H0513aaS............................................by REVENUE AND TAXATION PROPERTY TAX - FOREST TRACTS - Amends existing law to provide an alternative method of determining market values for assessment purposes for large-sized forest tracts for the period January 1, 2000, through January 1, 2006; to create within the State Tax Commission the Committee on Forest Land Taxation Methodologies; to provide membership of the committee; to provide duties; and to provide for a report to legislative committees. 02/04 House intro - 1st rdg - to printing 02/07 Rpt prt - to Rev/Tax 02/11 Rpt out - rec d/p - to 2nd rdg 02/14 2nd rdg - to 3rd rdg 02/16 3rd rdg - PASSED - 53-11-6 AYES -- Alltus, Barraclough, Barrett, Bell, Black, Boe, Bruneel, Callister, Campbell, Cheirrett, Clark, Crow, Deal, Denney, Ellsworth, Gagner, Geddes, Gould, Hadley, Hammond, Hansen(23), Hansen(29), Henbest, Jones, Kempton, Kendell, Kunz, Lake, Linford, Mader, McKague, Meyer, Montgomery, Mortensen, Moss, Moyle, Pearce, Pischner, Pomeroy, Reynolds, Ridinger, Sali, Schaefer, Smith, Smylie, Stevenson, Stone, Taylor, Tilman, Trail(Miller), Wheeler, Wood, Zimmermann NAYS -- Bieter, Chase, Cuddy, Jaquet, Judd, Kellogg, Marley, Ringo, Robison, Shepherd, Stoicheff Absent and excused -- Field(13), Field(20), Hornbeck, Loertscher, Sellman, Mr Speaker Floor Sponsor - Gagner Title apvd - to Senate 02/17 Senate intro - 1st rdg - to Loc Gov 02/24 Rpt out - to 14th Ord 03/01 Rpt out amen - to 1st rdg as amen 03/02 1st rdg - to 2nd rdg as amen 03/03 2nd rdg - to 3rd rdg as amen 03/21 3rd rdg as amen - PASSED - 26-5-4 AYES--Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron, Crow, Danielson, Darrington, Davis, Deide, Dunklin, Frasure, Hawkins, Ingram, Ipsen, King-Barrutia, Parry, Richardson, Risch, Sorensen, Stegner, Stennett, Thorne, Wheeler, Williams NAYS--Keough, McLaughlin, Riggs, Schroeder, Whitworth Absent and excused--Geddes, Lee, Noh, Sandy Floor Sponsor - Thorne Title apvd - to House 03/22 House concurred in Senate amens - to engros 03/23 Rpt engros - 1st rdg - to 2nd rdg as amen 03/24 2nd rdg - to 3rd rdg as amen Rules susp - PASSED - 59-4-7 AYES -- Alltus, Barraclough, Barrett, Bell, Bieter, Black, Boe, Bruneel, Callister, Cheirrett, Clark, Crow, Cuddy, Deal, Denney, Ellsworth, Field(13), Field(20), Gagner, Geddes, Gould, Hadley, Hammond, Hansen(23), Henbest, Hornbeck, Jaquet, Jones, Judd, Kellogg, Kempton, Kendell, Kunz, Linford, Loertscher, Mader, Marley, McKague, Meyer, Montgomery, Moss, Moyle, Pearce, Pomeroy, Ridinger, Sali, Schaefer, Sellman, Smith, Smylie, Stevenson, Stone, Taylor, Tilman, Trail, Wheeler, Wood, Zimmermann, Mr Speaker NAYS -- Ringo, Robison, Shepherd, Stoicheff Absent and excused -- Campbell, Chase, Hansen(29), Lake, Mortensen, Pischner, Reynolds Floor Sponsor - Gagner Title apvd - to enrol 03/27 Rpt enrol - Sp signed 03/28 Pres signed 03/29 To Governor 04/03 Governor signed Session Law Chapter 156 Effective: 01/01/00
|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature Second Regular Session - 2000 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 513, As Amended in the Senate BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO TAXATION OF LARGE-SIZE FOREST TRACTS; PROVIDING LEGISLATIVE 3 INTENT; AMENDING SECTION 63-1705, IDAHO CODE, TO PROVIDE AN ALTERNATIVE 4 METHOD OF DETERMINING MARKET VALUES FOR ASSESSMENT PURPOSES FOR LARGE-SIZE 5 FOREST TRACTS FOR THE PERIOD JANUARY 1, 2000, THROUGH JANUARY 1, 2006, TO 6 CREATE WITHIN THE STATE TAX COMMISSION THE COMMITTEE ON FOREST LAND TAXA- 7 TION METHODOLOGIES, TO PROVIDE MEMBERSHIP, TO PROVIDE DUTIES, TO PROVIDE 8 FOR A REPORT TO LEGISLATIVE COMMITTEES AND TO MAKE TECHNICAL CORRECTIONS; 9 DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION. 10 Be It Enacted by the Legislature of the State of Idaho: 11 SECTION 1. LEGISLATIVE INTENT. The Legislature of the State of Idaho 12 declares that the purposes of this act are to: (1) establish market values for 13 large-size forest tracts for the period January 1, 2000, until January 1, 14 2006; (2) establish a Forest Lands Taxation Methodologies Committee within the 15 Idaho State Tax Commission; (3) require that the committee analyze and evalu- 16 ate