall be the sum of the following components:
(1) An interest component to be determined by the board and
announced no later than October 1 of the year preceding the
assessment year and that was the yield rate equal to the effective
rate on conventional mortgages as most recently published by the
Federal Housing Finance Board as of September 1, rounded to the
nearest one-fourth of 1 percent.
(2) A historical property risk component of 4 percent.
(3) A component for property taxes that shall be a percentage
equal to the estimated total tax rate applicable to the property for
the assessment year times the assessment ratio.
(4) A component for amortization of the improvements that shall be
a percentage equivalent to the reciprocal of the remaining life.
(c) The capitalization rate to be used in valuing all other
restricted historical property pursuant to this article shall not be
derived from sales data and shall be the sum of the following
components:
(1) An interest component to be determined by the board and
announced no later than October 1 of the year preceding the
assessment year and that was the yield rate equal to the effective
rate on conventional mortgages as determined by the Federal Housing
Finance Board as of September 1, rounded to the nearest one-fourth of
1 percent.
(2) A historical property risk component of 2 percent.
(3) A component for property taxes that shall be a percentage
equal to the estimated total tax rate applicable to the property for
the assessment year times the assessment ratio.
(4) A component for amortization of the improvements that shall be
a percentage equivalent to the reciprocal of the remaining life.
(d) Unless a party to an instrument that creates an enforceable
restriction expressly prohibits the valuation, the valuation
resulting from the capitalization of income method described in this
section shall not exceed the lesser of either the valuation that
would have resulted by calculation under Section 110, or the
valuation that would have resulted by calculation under Section
110.1, as though the property was not subject to an enforceable
restriction in the base year.
(e) The value of the restricted historical property shall be the
quotient of the income determined as provided in subdivision (a)
divided by the capitalization rate determined as provided in
subdivision (b) or (c).
(f) The ratio prescribed in Section 401 shall be applied to the
value of the property determined in subdivision (d) to obtain its
assessed value.
439.3. Notwithstanding any provision of Section 439.2 to the
contrary, if either the county or city or the owner of restricted
historical property subject to contract has served notice of
nonrenewal as provided in Section 50282 of the Government Code, the
county assessor shall value that restricted historical property as
provided in this section.
(a) Following the hearing conducted pursuant to Section 50285 of
the Government Code, subdivision (b) shall apply until the
termination of the period for which the restricted historical
property is enforceably restricted.
(b) The board or assessor in each year until the termination of
the period for which the property is enforceably restricted shall do
all of the following:
(1) Determine the full cash value of the property pursuant to
Section 110.1. If the property is not subject to Section 110.1 when
the restriction expires, the value shall be determined pursuant to
Section 110 as if the property were free of contractual restriction.
If the property will be subject to a use for which this chapter
provides a special restricted assessment, the value of the property
shall be determined as if it were subject to the new restriction.
(2) Determine the value of the property by the capitalization of
income method as provided in Section 439.2 and without regard to the
fact that a notice of nonrenewal or cancellation has occurred.
(3) Subtract the value determined in paragraph (2) of this
subdivision by capitalization of income from the full cash value
determined in paragraph (1).
(4) Using the rate announced by the board pursuant to paragraph
(1) of subdivision (b) of Section 439.2, discount the amount obtained
in paragraph (3) for the number of years remaining until the
termination of the period for which the property is enforceably
restricted.
(5) Determine the value of the property by adding the value
determined by the capitalization of income method as provided in
paragraph (2) and the value obtained in paragraph (4).
(6) Apply the ratios prescribed in Section 401 to the value of the
property determined in paragraph (5) to obtain its assessed value.
439.4. No property shall be valued pursuant to this article unless
an enforceable restriction meeting the requirements of Section 439 is
signed, accepted and recorded on or before the lien date for the
fiscal year in which the valuation would apply.
