Assembly BillChaptered/SignedRevenue and Taxation
AB 245: Property taxation: application of base year value: disaster relief.
What AB 245 does, verified December 7, 2025
The bill aims to amend the property tax code in California to provide relief to property owners who lost their properties due to the 2025 wildfires. The bill would extend the time period for applying the base year value to replacement properties from 5 years to 8 years if the property was damaged or destroyed by the wildfires on or after January 7, 2025, but before February 1, 2025. This would allow property owners to rebuild or replace their properties within the extended time frame. Additionally, the bill would require that the fair market value of the property takes into account any reduction in value due to damage, destruction, or other factors. The bill also includes provisions for reimbursement of costs mandated by the state and declares that it is to take effect immediately.
Bill journey
✓IntroducedComplete
✓In CommitteeComplete
✓First Chamber FloorComplete
✓Second ChamberComplete
✓GovernorComplete
6ChapteredCurrent
Last action: Chaptered by Secretary of State - Chapter 530, Statutes of 2025. (2025-10-10)Alert me
Author and sponsors
Full contact details, staff, and committees with Connect, $16/moUnlockRecent actions37 total · showing 5
| Oct. 10, 2025 | Chaptered by Secretary of State - Chapter 530, Statutes of 2025. |
| Oct. 10, 2025 | Approved by the Governor. |
| Sep. 24, 2025 | Enrolled and presented to the Governor at 3 p.m. |
| Sep. 12, 2025 | Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 80. Noes 0. Page 3368.). |
| Sep. 12, 2025 | Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 80. Noes 0. Page 3368.). |
Latest bill textChaptered version, October 10, 2025 · 3,530 words
Assembly Bill No. 245
CHAPTER 530
An act to amend Section 70.5 of, and to add Section 171.5 to, the Revenue and Taxation Code, relating to taxation, and declaring the urgency thereof, to take effect immediately.
[ Approved by Governor October 10, 2025. Filed with Secretary of State October 10, 2025. ]
LEGISLATIVE COUNSEL'S DIGEST
AB 245, Gipson. Property taxation: application of base year value: disaster relief.
(1) The California Constitution generally limits ad valorem taxes on real property to 1% of the full cash value of that property. For purposes of this limitation, “full cash value” is defined as the assessor’s valuation of real property as shown on the 1975–76 tax bill under “full cash value” or, thereafter, the appraised value of that real property when purchased, newly constructed, or a change in ownership has occurred. Existing law defines “newly constructed” and “new construction” to mean any addition to real property since the last lien date and any alteration of land or of any improvement since the last lien date that constitutes a major rehabilitation thereof or that converts the property to a different use. Existing law, where real property has been damaged or destroyed by misfortune or calamity, excludes from the definition of “newly constructed” and “new construction” any timely reconstruction of the real property, or portion thereof, where the property after reconstruction is substantially equivalent to the property prior to damage or destruction. Existing law, pursuant to the authorization of the California Constitution, authorizes the transfer of the base year value of property that is substantially damaged or destroyed by a disaster, as declared by the Governor, to comparable replacement property within the same county that is acquired or newly constructed within 5 years after the disaster, as provided.
Existing law authorizes the owner of property substantially damaged or destroyed by a disaster, as declared by the Governor, to apply the base year value of that property to replacement property reconstructed on the same site of the damaged or destroyed property within 5 years after the disaster if the reconstructed property is comparable to the substantially damaged or destroyed property, determined as provided.
This bill would extend the 5-year time period described above by 3 years if the property was substantially damaged or destroyed by the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire on or after January 7, 2025, but before February 1, 2025. The bill would make these provisions applicable to the determination of base year values for the 2025–26 fiscal year and fiscal years thereafter. By imposing additional duties on local tax officials, the bill would create a state-mandated local program.
(2) Existing property tax law authorizes counties to adopt ordinances that allow assessees whose property was damaged or destroyed to apply for a reassessment of that property if certain conditions, including the filing of an application for reassessment, are met.
This bill would require that, in the case of property impacted by the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire, the fair market value of that real property on January 1, 2025, takes into account any reduction in value to that property due to damage, destruction, depreciation, obsolescence, removal of property, or other factors causing a decline in value.
(3) This bill would make legislative findings and declarations as to the public purpose served by these provisions.
(4) This bill would incorporate additional changes to Section 70.5 of the Revenue and Taxation Code proposed by SB 663 to be operative only if this bill and SB 663 are enacted and this bill is enacted last.