the income approach methodology currently contained in Section 63-1705, 17 Idaho Code; (4) require the committee to analyze and evaluate alternative 18 income approach methodologies and soil expectation value methodologies; (5) 19 require the committee recommend to the First Regular Session of the Fifty- 20 eighth Idaho Legislature whether the income approach methodology contained in 21 Section 63-1705, Idaho Code, be retained or be replaced with another income 22 methodology or with a soil expectation value methodology; (6) require the com- 23 mittee to commence its analysis and evaluation based upon the written testi- 24 mony by the Idaho State Tax Commission, the Idaho Association of Counties and 25 the Intermountain Forest Association provided to the House of Representatives 26 Revenue and Taxation Committee during its consideration of this act. 27 SECTION 2. That Section 63-1705, Idaho Code, be, and the same is hereby 28 amended to read as follows: 29 63-1705. TAXATION OF LARGE-SIZE FOREST TRACTS. (1) In order to encourage 30 private forest landowners to retain and improve their holdings of forest lands 31 and to promote better forest management, large-size dforest tracts shall be 32 appraised, assessed and taxed as real property under the provisions of this 33 section. 34 (2) The inventory of timber and other forest products growing on large- 35 size dforest tracts shall not be included as a part of the total forest asset. 36 The forest value shall be determined by an income approach which capitalizes 37 the value of the average annual net wood production over a reasonable rotation 38 period plus other agricultural-related income, if any, less annualized 39 expenses including, but not limited to, the establishment, protection, mainte- 40 nance, improvement and management of the crop over the rotation period. 41 (3) Effective January 1, 2000, through January 1, 2006, t The market value 42 for assessment purposes shall be determined by the county assessor either 2 1 under rules prescribed by the state tax commission or the market values con- 2 tained in subsection (5) of this section, whichever is less. In prescribing 3 such rules, the tax commission shall: 4 (a) Divide the state into appropriate forest valuation zones, with each 5 zone designated so as to recognize the uniqueness of marketing areas, tim- 6 ber types, growth rates, access, operability, and other pertinent factors 7 of that zone; and 8 (b) Establish a uniform system of forest land classification which con- 9 siders the productive capacity of the soil to grow forest products and 10 furnish other associated agricultural uses. 11 (4) The state tax commission shall by March 1 of each year, furnish the 12 county assessor for each value zone the capitalization rate, stumpage value, 13 agricultural-related income, if any, and expense component to be used in 14 determining the forest value. From January 1, 1999, until January 1, 200 16, 15 the capitalization rate shall be the interest rate for the farm credit bank 16 district serving Idaho, as set forth in the most current revenue ruling made 17 pursuant to section 2032A(e)(7)(A) of the Internal Revenue Code and 26 CFR 18 20.2032A-4(e), plus eighty-five one hundredths percent (.85%), plus a compo- 19 nent for the local tax rate. Stumpage values shall be based upon the preceding 20 five (5) year rolling average value of timber harvested within the forest 21 value zone from state timber sales and/or the best available data for the same 22 five (5) year period. Average agricultural-related income and the average 23 expense component for each forest value zone shall be determined for the same 24 time period as the period used to determine average stumpage values. 25 (5) The following are the alternative market values for assessment pur- 26 poses for the period January 1, 2000, until January 1, 2006. The rules pre- 27 scribed by the state tax commission in effect on January 1, 2000, are applica- 28 ble to these alternative market values. 