{"id":2164,"date":"2022-04-19T06:53:06","date_gmt":"2022-04-19T06:53:06","guid":{"rendered":"https:\/\/crowdsourcelawyers.com\/california-statutes\/?page_id=2164"},"modified":"2022-05-20T23:45:42","modified_gmt":"2022-05-20T23:45:42","slug":"rtcd-423","status":"publish","type":"page","link":"https:\/\/crowdsourcelawyers.com\/california-statutes\/california-statutes\/rtcd-423\/","title":{"rendered":"RTCD-423"},"content":{"rendered":"\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-l25s9ivo-e871a83047611ce83a0e7b05ae99d32f\">\n#top .av-special-heading.av-l25s9ivo-e871a83047611ce83a0e7b05ae99d32f{\npadding-bottom:10px;\n}\nbody .av-special-heading.av-l25s9ivo-e871a83047611ce83a0e7b05ae99d32f .av-special-heading-tag .heading-char{\nfont-size:25px;\n}\n.av-special-heading.av-l25s9ivo-e871a83047611ce83a0e7b05ae99d32f .av-subheading{\nfont-size:22px;\n}\n<\/style>\n<div  class='av-special-heading av-l25s9ivo-e871a83047611ce83a0e7b05ae99d32f av-special-heading-h1 blockquote modern-quote  avia-builder-el-0  el_before_av_hr  avia-builder-el-first '><div class='av-subheading av-subheading_above'><p>California<\/p>\n<\/div><h1 class='av-special-heading-tag '  itemprop=\"headline\"  >Revenue and Taxation Code &#8211; RTC \u00a7 423<\/h1><div class=\"special-heading-border\"><div class=\"special-heading-inner-border\"><\/div><\/div><\/div>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-av_hr-3a876428eececa9d35452247ddb053af\">\n#top .hr.hr-invisible.av-av_hr-3a876428eececa9d35452247ddb053af{\nheight:50px;\n}\n<\/style>\n<div  class='hr av-av_hr-3a876428eececa9d35452247ddb053af hr-invisible  avia-builder-el-1  el_after_av_heading  el_before_av_textblock '><span class='hr-inner '><span class=\"hr-inner-style\"><\/span><\/span><\/div>\n<section  class='av_textblock_section av-av_textblock-e878f05c31dff72941bf1e49a00d9ff5 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/CreativeWork\" ><div class='avia_textblock'  itemprop=\"text\" ><p><a href=\"https:\/\/crowdsourcelawyers.com\/\">CrowdSourceLawyers.com<\/a><\/p>\n<\/div><\/section>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad\">\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad .av_searchform_wrapper{\nborder-color:#edae44;\nbackground-color:#edae44;\n}\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad #s.av-input-field{\ncolor:#edae44;\n}\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad .av-input-field-icon.av-search-icon{\ncolor:#edae44;\n}\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad .av-input-field-icon.av-search-icon.avia-svg-icon svg:first-child{\nfill:#edae44;\nstroke:#edae44;\n}\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad #searchsubmit{\nbackground-color:#edae44;\n}\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad .av_searchsubmit_wrapper{\nbackground-color:#edae44;\n}\n<\/style>\n<div  class='avia_search_element av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad  avia-builder-el-3  el_after_av_textblock  el_before_av_hr '><search><form action='https:\/\/crowdsourcelawyers.com\/california-statutes\/' id='searchform_element' method='get' class='' data-element_id='av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad' ><div class='av_searchform_wrapper'><input type='search' value='' id='s' name='s' placeholder='Search CA statutes' aria-label='Search CA statutes' class='av-input-field ' required \/><div class='av_searchsubmit_wrapper '><input type='submit' value='Find' id='searchsubmit' class='button ' title='View results on search page' aria-label='View results on search page' \/><\/div><input type='hidden' name='numberposts' value='10' \/><input type='hidden' name='results_hide_fields' value='' \/><\/div><\/form><\/search><\/div>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-av_hr-3a876428eececa9d35452247ddb053af\">\n#top .hr.hr-invisible.av-av_hr-3a876428eececa9d35452247ddb053af{\nheight:50px;\n}\n<\/style>\n<div  class='hr av-av_hr-3a876428eececa9d35452247ddb053af hr-invisible  avia-builder-el-4  el_after_avia_sc_search  el_before_av_textblock '><span class='hr-inner '><span class=\"hr-inner-style\"><\/span><\/span><\/div>\n<section  class='av_textblock_section av-l25shb6b-73c4f2bb9ac5f2de19c00bba7a98bc38 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/CreativeWork\" ><div class='avia_textblock'  itemprop=\"text\" ><div class=\"row\">\n<div class=\"subsection\"><\/div>\n<div class=\"subsection\">\n<p>Except as provided in\u00a0<span class=\"cite\">Sections 423.7\u00a0<\/span>and\u00a0<span