BOE pauses proposed LEOP hearing amid concerns it could stray into legislation; will revisit in November
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Summary
Vice Chair Salina Lieber proposed an informational hearing on the Legal Entity Ownership Program, but the board deferred the item and asked staff to return in November with a narrower agenda after members warned the hearing might stray into legislative territory.
Vice Chair Salina Lieber proposed Oct. 21 that the Board of Equalization hold a Dec. 16 informational hearing to review the Legal Entity Ownership Program (LEOP), explain recent reforms and discuss whether the BOE’s examination function is effectively identifying unreported changes in legal ownership.
Several members raised procedural and policy concerns, saying the BOE should not be seen as creating or advocating legislative changes to Proposition 13 or other taxation statutes. "My concern is that we shouldn't be legislating,” Chairman Gaines said, urging that any hearing remain informational rather than advocacy for statutory change. Member Schaeffer and others also stressed staying within the board’s constitutional role.
Chief Counsel Richard Moon said informational hearings are routine and appropriate when limited to explanation of current BOE programs and administrative practice. "A discussion on the operation of our legal entity program about interpretation of current law, about whether our interpretations might need some change or some refinement, how it's affecting the counties, how it's affecting our LEOP group — those kinds of questions, I think, certainly would be legitimate," Moon said.
CalTax (the California Taxpayers Association) submitted a written letter and a spokesman, JC Lee, appeared and urged caution. Lee said the hearing, as initially framed, included items (such as creating a rebuttable presumption) that would cross into legislative territory and risk politicizing tax administration. He recommended the agency instead prioritize other administrative projects within the BOE’s statutory scope.
After discussion the board did not schedule the December hearing on the floor. Vice Chair Lieber agreed to bring a more detailed, public agenda and proposed speaker list to the November board meeting as a "taste test." The item will return in November for a vote on whether to schedule the informational hearing in December.
Why it matters: LEOP touches enforcement of change‑of‑ownership rules and can affect assessment outcomes for commercial property. The debate highlights a tension members identified between providing oversight of administration and engaging in policy advocacy that is properly the legislature’s role.
What’s next: Vice Chair Lieber will present a narrower, documented hearing plan in November that specifies topics, speakers and whether the hearing will include legislative proposals or remain purely informational.
