1

Filed 4/16/14 (unmodified version attached)

IN THE SUPREME COURT OF CALIFORNIA

JOSEPH E. HOLLAND, as Assessor, etc., )

)

Plaintiff and Appellant, )

) S205876

v. )

) Ct.App. 2/6 B229656

ASSESSMENT APPEALS BOARD NO. 1, )

)

 Defendant and Respondent; ) Santa Barbara County

) Super. Ct. No. 01244457

RANCHO GOLETA LAKESIDE )

MOBILEERS, INC., et al., )

)

Real Parties in Interest and )

Respondents. )

____________________________________)

ORDER MODIFYING OPINION AND

DENYING PETITION FOR REHEARING

THE COURT:

The opinion herein, filed January 23, 2014, appearing at 58 Cal.4th 482, is 

modified as follows:

On page 487, of the majority opinion, in the first paragraph, following the 

phrase “In this case, the Assessor for the County of Santa Barbara (Assessor) 

reassessed,” insert the following phrase after the word “reassessed” and before the 

word “two:” “26 subsequent transfers of individual interests in.” In the same 

sentence, delete the word “owned” and substitute the word “held.” The new 

sentence should read as follows: “In this case, the Assessor for the County of 
2

Santa Barbara (Assessor) reassessed 26 subsequent transfers of individual interests 

in two mobilehome parks held by resident-controlled nonprofit corporations after 

certain residents sold both their mobilehomes and their interests in the 

corporation.”

This modification does not affect the judgment.

The petition for rehearing is denied.
1

Filed 1/23/14 (Unmodified version)

IN THE SUPREME COURT OF CALIFORNIA

JOSEPH E. HOLLAND, as Assessor, etc., )

)

Plaintiff and Appellant, )

) S205876

v. )

) Ct.App. 2/6 B229656

ASSESSMENT APPEALS BOARD NO. 1, )

)

 Defendant and Respondent; ) Santa Barbara County

) Super. Ct. No. 01244457

RANCHO GOLETA LAKESIDE )

MOBILEERS, INC., et al., )

)

Real Parties in Interest and )

Respondents. )

____________________________________)

In 1978, California voters adopted Proposition 13, which added article XIII 

A to our state Constitution. This amendment limited the rate at which real 

property in this state may be taxed and the extent to which the assessed value of 

real property may be increased. As relevant here, real property may be taxed at no 

more than 1 percent of its “full cash value,” with “full cash value” defined to mean 

either the assessed value of that property in the 1975–1976 tax year or the 

property’s value at the time of a subsequent “change in ownership,” subject to an 

adjustment for inflation. (Cal. Const., art. XIII A, §§ 1, subd. (a), 2, subds. (a) & 

(b).) Thus, real property generally is taxed based on its value at the time of 

acquisition, not its current value. The task of defining when there has been a 

change in ownership that triggers reassessment has been left largely to the 
2

Legislature. (Pacific Southwest Realty Company v. County of Los Angeles (1991) 

1 Cal.4th 155, 160–161.) 

This case concerns the assessment of certain types of mobilehome parks. 

Mobilehome parks in California may be organized in a number of ways. In 1985, 

the Legislature passed a statute intended to encourage one particular form of 

organization. Pursuant to what is now Revenue and Taxation Code section 62.1, 

subdivision (a)(1), a “transfer . . . of a mobilehome park to a nonprofit corporation, 

stock cooperative corporation, limited equity stock cooperative, or other entity 

formed by the tenants of a mobilehome park, for the purpose of purchasing the 

mobilehome park” is deemed not to be a change in ownership of the park. (All 

undesignated statutory references are to the Revenue and Taxation Code.) Thus,

section 62.1, subdivision (a)(1) allows the residents of a mobilehome park to form 

a nonprofit corporation or similar entity to take ownership of the park without 

triggering reassessment.

Subsequently, in 1988, the Legislature introduced Senate Bill No. 1885

(1987–1988 Reg. Sess.) in part to address a problem in the tax treatment of 

mobilehome parks that emerged under section 62.1. Transfers of interests in 

mobilehome parks held by a nonprofit corporation, unlike those held by a 

condominium or stock cooperative, did not constitute a change in ownership under 

the Revenue and Taxation Code. (See §§ 61, 65.1.) Therefore, once a 

mobilehome park was purchased by a nonprofit corporation or similar entity, 

subsequent transfers of membership shares were not subject to reassessment. As 

explained in an analysis of Senate Bill No. 1885 prepared by the State Board of 

Equalization (SBE), “[p]utting a park into a nonprofit mutual benefit corporation

ownership could mean that no part of the park would ever be reappraised again, 

since transfers of individual interests in a nonprofit corporation do not trigger 

reappraisal. This would give mobilehome parks much more favorable treatment 
3

than the average homeowner.” (SBE, analysis of Sen. Bill No. 1885 (1987–1988 

Reg. Sess.) Mar. 24, 1988, p. 2.)

