Valuation of Certificated Aircraft

Senate Bill (SB) 791 (Stats. 2019, ch. 333), in addition to other changes, establishes a new allocation formula for the valuation of certificated aircraft. In part, SB 791 added section 1157 to the Revenue and Taxation Code, which provides that the Board of Equalization (BOE), after consultation with the California Assessors' Association (CAA) and representatives of commercial air carriers, draft regulations, and produce forms and instructions necessary to implement the new allocation formula.

(Please note that SB 791 amended section 441, amended and added section 1152, added sections 1153.5 and 1157, and repealed section 1153, of the Revenue and Taxation Code.)

See Letter To Assessors Number 2019/034, Valuation of Certificated Aircraft, for additional information on changes implemented by SB 791.

Proposed Revision to Property Tax Rule 202, Allocation of Aircraft of Certificated Air Carriers and Scheduled Air Taxi Operators

Revenue and Taxation Code section 1152 sets forth the requirements for the new allocation formula, which is operative on January 1, 2020. Section 1157, in part, requires that the BOE, after consultation with the California Assessors' Association and representatives of commercial air carriers, promulgate an emergency regulation to implement the newly established allocation formula. The emergency regulation must be effective by January 1, 2020. In order to meet this deadline, proposed revisions to Rule 202 is scheduled to be presented to the Board Members at the November Board Meeting.

Please note than an emergency regulation is effective for 180 days, and may be readopted for two additional 90 day periods. Therefore, the BOE will initiate a subsequent project to revise Property Tax Rule 202 that will go through the regular rulemaking process. Information on the Emergency Rulemaking Process and the Regular Rulemaking Process may be found at the Office of Administrative Law's website.

Emergency Regulation: Proposed Revision of Property Tax Rule 202

Date Description of Task
10/11/19 Staff to release draft rule advising recipients of the project and inviting the California Assessors' Association and representatives of commercial air carriers to submit proposed changes to the draft emergency regulation
10/18/19 Deadline for interested parties to submit proposed changes, in the form of alternative text, to staff on the draft rule
10/22/19 Staff to provide a status update to recipients of the project
11/19/19 Board to authorize publication of proposed amendments to Emergency Regulation Rule 202
12/6/19 BOE to publish emergency notice

The BOE will initiate a project to revise Property Tax Rule 202 through the Regular Rulemaking Process after January 1, 2020.

Proposed Revision of Property Tax Rule 202

Date Description of Task
Staff to release letter advising recipients of the project and inviting interested parties to submit proposed changes to the draft rule
Deadline for interested parties to submit proposed changes, in the form of alternative text, to staff on the draft rule
Board to authorize publication of proposed amendments to Rule 202
Staff to mail letter announcing public hearing
Public hearing to adopt proposed amendments to Rule 202

Property Tax Forms, Supplementary Schedule to the Business Property Statement

Revenue and Taxation Code section 1152 sets forth the requirements for the new allocation formula, which is operated on January 1, 2020. Section 1157, in part, requires that the BOE, after consultation with the California Assessors' Association and representatives of commercial air carriers, produce forms and instructions that implement the newly established allocation formula. The forms and instructions must be effective by January 1, 2020. In order to meet this deadline, proposed forms and instructions are scheduled to be presented to the Board Members at the November Board Meeting.

BOE-570-1, Air Carrier's Operation Report

BOE-570-2, Flight Equipment Value Computation

Date Description of Task
10/11/19 Staff to release draft forms and instructions advising recipients of the project and inviting the California Assessors' Association and representatives of commercial air carriers to submit proposed changes to the draft forms and instructions
10/18/19 Deadline for interested parties to submit proposed changes, in the form of alternative text, to staff on the draft forms and instructions
10/22/19 Staff to provide a status update to recipients of the project
11/19/19 Board to authorize adoption of proposed forms and instructions

Please see the project page titled, Representative Period for Certificated Air Carriers and Scheduled Air Taxi Operations Discussion, for historical documents on the project addressing the assessment of certificated aircraft.