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S1001..................by STENNETT, BURKETT, MALEPEAI, MARLEY, WERK, KELLY,
LANGHORST PROPERTY TAX - EXEMPTION - Amends and adds to existing law to
enact the "Idaho Homeowner Tax Reduction Act"; to provide a property tax
exemption from school maintenance and operation levies to owner-occupied
residential property; to provide for the transfer of certain accumulated
balances in the Public Education Stabilization Fund to the Bond Levy
Equalization Fund; to provide for replacement of those moneys during fiscal
year 2007; and to appropriate an additional $104,000,000 to the Educational
Support Program/Division of Operations for fiscal year 2007.
08/25 Senate intro - 1st rdg - to printing
Rpt prt - to Loc Gov
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-eighth Legislature First Extraordinary Session - 2006IN THE SENATE SENATE BILL NO. 1001 BY STENNETT, BURKETT, MALEPEAI, MARLEY, WERK, KELLY, LANGHORST 1 AN ACT 2 RELATING TO TAXATION FOR PUBLIC SCHOOL SUPPORT; PROVIDING A SHORT TITLE; 3 AMENDING SECTION 33-802, IDAHO CODE, TO PROVIDE FOR SCHOOL MAINTENANCE AND 4 OPERATION LEVIES FOR TAX YEAR 2006 ONLY; AMENDING SECTION 33-907, IDAHO 5 CODE, TO PROVIDE THAT ANY ACCUMULATED BALANCES IN THE PUBLIC EDUCATION 6 STABILIZATION FUND THAT ARE IN EXCESS OF TEN PERCENT OF THE CURRENT FIS- 7 CAL YEAR'S TOTAL GENERAL FUND APPROPRIATION FOR PUBLIC SCHOOL SUPPORT 8 SHALL BE TRANSFERRED TO THE BOND LEVY EQUALIZATION FUND; AMENDING SECTION 9 33-1002, IDAHO CODE, TO REVISE CALCULATIONS IN THE EDUCATIONAL SUPPORT 10 PROGRAM FOR LOCAL DISTRICTS' CONTRIBUTION CALCULATION AND TO REVISE THE 11 TOTAL DISTRICT ALLOWANCE EDUCATIONAL PROGRAM; AMENDING SECTION 33-1002D, 12 IDAHO CODE, TO REVISE THE CALCULATION OF PROPERTY TAX REPLACEMENT FOR FIS- 13 CAL YEAR 2007; AMENDING SECTION 33-1408, IDAHO CODE, TO REVISE THE SPECIAL 14 LEVY FOR TUITION AND TO EXEMPT THE LEVY FROM THE THREE PERCENT PROPERTY 15 TAX CAP; AMENDING SECTION 63-602G, IDAHO CODE, TO PROVIDE THAT ONE HUNDRED 16 PERCENT OF THE MARKET VALUE FOR ASSESSMENT PURPOSES OF THE HOMESTEAD SHALL 17 BE EXEMPT FROM TAXATION FOR THE PURPOSE OF APPLYING SCHOOL DISTRICT MAIN- 18 TENANCE AND OPERATION LEVIES AND TO PROVIDE A LIMITATION EXEMPTION FOR 19 HOMESTEADS IN CHARTER DISTRICTS; APPROPRIATING MONEYS FROM THE GENERAL 20 FUND TO THE PUBLIC SCHOOL INCOME FUND FOR FISCAL YEAR 2007; APPROPRIATING 21 ADDITIONAL MONEYS FROM THE PUBLIC SCHOOL INCOME FUND TO THE EDUCATIONAL 22 SUPPORT PROGRAM/DIVISION OF OPERATIONS FOR FISCAL YEAR 2007; PROVIDING 23 SEVERABILITY; DECLARING AN EMERGENCY, PROVIDING RETROACTIVE APPLICATION 24 AND PROVIDING EFFECTIVE DATES. 25 Be It Enacted by the Legislature of the State of Idaho: 26 SECTION 1. SHORT TITLE. This act may be known and cited as the "Idaho 27 Homeowner Tax Reduction Act." 28 SECTION 2. That Section 33-802, Idaho Code, be, and the same is hereby 29 amended to read as follows: 30 33-802. SCHOOL LEVIES. Any tax levied for school purposes shall be a lien 31 on the property against which the tax is levied. The board of trustees shall 32 determine the levies upon each dollar of taxable property in the district for 33 the ensuing fiscal year as follows: 34 1. Bond, Interest and Judgment Obligation Levies. Such levies as shall be 35 required to satisfy all maturing bond, bond interest, and judgment obliga- 36 tions. 37 2. Maximum School Maintenance and Operation Levies. Such levies for main- 38 taining and operating the schools of the district and for the payment of 39 tuition and transportation, that do not exceed an amount equal to four-tenths 40 of one percent (.4%) during tax year 1994, and do not exceed an amount equal 41 to three-tenths of one percent (.3%) during tax year 1995 and thereafter, 42 applied to the actual or adjusted market value for assessment purposes of the 2 1 district as such valuation existed on December 31 of the previous year, but 2 allowances necessary as a credit for prepaid taxes, as provided in section 3 63-1607, Idaho Code, shall not be included in such maximum levies. Provided 4 however, that in the event property within a district's boundaries is con- 5 tained in a revenue allocation area established under chapter 29, title 50, 6 Idaho Code, and such revenue allocation area has given notice of termination 7 thereunder, then, only for the purpose of determining the levy described in 8 this subsection, the district may add the increment value, as defined in sec- 9 tion 50-2903, Idaho Code, to the actual or adjusted market value for assess- 10 ment purposes of the district as such value existed on December 31 of the pre- 11 vious year. For tax year 2006 only, school maintenance and operation levies 12 shall consist of an amount equal to the maximum rates established in this sub- 13 section, applied to the 2006 market value for assessment purposes. For a 14 charter district that levied a maintenance and operation levy in tax year 2005 15 that was greater than four-tenths of one percent (.4%) of the actual or 16 adjusted market value for assessment purposes of the district as such valua- 17 tion existed on December 31 of the previous year, the district shall utilize 18 the same methodology as described herein for tax year 2006, for that portion 19 of its maintenance and operation levy property tax computation ratio that is 20 represented by the maximum rates prescribed herein. As used herein, the term 21 "property tax computation ratio" shall mean a ratio determined by dividing the 22 district's certified property tax maintenance and operation budget by the 23 actual or adjusted market value for assessment purposes as such values existed 24 on December 31, 1993. 