In amending section 62.1, the Legislature crafted a rule to facilitate what it 

viewed as equitable tax treatment of these property interests: Where a 

mobilehome park has been purchased by a nonprofit corporation or similar entity, 

any subsequent transfers “of shares of the voting stock of, or other ownership or 

membership interests in, the entity that acquired the park . . . shall be a change in 

ownership of a pro rata portion of the real property of the park . . . .” (§ 62.1, 

subd. (b)(1).) The Legislature defined the term “ ‘pro rata portion of the real 

property’ ” as “the total real property of the mobilehome park multiplied by a 

fraction consisting of the number of shares of voting stock, or other ownership or 

membership interests, transferred divided by the total number of outstanding 

issued or unissued shares of voting stock of, or other ownership or membership 

interests in, the entity that acquired the park . . . .” (§ 62.1, subd. (b)(2).) Thus, no 

change of ownership occurs when the residents of a mobilehome park form a 

nonprofit corporation or similar entity that purchases the park. But if one of the

residents subsequently transfers his or her interest in the entity that owns the park, 

that transfer will constitute a change in ownership of a “pro rata portion” of the 

park. 

In this case, the Assessor for the County of Santa Barbara (Assessor) 

reassessed two mobilehome parks owned by resident-controlled nonprofit 

corporations after certain residents sold both their mobilehomes and their interests 

in the corporation. The mobilehomes themselves, which are classified as personal 

property, were assessed separately. (§§ 5801, 5810.) Following the guidance of 

the SBE, the Assessor appraised the real property interest subject to reassessment 

— i.e., a fraction of the mobilehome park itself — by subtracting the estimated 

market value of the mobilehome from the total price paid for both the mobilehome 
4

and the membership interest in the corporation owning the park. We are asked to 

determine whether section 62.1, subdivision (b) (hereafter section 62.1(b))—

which states that a transfer of a membership in an entity that owns a mobilehome 

park is a “change of ownership of a pro rata portion of the real property of the 

park” — requires an assessor to instead appraise such an interest by first 

estimating the value of the entire park and then multiplying that value by the 

fractional interest in the park that was transferred. We conclude that it does not. 

Section 62.1(b) simply describes a unit of real property that is subject to 

reassessment; it does not mandate any particular formula for appraising this unit. 

Accordingly, we reverse the judgment of the Court of Appeal, which affirmed the 

denial of the Assessor’s petition for a writ of mandate. 

I.

Rancho Goleta Mobilehome Park (Rancho Goleta) was purchased in 1992 

for $9.4 million by Rancho Goleta Lakeside Mobileers, Inc., a nonprofit 

corporation whose members are residents of the park. Silver Sands Village 

Mobilehome Park (Silver Sands) was similarly purchased by a nonprofit 

corporation formed by park residents, Silver Sands Inc., for $1.5 million in 1998. 

All of the residents in these parks — including both those residents who hold 

interests in the corporations that own the parks and the handful of residents who 

do not — entered into a lease with the corporation that entitles each resident to a 

specific mobilehome space. During the 2001 calendar year, a total of 26 members 

of these two corporations sold both their membership interests and their 

mobilehomes to incoming residents of the parks. 

In 1999, the SBE issueD an advisory letter to county assessors that

described how mobilehome parks should be assessed following such transfers of 

individual interests in resident-owned mobilehome parks. (Letter No. 99/87, 

Individual Transfers in Resident-Owned Mobilehome Parks (Dec. 31, 1999) (LTA 
5

No. 99/98).) LTA No. 99/87 explained that such a sale “conveys to its holder in 

substance: (1) the outright ownership of a particular mobilehome, and (2) the 

exclusive right to occupy a particular space within the park.” (Id. at p. 3.) The 

letter observed that the phrase “pro rata portion of the real property” in section 

62.1(b) is “the fractional interest in the park that is conveyed by the transferred 

share of stock.” (Ibid.) It also observed that the “appraisal unit” to be considered 

in calculating the fair market value of this interest is “the individual mobilehome 

space and the mobilehome,” as “it is clear that what persons in the marketplace 

commonly buy and sell as a unit is not the entire park, but rather the fractional 

interests conveyed by the individual interests.” (Id. at p. 4; see § 51, subd. (d) 

[defining appraisal unit]; 18 Cal. Code Regs., § 324, subd. (b).) Thus, “if the 

reported purchase price was negotiated in the open market at arm’s length, then it 

is our view that the entire amount should be reflected in the combined assessments 

of the mobilehome and the underlying interest in the park.” (LTA No. 99/87, at 

p. 3.) LTA No. 99/87 concluded that the “most reasonable way of allocating the 

value” between the mobilehome and the underlying fractional interest in the park 

was to employ what has been termed the extraction method: “(1) extract from the 

reported purchase price the value of the mobilehome itself, using the N.A.D.A. 

Manufactured Housing Appraisal Guide or another recognized value guide, and 

then (2) assign the remainder of the purchase price to the interest in the park.” 

(Ibid.)

The Assessor applied LTA No. 99/87’s extraction method of appraisal in 

reassessing both Rancho Goleta and Silver Sands for the 2002–2003 tax year. In 

response, the corporations that owned these parks filed applications for changed 

assessment with Santa Barbara County Assessment Appeals Board No. 1 (Appeal 

Board). At the parties’ request, the Appeal Board consolidated the hearing on 

these applications and then bifurcated the proceedings into two phases, with the 
6

first focusing on questions of law and the second on the valuation of the parks.

