California State Board of Equalization

The California State Board of Equalization (BOE) is a public agency charged with tax administration and fee collection in the state of California in the United States. The authorities of the Board attempt to ensure that counties fairly assess property taxes, collect excises taxes on alcoholic beverages, administer the insurance tax program, and other tax collection related activities.^[1]

California State Board of Equalization

Partisan makeup of the Board of Equalization.
Board overview
Formed	1879 (1879)
Type	Tax administration and fee collection
Jurisdiction	Government of California
Headquarters	Sacramento, California
Employees	400
Board executives	Ted Gaines, First District Sally Lieber, Second District Tony Vazquez, Third District Mike Schaefer, Fourth District Malia Cohen, State Controller
Website	www.boe.ca.gov

The BOE is the only publicly elected tax commission in the United States.^[2] It is made up of four directly elected members, each representing a district for four-year terms, along with the State Controller, who is elected on a statewide basis, serving as the fifth member. In June 2017, Governor Jerry Brown signed legislation stripping the Board of many of its powers, returning the agency to its original core responsibilities (originating in the State Constitution in 1879).

History

The State Board of Equalization was created in 1879 by the ratification of the second Constitution of California. Its original mandate was to ensure that property tax assessments were uniform and equal across all counties in the state.^[1]

Prior to the creation of the state income tax, sales tax, and fuel taxes in the 1930s, California's state government was almost completely supported by property taxes, which were and still are assessed at the county level by elected tax assessors. Assessors were tempted to boost their popularity with county voters by undervaluing voters' property (and thereby lowering their taxes). This presented the risk of counties with honest assessors paying more than their fair share of the burden of operating the state government, so the Board of Equalization was created to equalize the burden.

The California Franchise Tax Board and the Employment Development Department are separately also responsible for collecting taxes.^[3] Some have criticized this as inefficient.^[4] Efforts to reform the Board were made in the 1940s, 1950s, 1960s, 1990s, and 2000s.^[3]

In 1994, Governor Pete Wilson vetoed a plan by the legislature to abolish the Franchise Tax Board and give its responsibilities to the Board of Equalization, explaining in his veto message that the state should have done the opposite. In 2004, Governor Arnold Schwarzenegger released a 2,500-page report seeking to merge the Board with other agencies and then promoted a bill by Assemblywoman Lois Wolk to do just that. The effort failed.^[3] In 2008, the agency employed approximately 3,950 people throughout the state.^[5]

By 2017, the Board had expanded to collecting $60 billion a year. It collected sales and use taxes, hazardous waste fees, jet fuel taxes, marijuana taxes, and over 30 additional taxes. That year, the Board had 4,700 employees and a $617 million annual budget. Board members are paid a $137,000 annual salary and are each allowed to hire a 12-member staff. Each year, the Board spends at least $3 million on education events where elected members appear before their constituents.^[3]

In March 2017, an audit by the California Department of Finance revealed missing funds and signs of nepotism, leading to calls for the governor to put the Board under a public trustee.^[6][7] In June 2017, the California Department of Justice began a criminal investigation into the members of the Board.^[8]

On June 27, 2017, Governor Jerry Brown signed into law legislation stripping the Board of many of its powers. The legislation created two new departments controlled by the governor responsible for the Board’s statutory duties, the California Department of Tax and Fee Administration and the California Office of Tax Appeals.^[9]

The Board still has its constitutional powers to review property tax assessments and insurer tax assessments, and its role in the collection of alcohol excise and pipeline taxes.^[10] It retained 400 employees, with the rest of its 4,800 workers being shifted to the new departments.^[9]

In 2023, constitutional amendment ACA-11 was introduced by Phil Ting in the California State Assembly to abolish the board and redistribute its staff and duties to other state tax agencies.^[11] The Los Angeles Times editorial board called for ACA-11 and ACA-9, which would abolish the elected position of California State Superintendent of Public Instruction, to pass the legislature and appear before voters as a ballot proposition.^[12]

Equalization districts

District map effective from January 1, 2015 until January 1, 2023 (left) and district map effective from January 1, 2023 (right) (Interactive version)

  First District

  Second District

  Third District

  Fourth District

For the purposes of tax administration, the BOE divides the state into four Equalization districts, each with its own elected board member.^[13] District boundaries are redrawn following the decennial census. The latest boundaries were drawn following the 2010 census and have been in effect since January 1, 2015.^[14]

First district

The First Equalization District is made up of the following counties: Alpine, Amador, Butte, Calaveras, El Dorado, Fresno, Inyo, Kern, Kings, Lassen, Madera, Mariposa, Merced, Modoc, Mono, Nevada, Placer, Plumas, Sacramento, San Joaquin, Shasta, Sierra, Siskiyou, Stanislaus, Sutter, Tulare, Tuolumne and Yuba; a portion of Los Angeles County including the cities of Azusa, Bradbury, Claremont, Duarte, Irwindale, La Verne, Lancaster, Palmdale, Pomona, San Dimas, San Fernando and Santa Clarita; and most of San Bernardino County, the portion not included in the Third and Fourth districts. From 2003 until 2015 most of this area was the Second District.