25 3. Authorized School Maintenance and Operation Levies. Such levies for 26 maintaining and operating the schools of the district and for the payment of 27 tuition and transportation that do not exceed one hundred eleven percent 28 (111%) of the local district's contribution authorized in subsection 2. of 29 section 33-1002, Idaho Code. Implementation of the provisions of this subsec- 30 tion shall be authorized only after approval by a majority of the district's 31 electors voting on the question. Levies otherwise authorized by law shall not 32 require an election. 33 4. Supplemental Maintenance and Operation Levies. No levy in excess of 34 the levy permitted by subsection 2. or 3. of this section shall be made by a 35 noncharter school district unless such a supplemental levy in a specified 36 amount and for a specified time not to exceed two (2) years be first autho- 37 rized through an election held pursuant to chapter 4, title 33, Idaho Code, 38 and approved by a majority of the district electors voting in such election. A 39 levy approved pursuant to this subsection may be reduced by a majority vote of 40 the board of trustees in the second year. 41 5. Charter District Supplemental Maintenance and Operation. Levies pursu- 42 ant to the respective charter of any such charter district shall be first 43 authorized through an election held pursuant to chapter 4, title 33, Idaho 44 Code, and approved by a majority of the district electors voting in such elec- 45 tion. 46 6. The Local District Contribution. The local school district contribu- 47 tion levy is the amount utilized for calculating local district participation 48 in the educational foundation program, which is applied to the adjusted market 49 value for assessment purposes, as such valuation existed on December 31 of the 50 previous year, together with the increment value, as defined in section 51 50-2903, Idaho Code, if applicable under the circumstance described in subsec- 52 tion 2. of this section, relating to termination of a revenue allocation area. 53 7. The board of trustees of any school district that has, for at least 54 seven (7) consecutive years, been authorized through an election held pursuant 55 to chapter 4, title 33, Idaho Code, to certify a supplemental levy that has 3 1 annually been equal to or greater than twenty percent (20%) of the total gen- 2 eral maintenance and operation fund, may submit the question of an indefinite 3 term supplemental levy to the electors of the school district. Such question 4 shall clearly state the dollar amount that will be certified annually and that 5 the levy will be for an indefinite number of years. The question must be 6 approved by a majority of the district electors voting on the question in an 7 election held pursuant to chapter 4, title 33, Idaho Code. The levy approved 8 pursuant to this subsection may be reduced by a majority vote of the board of 9 trustees during any fiscal year. 10 SECTION 3. That Section 33-907, Idaho Code, be, and the same is hereby 11 amended to read as follows: 12 33-907. PUBLIC EDUCATION STABILIZATION FUND. There is hereby created in 13 the state treasury a fund to be known as the public education stabilization 14 fund, which shall function as a fund detail of the public school income fund. 15 The fund shall consist of moneys transferred to the fund according to the pro- 16 visions of sections 33-905 and 33-1018, Idaho Code, and any other moneys made 17 available through legislative transfers or appropriations. Moneys in the fund 18 are hereby continuously appropriated for the purposes stated in sections 19 33-1018 and 33-1018B, Idaho Code, and shall only be expended for the purposes 20 stated in sections 33-1018, 33-1018A and 33-1018B, Idaho Code. Any accumulated 21 balances in the fund that are in excess offiveten percent (510%) of the cur- 22 rent fiscal year's total general fund appropriation for public school support 23 shall be transferred to the bond levy equalization fund. Interest earned from 24 the investment of moneys in the fund shall be credited to the public school 25 income fund. 26 SECTION 4. That Section 33-1002, Idaho Code, be, and the same is hereby 27 amended to read as follows: 28 33-1002. EDUCATIONAL SUPPORT PROGRAM. The educational support program is 29 calculated as follows: 30 1. State Educational Support Funds. Add the state appropriation, includ- 31 ing the moneys available in the public school income fund, together with all 32 miscellaneous revenues to determine the total state funds. 