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<ns0:Id>20250SB__117298AMD</ns0:Id>
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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-18</ns0:ActionDate>
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<ns0:ActionText>AMENDED_SENATE</ns0:ActionText>
<ns0:ActionDate>2026-03-23</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Senator Hurtado</ns0:AuthorText>
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<ns0:House>SENATE</ns0:House>
<ns0:Name>Hurtado</ns0:Name>
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<ns0:Title>An act to add Section 53084.6 to the Government Code, relating to tax sharing agreements.</ns0:Title>
<ns0:RelatingClause>tax sharing agreements</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Bradley-Burns Uniform Local Sales and Use Tax Law: location of transaction: genuine human interaction.</ns0:Subject>
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<html:p>Existing law prohibits a local agency from entering into any form of agreement that would result, directly or indirectly, in the payment, transfer, diversion, or rebate of any tax revenue resulting from the imposition of a sales and use tax under the Bradley-Burns Uniform Local Sales and Use Tax Law to any person for any purpose when the agreement results in a reduction in the amount of revenue under the Bradley-Burns Uniform Local Sales and Use Tax Law that, in the absence of the agreement, would be received by another local agency and the retailer continues to maintain a physical presence within the territorial jurisdiction of that other local agency. Existing law also requires a local agency entering into an agreement that results in a reduction of the amount of revenue under the Bradley-Burns Uniform
Local Sales and Use Tax Law that, in the absence of the agreement, would be received by another local agency to take certain actions with respect to that agreement, including posting the proposed agreement on its internet website for at least 30 days prior to ratification or approval of that agreement by its governing body.</html:p>
<html:p>This bill would prohibit a person from paying compensation to a consultant with respect to a specific tax sharing agreement, as defined, that exceeds the lower of 5% of the total tax revenues shared pursuant to the tax sharing agreement and $250,000. The bill would define a tax sharing agreement for this purpose to mean any agreement under which a local agency, as defined, agrees to rebate, refund, or otherwise share a portion of locally generated tax revenues with a private party. The bill would require a local agency to publish on its internet website and submit to the Controller certain information with respect to any tax sharing agreement. By
imposing new duties on local agencies regarding publication and submission of information, the bill would impose a state-mandated local program. The bill would exclude from these provisions agreements between a local agency and a member of the agency’s staff directly employed by the jurisdiction or technical consultants providing noncompensated advisory services. The bill would apply these provisions only to agreements entered into on and after January 1, 2027.</html:p>
<html:p>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.</html:p>
<html:p>This bill would provide that no reimbursement shall be made pursuant to these statutory provisions for costs mandated by the state pursuant to this act, but would recognize that a local agency or school district may pursue any available remedies
to seek reimbursement for these costs.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Section 53084.6 is added to the
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, to read:
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<ns0:Num>53084.6.</ns0:Num>
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(a)
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As used in this section:
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(1)
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“Consultant” means a person or a business that provides services, including, but not limited to, legal, lobbying, or financial services, for facilitating, negotiating, and advising on a tax sharing agreement.
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(2)
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“Local agency” means a city, county, city and county, or special district.
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(3)
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“Tax sharing agreement” means any arrangement under which a local agency agrees to rebate, refund, or otherwise share a portion of locally generated tax revenues with a private entity.
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(b)
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A person shall not pay compensation to a
consultant with respect to a specific tax sharing agreement that exceeds the lower of the following:
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(1)
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Five percent of the total tax revenues shared pursuant to the tax sharing agreement.
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(2)
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Two hundred fifty thousand dollars ($250,000).
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<html:p>
(c)
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A consultant shall not receive compensation from proceeds of a tax sharing agreement more than three years after the effective date, or completion of the project phase that directly benefits from the agreement, whichever occurs first.
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(d)
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A local agency shall, within 30 days of entering a tax sharing agreement, publish on its internet website and report to the Controller, in the form and manner prescribed by the Controller, all of the following:
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(1)
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The names of all consultants engaged by the local agency for purposes of the agreement.
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(2)
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The total amount and structure of compensation to be received by the consultant.
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(3)
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The form of compensation paid to the consultant, such as by flat fee, success fee, or percentage-based arrangement.
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(4)
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A copy of any consultant contract or agreement related to the tax sharing agreement.
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(e)
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This section shall not apply to the following:
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(1)
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Local agency staff directly employed by the jurisdiction executing the agreement.
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(2)
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Technical consultants providing noncompensated advisory services.
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(f)
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This section shall only apply to tax sharing agreements entered into on or after January 1, 2027.
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<ns0:Num>SEC. 2.</ns0:Num>
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<html:p>No reimbursement shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code for costs mandated by the state pursuant to this act. It is recognized, however, that a local agency or school district may pursue any remedies to obtain reimbursement available to it under Part 7 (commencing with Section 17500) and any other law.</html:p>
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