The Assembly has approved SB 364 (Mitchell) to exempt solar farms from Proposition 15, the “split-roll” initiative on the November ballot.
SB 364 is effectively an agreement between split-roll supporters and solar advocates that would ensure Proposition 15 won’t adversely impact the tax treatment of California solar farms if voters approve the initiative. The Assembly approved the bill on a 56-8 vote.
The “solar fix,” which would preserve the solar industry’s property tax exemption for existing solar farms, was initially contained within AB 105 as a budget trailer bill. But the Legislature failed to consider the proposal before they left for summer recess last month.
SB 364 was amended with the solar language on July 27, clearing the Assembly Revenue and Taxation Committee the same day and moving to the Assembly floor.
The one key difference between AB 105 and SB 364 was that the Assembly bill unintentionally extended the tax exemption to the purchaser of an existing solar farm. That’s not what existing law allows, however. SB 364 closed that loophole to ensure that when a solar farm is sold, the new owner is taxed based on the change in property value.
The bill would still protect solar farms built through 2024. Industry advocates say they need the bill because their financial calculations have relied on preserving the tax break on their projects.
Because SB 364 was amended in the Assembly, it must pass the Senate for concurrence before reaching the Governor’s desk for action. If approved, Newsom is expected to sign the bill.