33 2. From the total state funds subtract the following amounts needed for 34 state support of special programs provided by a school district: 35 a. Pupil tuition-equivalency allowances as provided in section 33-1002B, 36 Idaho Code; 37 b. Transportation support program as provided in section 33-1006, Idaho 38 Code; 39 c. Feasibility studies allowance as provided in section 33-1007A, Idaho 40 Code; 41 d. The approved costs for border district allowance, provided in section 42 33-1403, Idaho Code, as determined by the state superintendent of public 43 instruction; 44 e. The approved costs for exceptional child approved contract allowance, 45 provided in subsection 2. of section 33-2004, Idaho Code, as determined by 46 the state superintendent of public instruction; 47 f. Certain expectant and delivered mothers allowance as provided in sec- 48 tion 33-2006, Idaho Code; 49 g. Salary-based apportionment calculated as provided in sections 33-1004 50 through 33-1004F, Idaho Code; 51 h. Unemployment insurance benefit payments according to the provisions of 4 1 section 72-1349A, Idaho Code; 2 i. For expenditure as provided by the public school technology program; 3 j. For the support of provisions that provide a safe environment condu- 4 cive to student learning and maintain classroom discipline, an allocation 5 of $300 per support unit; and 6 k. Any additional amounts as required by statute to effect administrative 7 adjustments or as specifically required by the provisions of any bill of 8 appropriation; 9 to secure the state educational support funds. 10 3. Local Districts' Contribution Calculation. Without including any 11 allowance as a credit for prepaid taxes as provided by section 63-1607, Idaho 12 Code, the local districts' contribution shall be the amount appropriated pur- 13 suant to section 33-1002D, Idaho Code, plusthree-tenths percent (.3%) during14fiscal year 2003-04 and each year thereafter, of the total state adjusted mar-15ket value for assessment purposes for the previous year with such value being16determined by the provisions of section 63-315the amount received pursuant to 17 section 33-802 2., Idaho Code, and four-tenths percent (.4%) during fiscal 18 year 1994-95 and each year thereafter, of the cooperative electrical associa- 19 tions' property values that have been derived from the taxes paid in lieu of 20 property taxes for the previous year as provided in section 63-3502, Idaho 21 Code, less any maintenance and operations levy funds credited as a reduction 22 against state funds provided for students attending school in another state. 23 4. Educational Support Program Distribution Funds. Add the local dis- 24 tricts' contribution, subsection 3. of this section, and the state educational 25 support program funds, subsection 1. of this section, together to secure the 26 total educational support program distribution funds. 27 5. Average Daily Attendance. The total state average daily attendance 28 shall be the sum of the average daily attendance of all of the school dis- 29 tricts of the state. The state board of education shall establish rules set- 30 ting forth the procedure to determine average daily attendance and the time 31 for, and method of, submission of such report. Average daily attendance calcu- 32 lation shall be carried out to the nearest hundredth. Computation of average 33 daily attendance shall also be governed by the provisions of section 33-1003A, 34 Idaho Code. 35 6. Support Units. The total state support units shall be determined by 36 using the tables set out hereafter called computation of kindergarten support 37 units, computation of elementary support units, computation of secondary sup- 38 port units, computation of exceptional education support units, and computa- 39 tion of alternative school secondary support units. The sum of all of the 40 total support units of all school districts of the state shall be the total 41 state support units. 42 COMPUTATION OF KINDERGARTEN SUPPORT UNITS 43 Average Daily 44 Attendance Attendance Divisor Units Allowed 45 41 or more .... 40....................... 1 or more as computed 46 31 - 40.99 ADA.... -....................... 1 47 26 - 30.99 ADA.... -....................... .85 48 21 - 25.99 ADA.... -....................... .75 49 16 - 20.99 ADA.... -....................... .6 50 8 - 15.99 ADA.... -....................... .5 51 1 - 7.99 ADA.... -....................... count as elementary 5 1 COMPUTATION OF ELEMENTARY SUPPORT UNITS 2 Average Daily 3 Attendance Attendance Divisor Minimum Units Allowed 4 300 or more ADA........................................ 15 5 ..23...grades 4,5 & 6.... 6 ..22...grades 1,2 & 3....1994-95 7 ..21...grades 1,2 & 3....1995-96 8 ..20...grades 1,2 & 3....1996-97 9 and each year thereafter. 10 160 to 299.99 ADA... 20..................... 8.4 11 110 to 159.99 ADA... 19..................... 6.8 12 71.1 to 109.99 ADA... 16..................... 4.7 13 51.7 to 71.0 ADA... 15..................... 4.0 14 33.6 to 51.6 ADA... 13..................... 2.8 15 16.6 to 33.5 ADA... 12..................... 1.4 16 1.0 to 16.5 ADA... n/a.................... 1.0 17 COMPUTATION OF SECONDARY SUPPORT UNITS 18 Average Daily 19 Attendance Attendance Divisor Minimum Units Allowed 20 750 or more .... 18.5..................... 47 21 400 - 749.99 ADA.... 16....................... 28 22 300 - 399.99 ADA.... 14.5..................... 22 23 200 - 299.99 ADA.... 13.5..................... 17 24 100 - 199.99 ADA.... 12....................... 9 25 99.99 or fewer Units allowed as follows: 26 Grades 7-12 ......................... 