(5) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.
(6) Existing law requires the state to reimburse local agencies annually for certain property tax revenues lost as a result of any exemption or classification of property for purposes of ad valorem property taxation.
This bill would provide that, notwithstanding those provisions, no appropriation is made and the state shall not reimburse local agencies for property tax revenues lost by them pursuant to the bill.
(7) This bill would declare that it is to take effect immediately as an urgency statute.
The people of the State of California do enact as follows:
SECTION 1.
Section 70.5 of the Revenue and Taxation Code is amended to read:70.5.
(a) Notwithstanding Section 70, and pursuant to Section 2 of Article XIII A of the California Constitution, the base year value of property that is substantially damaged or destroyed by a disaster, as declared by the Governor, may be applied to replacement property reconstructed on the site of the damaged or destroyed property within five years after the disaster as a replacement for the substantially damaged or destroyed property if that reconstructed property is comparable to the substantially damaged or destroyed property. A person who owns substantially damaged or destroyed property that receives property tax relief under this section shall not be eligible for property tax relief provided under Section 69.(b) (1) The replacement base year value of the reconstructed property shall be determined in accordance with this section.
(2) The assessor shall use the following procedure in determining the appropriate base year value of the reconstructed property:
(A) If the full cash value of the reconstructed property does not exceed 120 percent of the full cash value of the property substantially damaged or destroyed, then the adjusted base year value of the property substantially damaged or destroyed shall apply to the reconstructed property as its base year value.
(B) If the full cash value of the reconstructed property exceeds 120 percent of the full cash value of the property substantially damaged or destroyed, then the amount of the full cash value over 120 percent of the full cash value of the property substantially damaged or destroyed shall be added to the adjusted base year value of the original property substantially damaged or destroyed. The sum of these amounts shall become the reconstructed property’s base year value.
(C) If the full cash value of the reconstructed property is less than the adjusted base year value of the original property substantially damaged or destroyed, then that lower value shall become the reconstructed property’s base year value.
(D) The full cash value of the property substantially damaged or destroyed shall be the amount of its full cash value immediately prior to its substantial damage or destruction, as determined by the county assessor of the county in which the property is located.
(c) For purposes of this section:
(1) Property is substantially damaged or destroyed if the improvements sustain physical damage amounting to more than 50 percent of the improvements’ full cash value immediately prior to the disaster.
(2) Reconstructed property shall be considered comparable to the original property substantially damaged or destroyed if it is similar in size, utility, and function to the property which it replaces. For purposes of this paragraph:
(A) Property is similar in function if the reconstructed property is subject to similar governmental restrictions, such as zoning.
(B) (i) Both the size and utility of property are interrelated and associated with value. Property shall be considered similar in size and utility only to the extent that the reconstructed property is, or is intended to be, used in the same manner as the original property substantially damaged or destroyed and its full cash value does not exceed 120 percent of the full cash value of the original property substantially damaged or destroyed.
(ii) A reconstructed property or any portion of reconstructed property used or intended to be used for a purpose substantially different than the use made of the original property substantially damaged or destroyed shall to the extent of the dissimilar use be considered not similar in utility.
(iii) A reconstructed property or any portion of reconstructed property that satisfies the use requirement but has a full cash value that exceeds 120 percent of the full cash value of the original property substantially damaged or destroyed shall be considered, to the extent of the excess, not similar in utility and size.
(C) To the extent that reconstructed property or any portion of reconstructed property is not similar in function, size, and utility, the property or portion of that property shall be considered to be newly constructed.
(3) “Disaster” means a major misfortune or calamity in an area subsequently proclaimed by the Governor to be in a state of disaster as a result of that misfortune or calamity.
(d) Only the owner or owners of the property substantially damaged or destroyed, whether one or more individuals, partnerships, corporations, other legal entities, or a combination thereof, shall be eligible to receive property tax relief under this section. Relief under this section shall be granted to an owner or owners of substantially damaged or destroyed property who have reconstructed that property.
(e) (1) Notwithstanding any law, the time period specified in subdivision (a) to apply the base year value of qualified property to replacement property reconstructed on the site of the damaged or destroyed property is extended by three years if the qualified property was substantially damaged or destroyed on or after November 1, 2018, but on or before November 30, 2018.
(2) This subdivision shall apply to the determination of base year values for the 2018–19 fiscal year and fiscal years thereafter.