After conducting extensive hearings, the Appeal Board issued an opinion in the 

first phase resolving the issues of law adversely to the Assessor. It determined 

that the appraisal method set forth in LTA No. 99/87 was inconsistent with section 

62.1(b). That statutory provision, the Appeal Board concluded, prescribed the 

following formula for appraising the portion of the park subject to reassessment: 

“Fractional Interest x FMV [Fair Market Value] of Entire Real Property of Park = 

FMV of Fractional Interest.”

At the second phase, the parties presented evidence regarding the proper 

valuation of the parks. Both corporations submitted the reports of an expert 

appraiser, who concluded that Rancho Goleta’s fair market value during 2001 was 

$13 million and that Silver Sands’ fair market value ranged from $2.25 million to 

$ 3.4 million during 2001. The Assessor, in turn, submitted evidence that the two 

parks should be valued at approximately $39.8 million and $15.6 million, 

respectively. The Assessor arrived at these values through a so-called “market 

approach,” which, like the extraction method described in LTA No. 99/87, 

subtracted the estimated market value of the mobilehome from the total purchase 

price paid for both the mobilehome and the interest in the entity owning the park, 

and then used that figure to calculate the value of the entire park.

In a second opinion, the Appeal Board rejected the appraisals submitted by 

the Assessor and instead used those submitted by the two corporations to calculate 

the value of the interests subject to reassessment. Finding that the Assessor’s 

“market approach” was the “very same market approach model, but on a larger 

scale,” that it had already rejected as inconsistent with section 62.1(b), the Appeal 

Board concluded that “[w]hat was invalid on a small scale does not become 

legitimate by its use on a much larger scale.”
7

The Assessor filed a petition for a writ of mandate, which the Appeal Board 

and the corporations owning the two parks (collectively, respondents) opposed. 

After the trial court denied the petition, a divided Court of Appeal affirmed. The 

court concluded that while “[a]rguably, the Assessor presents a reasonable method 

for the taxation of changes in mobilehome ownership, . . . it is not the method set 

forth in section 62.1, subdivision [(b)].” Instead, the court found that the formula 

adopted by the Board “conforms to and embodies the plain meaning of the 

statute.” It went on to reject the Assessor’s various challenges to the Appeal 

Board’s application of that formula. In dissent, Justice Yegan argued that the 

court had failed to give proper deference to the SBE and concluded that although 

section 62.1(b) “establishes the formula for determining what portion of a 

mobilehome park’s real property is subject to separate assessment,” the statute “is 

silent . . . on the method assessors are to use in determining the value of the 

membership interest.”

II.

The question presented is whether section 62.1(b) simply defines a unit of 

property that is deemed to change ownership for assessment purposes, or whether 

it also prescribes the manner in which that unit of property is to be appraised. 

Applying well-established rules of statutory construction, we conclude that the 

former interpretation is correct: Section 62.1(b) does not compel an assessor to 

appraise fractional interests in resident-owned mobilehome parks using the 

formula adopted by the Appeal Board.

Our goal in construing a statute is “to determine and give effect to the intent 

of the enacting legislative body.” (People v. Braxton (2004) 34 Cal.4th 798, 810.) 

“ ‘We first examine the words themselves because the statutory language is 

generally the most reliable indicator of legislative intent. [Citation.] The words of 

the statute should be given their ordinary and usual meaning and should be 
8

construed in their statutory context.’ [Citation.] If the plain, commonsense 

meaning of a statute’s words is unambiguous, the plain meaning controls.” (Fitch 

v. Select Products Co. (2005) 36 Cal.4th 812, 818.) If, however, the statute is 

susceptible to more than one interpretation, we “may consider various extrinsic 

aids, including the purpose of the statute, the evils to be remedied, the legislative 

history, public policy, and the statutory scheme encompassing the statute. 

[Citation.]” (Torres v. Parkhouse Tire Service, Inc. (2001) 26 Cal.4th 995, 1003.) 

Moreover, “ ‘ “[i]t is a settled principle of statutory interpretation that language of 

a statute should not be given a literal meaning if doing so would result in absurd 

consequences which the Legislature did not intend.” [Citations.]’ ” (Horwich v. 

Superior Court (1999) 21 Cal.4th 272, 276.)

The text of section 62.1(b) offers little support for the Appeal Board’s 

interpretation. As noted, the relevant statutes provide that if a mobilehome park 

has been transferred to certain resident-owned entities and has been excluded from 

reassessment pursuant to section 62.1, subdivision (a), “any transfer . . . of shares 

of the voting stock of, or other ownership or membership interests in, the entity 

that acquired the park . . . shall be a change in ownership of a pro rata portion of 

the real property of the park.” (§ 62.1(b)(1).) “For the purposes of this 

subdivision, ‘pro rata portion of the real property’ means the total real property of 

the mobilehome park multiplied by a fraction consisting of the number of shares 

of voting stock, or other ownership or membership interests, transferred divided 

by the total number of outstanding issued or unissued shares of voting stock of, or 

other ownership or membership interests in, the entity that acquired the park . . . .” 