8 27 Grades 9-12 ......................... 6 28 Grades 7- 9 ......................... 1 per 14 ADA 29 Grades 7- 8 ......................... 1 per 16 ADA 30 COMPUTATION OF EXCEPTIONAL EDUCATION SUPPORT UNITS 31 Average Daily 32 Attendance Attendance Divisor Minimum Units Allowed 33 14 or more .... 14.5..................... 1 or more as computed 34 12 - 13.99.... -....................... 1 35 8 - 11.99.... -....................... .75 36 4 - 7.99.... -....................... .5 37 1 - 3.99.... -....................... .25 38 COMPUTATION OF ALTERNATIVE SCHOOL SECONDARY SUPPORT UNITS 39 Pupils in Attendance Attendance Divisor Minimum Units Allowed 40 12 or more.......... 12...................... 1 or more as computed 41 In applying these tables to any given separate attendance unit, no school 42 district shall receive less total money than it would receive if it had a 43 lesser average daily attendance in such separate attendance unit. In applying 44 the kindergarten table to a kindergarten program of less days than a full 45 school year, the support unit allowance shall be in ratio to the number of 46 days of a full school year. The tables for exceptional education and alterna- 47 tive school secondary support units shall be applicable only for programs 48 approved by the state department of education following rules established by 49 the state board of education. Moneys generated from computation of support 50 units for alternative schools shall be utilized for alternative school pro- 51 grams. School district administrative and facility costs may be included as 6 1 part of the alternative school expenditures. 2 7. State Distribution Factor per Support Unit. Divide educational support 3 program distribution funds, after subtracting the amounts necessary to pay the 4 obligations specified in subsection 2. of this section, by the total state 5 support units to secure the state distribution factor per support unit. 6 8. District Share of State Funds for Educational Support Program. Ascer- 7 tain a district's share of state funds for the educational support program as 8 follows: 9 a. District Contribution Calculation. Without including any allowance as 10 a credit for prepaid taxes, as provided in section 63-1607, Idaho Code, 11 the district contribution calculation shall be the rate determined under 12 subsection 3. of this section. 13 b. District Support Units. The number of support units for each school 14 district in the state shall be determined as follows: 15 (1) Divide the actual average daily attendance, excluding students 16 approved for inclusion in the exceptional child educational program, 17 for the administrative schools and each of the separate schools and 18 attendance units by the appropriate divisor from the tables of sup- 19 port units in this section, then add the quotients to obtain the 20 district's support units allowance for regular students, kindergarten 21 through grade 12 including alternative school secondary students. 22 Calculations in application of this subsection shall be carried out 23 to the nearest tenth. 24 (2) Divide the combined totals of the average daily attendance of 25 all preschool, handicapped, kindergarten, elementary, secondary and 26 juvenile detention center students approved for inclusion in the 27 exceptional child program of the district by the appropriate divisor 28 from the table for computation of exceptional education support units 29 to obtain the number of support units allowed for the district's 30 approved exceptional child program. Calculations for this subsection 31 shall be carried out to the nearest tenth when more than one (1) unit 32 is allowed. 33 (3) The total number of support units of the district shall be the 34 sum of the total support units for regular students, subsection 35 8.b.(1) of this section, and the support units allowance for the 36 approved exceptional child program, subsection 8.b.(2) of this sec- 37 tion. 38 c. Total District Allowance Educational Program. Multiply the district's 39 total number of support units, carried out to the nearest tenth, by the 40 state distribution factor per support unit and to this product add the 41 approved amount of programs of the district provided in subsection 2. g. 42 of this section, excluding benefits paid pursuant to section 33-1004F, 43 Idaho Code, to secure the district's total equalized allowance for the 44 educational support program. 45 d. District Share. To secure the district's share of state apportionment, 46 subtract the amount of the local district contribution calculation, sub- 47 section 3. of this section, from the amount of the total equalized dis- 48 trict allowance, subsection 8.c. of this section. 49 e. Adjustment of District Share. The contract salary of every noncertifi- 50 cated teacher shall be subtracted from the district's share as calculated 51 from the provisions of subsection 8.d. of this section. 