29 Alternative Forest Land Values 30 ($/Acre) 31 2000 Productivity Class 2003 Productivity Class 32 Zone Good Medium Poor Zone Good Medium Poor 33 I 733 470 207 I 564 361 159 34 II 700 449 198 II 539 346 152 35 III 553 368 172 III 426 283 132 36 IV 379 252 117 IV 291 194 90 37 2001 Productivity Class 2004 Productivity Class 38 Zone Good Medium Poor Zone Good Medium Poor 39 I 676 434 191 I 507 325 143 40 II 646 415 183 II 485 311 137 41 III 511 339 159 III 383 255 119 42 IV 350 232 108 IV 262 174 81 43 2002 Productivity Class 2005 Productivity Class 44 Zone Good Medium Poor Zone Good Medium Poor 45 I 620 398 175 I 451 289 127 46 II 592 380 167 II 431 277 122 47 III 468 311 145 III 341 226 106 48 IV 321 213 99 IV 233 155 72 49 (6) Forest lands upon which, at any time after January 1, 1982, the trees 50 are destroyed by fire, disease, insect infestation or other natural disaster 51 such that the lands affected will not meet minimum stocking requirements under 3 1 rules adopted pursuant to chapter 13, title 38, Idaho Code, shall be eligible 2 for a reduction in value for the first ten (10) property tax years following 3 the loss. The amount of reduction shall be determined by dividing the average 4 age of the trees destroyed by the rotation age for the specific forest value 5 zone in which the property is located. In no instance shall the annual reduc- 6 tion exceed eighty percent (80%) of the original forest value per year. In 7 order to obtain a reduction, the landowner shall, on or before January 1, fol- 8 lowing the destruction, make written application to the assessor indicating 9 the legal description of the lands in question and stating all pertinent 10 facts. The assessor may investigate the facts and may request assistance from 11 the state tax commission in performing such investigations. If the require- 12 ments are met, such forest lands shall be assessed and taxed on the reduced 13 basis herein provided. 14 ( 67) Buildings and other improvements, other than roads, located on for- 15 est lands shall be appraised, assessed and taxed as provided by applicable 16 laws and rules. 17 (8) Effective January 1, 2004, there is created within the Idaho state 18 tax commission the committee on forest land taxation methodologies. The mem- 19 bership of the committee shall be: 20 (a) A nonvoting chairman who shall be the member of the Idaho state tax 21 commission assigned to property tax matters; 22 (b) Four (4) members selected from the membership of the intermountain 23 forest association; 24 (c) One (1) member selected from the membership of the Idaho forest 25 owners' association; 26 (d) Five (5) members selected from the membership of the Idaho associa- 27 tion of counties; and 28 (e) The state superintendent of public instruction or his/her designee, 29 in a nonvoting capacity. 30 The committee shall retain a forest economist selected by a majority of its 31 members to advise the committee. 32 The costs of each committee member shall be borne by the respective mem- 33 ber. The fees and costs of the forest economist shall be borne as determined 34 by the committee. 35 The committee shall review forest land valuation in Idaho and consider 36 replacement of the current income methodology found in this section by review- 37 ing all income and soil expectation methodologies to determine forest land 38 values. 39 The committee shall report to the house of representatives revenue and 40 taxation and senate local government and taxation committees its findings and 41 recommendations for legislation by no later than January 15, 2005. 42 During the first regular session of the fifty-eighth Idaho legislature the 43 house of representatives revenue and taxation and senate local government and 44 taxation committees, shall review the values and formula used to compute for- 45 est land values to determine if modification to this section is appropriate 46 and necessary. 47 SECTION 3. An emergency existing therefor, which emergency is hereby 48 declared to exist, this act shall be in full force and effect on and after its 49 passage and approval, and retroactively to January 1, 2000.
|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature Second Regular Session - 2000 Moved by Thorne Seconded by IN THE SENATE SENATE AMENDMENT TO H.B. NO. 513 1 AMENDMENT TO SECTION 2 2 On page 2 of the printed bill, in line 14, delete "2001" and insert: 3 "200 16".
