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CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

95

Introduced by Senators Padilla, McNerney, and Umberg

(Coauthors: Senators Arreguín, Pérez, and Rubio)

February 18, 2025

An act to add Section 214.12 to the Revenue and Taxation Code, relating to taxation.

Vote: majority   Appropriation: no   Fiscal committee: no   Local program: no

LEGISLATIVE COUNSEL’S DIGEST

The California Constitution authorizes the Legislature to exempt from taxation, in whole or in part, property that is used exclusively for religious, hospital, or charitable purposes, and is owned or held in trust by a nonprofit entity. Pursuant to that authority, existing law provides for a welfare exemption under which property used exclusively for an exempt purpose and owned and operated by specified entities, including foundations, limited liability companies, or corporations meeting certain statutory requirements is exempt from taxation.

This bill would specify that for the purposes of the welfare exemption provisions above, “property used exclusively for religious, hospital, scientific, or charitable purposes” shall not include property, or any portion thereof, operated as a detention facility, as defined, by a for-profit entity. defined. The bill would declare that the above provision is declarative of, and not a change in, existing law.

The people of the State of California do enact as follows:

SECTION 1.

Section 214.12 is added to the Revenue and Taxation Code, to read:

214.12.

(a) For purposes of Section 214, “property used exclusively for religious, hospital, scientific, or charitable purposes” shall not include property, or any portion thereof, operated as a detention facility by a for-profit entity. facility.

(b) For purposes of this section, “detention facility” shall have the same meaning as is provided in Section 9500 of the Penal Code.

(c) The Legislature finds and declares that this section does not constitute a change in, but is declaratory of, existing law.