(§ 62.1(b)(2).)

The meaning of this statutory language is clear: When a membership 

interest in a resident-owned entity that owns a mobilehome park is transferred, a 

fraction of the underlying real property will be deemed to have changed 
9

ownership. Any contention that section 62.1(b) also identifies a method for 

appraising this fractional interest appears to rest on a misunderstanding of the term 

“pro rata.” That term simply means “[p]roportionately; according to an exact rate, 

measure, or interest.” (Black’s Law Dict. (9th ed. 2009) p. 1340, col. 2; see 

Merriam-Webster’s Collegiate Dict. (11th ed. 2003) p. 997 [defining “pro rata” as 

“proportionately, according to an exactly calculable factor”]; Rosenberg v. Frank

(1881) 58 Cal. 387, 405 [providing various examples of the definition of the term 

“pro rata,” including: “ ‘To divide or distribute proportionately; to assess pro 

rata,’ ” “ ‘according to a certain part, in proportion” and “(L. according to the 

rate) (com.) in proportion’ ”].) Although the term is often used to describe the 

distribution of a sum of money (see, e.g., id. at p. 406), its usage is not restricted to 

the division of money. In section 62.1(b), the interest that is being divided 

“proportionally” is “the real property of the park” (§ 62.1(b)(1)), and the rate (or 

proportion) according to which it is being divided is “the number of shares of 

voting stock, or other . . . membership interests, transferred divided by the total 

number of outstanding issued or unissued shares of voting stock of . . . or 

membership interests in, the entity that acquired the park” (§ 62.1(b)(2)). Thus, if 

there are 100 equal membership interests and one of these interests is transferred, 

then the “pro rata portion of the real property of the park” is simply 1/100 of the 

park.

Respondents, echoing a rationale adopted by the Court of Appeal below, 

contend that whereas the Appeal Board’s formula for appraising these interests 

“ ‘gives meaning to the term multiply as used in Section 62.1[(b)](2)’ . . . [,] the 

SBE’s interpretation ‘makes the term multiply completely meaningless since no 

multiplication occurs under the SBE’s approach.’ ” But this argument 

presupposes that section 62.1(b) prescribes a method for appraising the pro rata 

portion of the park. In fact, section 62.1(b) says nothing about how to appraise
10

this interest. It does not, for example, provide that the underlying real property 

interest must be appraised as a pro rata portion of the total value of the park. It 

also does not make any reference to “full cash value” or “fair market value” of the 

total real property of the park. Rather, the relevant “multiplication” contemplated 

by section 62.1(b) occurs simply in defining the interest to be valued: The real 

property interest deemed to have changed ownership is the total real property of 

the park multiplied by the fractional interest in the entity owning the park that has 

been transferred. In other words, the formula set forth in section 62.1(b) is not, as 

the Appeal Board concluded, “Fractional Interest x FMV of Entire Real Property 

of Park = FMV of Fractional Interest.” Rather, it is simply: Fractional Interest (in 

Entity Owning the Park) x Entire Real Property of Park = Fractional Interest in 

Real Property of Park. Section 62.1(b) is silent as to the method that must be used 

in appraising the interest defined by this formula.

To the extent that the statutory text leaves any room for alternative 

interpretations, legislative history supports the conclusion that section 62.1(b) 

simply defines a unit to be appraised and not a method of appraisal. The 

Legislature’s purpose in enacting this provision was to eliminate a potential 

loophole that had been discovered following the passage of the exemption codified 

in what is now section 62.1, subdivision (a). Like the SBE analysis (see ante, at p. 

2), an analysis prepared for the Assembly Committee on Revenue and Taxation 

explained: “[I]f a park were purchased by a nonprofit mutual benefit corporation, 

it is possible that no part of the park would ever be appraised again. Transfers of 

individual interest in a nonprofit corporation do[] not trigger a property 

reappraisal. Thus, current law could allow mobilehome parks more favorable tax 

treatment than the average homeowner receives.” (Assem. Com. on Rev. & 

Taxation, analysis of Sen. Bill No. 1885 (1987–1988 Reg. Sess.) Aug. 1, 1988, p. 

2.)
11

Section 62.1(b) eliminated this problem by defining an interest in the 

underlying real property itself that would be deemed to change ownership within 

the meaning of Proposition 13 when interests in the owning entity were 

transferred. There is no indication in the legislative history that section 62.1(b) 

was intended to do anything beyond what was necessary to close this loophole. 

The analysis for the Assembly Committee on Revenue and Taxation explained: 

“If the original stockholders (tenants) in the nonprofit organization transfer their 

stock or ownership interests in the park to a new owner, the transferred property 

will be subject to a change of ownership reappraisal. The new owner’s pro rata 

portion of the real property of the park is considered a change of ownership for tax 

purposes.” (Assem. Com. on Rev. & Taxation, analysis of Sen. Bill No. 1885 

(1987–1988 Reg. Sess.) Aug. 1, 1988, pp. 1–2.) A similar analysis for the

Assembly Ways and Means Committee explained that section 62.1(b) “provides 

that subsequent transfers of shares in the mobilehome park are changes of 

ownership for property tax purposes.” (Legisl. Analyst, analysis of Sen. Bill No. 