52 SECTION 5. That Section 33-1002D, Idaho Code, be, and the same is hereby 53 amended to read as follows: 7 1 33-1002D. PROPERTY TAX REPLACEMENT. The purpose of this section is to 2 replace a portion of the authorized school maintenance and operation property 3 tax levy with statesales tax receiptsgeneral fund appropriations. As used in 4 this section, the term "property tax computation ratio" shall mean a ratio 5 determined by dividing the district's certified property tax maintenance and 6 operation budget by the actual or adjusted market value for assessment pur- 7 poses as such values existed on December 31 of the previous calendar year, 8 together with the increment value, as defined in section 50-2903, Idaho Code, 9 if applicable under the circumstance described in section 33-802 2., Idaho 10 Code, relating to termination of a revenue allocation area. 11 (1) (a) In the case of a school district that had a property tax computa- 12 tion ratio of not less than four-tenths of one percent (.4%) in tax year 13 1994, that school district shall receive from the appropriations made for 14 that purpose, an amount equal to the greater of the district's actual or 15 adjusted market value for assessment purposes as such valuation existed on 16 December 31 of the previous calendar year, together with the increment 17 value, as defined in section 50-2903, Idaho Code, if applicable under the 18 circumstance described in section 33-802 2., Idaho Code, relating to ter- 19 mination of a revenue allocation area, multiplied by one-tenth of one per- 20 cent (.1%). 21 (b) In the case of a school district that had a property tax computation 22 ratio of less than four-tenths of one percent (.4%) in tax year 1994, the 23 greater of the 1992, 1993 or 1994 property tax computation ratio less 24 three-tenths of one percent (.3%) shall be designated the district's base 25 multiplier. In no case shall the base multiplier be less than zero (0). 26 Four-tenths of one percent (.4%) less the greater of the district's 1992, 27 1993 or 1994 property tax computation ratio shall be designated the 28 district's adjustment factor. In no case shall the adjustment factor be 29 greater than one-tenth of one percent (.1%) or less than zero (0). Each 30 school district's actual multiplier shall be the base multiplier plus one- 31 fifth (1/5) of the adjustment factor in tax year 1995, the base multiplier 32 plus two-fifths (2/5) of the adjustment factor in tax year 1996, the base 33 multiplier plus three-fifths (3/5) of the adjustment factor in tax year 34 1997, the base multiplier plus four-fifths (4/5) of the adjustment factor 35 in tax year 1998, and the base multiplier plus the adjustment factor in 36 tax year 1999 and beyond. Each school district shall receive, from the 37 appropriations made for that purpose, an amount equal to the district's 38 actual or adjusted market value for assessment purposes as such valuation 39 existed on December 31 of the previous calendar year, together with the 40 increment value, as defined in section 50-2903, Idaho Code, if applicable 41 under the circumstance described in section 33-802 2., Idaho Code, relat- 42 ing to termination of a revenue allocation area, multiplied by the 43 district's actual multiplier. 44 (c) The preceding provisions of this subsection notwithstanding, appro- 45 priations from the state for the value of one-tenth of one percent (.1%) 46 of the greater of the district's actual or adjusted market value for 47 assessment purposes as such valuation existed on December 31 of the previ- 48 ous calendar year, together with the increment value, as defined in sec- 49 tion 50-2903, Idaho Code, if applicable under the circumstance described 50 in section 33-802 2., Idaho Code, relating to termination of a revenue 51 allocation area, shall not exceed seventy-five million dollars 52 ($75,000,000) in any fiscal year. If the amount school districts would 53 otherwise be entitled to receive pursuant to the preceding provisions of 54 this subsection exceeds seventy-five million dollars ($75,000,000), then 55 each school district shall receive its share of seventy-five million dol- 8 1 lars ($75,000,000) based on the formulas contained in this section. 2 (2) (a) Participation in this property tax reduction program is voluntary 3 for a charter district. If a charter district participates, in addition to 4 the provisions of subsection (1) of this section it shall not have a prop- 5 erty tax computation ratio that is above three-tenths of one percent (.3%) 6 or the district's property tax computation ratio in tax year 1994, less 7 one-tenth of one percent (.1%), whichever is greater. 8 (b) If in any year the charter district's property tax computation ratio 9 used to calculate its maintenance and operation budget is increased above 10 the limit specified in this subsection the district shall not be eligible 11 for the distribution pursuant to subsection (1) of this section for that 12 year. 13 (3) Limitations imposed upon a school district's property tax computation 14 ratio under the provisions of this section do not apply to any levy approved 15 by electors of the school district as provided by law. 16 (4) For fiscal year 2007, each school district shall receive a distribu- 17 tion of funds equal to the difference between the maximum amount of mainte- 18 nance and operation levy funds that the school district is entitled to receive 19 for tax year 2006, and the maximum amount of maintenance and operation levy 20 funds that would have been received by the school district for tax year 2006, 21 based on the laws of the state of Idaho as they existed prior