2008 Legislation
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HOUSE BILL NO. 579<br /> – Taxing dist/budget reduced/election

HOUSE BILL NO. 579

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Bill Status



H0579...............................................by REVENUE AND TAXATION
TAXING DISTRICTS - ELECTIONS - Adds to and amends existing law to provide a
mechanism for the voters of certain taxing districts to reduce the property
tax portion of the taxing district's budget for the following fiscal year,
with exceptions; to define terms; to provide procedures; to provide a
restriction imposed by statute for indigent assistance; to provide the
amount of the property tax portion of a taxing district's budget in the
event a taxing district's property tax portion of its budget is established
pursuant to a property tax reduction election; to provide for an increase
of that amount according to certain factors; and to limit foregone
increases.

02/28    House intro - 1st rdg - to printing
02/29    Rpt prt - to Rev/Tax
03/05    Rpt out - rec d/p - to 2nd rdg
03/06    2nd rdg - to 3rd rdg
03/07    3rd rdg - PASSED - 39-29-2
      AYES -- Anderson, Barrett, Bayer, Bedke, Bell, Bilbao, Block, Bowers,
      Brackett, Bradford, Chadderdon, Collins, Crane, Eskridge, Hagedorn,
      Hart, Harwood, Kren, Lake, LeFavour, Loertscher, Marriott, Mathews,
      McGeachin, Moyle, Nielsen, Nonini, Patrick, Roberts, Schaefer,
      Shepherd(02), Shepherd(08), Snodgrass, Thayn, Vander Woude, Wills,
      Wood(27), Wood(35), Mr. Speaker
      NAYS -- Andrus, Black, Bock, Boe, Bolz, Chavez, Chew, Clark, Durst,
      Henbest, Henderson, Jaquet, Killen, King, Mortimer, Pasley-Stuart,
      Pence, Raybould, Ringo, Ruchti, Rusche, Sayler, Shirley, Shively,
      Smith(30), Smith(24), Stevenson, Thomas, Trail
      Absent and excused -- Labrador, Luker
    Floor Sponsor - Wills
    Title apvd - to Senate
03/10    Senate intro - 1st rdg - to Loc Gov

Bill Text




                                                                       
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   Second Regular Session - 2008

                                                                       

                              IN THE HOUSE OF REPRESENTATIVES

                                     HOUSE BILL NO. 579

                             BY REVENUE AND TAXATION COMMITTEE

  1                                        AN ACT
  2    RELATING TO LIMITATION OF PROPERTY TAXES; AMENDING CHAPTER 8, TITLE 63,  IDAHO
  3        CODE,  BY  THE ADDITION OF A NEW SECTION 63-802B, IDAHO CODE, TO PROVIDE A
  4        MECHANISM FOR THE VOTERS OF CERTAIN TAXING DISTRICTS TO REDUCE  THE  PROP-
  5        ERTY  TAX PORTION OF THE TAXING DISTRICT'S BUDGET FOR THE FOLLOWING FISCAL
  6        YEAR WITH EXCEPTIONS, TO DEFINE TERMS AND TO PROVIDE PROCEDURES;  AMENDING
  7        SECTION  63-802, IDAHO CODE, TO PROVIDE A RESTRICTION IMPOSED BY A STATUTE
  8        FOR INDIGENT ASSISTANCE, TO PROVIDE FOR A LIMIT  ON  AN  INCREASE  IN  THE
  9        EVENT  A  TAXING  DISTRICT'S  PROPERTY TAX PORTION OF ITS BUDGET IS ESTAB-
 10        LISHED PURSUANT TO A PROPERTY TAX REDUCTION ELECTION AND TO LIMIT FOREGONE
 11        INCREASES; PROVIDING SEVERABILITY; DECLARING AN  EMERGENCY  AND  PROVIDING
 12        RETROACTIVE APPLICATION.

