Property taxation: assessment: affordable commercial property.

The bill text was reformatted from a paginated legislative document with line numbers into a web page layout including navigation elements (home, accessibility, FAQ, search, version selector). No changes to the actual statutory language.

Removed the requirement that more than 30 percent of the total square footage of the larger property be leased to community-serving small businesses or nonprofits. Only the existing requirement that at least 70 percent of the commercial square footage (excluding areas occupied by the ownership entity itself) meet the criteria remains.

Added a new standalone subsection (B) explicitly stating that the determination of whether a lease meets the requirements in subparagraph (A) shall be made by one of four designated public officials: county counsel, director of the county economic development department or equivalent agency, city attorney, or director of the city economic development department or equivalent agency. This was previously only implied through the definition of affordability restrictions.

Relettered subsequent subsections to accommodate the new subsection (B): old (C) definitions section became (C), and old (C) legislative findings section became (D). Page numbers shifted from 97 to 96 throughout due to reflowing.

The threshold for qualifying for the assessment exemption on commercially leased property was raised from 'more than 30 percent of the square footage of the larger property' to 'at least 70 percent of the commercial square footage of the property.' This dramatically narrows which properties can benefit from the tax exemption, requiring that the vast majority of commercial space be dedicated to affordable community-serving uses.

The measurement basis changed from 'square footage of the larger property' to 'commercial square footage of the property,' which may exclude non-commercial areas (such as residential units) from the calculation, further tightening the test.

The fiscal committee designation changed from 'no' to 'yes' and state-mandated local program changed from 'no' to 'yes,' indicating the bill now carries recognized fiscal impacts and potential state reimbursement obligations for local agencies.

The digest line stating 'This bill would make a nonsubstantive change to that provision' was removed, consistent with the substantive eligibility threshold change now present in the bill.

New subsection (12) added to Section 402.1 creating a new enforceable restriction category: renewable leases of at least three years between a commercial community ownership entity and a community-serving small business or nonprofit, where the leased commercial unit is subject to affordability restrictions (rent below fair market value).

The bill's fiscal committee designation changed from 'no' to 'yes' and state-mandated local program designation changed from 'no' to 'yes', reflecting that the new assessor duties constitute a state-mandated local program requiring fiscal analysis.

New definition of 'commercial community ownership entity': a 501(c)(3) nonprofit, a limited partnership managed by such a nonprofit, or an LLC wholly owned by such a nonprofit, that either has as a primary purpose creating and maintaining commercial property for low-income entrepreneurs/small businesses/nonprofits, or has received a welfare exemption under Section 214 for housing low-income households and leases commercial units on the same property.

New definition of 'community-serving small business or nonprofit': a microenterprise as defined in Business and Professions Code Section 18000(a), a restaurant with fewer than 10 employees, or a nonprofit organization with fewer than 20 employees.

A threshold requirement that more than 30 percent of the square footage of the larger property owned by the commercial community ownership entity (excluding areas occupied by the entity itself) must be leased to community-serving small businesses or nonprofits and subject to affordability restrictions.

New Section 4 explicitly states that no appropriation is made and the state will not reimburse local agencies for property tax revenues lost as a result of this act, overriding the general reimbursement provisions in Revenue and Taxation Code Section 2229.

Tax expenditure reporting requirement: the State Board of Equalization must annually collect data from county assessors on the additional assessed value exempted and the number and type of taxpayers granted the exemption, and report to the Legislature on or before June 1, 2027, and every June 1 thereafter.

New Section 5 declares the act a tax levy under Article IV of the California Constitution, making it take effect immediately upon enactment rather than on the standard January 1 date.

New short title section (Section 1) designating the act as the 'Community-Owned Real Estate (CORE) Act.'

Minor wording change in subsection (a): 'shall include, but are not limited to' changed to 'include, but are not limited to,' removing the mandatory 'shall' language.