AB 1574, Legislation Legitimizing Private Transfer Taxes, Withdrawn from Committee; Delayed until Next Year.

LOS ANGELES -- Assembly Bill 1574 (Houston), "Private Transfer Taxes," was withdrawn from last week's agenda for the Senate Judiciary Committee, having failed to receive adequate support from committee members.

The CALIFORNIA ASSOCIATION OF REALTORS[R] (C.A.R.) vigorously opposes AB 1574, which would authorize developers to surcharge home buyers through a "private transfer tax" and add to the cost of owning a home. The deadline for policy committees to hear and report on bills was Friday, July 13; AB 1574 now cannot be acted upon until next year. An interim hearing is expected to be held during the fall to investigate the imposition of "private transfer taxes" by developers.

"The legislature wisely decided this week that AB 1574 should not move forward," said C.A.R. President Colleen Badagliacco. "This bill would have legitimatized developer-imposed transfer taxes on home buyers at the point of purchase. Under Assemblyman Houston's bill, 2 percent of the home sales price could be imposed every time the home sells -- for 99 years into the future. This unfairly burdens future home buyers without any guarantee that they will receive benefit or value in exchange for the transfer taxes.

"We commend Senator Corbett, who chairs the Judiciary Committee, for encouraging further legislative investigation of this unacceptable practice, just as we encourage legislation prohibiting such 'taxes' altogether," said Badagliacco.

Leading the way...[R] in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS[R] (www.car.org) is one of the largest state trade organizations in the United States, with more than 185,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

Today's release also is available on C.A.R. Online at http://www.car.org/index.php?id=Mzc1ODI.