to amendment by 22 the first extraordinary session of the fifty-eighth Idaho legislature. For 23 each subsequent fiscal year, distributions to each school district shall be 24 made based on the amount distributed in the prior fiscal year, adjusted by the 25 percentage change in the consumer price index for all urban consumers, as such 26 index is published by the United States department of labor, and by the per- 27 centage change in midterm support units for each school district. For the con- 28 sumer price index for all urban consumers, the time period used as the basis 29 of calculation shall be the average of all months for the most recent full 30 calendar year that is available at the time the appropriation for public 31 schools is originally made. For the midterm support units, the figures used as 32 the basis for calculation shall be the same as are used for the calculation of 33 salary-based apportionment in the fiscal year in which the distribution is 34 made. 35 (5) Distributions calculated as provided in this section shall be made to 36 school districts of this state in two (2) equal installments on the due dates 37 as specified in section 63-903(1), Idaho Code, for the property taxes being 38 replaced. 39 (56) For purposes of section 33-1002, Idaho Code, moneys distributed pur- 40 suant to this section shall not be included in determining total state funds. 41 SECTION 6. That Section 33-1408, Idaho Code, be, and the same is hereby 42 amended to read as follows: 43 33-1408. SPECIAL LEVY FOR TUITION. Any school district is hereby autho- 44 rized to make a levy above the maintenance and operation levy otherwise autho- 45 rized by law for the purpose of paying tuition costs of its students who, 46 under authorization of the board of trustees of the district, attend school in 47 another districteitherinor out ofIdaho, except for those costs reimbursed48by the state under border contracts. Such levy shall be exempt from the provi- 49 sions of section 63-802, Idaho Code. 50 SECTION 7. That Section 63-602G, Idaho Code, be, and the same is hereby 51 amended to read as follows: 9 1 63-602G. PROPERTY EXEMPT FROM TAXATION -- HOMESTEAD. 2 (1) (a) During the tax year 2006 and each year thereafter, subject to 3 annual adjustment as provided herein, the first seventy-five thousand dol- 4 lars ($75,000) of the market value for assessment purposes of the home- 5 stead as that term is defined in section 63-701, Idaho Code, or fifty per- 6 cent (50%) of the market value for assessment purposes of the homestead as 7 that term is defined in section 63-701, Idaho Code, whichever is the 8 lesser, shall be exempt from property taxation. Beginning for tax year 9 2007, the state tax commission shall publish adjustments to the maximum 10 amount subject to property tax exemption to reflect cost-of-living fluctu- 11 ations. The adjustments shall effect changes in the amount subject to tax 12 exemption by a percentage equal as near as practicable to the annual 13 increase in the Idaho housing price index as determined by the United 14 States office of federal housing enterprise oversight. The state tax com- 15 mission shall publish the adjustments required by this subsection each and 16 every year the office of federal housing enterprise oversight announces a 17 change in the Idaho housing price index. The adjustments shall be pub- 18 lished no later than October 1 of each year and shall be effective for 19 claims filed in and for the following property tax year. The publication 20 of adjustments under this subsection shall be exempt from the provisions 21 of chapter 52, title 67, Idaho Code, but shall be provided to each county 22 and to members of the public upon request and without charge. 23 (b) During tax year 2006 and each year thereafter, one hundred percent 24 (100%) of the market value for assessment purposes of the homestead as 25 that term is defined in section 63-701, Idaho Code, shall be exempt from 26 taxation for the purposes of applying the maintenance and operation levy 27 of a school district pursuant to section 33-802 2., Idaho Code, or apply- 28 ing forty-five and seventeen-hundredths percent (45.17%) of the mainte- 29 nance and operation levy of a charter district that levied a maintenance 30 and operation levy in tax year 2005 that was greater than four-tenths of 31 one percent (.4%) of the actual or adjusted market value for assessment 32 purposes of the district as such valuation existed on December 31 of the 33 previous year. The county clerk shall submit to the state tax commission 34 the taxable market value for assessment purposes of all homesteads, as 35 that term is defined in section 63-701, Idaho Code, as such values existed 36 on December 31 of the previous year, delineated by school district, by no 37 later than the first Monday in March. 