1885 (1987–1988 Reg. Sess.) Aug. 6, 1988, p. 1.) The fact that this provision was 

to be codified in section 62.1, in a subsection of the Revenue and Taxation Code 

that defines what will constitute a change of ownership triggering reassessment 

(see Auerbach v. Assessment Appeals Bd. No. 1 (2006) 39 Cal.4th 153, 161),

further confirms the understanding that section 62.1(b) merely defines a unit of 

property that is deemed to have changed ownership.

Respondents point to one snippet of the SBE’s legislative bill analysis in 

arguing that the Legislature also intended to enact a particular method for valuing 

this interest. The SBE sponsored Senate Bill No. 1885 (1987–1988 Reg. Sess.), 

which contained what is now section 62.1(b). In an early legislative bill analysis, 

the SBE, after explaining the purpose of the provision and identifying how it 

accomplished this purpose, went on to offer the following comments: “This 
12

amendment attempts to parallel as closely as possible the tax treatment accorded 

condominium and stock cooperatives. A perfect match is not possible, however, 

because the transfer of a share or membership interest in a nonprofit corporation is 

not the same thing as a transfer of ownership of a condominium or stock 

cooperative interest, which relates to specific identifiable property. Thus, rather 

than following the pattern prescribed in Section 65.1(b), which provides for 

reappraisal of the specific unit or lot transferred as well as a share of the common 

area, the amendment provides for a straight pro rate adjustment. [¶] Thus, any 

differences in a value between mobilehome spaces in a particular park cannot be 

recognized under this method.” (SBE, analysis of Sen. Bill No. 1885 (1987–1988 

Reg. Sess.) Feb. 2, 1988, pp. 2–3, italics added.) 

Other than the final, italicized sentence above, this explanation provides 

little support for respondents. The first three sentences of the excerpt quoted 

above explain that because an owner of a condominium has a formal, exclusive 

interest in specific identifiable property that a member of a nonprofit corporation 

does not, section 65.1, subdivision (b) identifies the interest in property to be 

reappraised when a condominium unit is sold as “the unit or lot transferred and the 

share in the common area reserved as an appurtenance,” while section 62.1(b) 

identifies the comparable interest as “a pro rata portion of the real property of the 

park.” It does not follow that a statute defining an interest in the latter fashion 

must also require a particular and distinct manner of appraising that interest. 

The final, italicized sentence does indicate that the SBE contemplated a 

particular manner in which the interest defined by section 62.1(b) would be 

appraised and that all such interests would be valued equally. Notably, however, 

this italicized sentence was omitted from later versions of the SBE’s bill analysis 

submitted to the Legislature. The omission occurred after the bill was amended to 

incorporate a provision requiring that an assessor provide a separate assessment of 
13

“a pro rata portion of the real property of a mobilehome park” that has changed 

ownership if certain conditions are met (§ 2188.10, subd. (a)) — an amendment 

that perhaps prompted the SBE to reconsider how such interests may be appraised. 

In any event, the earlier version of the SBE’s bill analysis on which respondents 

rely shows at most that the SBE might have believed, at one point in time, that the 

most appropriate way to assess these interests was the manner advocated by 

respondents here. It does not demonstrate that the SBE — or, for that matter, the 

Legislature — ultimately or ever believed that section 62.1(b) compels such a 

method of appraisal.

The Court of Appeal suggested that giving section 62.1(b) its plain meaning 

would produce absurd results by way of the following hypothetical, which was 

first set forth by the Appeal Board: “ ‘[I]f 3 purchasers simultaneously paid 

$300,000 for a mobile home and an ownership interest in the park and they 

acquire spaces that are immediately adjacent to each other and that are identical 

for purposes of this example, and if the values of the mobile homes respectively 

vary from $75,000 to $125,000 to $175,000, the underlying values of the real 

property, the spaces, for tax assessment purposes would [under the Assessor’s 

method] respectively vary from $225,000, $175,000 and $125,000.’ . . . The 

Board’s method of valuation, on the other hand, results in the same value being 

assigned to substantially similar properties . . . .” This hypothetical begs an 

obvious question: If the adjacent spaces are indeed identical, why would these 

three purchasers have paid the same amount in order to acquire mobilehomes 

whose values vary widely? These are not the sort of purchasing decisions one 

would expect to find in a well-functioning market. If each of these purchasers was 

in fact willing to pay the same amount for a mobilehome and the interest in the 

corporation, and if the mobilehome values were as varied as the hypothetical 

indicates, then the natural presumption would be that the sites associated with 
14

those mobilehomes actually differed in value. There is nothing odd about the 

possibility that two equal fractional interests in property could be assessed at two 

different values for tax purposes. One 1/100 interest in a park could be appraised 

differently from another 1/100 interest in the same park, depending on its location, 

shape, available views, and possibly other factors. And if the market reveals that 

two equal fractional interests in property do not, in fact, have the same value, there 

is no reason to construe section 62.1(b) contrary to its plain meaning in order to 

eliminate such discrepancies.

