HOUSE BILL NO. 510

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Bill Status



H0510...............................................by REVENUE AND TAXATION
RURAL HOMESITES - PROPERTY TAX - Amends existing law relating to property
taxation to provide that the platting of land actively devoted to
agriculture does not alone cause the land to lose its actively devoted to
agriculture status; to provide additional definitions; and to revise a
definition.
                                                                        
01/30    House intro - 1st rdg - to printing
01/31    Rpt prt - to Rev/Tax

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   Second Regular Session - 2006
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 510
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO PROPERTY TAXATION; REPEALING SECTION 63-602FF, IDAHO CODE,  RELAT-
  3        ING TO PARTIAL EXEMPTION FOR PARCELS OF LAND IN A RURAL HOME SITE DEVELOP-
  4        MENT  PLAT;  AMENDING SECTION 63-604, IDAHO CODE, TO PROVIDE THAT PLATTING
  5        LAND ACTIVELY DEVOTED TO AGRICULTURE DOES NOT ALONE CAUSE THE LAND TO LOSE
  6        ITS ACTIVELY DEVOTED TO AGRICULTURE STATUS AND TO  PROVIDE  AN  ADDITIONAL
  7        DEFINITION;  AMENDING SECTION 63-602K, IDAHO CODE, TO REVISE A DEFINITION;
  8        DECLARING AN EMERGENCY AND PROVIDING A RETROACTIVE EFFECTIVE DATE.
                                                                        
  9    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 10        SECTION 1.  That Section   63-602FF, Idaho  Code,  be,  and  the  same  is
 11    hereby repealed.
                                                                        
 12        SECTION  2.  That  Section  63-604, Idaho Code, be, and the same is hereby
 13    amended to read as follows:
                                                                        
 14        63-604.  LAND ACTIVELY DEVOTED TO AGRICULTURE DEFINED.  (1)  For  property
 15    tax  purposes, land which is actively devoted to agriculture shall be eligible
 16    for appraisal, assessment and taxation as agricultural property each  year  it
 17    meets one (1) or more of the following qualifications:
 18        (a)  The  total  area  of  such land, including the homesite, is more than
 19        five (5) contiguous acres, and is actively devoted  to  agriculture  which
 20        means:
 21             (i)   It  is  used  to produce field crops including, but not limited
 22             to, grains, feed crops, fruits and vegetables; or
 23             (ii)  It is used to produce  nursery  stock  as  defined  in  section
 24             22-2302(11), Idaho Code; or
 25             (iii) It is used by the owner for the grazing of livestock to be sold
 26             as  part  of  a for-profit enterprise, or is leased by the owner to a
 27             bona fide lessee for grazing purposes; or
 28             (iv)  It is in a cropland retirement or rotation program.
 29        (b)  The area of such land is five (5) contiguous acres or less  and  such
 30        land  has  been actively devoted to agriculture within the meaning of sub-
 31        section (1)(a) of this section during the last three (3) growing  seasons;
 32        and
 33             (i)   It  agriculturally  produces  for  sale or home consumption the
 34             equivalent of fifteen  percent  (15%)  or  more  of  the  owner's  or
 35             lessee's annual gross income; or
 36             (ii)  It  agriculturally  produced  gross revenues in the immediately
 37             preceding year of one thousand dollars ($1,000)  or  more.  When  the
 38             area of land is five (5) contiguous acres or less, such land shall be
 39             presumed  to be nonagricultural land until it is established that the
 40             requirements of this subsection have been met.
 41        (2)  Land shall not be classified or valued as agricultural land which  is
 42    part of a platted subdivision with stated restrictions prohibiting its use for
                                                                        
