New MPC Commissioner to be Appointed

The Santa Barbara County Executive Office is seeking to fill a vacancy on the Montecito Planning Commission, effective immediately. The vacancy is left from the departure of Charles Newman, who stepped down from the Commission at the end of his second term in December. 

Newman was appointed to the Montecito Planning Commission in January 2017, and was reappointed for a second term in 2019. Current Commissioners include Bob Kupiec and Susan Keller, who have one year remaining in their terms, and Donna Senauer and Ron Pulice, who were both reappointed for another term in January of this year. 

According to Darcel Elliott with First District Supervisor Das Williams’ office, a new appointment to the Commission will be made in March, in time for the March 17 Montecito Planning Commission Hearing. Supervisor Williams is in the process of considering both new applications as well as considering from a pool of applicants from previous MPC vacancies. If you are interested in applying to serve on the Commission, and have not applied before, visit www.countyofsb.org/ceo/cob.sbc. 

Supervisor Williams also made his annual appointments to Montecito Board of Architectural Review (MBAR) in January; Claire Gottsdanker, Sam Maphis, and Don Sharpe were reappointed to the Board. 

Both the MBAR and MPC are still going strong after nearly 18 years since their inception in 2003. Both governmental bodies were formed after an attempt to annex Montecito as its own city failed; at the time, Montecito land use issues were heard by the Santa Barbara County Planning Commission, and many Montecito residents felt our community would be better served with a separate planning commission and architectural review board solely for Montecito.Bob Meghreblian, who passed away in 2018, and several other instrumental Montecito residents formed a group to look into the idea, and after consulting with then First District Supervisor Naomi Schwartz and her staff, the Board of Supervisors granted approval for a Montecito Planning Commission and Montecito Board of Architectural Review for just a two-year trial period. 

The two entities have no doubt shaped and protected the “village feel” of Montecito, ensuring projects and builders adhere to the Montecito Community Plan. 

Prop 19: What You Should Know

With California’s Proposition 19 passing with 51% of the vote last November, the complicated proposition that has significant financial implications for millions of Californians is still very confusing for many property sellers. February 16, 2021, and April 1, 2021 are two important dates related to Prop 19; here is what you need to know. 

Prop 19 allows homeowners who are over 55 years old or older, severely disabled, or whose home was substantially damaged by wildfire or a natural disaster to transfer their property tax base of their primary residence to a new (replacement) primary residence anywhere in California within two years, regardless of the value of the replacement property. Propositions 60 and 90, which were in effect prior to the passing of Prop 19, allowed a homeowner 55 or older to transfer their property tax base to a property of equal or lesser value within the same county (Prop 60) or to another eligible reciprocating county – of which there were roughly 10 participating counties (Prop 90). Prop 19 also allows a homeowner to transfer the property tax base up to three times, or as often as needed for victims of wildfire or other natural disasters. Previously, sellers could only make use of the transfer one time. 

According to the California Association of Realtors (CAR), which is keeping California realtors abreast of how the law will affect their clients, the tax benefits of Prop 19 take effect on April 1, 2021. While the details are still unclear, the CAR reports that the tax benefits under Prop 19 will apply to transactions where either the sale or purchase takes place before April 1, as long as the subsequent sale or purchase takes place within two years and occurs on or after April 1. The law still allows for the purchase of the replacement property to occur before the sale of the original property, which is a nice perk in a tight sellers’ market like we are currently experiencing. Property owners are encouraged to consult with a real estate attorney or tax advisor if the sale of one of the properties occurs before April 1. 

As mentioned, homeowners can now purchase more expensive properties and still qualify for the tax benefits. For replacement properties that are of greater value, a new tax basis is calculated by adding the difference between the full value of the new property and the original property to the original tax basis. An example would be if the original property is based on a $500,000 tax basis, but is now worth $1.2M, and the replacement property costs $2M, the tax basis of the new property would be $1.3M. This is a significant savings for a homeowner. If the new property is equal to or less than the value of the old property, the taxable value of the original property may be transferred and become the taxable value of the new property; i.e. the tax basis does not decrease. 

Another key aspect of Prop 19 is the tax reassessment related to intergenerational property transfers within a family. Under Prop 19, the only time an intergenerational property transfer is not subject to a tax reassessment is when a primary residence is transferred to a child or grandchild, and that person continues to use the property as a primary residence; i.e. not as an investment property where tenants are installed. Even in this situation, the child or grandchild will be required to pay a higher taxation if the difference between the taxable value and actual market value is more than $1M. The new taxable basis will be the assessed value of the property at the time of transfer, minus $1M. If a child or grandchild inherits a property and chooses not to use it as a primary residence, the property’s tax basis will be reassessed; these new rules began earlier this week, on February 16. Another thing to note: in order for a transfer from a grandparent to a grandchild to be eligible for the tax break, the parents of the grandchild must be deceased. 

Prop 19 is complex and every situation is different. The County’s Tax Assessor website has a plethora of information including contact information for questions related to tax basis transferring in various situations. Visit www.county
ofsb.org/care/assessor/home.sbc, and click on the orange “Proposition 19” button at the top of the page.