What length guideline did California use to decide whether a motorboat qualified as a ship and mobile transportation equipment?

Plain-English summary

California considered what "ship" meant in section 6023 for leased motorboats and houseboats.

The memorandum limited MTE to property commonly used to transport persons or property substantial distances. After recounting Coast Guard practice, approximate five-net-ton dimensions, fuel capacity, and the smallest documented local vessel, its author proposed 30 feet as a general motorboat guideline.

The proposal would regard motorboats at least 30 feet long as MTE and shorter motorboats generally as non-MTE. But length would not automatically qualify a houseboat: typical houseboats used on lakes or bays were not designed for substantial-distance transport and were compared to pilot or tugboats.

Why the 30-foot line was only a proposal

The author says he spent several hours on January 22 speaking with a San Diego Coast Guard commander. According to the memorandum, commercial vessels of five net tons were documented, an approximate five-ton rule of thumb was 30 feet long by eight feet wide by five feet deep, and toilet and wheelhouse exclusions could keep a longer vessel below five net tons. The commander reportedly found that San Diego's smallest documented boat was 34 feet and associated sub-30-foot craft with insufficient fuel for common high-seas commercial carriage.

No Coast Guard rule, statute, documentation list, measurement record, or separate conversation note accompanies the PDF. The memo itself says the commander was unsure why the government chose five net tons. These are the author's reported inputs to a tax guideline, not a published Coast Guard determination that every 30-foot boat weighs five net tons or travels substantial distances.

The operative wording is tentative: “I propose that we use the 30 foot figure as a general guideline.” The author closes by asking the addressee and another colleague for their thoughts; no response is included. The source identifies no taxpayer, boat, actual dimensions, tonnage, fuel capacity, route, lease, election, assessment, or tax payment.

The houseboat analysis is a separate design-and-use judgment. Even at 30 feet, houseboats normally used on lakes such as Shasta or Trinity or in bays were not considered designed for substantial-distance carriage. The memorandum does not supply specifications or operating records for a particular houseboat.

The live annotation now states only that motorboats less than 30 feet are not MTE. It does not repeat the memorandum's proposed affirmative treatment for longer motorboats, Coast Guard discussion, five-ton rule of thumb, houseboat exception, or request for colleagues' views.

Common questions

Was 30 feet an exact tonnage rule?

No. The source described it as a rough general guideline; net tonnage could vary with vessel design.

Did the memorandum say every boat at least 30 feet long qualified as MTE?

No. The memorandum separately excluded typical houseboats based on design and confined use.

Why were shorter boats generally excluded?

The source recounted a Coast Guard commander's association between shorter length, limited fuel capacity, and lack of common substantial-distance commercial use; it supplied no separate supporting record.

Did the current live annotation adopt the memo's entire proposal?

No. It preserves only the negative statement that motorboats under 30 feet are not MTE.

Citations and references

• California Revenue and Taxation Code section 6023
• California Sales and Use Tax Regulation 1661(b)(1)
• January 22, 1973 Coast Guard conversation — recounted without a separate record

Verbatim support

From the official January 31, 1973 memorandum:

With the foregoing in mind, I propose that we use the 30 foot figure as a general guideline in determining whether or not a motor boat qualifies as mobile transportation equipment.

I would appreciate any thoughts you or Mr. Nunes might have in this area.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/335-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/335-0050.pdf

Original ruling text

335.0050

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

Jan. 31, 1973

To:

T. P. Putnam

From:

Glenn L. Rigby

Subject:

Definition of Term "Ship" Under Section 6023

The question has just been posed by the Marysville District office as to what is meant by the word "ship" in Section 6023. Their specific problem involves leases of motor boats and houseboats. In general, paragraph (b) (1) of Regulation 1661 limits the term mobile transportation equipment to items of property that are commonly used for transporting persons or property substantial distances. Accordingly, it is our opinion that we must interpret the word "ship" to mean only that type of equipment that is commonly used for transporting persons or property substantial distances. Of course, a row boat or small boat would not come within this type of classification. In an effort to get some footage or tonnage guidelines that may be of some use to us, I talked to Commander M. D. Henderson of the San Diego Coast Guard on January 22 for several hours. Although the Coast Guard does document commercial vessels weighing 5 net tons, there is no similar required documentation of vessels that are used for noncommercial purposes. A rough rule of thumb in determining whether a boat meets the 5 net ton rule is one that is approximately 30 feet in length, 8 feet in width, and 5 feet in depth. However, the commander explained that a ship can still come under 5 net tons even if it exceeds 30 feet in length by having large toilet and wheel house areas since these areas are specifically excluded in computing the 5 net ton figure. Although he was not sure why the government by statute chose the 5 net ton limitation, he did say that a vessel any less than 30 feet in length would not, as a common practice, be used in commercial operations for carrying persons or property on the high seas or if you will substantial distances. This is mainly due to the lack of the fuel capacity. In checking the boats that are documented in San Diego, he found that the smallest one was 34 feet in length. With the foregoing in mind, I propose that we use the 30 foot figure as a general guideline in determining whether or not a motor boat qualifies as mobile transportation equipment. This would mean that any motor boat that is 30 feet or more in length would be regarded as mobile transportation equipment.

This conclusion would not, however, require us to conclude that houseboats that are 30 feet or more in length and that are normally used on such lakes as Shasta or Trinity would be regarded as mobile transportation equipment. In my opinion, houseboats in general are not the kind of property that are designed to carry persons or property substantial distances. They are normally used in lakes or bays and therefore should be treated like pilot or tug boats. I would appreciate any thoughts you or Mr. Nunes might have in this area.

GLR: 1b
cc: Mr. Robert Nunes