 13    Be It Enacted by the Legislature of the State of Idaho:

 14        SECTION  1.  That  Chapter  8,  Title  63, Idaho Code, be, and the same is
 15    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 16    ignated as Section 63-802B, Idaho Code, and to read as follows:

 17        63-802B.  TAXPAYER  PROPERTY  TAX  RELIEF. (1) Property tax is a local tax
 18    best controlled by registered voters in any given taxing district;  such  dis-
 19    trict  generally  having  been established at the request of the voters, or by
 20    legislative action to comply with provisions of the state's  constitution.  It
 21    is therefore legislative intent that taxpayers have proper authority to resist
 22    excessive  property taxes and, to this end, taxpayers in any given taxing dis-
 23    trict may initiate local option property tax relief in the form  of  a  budget
 24    limitation  on the property tax portion of the district's budget. This section
 25    shall only apply to those taxing districts subject to the provisions  of  sec-
 26    tion  63-802,  Idaho Code, and whose property tax portion of its budget equals
 27    or exceeds two hundred fifty thousand dollars ($250,000) annually.
 28        (2)  For the purpose of this section, the term "property  tax  portion  of
 29    the  district's budget" does not include revenues from nonproperty tax sources
 30    nor amounts or levies that  have  been  voter  approved  for  bonds,  override
 31    levies,  supplemental  levies,  levies  applicable  to newly annexed property,
 32    school districts or levies for newly created taxing districts.
 33        (3)  After a district has adopted a  budget  for  the  forthcoming  fiscal
 34    year,  electors who are registered to vote in the taxing district may initiate
 35    a budget limitation election that places a budget limitation on  the  property
 36    tax  portion  of  the  district's budget. The limit shall be the amount estab-
 37    lished by the election in the district, which amount shall  be  effective  for
 38    the district's next fiscal year following the election. In the event of multi-
 39    ple petitions, the petition first certified by the taxing district clerk shall
 40    be  the  question  for  election.  An election may be held pursuant to section
 41    63-802, Idaho Code, for an override of the budget limitation. The budget limi-
 42    tation of this section shall be automatically terminated in the event  a  dis-
 43    trict subject to the limitation shall consolidate or combine with another dis-

                                       2

  1    trict.  The newly formed district shall be subject to all of the provisions of
  2    this section as a newly created taxing district.
  3        (4)  Registered voters may initiate any budget limitation election by sub-
  4    mitting a petition that has been signed by residents of the  district  to  the
  5    governing board of the district equal to or exceeding ten percent (10%) of the
  6    number of voters voting at the last election of the taxing district. The peti-
  7    tion shall be in substantially the following form:
  8                              BUDGET LIMITATION PETITION

  9             To the (name of the taxing district):
 10             We,  the  undersigned agree that the property tax portion of the
 11        district's budget, as most recently adopted by the district governing
 12        board, is excessive in its demand  for  increased  property  tax  and
 13        request that the following question be placed on the ballot, to wit:
 14             "Shall the property tax portion of the .... district's budget be
 15        limited to ....(insert dollar amount)....?".
 16        (5)  Upon  receiving  a  signed petition, the governing board clerk of the
 17    district shall review  the  petition  and  determine  whether  the  signatures
 18    thereon are valid. Upon a determination that sufficient signatures for passage
 19    are  valid,  the  governing  board  may  give notice and hold a public hearing
 20    within thirty (30) days to explain the currently  adopted  budget  and  future
 21    expectations  and  needs.  Notice  of such hearing shall be prominently adver-
 22    tised, to include the place, hour and day of the hearing. After  the  hearing,
 23    or  if no hearing is held, the district shall conduct an election at the first
 24    available election date. The election shall meet the requirements  of  section
 25    34-106,  Idaho Code.  Notice of the election shall be posted at least ten (10)
 26    days prior to the date of the election in at least one (1)  conspicuous  place
 27    in  the district, such place to be determined by the governing board. At least
 28    ten (10) days before the election, a copy of such notice shall also  be   pub-
 29    lished  in  a  daily  or weekly newspaper published within the district, in at
 30    least one (1) issue thereof. If there is no newspaper within the district, the
 31    governing board shall advertise as specified above in a newspaper  of  general
 32    circulation  within  the  district.  The  place, hour and day of such election
 33    shall be specified in the notice. Within seven (7) days  after  the  election,
 34    the  governing  board shall canvass the ballots and certify the results to the
 35    county clerk and the state tax commission.
 36        (6)  If a budget limitation election is held, the  question  for  election
 37    shall be:
 38             "Shall the property tax portion of the district's budget be lim-
 39        ited to ....(insert dollar amount)....?".
 40        For this election:
 41        (a)  The  term  "property  tax  portion of the district's budget" does not
 42        include revenues from nonproperty tax sources and does not include revenue
 43        from levies that are voter approved for bonds, override levies, supplemen-
 44        tal levies, or for levies applicable to newly  annexed  property,  or  for
 45        levies for newly created taxing districts; and
 46        (b)  Budget  limitation elections may be initiated either by the number of
 47        residents of the district equal to or exceeding ten percent (10%)  of  the
 48        number of voters voting at the last election of the taxing district or the
 49        district's  governing  board. No more than one (1) budget limitation elec-
 50        tion may be held in any one (1) year.
 51        (7)  If sixty-six and two-thirds percent (66 2/3%) or more of the  persons
 52    voting  at  the  budget limitation election vote in favor of the question, the
 53    property tax portion of the district's budget shall be limited  to the  amount
 54    established  by  the  registered  voters  in the district provided an override