A final reason for concluding that section 62.1(b) does not mandate the 

valuation formula adopted by the Appeal Board is that we owe a degree of 

deference to the SBE’s interpretation of the statute, even though that interpretation 

is embodied only in an informal advice letter to the county assessors. (See 

Auerbach v. Los Angeles County Assessment Appeals Bd. (2008) 167 Cal.App.4th 

1428, 1441 (Auerbach); Watson Cogeneration Co. v. County of L.A. (2002) 98 

Cal.App.4th 1066, 1071, fn. 2.) “An agency interpretation of the meaning and 

legal effect of a statute is entitled to consideration and respect by the courts . . . .” 

(Yamaha Corporation of America v. State Board of Equalization (1998) 19 Cal.4th 

1, 7 (Yamaha).) Such deference is warranted because “the agency will often be 

interpreting a statute within its administrative jurisdiction . . . [and] may possess 

special familiarity with satellite legal and regulatory issues.” (Id. at p. 11.) The 

degree to which “judicial deference to an agency’s interpretation is appropriate . . . 

is . . . fundamentally situational” and will depend on the extent to which the 

agency’s expertise will provide it with a “ ‘comparative interpretative advantage 

over the courts’ ” and the degree to which it appears that the agency has carefully 

considered the issue. (Id. at p. 12; accord, Skidmore v. Swift & Co. (1944) 323 

U.S. 134, 140.)
15

The SBE undoubtedly has expertise in property tax matters. (See Yamaha, 

supra, 19 Cal.4th at p. 14; Auerbach, supra, 167 Cal.App.4th at p. 1441.)

Moreover, the SBE might be expected to have particular familiarity with the 

provision at issue here because the SBE sponsored its passage. Respondents 

nevertheless contend that no deference to the SBE’s understanding of section 

62.1(b) is appropriate because its current interpretation of the statute is not 

longstanding and conflicts with its prior interpretation. (Cf. Yamaha, at p. 13 

[“ ‘[a] vacillating position . . . is entitled to no deference’ ”].) Respondents point 

to an earlier advice letter, circulated a month after the effective date of section 

62.1(b), that did not explicitly recommend the extraction method of appraisal later 

set forth in LTA No. 99/87. (See Letter No. 89/13,Mobilehome Park Exclusion 

(Feb. 1, 1989) (LTA No. 89/13).) Again, however, respondents confuse the SBE’s 

suggested method of appraisal for these real property interests with the SBE’s

interpretation of section 62.1(b) itself. Although LTA No. 89/13 did not

recommend the extraction method of appraisal, it also did not state that such an 

approach was forbidden by section 62.1(b) or that section 62.1(b) established any 

particular method of appraisal. Rather, LTA No. 89/13 reflected the SBE’s 

understanding that section 62.1(b) simply defined a unit of property subject to 

reassessment: “Upon the transfer of any ownership interest in the entity of either 

an originally issued share or an unissued share to a new participant, a change in 

the ownership of a pro rata portion of the real property of the park has taken place. 

A new base-year value is established for that portion of the real property.” (LTA 

No. 89/13, p. 2.) Even if the SBE’s understanding of how to appraise that unit of 

property has evolved as it has gained a greater understanding of the market in 

these interests, its interpretation of section 62.1(b) has not. The SBE’s consistent 

interpretation further confirms our conclusion that section 62.1(b) does not 

mandate any particular appraisal formula.
16

The Appeal Board’s decisions in this case were premised entirely on its 

contrary construction of section 62.1(b). Because this interpretation was 

erroneous, the Appeal Board necessarily abused its discretion, and the Assessor’s 

petition for a writ of administrative mandate should have been granted. (See Code 

Civ. Proc., § 1094.5, subd. (b); Merrill v. Department of Motor Vehicles (1969) 71 

Cal.2d 907, 923; In re Esperanza C. (2008) 165 Cal.App.4th 1042, 1061; Natter v. 

Palm Desert Rent Review Com. (1987) 190 Cal.App.3d 994, 1004.) In reaching 

this conclusion, we make no judgment as to the proper means of appraising these 

property interests. We hold only that the extraction method of appraisal is not 

foreclosed by section 62.1(b).

CONCLUSION

For the reasons above, we hold that the Court of Appeal erred in concluding 

that section 62.1(b) establishes a particular formula for appraising the fraction of 

real property that is deemed to change ownership upon transfer of an interest in the 

resident-owned entity that owns a mobilehome park. Accordingly, we reverse the 

judgment of the Court of Appeal and remand for further proceedings consistent 

with this opinion.

LIU, J.

WE CONCUR: CANTIL-SAKAUYE, C. J.

KENNARD, J.

CHIN, J.

CORRIGAN, J.

MCINTYRE, J.*

 

* Associate Justice of the Court of Appeal, Fourth Appellate District, 

Division One, assigned by the Chief Justice pursuant to article VI, section 6 of the 

California Constitution.
1

CONCURRING OPINION BY WERDEGAR, J.

I concur in the majority’s holding that Revenue and Taxation Code section 

62.1, subdivision (b)1 does not by its terms mandate use of the appraisal formula 

adopted in this case by the Santa Barbara County Assessment Appeals Board No. 

