Assembly Bill (AB) 428 Will Establish a Five Year 30% Tax Credit for Seismic Retrofit of Earthquake Vulnerable Buildings
LOS ANGELES--Mayor Eric Garcetti and Assemblymember Adrin Nazarian today stood on the steps of the seismic-retrofitted Van Nuys City Hall to highlight historic legislation which would provide a five-year 30% state seismic tax credit to property owners for safety improvements to their vulnerable buildings.
“It’s not a question of if, but rather when the next big earthquake will hit Los Angeles, and together with Assemblymember Nazarian, we’re taking action to shore up our buildings and better protect our city from the inevitable,” said Mayor Garcetti. “AB428 would take an important step in making my seismic resilience plan a reality, providing a tax benefit to help building owners complete lifesaving retrofits. I urge the State Legislature to pass this important legislation.”
Author of AB 428, Assemblymember Nazarian added: “It is common sense legislation that will help property owners afford lifesaving structural changes to their buildings. On average, a dollar spent on hazard mitigation provides our community about $4 in future benefits.”
"With lives as well as dollars on the line, for Los Angeles, preparing for the next major earthquake is both a pragmatic necessity, as well as a moral imperative," said Councilmember Bob Blumenfield. "Providing tax credits for critically needed seismic retrofits is not only the smart thing to do, but the right thing to do. Assemblymember Nazarian's proposal will work with existing PACE programs for seismic upgrades to reduce already low interest rates and give property owners an additional tool to absorb the costs of critical improvements."
This bill will support Mayor Garcetti’s “Resilience by Design” seismic safety and resilience plan that he created with the USGS’s Dr. Lucy Jones. Part of his plan requires retrofitting of two types of vulnerable buildings: retrofits would be required within 5 years at “soft-first-story” buildings built prior to 1980, and required within 25 years at “non-ductile reinforced concrete” buildings built prior to 1980. AB 428 provides a powerful financial incentive for property owners to make the seismic upgrades within the next five years at a substantially reduced cost.
“We need to act decisively now to protect our state from senseless and preventable loss of life and property, stated Assemblymember Nazarian. “We know ‘soft-first-story’ buildings built prior to 1980, and ‘non-ductile reinforced concrete’ buildings built prior to 1980 are vulnerable. To do nothing is simply criminal.”
The key components of Assembly Bill 428:
- Establishes a 5 year 30% tax credit for qualified costs associated with Seismic Retrofit for qualified owners of an “at-risk property.” The tax credit is awarded upon completion of Seismic Retrofit.
- Defines an “at-risk property” as a building that is deemed hazardous and in danger of collapse in the event of a major earthquake and is certified as so by the appropriate local jurisdiction with authority for building code enforcement, including but not limited to, soft story buildings, non-ductile concrete residential buildings, and pre-1980 concrete residential buildings.
- Provides that a municipality’s local agency with jurisdiction for building code and safety enforcement certify an “at-risk building” located within their area.
- Provides what type of Seismic Retrofit Construction qualifies under the credit to mitigate seismic damage
- Sets a sunset date of December 1, 2021.
Recent findings by UC Berkley researchers identified 1,500 concrete buildings that are seismically vulnerable in just the Los Angeles area. The researchers state that in the event of a huge earthquake 75 are likely to collapse but many more will be affected.
“Strengthening our most vulnerable buildings is a critical first step in developing the groundwork for the Mayor’s broader vision of keeping our infrastructure and economy in tact in the event of a major earthquake. Having viable building, water, and telecommunication infrastructure are key elements to earthquake preparedness that I am committed to working on with our partners at the local level and statewide,” stated Assemblymember Nazarian.