                                           2
                                                                        
  1    agricultural purposes, whether within or without a city.
  2        (3)  Land  utilized  for the grazing of a horse or other animals kept pri-
  3    marily for personal use or pleasure rather than as part of a  bona  fide  for-
  4    profit enterprise shall not be considered to be land actively devoted to agri-
  5    culture.
  6        (4)  Land actively devoted to agriculture, having previously qualified for
  7    exemption under this section in the preceding year, or which would have quali-
  8    fied  under this section during the current year, shall not lose such qualifi-
  9    cation due to the owner's or lessee's  absence in the current year  by  reason
 10    of  active military service in a designated combat zone, as defined in section
 11    112 of the Internal Revenue Code. If an owner fails to timely apply for exemp-
 12    tion as required in this section solely by reason of active duty in  a  desig-
 13    nated combat zone, as defined in section 112 of the Internal Revenue Code, and
 14    the  land  would  otherwise qualify for exemption under this section, then the
 15    board of county commissioners of the county in which the land actively devoted
 16    to agriculture is located shall refund property taxes, if previously paid,  in
 17    an amount equal to the exemption which would otherwise have applied.
 18        (5)  For  purposes  of  this  section,  the  act of platting land actively
 19    devoted to agriculture does not, in and of itself, cause the land to lose  its
 20    status  as  land  being  actively devoted to agriculture if the land otherwise
 21    qualifies for the exemption under this section.
 22        (6)  As used in this section:
 23        (a)  "Contiguous" means being in actual contact or touching along a bound-
 24        ary or at a point, except no area of land shall be considered not contigu-
 25        ous solely by reason of a roadway or other right-of-way; and.
 26        (b)  "For-profit" means the enterprise will, over  some  period  of  time,
 27        make or attempt to make a return of income exceeding expenses.
 28        (c)  "Plat"  means the filing of the drawing, map or plan of a subdivision
 29        or a replatting of such, including certification, descriptions and approv-
 30        als with the proper county or city official.
                                                                        
 31        SECTION 3.  That Section 63-602K, Idaho Code, be, and the same  is  hereby
 32    amended to read as follows:
                                                                        
 33        63-602K.  PROPERTY EXEMPT FROM TAXATION -- SPECULATIVE PORTION OF VALUE OF
 34    AGRICULTURAL LAND. (1) The speculative portion of the value of land devoted to
 35    agriculture is exempt from taxation.
 36        (2)  "Land  actively  devoted  to  agriculture"  shall means that property
 37    defined by section 63-604, Idaho Code. For purposes of this section,  the  act
 38    of  platting  land actively devoted to agriculture does not, in and of itself,
 39    cause the land to lose its status as land being actively devoted  to  agricul-
 40    ture if the land otherwise qualifies for the exemption under this section.
 41        (3)  "Speculative  portion"  shall mean that portion of the value of agri-
 42    cultural land which represents the excess over the actual use  value  of  such
 43    land  established  by  comparable  sales data compared to value established by
 44    capitalization of economic rent or long-term average crop rental at a capital-
 45    ization rate which shall be the rate of interest charged by the Spokane office
 46    of the farm credit system averaged over the immediate past five (5) years plus
 47    a component for the local tax rate.
 48        (4)  The state tax commission shall adopt rules implementing this  section
 49    which  shall  provide the procedure by which it shall establish economic rent,
 50    average crop rental and capitalization rates and for the publication  of  crop
 51    prices and the discount rate to be used to determine the capitalization rate.
                                                                        
 52        SECTION  4.  An  emergency  existing  therefor,  which emergency is hereby
                                                                        
                                           3
                                                                        
  1    declared to exist, this act shall be in full force and effect on and after its
  2    passage and approval, and retroactively to January 1, 2006.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE

                            RS 15823

This legislation repeals the partial exemption for parcels of
land in a rural home site development plat (Idaho code 63-602FF.
It also provides that platting land actively devoted to
agriculture does not alone cause the land to lose its agriculture
exemption.  The legislation is effective January 1 2006.



                           FISCAL NOTE

There is no fiscal impact to the General Fund.



             

Contact
Name:  Rep. Ken Roberts             Sen. Tim Corder
       Rep. Dell Raybould           Sen. Brad Little
       Rep. Wendy Jaquet            Sen. David Langhorst
Phone: 332-1000





STATEMENT OF PURPOSE/FISCAL NOTE                         H 510