An act to amend Section 214 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.
SB 336 would expand California’s property tax welfare exemption to cover certain nonprofit-owned or operated rental housing that serves low- and moderate-income households, not just lower-income households. The bill creates a new partial exemption for qualifying residential rental property, with the exempt share tied to the percentage of units occupied by eligible households. It also adds a separate, more targeted partial exemption for newly constructed or converted residential projects beginning on or after January 1, 2026, if the owner claims the exemption within five years of the building permit and meets additional affordability, rent-setting, and long-term restriction requirements.
To qualify, owners must certify under penalty of perjury that the property is subject to enforceable affordability restrictions, that initial rents are below comparable market rents, and that the property tax savings are used to preserve affordability or reduce rents. The bill also preserves and references existing rules for nonprofit housing, veterans organizations, community land trusts, low-income housing tax credit properties, and other exempt uses, while specifying how “units serving” eligible households are counted. It takes effect immediately as a tax levy and declares itself severable.
The bill would amend Revenue and Taxation Code Section 214, which governs California’s welfare exemption, by adding moderate-income housing to the set of rental housing properties that can receive a partial property tax exemption. It would affect nonprofit affordable housing owners, veterans organizations, community land trusts, county assessors, and the State Board of Equalization by expanding eligibility criteria, certification requirements, and administrative review obligations. The measure also states that no state reimbursement is made for local property tax revenues lost under the act, and it limits or conditions reimbursement for any other mandated local costs.
The available voting history suggests the bill was received favorably in committee, at least procedurally: it advanced on a 5-0 vote and was later placed on the suspense file, indicating support but also fiscal caution. Because there are no committee transcripts provided, there is no recorded debate to show broader public or member sentiment. Overall, the bill appears to have been treated as a housing-affordability measure with enough policy support to move forward, while still raising budgetary concerns typical of tax expenditure bills.
The main policy tension is fiscal: the bill would reduce property tax revenues for local agencies and school districts by expanding the welfare exemption, and it expressly denies state reimbursement for those lost revenues. Another likely point of contention is eligibility scope, because the bill extends benefits beyond lower-income housing to moderate-income housing and includes special treatment for certain newer projects, community land trusts, and income thresholds that may be viewed as broadening the exemption. Local assessors may also face added administrative burden because owners must make detailed certifications and the bill expands the duties associated with verifying compliance.