STATEMENT OF PURPOSE RS 09792C1 Property taxes on Idaho forest lands have tripled over the past seven years. In response to this enormous increase in taxes, an agreement was reached earlier this year between Idaho forest land owners and the Idaho Association of Counties to provide tax relief to forest land owners. The agreement was a recognition by both forest land owners and Idaho counties that such tax increases have had disproportionately large impacts on forest land owners. This legislation phases in up to a 40% reduction in forest land taxes over the next six years. The phase-in substantially reduces the tax shift impacts over this same period. There is a disagreement between forest land owners and the various counties of the state as to the appropriate method to value forest lands for tax purposes. Accordingly, this legislation also establishes a Forest Land Taxation Methodologies Committee within the Idaho State Tax Commission that will analyze and evaluate the income approach methodology currently contained in Idaho Code section 63-1705, as well as analyze and evaluate alternative income approach methodologies and soil expectation value methodologies. The Committee will recommend to the First Regular Session of the Fifty-Eighth Legislature whether the income approach methodology contained in Idaho Code section 63-1705 be retained, be replaced with another income methodology, or be replaced with a soil expectation value methodology. The Committee will commence its analysis and evaluation based upon the written testimony by the Idaho State Tax Commission, the Idaho Association of Counties and the Intermountain Forest Association provided to the House Revenue and Taxation Committee during its consideration of this legislation. CONTACT: Rep. Dolores Crow, Chair, House Revenue & Taxation (332-1125) Sen. Jerry Thorne, Chair, Senate Local Government & Tax (332-1323) H 513 FISCAL NOTE RS RS09792C1 The fiscal impact of this legislation is as follows: Year Loss of School property tax revenue Loss of School property tax replacement revenue from the state general fund Loss of property tax to county governments Gain of revenue to state general fund 2000 0 0 0 0 2001 0 0 0 0 2002 0 0 $400 0 2003 $29,000 $10,000 $6,700 $10,000 2004 $186,000 $62,000 $10,700 $62,000 2005 $292,000 $97,000 $14,500 $97,000 2006 $397,000 $132,000 not computed $132,000 *non-county and non-county school taxing districts are not included in the above table. Summary of Tax Shift to Non-Timberland Property Resulting from Timber Value Change Effect of Taxes on Property with $100,000 Taxable Value County 2/01/2000 Current Tax in 1999 1st Year Tax in 2000* Difference Current System 2005 Difference from 1999 Proposed Tax in 2005 Difference from 1999 Difference 5th Year Current Law from Proposed Law Adams $742.90 $748.00 $5.10 $761.66 $18.76 $769.82 $26.92 $8.16 Benewah $687.60 $706.03 $18.43 $739.73 $52.13 $759.37 $71.77 $19.64 Boise $784.70 $788.45 $3.75 $798.31 $13.61 $804.22 $19.52 $5.91 Bonner $546.90 $549.30 $2.40 $553.73 $6.83 $555.75 $8.85 $2.02 Boundary $719.60 $726.11 $6.51 $737.95 $18.35 $743.45 $23.85 $5.50 Clearwate r $590.90 $620.88 $29.98 $680.88 $89.98 $718.58 $127.68 $37.70 Elmore $999.00 $999.01 $0.01 $999.08 $0.08 $999.11 $0.11 $0.03 Gem $733.90 $733.92 $0.02 $733.94 $0.04 $733.96 $0.06 $0.02 Idaho $474.60 $475.60 $1.00 $477.04 $2.44 $477.82 $3.22 $0.78 Kootenai $946.40 $948.38 $1.98 $951.98 $5.58 $953.61 $7.21 $1.63 Latah $1,248.70 $1,260.21 $11.51 $1,280.28 $31.58 $1,291.42 $42.72 $11.14 Lewis $851.80 $857.19 $5.39 $866.35 $14.55 $871.36 $19.56 $5.02 Nez Perce $868.10 $868.41 $0.31 $868.95 $0.85 $869.24 $1.14 $0.29 Shoshone $1,116.00 $1,147.34 $31.34 $1,206.23 $90.23 $1,240.56 $124.56 $34.32 Valley $435.10 $436.12 $1.02 $438.73 $3.63 $440.29 $5.19 $1.55 * Current or Proposed Law 1. Based upon typical rural property tax rates exclusive of school M & O. 2. Assumes no growth in property tax portion of taxing district budgets. 3. Assumes no change in taxable of non-timber property. H 513