38 (2) The exemption allowed by this section may be granted only if: 39 (a) The homestead is owner-occupied and used as the primary dwelling 40 place of the owner as of January 1, provided that in the event the home- 41 stead is owner-occupied after January 1 but before April 15, the owner of 42 the property is entitled to the exemption. The homestead may consist of 43 part of a multidwelling or multipurpose building and shall include all of 44 such dwelling or building except any portion used exclusively for anything 45 other than the primary dwelling of the owner. The presence of an office in 46 a homestead, which office is used for multiple purposes, including busi- 47 ness and personal use, shall not prevent the owner from claiming the 48 exemption provided in this section; and 49 (b) The tax commission has certified to the board of county commissioners 50 that all properties in the county which are subject to appraisal by the 51 county assessor have, in fact, been appraised uniformly so as to secure a 52 just valuation for all property within the county; and 53 (c) The owner has certified to the county assessor by April 15 that: 54 (i) He is making application for the exemption allowed by this sec- 55 tion; 10 1 (ii) That the homestead is his primary dwelling place; and 2 (iii) That he has not made application in any other county for the 3 exemption, and has not made application for the exemption on any 4 other homestead in the county. 5 (d) For the purpose of this section, the definition of "owner" shall be 6 the same definition set forth in section 63-701(7), Idaho Code. 7 When an "owner," pursuant to the provisions of section 63-701(7), 8 Idaho Code, is any person who is the beneficiary of a revocable or irrevo- 9 cable trust, or who is a partner of a limited partnership, a member of a 10 limited liability company, or shareholder of a corporation, he or she may 11 provide proof of the trust, limited partnership, limited liability com- 12 pany, or corporation in the manner set forth in section 63-703(4), Idaho 13 Code. 14 (e) Any owner may request in writing the return of all copies of any doc- 15 uments submitted with the affidavit set forth in section 63-703(4), Idaho 16 Code, that are held by a county assessor, and the copies shall be returned 17 by the county assessor upon submission of the affidavit in proper form. 18 (f) For the purpose of this section, the definition of "primary dwelling 19 place" shall be the same definition set forth in section 63-701(8), Idaho 20 Code. 21 (g) For the purpose of this section, the definition of "occupied" shall 22 be the same definition set forth in section 63-701(6), Idaho Code. 23 (3) An owner need only make application for the exemption described in 24 subsection (1) of this section once, as long as all of the following condi- 25 tions are met: 26 (a) The owner has received the exemption during the previous year as a 27 result of his making a valid application as defined in subsection (2)(c) 28 of this section. 29 (b) The owner or beneficiary, partner, member or shareholder, as appro- 30 priate, still occupies the same homestead for which the owner made appli- 31 cation. 32 (c) The homestead described in subsection (3)(b) of this section is 33 owner-occupied or occupied by a beneficiary, partner, member or share- 34 holder, as appropriate, and used as the primary dwelling place of the 35 owner or beneficiary, partner, member or shareholder, as appropriate, as 36 of January 1; provided however, that in the event the homestead is owner- 37 occupied after January 1, but before April 15, the owner of the property 38 is entitled to the exemption. 39 (4) The exemption allowed by this section must be taken before the reduc- 40 tion in taxes provided by sections 63-701 through 63-710, Idaho Code, is 41 applied. 42 (5) Recovery of property tax exemptions allowed by this section but 43 improperly claimed or approved: 44 (a) Upon discovery of evidence, facts or circumstances indicating any 45 exemption allowed by this section was improperly claimed or approved, the 46 county assessor shall decide whether the exemption claimed should be 47 allowed and if not, notify the taxpayer in writing, assess a recovery of 48 property tax and notify the county treasurer of this assessment. 49 (b) When information indicating that an improper claim for the exemption 50 allowed by this section is discovered by the state tax commission, the 51 state tax commission may disclose this information to the appropriate 52 county assessor, board of county commissioners and county treasurer. 53 Information disclosed to county officials by the state tax commission 54 under this subsection may be used to decide the validity of any entitle- 55 ment to the exemption provided in this section and is not otherwise sub- 11 1 ject to public disclosure pursuant to chapter 3, title 9, Idaho Code. 2 (c) The assessment and collection of the recovery of property tax must 3 begin within the seven (7) year period beginning the date the assessment 4 notice reflecting the improperly claimed or approved exemption was 5 required to be mailed to the taxpayer. 6 (d) The taxpayer may appeal to the board of county commissioners the 7 decision by the county assessor to assess the recovery of property tax 8 within thirty (30) days of the date the county assessor sent the notice to 9 the taxpayer pursuant to this section. 