                                       3

  1    election pursuant to section 63-802, Idaho Code, is not held and passed in the
  2    interim.
  3        (8)  The cost of publication, hearing or election required in this section
  4    shall be paid from any district fund which is not prohibited by  statute  from
  5    being used for this purpose.

  6        SECTION  2.  That  Section  63-802, Idaho Code, be, and the same is hereby
  7    amended to read as follows:

  8        63-802.  LIMITATION ON BUDGET REQUESTS -- LIMITATION  ON  TAX  CHARGES  --
  9    EXCEPTIONS.  (1)  Except as provided in subsection (3) of this section for tax
 10    year 1995, and each year thereafter, no taxing district shall certify a budget
 11    request for an amount of property tax revenues to  finance  an  annual  budget
 12    that exceeds the greater of:
 13        (a)  The  dollar  amount of property taxes certified for its annual budget
 14        for any one (1) of the three (3) tax years preceding the current tax year,
 15        whichever is greater, which amount may be increased by a growth factor  of
 16        not  to  exceed  three  percent (3%) plus the amount of revenue that would
 17        have been generated by applying the levy of the previous year, not includ-
 18        ing any levy described in subsection (4) of this section,  or  any  school
 19        district  levy reduction resulting from a distribution of state funds pur-
 20        suant to section 63-3638(10), Idaho Code, to any increase in market  value
 21        subject  to taxation resulting from new construction or change of land use
 22        classification as evidenced by the value shown  on  the  new  construction
 23        roll compiled pursuant to section 63-301A, Idaho Code; and by the value of
 24        annexation  during  the  previous calendar year, as certified by the state
 25        tax commission for market values of operating property of public utilities
 26        and by the county assessor; or
 27        (b)  The dollar amount of property taxes certified for its  annual  budget
 28        during the last year in which a levy was made; or
 29        (c)  The  dollar  amount  of the actual budget request, if the taxing dis-
 30        trict is newly created except as may be provided in subsection  (1)(h)  of
 31        this section; or
 32        (d)  In  the  case of school districts, the restriction imposed in section
 33        33-802, Idaho Code, in the case of counties for indigent  assistance,  the
 34        restriction imposed in section 31-863, Idaho Code; or
 35        (e)  In  the  case of a nonschool district for which less than the maximum
 36        allowable increase in the dollar amount of property  taxes  is   certified
 37        for  annual  budget  purposes in any one (1) year, such a district may, in
 38        any following year, recover the foregone increase by certifying, in  addi-
 39        tion  to  any increase otherwise allowed, an amount not to exceed one hun-
 40        dred percent (100%) of the increase originally foregone.  Said  additional
 41        amount  shall be included in future calculations for increases as allowed;
 42        or
 43        (f)  In the case of cities, if the immediately preceding year's levy  sub-
 44        ject  to  the limitation provided by this section, is less than 0.004, the
 45        city may increase its budget by an amount not  to  exceed  the  difference
 46        between  0.004 and actual prior year's levy multiplied by the prior year's
 47        market value for  assessment  purposes.  The  additional  amount  must  be
 48        approved by sixty percent (60%) of the voters voting on the question at an
 49        election  called  for that purpose and held on the date in May or November
 50        provided by law, and may  be included in the annual budget of the city for
 51        purposes of this section; or
 52        (g)  A taxing district may submit to the electors within the district  the
 53        question of whether the budget from property tax revenues may be increased