(3) For purposes of this subdivision, “qualified property” means property that was substantially damaged or destroyed, as described in paragraph (1) of subdivision (c), by the 2018 Woolsey Fire disaster or by the 2018 Camp Fire disaster, as proclaimed by the Governor.
(f) (1) Notwithstanding any law, the time period specified in subdivision (a) to apply the base year value of qualified property to replacement property reconstructed on the site of the damaged or destroyed property is extended by three years if the qualified property was substantially damaged or destroyed on or after January 7, 2025, but before February 1, 2025.
(2) This subdivision shall apply to the determination of base year values for the 2025–26 fiscal year and fiscal years thereafter.
(3) For purposes of this subdivision, “qualified property” means property that was substantially damaged or destroyed, as described in paragraph (1) of subdivision (c), by the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire, for which the Governor proclaimed a state of emergency.
(g) This section shall apply to real property damaged or destroyed by misfortune or calamity on or after January 1, 2017.
SEC. 1.5.
Section 70.5 of the Revenue and Taxation Code is amended to read:70.5.
(a) Notwithstanding Section 70, and pursuant to Section 2 of Article XIII A of the California Constitution, the base year value of property that is substantially damaged or destroyed by a disaster, as declared by the Governor, may be applied to replacement property reconstructed on the site of the damaged or destroyed property within five years after the disaster as a replacement for the substantially damaged or destroyed property if that reconstructed property is comparable to the substantially damaged or destroyed property. A person who owns substantially damaged or destroyed property that receives property tax relief under this section shall not be eligible for property tax relief provided under Section 69.(b) (1) The replacement base year value of the reconstructed property shall be determined in accordance with this section.
(2) The assessor shall use the following procedure in determining the appropriate base year value of the reconstructed property:
(A) If the full cash value of the reconstructed property does not exceed 120 percent of the full cash value of the property substantially damaged or destroyed, then the adjusted base year value of the property substantially damaged or destroyed shall apply to the reconstructed property as its base year value.
(B) If the full cash value of the reconstructed property exceeds 120 percent of the full cash value of the property substantially damaged or destroyed, then the amount of the full cash value over 120 percent of the full cash value of the property substantially damaged or destroyed shall be added to the adjusted base year value of the original property substantially damaged or destroyed. The sum of these amounts shall become the reconstructed property’s base year value.
(C) If the full cash value of the reconstructed property is less than the adjusted base year value of the original property substantially damaged or destroyed, then that lower value shall become the reconstructed property’s base year value.
(D) The full cash value of the property substantially damaged or destroyed shall be the amount of its full cash value immediately prior to its substantial damage or destruction, as determined by the county assessor of the county in which the property is located.
(c) For purposes of this section:
(1) Property is substantially damaged or destroyed if the improvements sustain physical damage amounting to more than 50 percent of the improvements’ full cash value immediately prior to the disaster.
(2) Reconstructed property shall be considered comparable to the original property substantially damaged or destroyed if it is similar in size, utility, and function to the property which it replaces. For purposes of this paragraph:
(A) Property is similar in function if the reconstructed property is subject to similar governmental restrictions, such as zoning.
(B) (i) Both the size and utility of property are interrelated and associated with value. Property shall be considered similar in size and utility only to the extent that the reconstructed property is, or is intended to be, used in the same manner as the original property substantially damaged or destroyed and its full cash value does not exceed 120 percent of the full cash value of the original property substantially damaged or destroyed.
(ii) A reconstructed property or any portion of reconstructed property used or intended to be used for a purpose substantially different than the use made of the original property substantially damaged or destroyed shall to the extent of the dissimilar use be considered not similar in utility.
(iii) A reconstructed property or any portion of reconstructed property that satisfies the use requirement but has a full cash value that exceeds 120 percent of the full cash value of the original property substantially damaged or destroyed shall be considered, to the extent of the excess, not similar in utility and size.
(C) To the extent that reconstructed property or any portion of reconstructed property is not similar in function, size, and utility, the property or portion of that property shall be considered to be newly constructed.
(3) “Disaster” means a major misfortune or calamity in an area subsequently proclaimed by the Governor to be in a state of disaster as a result of that misfortune or calamity.
(d) Only the owner or owners of the property substantially damaged or destroyed, whether one or more individuals, partnerships, corporations, other legal entities, or a combination thereof, shall be eligible to receive property tax relief under this section. Relief under this section shall be granted to an owner or owners of substantially damaged or destroyed property who have reconstructed that property.
