Inter-Departmental Correspondence


Assessor-County Clerk-Recorder



May 16, 2002


June 4, 2002



Honorable Board of Supervisors



Warren Slocum, Assessor-County Clerk-Recorder



Agreement to Participate in the AB 1036 State-County Property Tax Administration Program



Adopt a resolution authorizing the President of the Board of Supervisors to execute an agreement with the State Department of Finance to continue to participate in the State-County Property Tax Administration Program (AB 1036) for fiscal year 2001-02 and to receive a state loan in the amount of $2,220,001, subject to State's forgiveness of the repayment obligation based on County's achievement of performance criteria during FY 2002-03, as provided therein.



The State-County Property Tax Administration Program was launched in 1995 (AB 818, chap. 914, Oct. 16, 1995) and later extended (AB 719, chap. 420, Sept. 22, 1997; Assembly Bill 1036 Chap. 620, Sept. 23, 2000) as a means of funding the otherwise unreimbursed costs of county property tax administration. The funding mechanism, as provided by Revenue and Taxation Code section 95.31, is a loan from the state, repayment of which is subject to release upon the recipient county's achievement of specified assessment performance goals. Eligible counties may participate in the program upon the recommendation of the county assessor and the resolution of the county board of supervisors. A county is eligible if additional property tax revenue allocated to school entities would reduce the amount of general fund monies apportioned to school entities.


This honorable board has consistently authorized participation in this program, beginning with Resolution 60232 (June 4, 1996) for fiscal years 1995/96-1997/98 and most recently Resolution 62775 (May 18, 1999) for fiscal years 1998/99-1999/00. The Assessor Division has consistently met its performance goals. Our efforts under the program have contributed to the enrollment of properties valued at more than $10 billion, and the collection of an additional $100 million in property tax revenues. By meeting our goals, we have earned a grant of state funds in the amount $2,220,001 to be used to improve property tax administration.


To date, these monies have funded the implementation of our new secured, unsecured, and supplemental assessment systems as well as staffing to support the property tax administration activities of the Assessment Appeals Board, County Counsel, the Tax Collector, the County Controller, and the new geographic information system (GIS).



During the several terms of the program, we have greatly reduced processing backlogs. At the same time, we have successfully resolved complex and standard-setting valuation disputes with the airlines and the biotech industry. We continue to use program resources to fund assessment improvement activities in collaboration with the Assessment Appeals Board, County Counsel, and the Tax Collector and Controller. As integration of the various components of the property tax system progresses, we anticipate that additional benefits will accrue to other County and city stakeholders in our fiscal performance and to the county residents we serve.


During its life, this program has contributed an annual revenue infusion of $2.2 million to fund the improvement of property tax administration. The resulting improvements may be credited with an increase of more than $100 million in property tax collections, adding over $14 million to County revenue accounts, over $65 million to local school districts, and over $21 million to cities and special districts. In the coming year, we anticipate earning additional revenues of more than $18 million.


As in prior years, repayment of the annual $2.2 million loan is based upon our performance in reaching stated workload goals. Once we achieve these goals, the state forgives the loan debt. If we fail to meet these goals, we will ensure repayment from our departmental funds, without impact to the County's General Fund. Our past performance and current conditions make us confident that the agreement's production goals are realistic and that we will meet them.


This agreement has been reviewed by County Counsel and has been verbally approved by the State Department of Finance.


Vision Alignment

This agreement will further commitments and assist in achieving goals set forth in the County's Shared Vision 2010 report. Specifically, this agreement implements the commitment to partnerships that produce "responsive, effective and collaborative government" and will help the County to achieve Goal #20, that "government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain," and Goal #22, that "County employees understand, support and integrate the County vision and goals into their delivery of services."


Fiscal Impact

There is no Net County Cost. .No loan repayment is required if we meet our goals. If we fall short of our goals, only proportional repayment is due, to be paid with departmental funds.