10 (e) A recovery of property tax shall be for each year the exemption 11 allowed by this section was improperly claimed or approved up to the 12 lesser of a maximum of seven (7) years or until the property was trans- 13 ferred to a bona fide purchaser for value. The amount of the recovery of 14 property tax shall be calculated using the product of the amount of 15 exempted value for each year multiplied by the levy for that year plus 16 costs, late charges and interest for each year at the rates equal to those 17 provided for delinquent property taxes during that year. 18 (f) Any recovery of property tax shall be due and payable no later than 19 the date provided for property taxes in section 63-903, Idaho Code, and if 20 not timely paid, late charges and interest, beginning the first day of 21 January in the year following the year the county assessor sent the notice 22 to the taxpayer pursuant to this section, shall be calculated at the cur- 23 rent rate provided for property taxes. 24 (g) Recovered property taxes shall be billed, collected and distributed 25 in the same manner as property taxes, except each taxing district or unit 26 shall be notified of the amount of any recovered property taxes included 27 in any distribution. 28 (h) Any unpaid recovered property taxes shall become a lien upon the real 29 property in the same manner as provided for property taxes in section 30 63-206, Idaho Code, except such lien shall attach as of the first day of 31 January in the year following the year the county assessor sent the notice 32 to the taxpayer pursuant to this section. 33 (i) For purposes of the limitation provided by section 63-802, Idaho 34 Code, moneys received pursuant to this subsection as recovery of property 35 tax shall be treated as property tax revenue. 36 (6) The legislature declares that this exemption is necessary and just. 37 (7) A homestead having previously qualified for exemption under this sec- 38 tion in the preceding year, shall not lose such qualification due to: the 39 owner's, beneficiary's, partner's, member's or shareholder's absence in the 40 current year by reason of active military service in a designated combat 41 zone, as defined in section 112 of the Internal Revenue Code, or because the 42 homestead has been leased because the owner, beneficiary, partner, member or 43 shareholder is absent in the current year by reason of active military service 44 in a designated combat zone, as defined in section 112 of the Internal Revenue 45 Code. If an owner fails to timely apply for exemption as required in this sec- 46 tion solely by reason of active duty in a designated combat zone by the owner, 47 beneficiary, partner, member or shareholder, as appropriate, as defined in 48 section 112 of the Internal Revenue Code, and such homestead would have other- 49 wise qualified under this section, then the board of county commissioners of 50 the county in which the homestead is located shall refund property taxes, if 51 previously paid, in an amount equal to the exemption which would otherwise 52 have applied. 12 1 SECTION 8. There is hereby appropriated the following amount to be trans- 2 ferred to the Public School Income Fund for the period July 1, 2006, through 3 June 30, 2007: 4 FROM: 5 General Fund $104,000,000 6 SECTION 9. In addition to any other appropriation provided by law, there 7 is hereby appropriated to the Educational Support Program/Division of Opera- 8 tions, pursuant to law and the provisions of this act, $104,000,000 from the 9 Public School Income Fund to be expended for the period July 1, 2006, through 10 June 30, 2007. 11 SECTION 10. SEVERABILITY. The provisions of this act are hereby declared 12 to be severable and if any provision of this act or the application of such 13 provision to any person or circumstance is declared invalid for any reason, 14 such declaration shall not affect the validity of the remaining portions of 15 this act. 16 SECTION 11. An emergency existing therefor, which emergency is hereby 17 declared to exist, Sections 1 through 7 and Section 10 of this act shall be in 18 full force and effect on and after passage and approval, and retroactively to 19 January 1, 2006. Sections 8 and 9 of this act shall be in full force and 20 effect on and after passage and approval.
STATEMENT OF PURPOSE
RS16446
The purpose of the Idaho Homeowners Tax Reduction Act:
· Permanently eliminate the 3 mil education maintenance
and operations levy on all Idaho properties currently
qualifying for the Homeowner's Exemption, namely owner
occupied primary residencies, resulting an a $104
million property tax cut for Idaho homeowners.
· Retain current property tax level for all other classes
of Idaho property.
· Provide targeted relief for homeowners without shifting
tax burden onto other tax payers or increasing the
sales tax. The Idaho Homeowner Tax Reduction Act does
not raise any tax.
· Appropriate the equivalent amount of reduced homeowner
taxes into the school maintenance and operations
budget, holding schools harmless.
· Protect public schools by maintaining the 3 mil levy on
all non-owner-occupied properties allowing schools to
retain a stable source of ongoing maintenance and
operations funding.
FISCAL IMPACT
Immediately reduces Idaho homeowner property taxes $104
million. Relies on current state surplus and ongoing growth
in state revenue to cover future costs.
Contacts:
Name: Sen. Clint Stennett Sen. Mike Burkett
Sen. Edgar Malepeai Sen. Elliot Werk
Sen. David Langhorst Sen. Bert Marley
Sen. Kate Kelly
Phone: (208) 332-1351
STATEMENT OF PURPOSE/FISCAL NOTE S 1001