(e) (1) Notwithstanding any law, the time period specified in subdivision (a) to apply the base year value of qualified property to replacement property reconstructed on the site of the damaged or destroyed property is extended by three years if the qualified property was substantially damaged or destroyed on or after November 1, 2018, but on or before November 30, 2018.
(2) This subdivision shall apply to the determination of base year values for the 2018–19 fiscal year and fiscal years thereafter.
(3) For purposes of this subdivision, “qualified property” means property that was substantially damaged or destroyed, as described in paragraph (1) of subdivision (c), by the 2018 Woolsey Fire disaster or by the 2018 Camp Fire disaster, as proclaimed by the Governor.
(f) (1) Notwithstanding any law, the time period specified in subdivision (a) to apply the base year value of qualified property to replacement property reconstructed on the site of the damaged or destroyed property is extended by three years if the qualified property was substantially damaged or destroyed on or after November 1, 2024, but before February 1, 2025.
(2) This subdivision shall apply to the determination of base year values for the 2025–26 fiscal year and fiscal years thereafter.
(3) For purposes of this subdivision, “qualified property” means property that was substantially damaged or destroyed, as described in paragraph (1) of subdivision (c), by the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire, or the 2024 Mountain Fire or Franklin Fire, for which the Governor proclaimed a state of emergency.
(g) This section shall apply to real property damaged or destroyed by misfortune or calamity on or after January 1, 2017.
SEC. 2.
Section 171.5 is added to the Revenue and Taxation Code, to read:171.5.
(a) Notwithstanding Section 51, for purposes of determining the full cash value of qualified real property, the fair market value of that qualified real property on January 1, 2025, shall be its full cash value as of the date the property was damaged or destroyed, taking into account reductions in value due to damage, destruction, depreciation, obsolescence, removal of property, or other factors causing a decline in value.(b) For purposes of this section, “qualified real property” shall mean real property impacted by the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire, for which the Governor proclaimed a state of emergency, if the sum of the full cash values of the land, improvements, and personality before the damage or destruction exceeds the sum of the values after the damage by ten thousand dollars ($10,000) or more, and if the property is not eligible for relief under Section 170.
SEC. 3.
The Legislature finds and declares that Sections 1, 1.5, and 2 of this act, which amend Section 70.5 of, and add Section 171.5 to, the Revenue and Taxation Code, do not constitute a gift of public funds within the meaning of Section 6 of Article XVI of the California Constitution and serve the following public purpose:To ensure that owners of real property that has been substantially damaged or destroyed in the 2025 Palisades Fire, Eaton Fire, Hurst Fire, Lidia Fire, Sunset Fire, or Woodley Fire, for which the Governor proclaimed a state of emergency, are provided the full and fair opportunity to reconstruct on the site of the damaged or destroyed real property and to retain the property tax base year value of that property, an extension of the deadline in Section 70.5 of the Revenue and Taxation Code is necessary. Additionally, to prevent undue hardship for owners of real property that has suffered significant reduction in value due to damage, destruction, depreciation, obsolescence, removal of property, or other factors causing a decline in value, these factors should be taken into account in determining property valuations for the 2025 calendar year, as provided by Section 171.5 of the Revenue and Taxation Code.
SEC. 4.
Section 1.5 of this bill incorporates amendments to Section 70.5 of the Revenue and Taxation Code proposed by this bill and Senate Bill 663. That section of this bill shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2026, (2) each bill amends Section 70.5 of the Revenue and Taxation Code, and (3) this bill is enacted after Senate Bill 663, in which case Section 70.5 of the Revenue and Taxation Code, as amended by Senate Bill 663, shall remain operative only until the operative date of this bill, at which time Section 1.5 of this bill shall become operative, and Section 1 of this bill shall not become operative.SEC. 5.
If the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code.SEC. 6.
Notwithstanding Section 2229 of the Revenue and Taxation Code, no appropriation is made by this act and the state shall not reimburse any local agency for any property tax revenues lost by it pursuant to this act.SEC. 7.
This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:Due to the potential inability of certain property owners to apply for, or respond to a notice of eligibility for, relief, and to provide immediate, automatic relief to victims of the fires in the County of Los Angeles and the County of Ventura, it is necessary that this act take effect immediately.
Text of AB 245 as chaptered, from the official record. Connect Plus keeps every version and highlights what changed.Compare versions