class=\"cite\">423.8\u00a0<\/span>, when valuing enforceably restricted open-space land, other than land used for the production of timber for commercial purposes, the county assessor shall not consider sales data on lands, whether or not enforceably restricted, but shall value these lands by the capitalization of income method in the following manner:<\/p>\n<div class=\"subsection\">\n<p>(a)\u2002The annual income to be capitalized shall be determined as follows:<\/p>\n<div class=\"subsection\">\n<p>(1)\u2002Where sufficient rental information is available the income shall be the fair rent which can be imputed to the land being valued based upon rent actually received for the land by the owner and upon typical rentals received in the area for similar land in similar use, where the owner pays the property tax. \u2002Any cash rent or its equivalent considered in determining the fair rent of the land shall be the amount for which comparable lands have been rented, determined by average rents paid to owners as evidenced by typical land leases in the area, giving recognition to the terms and conditions of the leases and the uses permitted within the leases and within the enforceable restrictions imposed.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(2)\u2002Where sufficient rental information is not available, the income shall be that which the land being valued reasonably can be expected to yield under prudent management and subject to applicable provisions under which the land is enforceably restricted. \u2002There shall be a rebuttable presumption that \u201cprudent management\u201d does not include use of the land for a recreational use, as defined in\u00a0<span class=\"cite\">subdivision (n) of Section 51201 of the Government Code\u00a0<\/span>, unless the land is actually devoted to that use.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(3)\u2002Notwithstanding any other provision herein, if the parties to an instrument which enforceably restricts the land stipulate therein an amount which constitutes the minimum annual income per acre to be capitalized, then the income to be capitalized shall not be less than the amount so stipulated.<\/p>\n<p>For the purposes of this section, income shall be determined in accordance with rules and regulations issued by the board and with this section and shall be the difference between revenue and expenditures. \u2002Revenue shall be the amount of money or money&#8217;s worth, including any cash rent or its equivalent, which the land can be expected to yield to an owner-operator annually on the average from any use of the land permitted under the terms by which the land is enforceably restricted, including, but not limited to, that from the production of salt and from typical crops grown in the area during a typical rotation period, as evidenced by historic cropping patterns and agricultural commodities grown. \u2002When the land is planted to fruit-bearing or nut-bearing trees, vines, bushes, or perennial plants, the revenue shall not be less than the land would be expected to yield to an owner-operator from other typical crops grown in the area during a typical rotation period, as evidenced by historic cropping patterns and agricultural commodities grown. \u2002Proceeds from the sale of the land being valued shall not be included in the revenue from the land.<\/p>\n<p>Expenditures shall be any outlay or average annual allocation of money or money&#8217;s worth that has been charged against the revenue received during the period used in computing that revenue. \u2002Those expenditures to be charged against revenue shall be only those\u00a0<span class=\"added-material\">that<\/span>\u00a0are ordinary and necessary in the production and maintenance of the revenue for that period. \u2002Expenditures shall not include depletion charges, debt retirement, interest on funds invested in the land, interest on funds invested in trees and vines valued as land as provided by\u00a0<span class=\"cite\">Section 429\u00a0<\/span>, property taxes, corporation income taxes, or corporation franchise taxes based on income. \u2002When the income used is from operating the land being valued or from operating comparable land, amounts shall be excluded from the income to provide a fair return on capital investment in operating assets other than the land, to amortize depreciable property, and to fairly compensate the owner-operator for his operating and managing services.