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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
]]]] 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11 hereby repealed.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
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