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Committee hears competing views on CORE Act to protect affordable commercial leases; referred to suspense
Summary
AB 613, the CORE Act, which would recognize enforceable affordability restrictions on commercial leases for property-tax assessment purposes and incentivize nonprofit ownership of commercial space, was discussed at length and referred to the committees suspense file.
AB 613, sponsored by Assemblymember Gonzalez on behalf of the author, would treat enforceable affordability restrictions on commercial leases as factors assessors consider when setting assessed value, creating a tax incentive for nonprofit ownership that preserves affordable retail and nonprofit space.
Supporters — including Inclusive Action for the City and the California Coalition for Community Investment — said nonprofit ownership of commercial property stabilizes neighborhoods, prevents small-business displacement and keeps culturally important businesses in place. Amy Chung of Inclusive Action told the committee the bill "creates a modest incentive for mission-driven organizations" to acquire and lease space at below-market rents. Rachel Mueller with the California Coalition for Community Investment said the measure “makes the tax code recognize the value of inclusive economic development.”
Sacramento County Assessor Christina Wynne, testifying on behalf of the California Assessors Association, said while assessors appreciate the bill's intent, the draft lacks clear definitions and would impose verification and administrative burdens on assessors to determine eligibility and verify affordable lease terms. She recommended more precise legislative language and said assessors are willing to work with the author to improve clarity.
The author and supporters said they had conferred with assessor offices and agreed the bill is not intended to add assessor workload; the bill directs another local public agency (city attorney, county counsel or local economic development agency) to certify affordability restrictions so assessors would not be the certifying body. After discussion, the bill was placed on the committees suspense file for further work on technical language and fiscal implications.