<\/p>\n<\/div>\n<\/div>\n<div class=\"subsection\">\n<p>(b)\u2002The capitalization rate to be used in valuing land pursuant to this article shall not be derived from sales data and shall be the sum of the following components:<\/p>\n<div class=\"subsection\">\n<p>(1)\u2002An interest component, to be determined by the board and announced no later than\u00a0<span class=\"added-material\">October<\/span>\u00a01 of the year preceding the assessment year, which is the arithmetic mean, rounded to the nearest\u00a0<span class=\"numerator\">1<\/span>\/<span class=\"denominator\">4<\/span>\u00a0percent, of the yield rate for long-term United States government bonds, as most recently published by the Federal Reserve Board\u00a0<span class=\"added-material\">as of September 1<\/span>, and the corresponding yield rates for those bonds, as most recently published by the Federal Reserve Board as of each September 1 immediately prior to each of the four immediately preceding assessment years.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(2)\u2002A risk component\u00a0<span class=\"added-material\">that<\/span>\u00a0shall be a percentage determined on the basis of the location and characteristics of the land, the crops to be grown thereon and the provisions of any lease or rental agreement to which the land is subject.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(3)\u2002A component for property taxes that shall be a percentage equal to the estimated total tax rate applicable to the land for the assessment year times the assessment ratio. \u2002The estimated total tax rate shall be the cumulative rates used to compute the state&#8217;s reimbursement of local governments for revenues lost on account of homeowners&#8217; property tax exemptions in the tax rate area in which the enforceably restricted land is situated.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(4)\u2002A component for amortization of any investment in perennials over their estimated economic life when the total income from land and perennials other than timber exceeds the yield from other typical crops grown in the area.<\/p>\n<\/div>\n<\/div>\n<div class=\"subsection\">\n<p>(c)\u2002The value of the land shall be the quotient for the income determined as provided in subdivision (a) divided by the capitalization rate determined as provided in subdivision (b).<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(d)\u2002Unless a party to an instrument which creates an enforceable restriction expressly prohibits such a valuation, the valuation resulting from the capitalization of income method described in this section shall not exceed the lesser of either the valuation that would have resulted by calculation under\u00a0<span class=\"cite\">Section 110\u00a0<\/span>, or the valuation that would have resulted by calculation under\u00a0<span class=\"cite\">Section 110.1\u00a0<\/span>, as though the property was not subject to an enforceable restriction in the base year.<\/p>\n<p>In determining the 1975 base year value under\u00a0<span class=\"cite-query\">Article XIII A of the California Constitution<\/span>\u00a0for any parcel for comparison, the county may charge a contractholder a fee limited to the reasonable costs of\u00a0<span class=\"added-material\">the<\/span>\u00a0determination not to exceed twenty dollars ($20) per parcel.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(e)\u2002If the parties to an instrument that creates an enforceable restriction expressly so provide therein, the assessor shall assess those improvements\u00a0<span class=\"added-material\">that<\/span>\u00a0contribute to the income of land in the manner provided herein. \u2002As used in this subdivision \u201cimprovements which contribute to the income of the land\u201d shall include, but are not limited to, wells, pumps, pipelines, fences, and structures which are necessary or convenient to the use of the land within the enforceable restrictions imposed.<\/p>\n<\/div>\n<p><br class=\"avia-permanent-lb\" \/><br class=\"avia-permanent-lb\" \/><\/p>\n<\/div>\n<\/div>\n<hr \/>\n<p><a href=\"https:\/\/crowdsourcelawyers.com\/\">CrowdSourceLawyers.com<\/a><\/p>\n<\/div><\/section>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":7,"featured_media":0,"parent":2019,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-2164","page","type-page","status-publish","hentry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>RTCD-423 - California 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