1 (Appeals Board). I also concur, therefore, in the majority’s direction to the 

lower courts that the Santa Barbara County Assessor’s petition for administrative 

mandate should be granted (maj. opn., ante, at p. 16); that petition prayed only for 

reversal of the Appeals Board’s decision and remand to that body for further 

proceedings consistent with California law. For reasons explained below, 

however, I greatly doubt the alternative appraisal formula recommended by the 

State Board of Equalization (SBE) and used by the assessor, the so-called 

“extraction” method (see maj. opn., ante, at p. 5), is consistent with either the 

language or the intent of section 62.1, subdivision (b).

Section 62.1, subdivision (b)(1) provides that the transfer of an individual 

share or membership interest in a mobilehome park owned by a nonprofit 

corporation or similar entity formed by park residents constitutes a change in 

ownership of “a pro rata portion of the real property of the park.” Subdivision 

(b)(2) of the statute defines “pro rata portion of the real property” as “the total real 

property of the mobilehome park multiplied by a fraction consisting of the number 

 

1 All further statutory references are to the Revenue and Taxation Code.
2

of shares of voting stock, or other ownership or membership interests, transferred 

divided by the total number of outstanding issued or unissued shares of voting 

stock of, or other ownership or membership interests in, the entity that acquired 

the park.”

As the majority observes, section 62.1, subdivision (b) defines the unit of 

real property that is subject to reassessment upon transfer of an individual share or 

membership in a nonsubdivided member-owned park; the statute’s language does 

not itself prescribe a mandated appraisal method. (Maj. opn., ante, at p. 4.) But 

the statute’s delineation of the property interest subject to reassessment is 

nonetheless important. The phrase “pro rata portion of the real property of the 

park” (§ 62.1, subd. (b)(1)) strongly suggests the unit to be appraised is an 

undivided portion of the park’s property, that is, a fractional part of the entire 

property rather than any individual mobilehome space or any other geographically 

specific piece of the park’s land. If any doubt existed on this point, the next 

paragraph (id., subd. (b)(2)) makes it explicit by defining the pro rata portion as a 

fractional part of the whole, where the fraction is determined by dividing the 

number of shares or interests transferred by the total outstanding shares or 

interests. 

The statute thus could not be clearer that the property unit subject to 

reassessment, and hence the unit that must be appraised, is an undivided fractional 

interest in the entirety rather than a specific physical portion of the park’s land. In 

this respect, section 62.1, subdivision (b) differs crucially from the parallel 

provision for transfers of units or lots within condominium and similar subdivided 

complexes, which provides that the property to be appraised is “the unit or lot 

transferred and the share in the common area [appurtenant to] such unit or lot.” 

(§ 65.1, subd. (b), italics added.) 
3

The legislative history shows the Legislature was aware of this distinction 

and understood that under section 62.1, subdivision (b), the transfer of an 

individual membership interest in a nonsubdivided mobilehome park would not 

result in reassessment of the particular mobilehome space associated with the 

membership. As explained in a bill analysis written by the SBE, the provision that 

became section 62.1, subdivision (b) was intended to parallel the treatment of 

condominium and cooperative unit sales — but only up to a point. The parallel 

could not be exact because unlike in those sales, no particular space was being 

transferred in a membership sale: “A perfect match is not possible, however, 

because the transfer of a share or membership interest in a nonprofit corporation is 

not the same thing as a transfer of ownership of a condominium or stock 

cooperative interest, which relates to specific identifiable property. Thus, rather 

than following the pattern prescribed in Section 65.1(b), which provides for 

reappraisal of the specific unit or lot transferred as well as a share of the common 

area, the amendment provides for a straight pro rata adjustment.” (SBE, analysis 

of Sen. Bill No. 1885 (1987–1988 Reg. Sess.) Feb. 2, 1988, pp. 2–3, italics added; 

see maj. opn., ante, at p. 12.)

When a share of a nonsubdivided mobilehome park is transferred, 

therefore, section 62.1, subdivision (b) mandates that an undivided pro rata portion 

of the entire park property, not any particular physical part of the park’s land, be 

reassessed. The statute’s premise, as the legislative history explains, is that sale of 

an interest in a nonsubdivided park does not transfer ownership of any individual 

unit or lot. Rather than reassess the individual mobilehome space, the assessor 

must therefore make what the bill analysis referred to as a “straight pro rata 

adjustment” to the assessed value. (SBE, analysis of Sen. Bill No. 1885 (1987–

1988 Reg. Sess.) supra, at p. 3.) Whatever appraisal method is used, it must be 

aimed at valuing the undivided pro rata interest deemed to have been transferred 
4

under section 62.1, subdivision (b), not a specific mobilehome space (even if one 

is associated by lease with the transferred share).

The SBE’s extraction method does not appear to meet this criterion. 

According to the SBE advisory letter upon which the assessor in this case relied, 

the extraction method is premised on the view that the sale of a membership share 

transfers ownership of the associated space. Because “[t]he ownership of a 

fractional interest in the park represents exclusive ownership of the individual 

underlying space,” the letter reasons, sale of a share or membership transfers “the 

exclusive right to occupy a particular space within the park.” (SBE Letter No. 

