TO: Board of Supervisors
FROM: Tracy A. Schulze - Auditor-Controller
REPORT BY: Jobina Toh - Assistant Auditor-Controller
SUBJECT: Authorization for the Auditor-Controller to process an Assessor Division assessment roll correction in excess of $10,000,000 limit permitted under Resolution No. 2013-137 (Revenue and Taxation Code Section 4831 et seq.)
RECOMMENDATION
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Request authorization for the Auditor-Controller to process an Assessor Division assessment roll correction for Assessor Parcel Number (APN) 850-000-445-000 for the structural improvements of $47,873,000 in tax year 2025-26. (Fiscal Impact: Various Funds Decrease Revenue, Mandatory)
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BACKGROUND
Resolution No. 2013-137 authorizes the Auditor-Controller to perform, on behalf of the Board of Supervisors, corrections to the local assessment roll as set forth in Section 4831 et seq. of the Revenue and Taxation Code where the amount of the correction does not exceed ten million ($10,000,000) in assessed valuation.
NCCD Napa Valley Properties LLC timely filed the college exemption claim form on February 4, 2025 for the college housing built on land (Assessor Parcel 046-450-073-000) leased from Napa Community College. This housing development is exempt from property taxes under the college exemption set forth in California Constitution Article XIII Section 3(e). The exemption applies to two separate assessments: 860-003-807-000 for the possessory interest in the leased land, and 850-000-445-000 for the structural improvements which are owned by NCCD Napa Valley Properties LLC and therefore are assessed as improvements on leased land. The exemption was correctly applied to the possessory interest in the amount of $6,892,650. Because of an Assessor Division clerical error, the college exemption was not applied to the structural improvements in the amount of $47,873,000. The property owner has received a total tax bill for $530,720.07.
The County Assessor has submitted a roll correction which will cancel the bill and relieve the owner of this debt. The assessed valuation of the exempted property exceeds the delegated authority of the Auditor-Controller, therefore must come before the Board of Supervisors for approval. The roll correction for APN 850-000-445-000 covers the tax year 2025-26 and will offset the tax bill with the college exemption.
Attachment A provides a breakdown of the exemption to the affected taxing jurisdictions. It should be noted that this correction is for a 2025-26 tax bill, and the 2025-26 AB8 allocation factors are not yet calculated, therefore the figures are estimated based on the prior year’s AB8 allocation factors. In addition to the 1% ad valorem taxes ($478,730.00), this correction also will result in a reduced collection for payments on Napa Valley Unified School District and College bond debt ($44,809.12), and the Direct Assessment for the City of Napa Paramedic Tax (7,180.95), for a total bill cancellation of $530,720.07.
Requested Action: Authorize the Auditor-Controller to process an Assessor Division assessment roll correction due to clerical error for exempt Napa Community College property with an assessed valuation of $47,873,000.
FISCAL IMPACT
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Is there a Fiscal Impact? |
Yes |
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Is it currently budgeted? |
No |
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Is it Mandatory or Discretionary? |
Mandatory |
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Is the general fund affected? |
Yes |
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Future fiscal impact: |
None, the exemption statues will continue into the future years as long as requirements are met. |
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Consequences if not approved: |
Napa County Assessor is required to grant exemptions to qualified properties if they file an exemption claim by February 15 of each year. The Assessor would not be in compliance with State Law if the qualified exemption is not granted. |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: The proposed action is not a project as defined by 14 California Code of Regulations 15378 (State CEQA Guidelines) and therefore CEQA is not applicable.