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Property Tax ReassessmentA statewide issue has arisen regarding the possibility of a dramatic increase in the property taxes of virtually all California private clubs through a potential reassessment under Proposition 13. Attached are two recent Los Angeles Times articles (a news story and a column.) The Articles present a factual and political context for the issue, and we urge you to review them carefully.
You will note that several Los Angeles County member-owned golf clubs are called out in the Article dated January 16 as avoiding “major property tax increases.” CSCA was asked by these named clubs to respond to reporter inquiries, which accounts for various quotes in the articles. The January 16 Article indicates that a freelance journalist questioned the Los Angeles County Assessor as to why the clubs are not reassessed under Proposition 13 as their owners (members) change over time. The Article tells us that the Los Angeles County Assessor and other assessors thereafter referred the question to the state Board of Equalization, where it now is pending. The Article also cites a 2002 Advice Letter from the Board of Equalization’s legal staff as a potential supporting rationale for reassessment of private club real property. The Advice Letter analyzes how in certain cases reassessment might be appropriate upon changes in member ownership of a corporation organized under the California Non-profit Mutual Benefit corporation law. Most California clubs, not just golf clubs, are organized under that law. If the supporting rationale of the Advice Letter could be extended successfully to the various clubs in California that own property—golf clubs, hunting clubs, downtown clubs, yacht clubs, riding clubs, swim and tennis clubs, service clubs, social clubs, clubs of distinct ethnicity—there could be a major adverse change in property taxation of many member-owned clubs in this state. CSCA fundamentally rejects any inference that prior Board of Equalization interpretations of existing law support a change in longstanding assessment practices. Critical constitutional and statutory protections of clubs and their members are at stake. Strategic legal and lobbying efforts are underway, coordinated under the leadership of CSCA. It is important that our industry speak with one voice on this sensitive matter, and for that reason we strongly suggest that any media inquiries on this issue be referred to CSCA for response. We will be seeking your help and counsel and will be communicating with you as developments occur. In addition to email alerts, please refer to our newsletters and other postings on our website: www.CAClubs.org. Bryan Gerstel, President Robert Bouchier, Chair, Legal Committee  |