99/87, Individual Transfers in Resident-Owned Mobilehome Parks (Dec. 31, 

1999) pp. 3-4 (LTA No. 99/98), italics added.) Under this view, it follows that 

“the appraisal unit is the individual mobilehome space and the mobilehome.” (Id.

at p. 4, italics added.) Ignoring the distinction it had made in the 1988 bill 

analysis, the SBE states in the 1999 advisory letter that under section 62.1, 

subdivision (b), transfers of shares in nonsubdivided parks are to be treated “on a 

par with” transfers of condominium and cooperative housing units. (LTA No. 

99/98, supra, at p. 3.)2

Granted that section 62.1, subdivision (b) specifies only the property unit to 

be reassessed and does not mandate any particular appraisal method, the statute

nonetheless appears to preclude the SBE’s extraction method, because the latter 

appraises the wrong unit of real property: it seeks to value the particular 

mobilehome space rather than an undivided share of the park’s total property. 

 

2 As the Court of Appeal majority observed, “[i]f the Legislature had 

intended to treat resident-owned mobilehome parks in a manner similar to 

condominiums, stock cooperatives, and subdivided mobilehome parks, it could 

have amended section 65.1 to include them.”
5

While section 62.1, subdivision (b) provides that the real property transferred by a 

membership share sale is an undivided “pro rata portion” of the park’s real 

property, the SBE’s 1999 advisory letter states the real property transferred, and 

hence the real property to be reassessed, is the “individual mobilehome space.” 

(LTA No. 99/98, supra, at p. 4.)

The SBE’s extraction method, in seeking to capture the market value of 

individual mobilehome spaces, may reflect market realities. But section 62.1, 

subdivision (b) is premised on an assumption seemingly inconsistent with the 

extraction method — that membership shares in park corporations, unlike 

condominium units, do not carry with them ownership of particular real property. 

Because, on this legislative view, no specific real property is transferred with sale 

of a park membership, the statute specifies the unit to be reassessed as an 

undivided pro rata portion of the whole rather than any individual mobilehome 

space. For this reason, I doubt the SBE’s method may validly be applied to the 

properties at issue here.

I do not understand the majority to hold that the Appeals Board, on remand, 

must approve use of the SBE’s extraction method or any similar appraisal method. 

I therefore concur in the judgment of the majority.

WERDEGAR, J.
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Holland v. Assessment Appeals Board No. 1

__________________________________________________________________________________

Unpublished Opinion

Original Appeal

Original Proceeding

Review Granted XXX 208 Cal.app.4th 1412

Rehearing Granted

__________________________________________________________________________________

Opinion No. S205876

Date Filed: January 23, 2014

__________________________________________________________________________________

Court: Superior

County: Santa Barbara

Judge: James W. Brown

__________________________________________________________________________________

Counsel:

Dennis A Marshall, County Counsel, and Marie A. LaSala, Deputy County Counsel, for Plaintiff and 

Appellant.

Douglas W. Walker, Kevin L. Morris; Nicholas S. Chrisos, County Counsel (Orange), James Clement 

Harman, Deputy County Counsel (Orange); Glenn Beloian; Sandeep Mitra; Walter Joseph DeLorrell III; 

James B. Rooney for California Assessors’ Association, Dennis Draeger, San Bernardino County Assessor, 

Webster J. Guillory, Orange County Assessor, Larry Ward, Riverside County Assessor, Lawrence E. Stone, 

Santa Clara County Assessor, and Ernest J. Dronenburg, Jr., San Diego County Assessor, as Amici Curiae 

on behalf of Plaintiff and Appellant.

Kamala D. Harris, Attorney General, Kathleen Kenealy, Chief Assistant Attorney General, Susan Duncan 

Lee, Acting Solicitor General, Paul D. Gifford, Assistant Attorney General, W. Dean Freeman, Felix E. 

Leatherwood and Stephen Lew, Deputy Attorneys General, for State Board of Equalization as Amicus 

Curiae on behalf of Plaintiff and Appellant.

Dennis A. Marshall, County Counsel, and Jerry F. Czuleger, Deputy County Counsel, for Defendant and 

Respondent.

David C. Fainer, Jr., for Real Parties in Interest and Respondents.

The Gibbs Law Firm, Gerald R. Gibbs and David L. Gibbs for The Associates Group for Affordable 

Housing, Inc., Palm Beach Park Association, Inc., and Summerland by the Sea, Inc., as Amici Curiae on 

behalf of Real Parties in Interest and Respondents.
Counsel who argued in Supreme Court (not intended for publication with opinion):

Marie A. LaSala

Deputy County Counsel

105 E. Anapamu Street, Suite 201

Santa Barbara, CA 93101

(805) 568-2950

James Clement Harman

Deputy County Counsel

333 West Santa Ana Boulevard

Santa Ana, CA 92702-1379

(714) 834-5257

Jerry F. Czuleger

Deputy County Counsel

105 E. Anapamu Street, Suite 201

Santa Barbara, CA 93101

(805) 568-2950

David C. Fainer, Jr.

1114 State Street, Suite 200

Santa Barbara, CA 93101

(805) 899-1300