Second district

The Second Equalization District is made up of the following counties: Alameda, Colusa, Contra Costa, Del Norte, Glenn, Humboldt, Lake, Marin, Mendocino, Monterey, Napa, San Benito, San Francisco, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Solano, Sonoma, Tehama, Trinity and Yolo. From 2003 until 2015 most of this area was the First District.

Third district

The Third Equalization District is made up of Ventura County; most of Los Angeles County, the portion not included in the First District; and the city of Chino Hills in San Bernardino County. From 2003 until 2015 most of this area was the Fourth District.

Fourth district

The Fourth Equalization District is made up of the following counties: Imperial, Orange, Riverside and San Diego; and a portion of San Bernardino County including the cities of Colton, Fontana, Grand Terrace, Highland, Loma Linda, Redlands, Rialto, San Bernardino, Twentynine Palms, Yucaipa and Yucca Valley. From 2003 until 2015 most of this area was the Third District.

Members of the Board of Equalization

Current members

• 
  Ted Gaines (R)
  (First District)
• 
  Sally Lieber (D)
  (Second District)
• 
  Tony Vazquez (D)
  (Third District)
• 
  Mike Schaefer (D)
  (Fourth District)
• 
  Malia Cohen (D)
  (State Controller)

List of members

Year	1st District	2nd District	3rd District	4th District	State Controller (ex officio)
1879	James L. King	Moses M. Drew	Warren Dutton	Tyler D. Heiskel	Daniel M. Kenfield
1880
1881
1882
1883	Charles Gildea	L. C. Morehouse	C. E. Wilcoxon	John Markley	John P. Dunn
1884
1885
1886
1887	Gordon E. Sloss			John T. Gaffey
1888
1889
1890
1891	J. S. Swan		Richard H. Beamer	James R. Hebbron	Edward P. Colgan
1892
1893
1894
1895	A. Chesebrough			George L. Arnold
1896
1897
1898
1899	J. G. Edwards	Alexander Brown		Thomas O. Toland
1900
1901
1902
1903	William H. Alford			Frank Mattison
1904
1905
1906					A. B. Nye
1907	Joseph H. Scott		Richard E. Collins	Jeff McElvaine
1908
1909
1910
1911	Edward M. Rolkin	John Mitchell
1912
1913					John S. Chambers
1914
1915	John C. Corbett
1916
1917
1918
1919				Phillip D. Wilson
1920
1921					Ray L. Riley
1922
1923				Harvey G. Cattell
1924
1925
1926
1927	John C. Corbett	Fred E. Stewart
1928
1929
1930
1931
1932
1933
1934
1935				Orfa Jean Shontz
1936
1937					Harry B. Riley
1938
1939	George R. Reilly			William G. Bonelli
1940
1941
1942
1943		James H. Quinn
1944
1945
1946					Thomas Kuchel
1947			Jerrold L. Seawell
1948
1949
1950
1951
1952
1953					Robert C. Kirkwood
1954			Paul R. Leake
1955				Robert E. McDavid
1956
1957
1958
1959		John W. Lynch		Richard Nevins	Alan Cranston
1960
1961
1962
1963
1964
1965
1966
1967					Houston I. Flournoy
1968
1969
1970
1971			William M. Bennett
1972
1973
1974
1975					Kenneth Cory
1976		Iris G. Sankey
1977
1978
1979		Ernest J. Dronenburg Jr.
1980
1981
1982
1983	Conway H. Collis
1984
1985
1986
1987	William M. Bennett	Conway H. Collis	Ernest J. Dronenburg, Jr.	Paul B. Carpenter	Gray Davis
1988
1989
1990
1991		Brad Sherman		Matt Fong
1992
1993
1994
1995	Johan Klehs	Dean Andal		Brad Sherman	Kathleen Connell
1996
1997				John Chiang
1998
1999			Claude Parrish
2000
2001
2002
2003	Carole Migden	Bill Leonard			Steve Westly
2004
2005	Betty Yee
2006
2007			Michelle Steel	Judy Chu	John Chiang
2008
2009
2010		Barbara Alby / Sean Wallentine		Steve Shea / Jerome Horton
2011		George Runner		Jerome Horton
2012
2013
2014
2015	George Runner	Fiona Ma	Jerome Horton	Diane Harkey	Betty Yee
2016
2017
2018
2019	Ted Gaines	Malia Cohen	Tony Vazquez	Mike Schaefer
2020
2021
2022
2023		Sally Lieber			Malia Cohen

Programs

After being reduced to its constitutional responsibilities in 2017, the Board retained almost none of its tax and fee responsibilities.^[15][16][17] The only property taxes it actively administers in its entirety are state-assessed properties and the Private Railroad Car Tax; the Board acts only in an appellate role in collecting the Alcoholic Beverage Tax and Insurance Tax, reviewing appeals of denials of claims for refund.^[18]

However, the Board does continue to appraise and audit public utilities, railroad companies and properties owned by counties outside of their own jurisdictions, known as 'state-assessed properties', and hear appeals from its own staff appraisals.

Tax administration programs

• State-assessed properties
• Private Railroad Car Tax

Regulatory programs

• County-assessed properties

Appellate-only programs

• Alcoholic Beverage Tax
• Tax on Insurers

Former responsibilities (as of 2008)

Sales and use tax programs Sales and Use Tax Bradley-Burns Uniform Local Sales and Use Tax District Transactions (Sales) and Use Tax Special tax and fee programs Electronic Waste Recycling Fee Environmental Fees Hazardous Substances Tax Marine Invasive Species Fee (formerly Ballast Water Management Fee) Occupational Lead Poisoning Prevention Fee Excise Taxes Alcoholic Beverages Tax Alternative Cigarette Tax Stamp Program (ACTS) California Tire Fee Cigarette and Tobacco Products Tax Cigarette and Tobacco Products Licensing Program Emergency Telephone Users Surcharge Energy Resources Surcharge Insurance Tax Integrated Waste Management Fee Natural Gas Surcharge Fuel Taxes Aircraft Jet Fuel Tax Childhood Lead Poisoning Prevention Fee Diesel Fuel Tax International Fuel Tax Agreement (IFTA) Interstate User Diesel Fuel Tax Motor Vehicle Fuel Tax Oil Spill Response, Prevention, and Administration Fees Underground Storage Tank Maintenance Fee Use Fuel Tax Property Tax Programs County-assessed droperties Private Railroad Car Tax State-assessed properties Timber Yield Tax Tax Appellate Programs Bank and Corporation Tax Law Personal Income Tax Homeowner and Renter Property Tax Assistance Law Publicly Owned Property Assessment Review Program Taxpayers' Bill of Rights Law

See also

• Districts in California

Notes

References

1. State Board of Equalization, About BOE
2. State Board of Equalization, Board Members
3. Ashton, Adam (23 April 2017). "For 90 years, Californians have tried to kill this tax board. This is why they failed". The Sacramento Bee. Retrieved 25 April 2017.
4. Daniel L. Simmons, California Tax Collection: Time for Reform, 48 Santa Clara L. Rev. 279 (2008).
5. State Board of Equalization, 2007-2008 Annual Report, Profile, "Governance" p. 3.
6. Ashton, Adam (24 March 2017). "Audit: California tax collectors on 'parking lot duty' for promotional events as politicos push boundaries". The Sacramento Bee. Retrieved 25 April 2017.
7. Ashton, Adam (31 March 2017). "Here's the audit shaking up the Board of Equalization". The Sacramento Bee. Retrieved 25 April 2017.
8. Ashton, Adam (20 June 2017). "Criminal investigation targets California tax board leaders". The Sacramento Bee. Retrieved 18 July 2017.
9. McGreevy, Patrick (27 June 2017). "In massive shakeup, Gov. Jerry Brown breaks up California's scandal-plagued tax collection agency". Los Angeles Times. Retrieved 18 July 2017.
10. "California – Bill shifts nearly all tax administration and appeal functions from the BOE to two new tax organizations". PricewaterhouseCoopers. June 2017. Retrieved 18 July 2017.
11. "ACA 11: State tax agency". CalMatters. Retrieved November 23, 2024.
12. Editorial Board (March 27, 2023). "Editorial: The Board of Equal What? Let California voters decide whether to dump pointless elected positions". Los Angeles Times. Retrieved November 23, 2024.
13. "Maps: Final Draft Board of Equalization Districts | California Citizens Redistricting Commission". wedrawthelines.ca.gov. Archived from the original on 30 September 2011. Retrieved 17 January 2022.
14. Equalization, California State Board of. "BOE District Boundaries Effective January 5, 2015 - California State Board of Equalization". www.boe.ca.gov.
15. State Board of Equalization, 2007-2008 Annual Report, Profile, "Tax and Fee Programs, 2007-2008" pp. 2.
16. State Board of Equalization. "Special Taxes". Retrieved May 21, 2006.
17. "Summary of Constitutional and Statutory Authorities" (PDF). California State Board of Equalization. December 2019. Archived (PDF) from the original on 2006-09-23.
18. "Fact Sheet" (PDF). California Board of Equalization. Archived (PDF) from the original on 2019-04-25.

External links

• Board of Equalization