                                       4

  1        beyond  the  amount  authorized  in  this section, but not beyond the levy
  2        authorized by statute. The additional amount must be approved by sixty-six
  3        and two-thirds percent (66 2/3%) or more of the voters voting on the ques-
  4        tion at an election called for that purpose and held on the May or  Novem-
  5        ber  dates  provided  by  section  34-106,  Idaho Code. If approved by the
  6        required minimum sixty-six and two-thirds percent (66 2/3%) of the  voters
  7        voting at the election, the new budget amount shall be the base budget for
  8        the purposes of this section; or
  9        (h)  When  a  nonschool  district consolidates with another nonschool dis-
 10        trict  or dissolves and a new  district  performing  similar  governmental
 11        functions  as the dissolved district forms with the same boundaries within
 12        three (3) years, the maximum amount of a budget of the district from prop-
 13        erty tax revenues shall not be greater than the sum of  the  amounts  that
 14        would  have been authorized by this section for the district itself or for
 15        the districts that were consolidated or dissolved and incorporated into  a
 16        new district; or
 17        (i)  In the instance or case of cooperative service agencies, the restric-
 18        tions imposed in sections 33-315 through 33-318, Idaho Code.
 19        (2)  In  the case of fire districts, during the year immediately following
 20    the election of a public utility or public utilities to consent to be provided
 21    fire protection pursuant to section 31-1425, Idaho Code, the maximum amount of
 22    property tax revenues permitted in subsection  (1)  of  this  section  may  be
 23    increased  by  an amount equal to the current year's taxable value of the con-
 24    senting public utility or public utilities multiplied by that portion  of  the
 25    prior year's levy subject to the limitation provided by subsection (1) of this
 26    section.
 27        (3)  No  board  of  county  commissioners  shall set a levy, nor shall the
 28    state tax commission approve a levy for annual budget purposes  which  exceeds
 29    the  limitation imposed in subsection (1) of this section, unless authority to
 30    exceed such  limitation  has  been  approved  by  a  majority  of  the  taxing
 31    district's electors voting on the question at an election called for that pur-
 32    pose  and  held pursuant to section 34-106, Idaho Code, provided however, that
 33    such voter approval shall be for a period of not to exceed two (2) years.
 34        (4)  The amount of property tax revenues to finance an annual budget  does
 35    not  include revenues from nonproperty tax sources, and does not include reve-
 36    nue from levies that are voter approved for bonds, override levies or  supple-
 37    mental  levies,  plant  facilities  reserve fund levies, school emergency fund
 38    levies or for levies applicable to newly annexed property or for levies appli-
 39    cable to new construction as evidenced by the value of property subject to the
 40    occupancy tax pursuant to section 63-317, Idaho Code, for  the  preceding  tax
 41    year.
 42        (5)  In  the  event an election is held pursuant to section 63-802B, Idaho
 43    Code, and the property tax portion of a taxing district's  budget  is  reduced
 44    pursuant  to  that  election,  the  amount  of the property tax portion of the
 45    district's budget that has been reduced pursuant  to  election  shall  be  the
 46    amount that may be increased by a growth factor of not to exceed three percent
 47    (3%) plus the amount of revenue that would have been generated by applying the
 48    levy  of the previous year, not including any levy described in subsection (4)
 49    of this section, to any increase in market value subject to taxation resulting
 50    from new construction or change of land use classification as evidenced by the
 51    value shown on the new construction roll compiled pursuant to section 63-301A,
 52    Idaho Code; and by the value of annexation during the previous calendar  year,
 53    as  certified by the state tax commission for market values of operating prop-
 54    erty of public utilities and by the county assessor. In the year of  the  ini-
 55    tial reduction, the taxing district shall not be eligible to recover the fore-

                                       5

  1    gone increase pursuant to subsection (1)(e) of this section.

  2        SECTION  3.  SEVERABILITY.  The provisions of this act are hereby declared
  3    to be severable and if any provision of this act or the  application  of  such
  4    provision  to  any  person or circumstance is declared invalid for any reason,
  5    such declaration shall not affect the validity of the  remaining  portions  of
  6    this act.

  7        SECTION  4.  An  emergency  existing  therefor,  which emergency is hereby
  8    declared to exist, this act shall be in full force and effect on and after its
  9    passage and approval, and retroactively to January 1, 2008.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE

                             RS 17901

This legislation will amend Chapter 8, Title 63, Idaho Code. 
By a vote of the people, a taxing district budget could be
limited, thus lowering property taxes.  This legislation would
exempt school budgets.   



                           FISCAL NOTE

There is no fiscal note.







Contact
Name: Rep. Mike Moyle
      Rep. Rich Wills
      Rep. Lawerence Denney
      Rep. Scott Bedke
      Rep. Ken Roberts
      Rep. JoAn Wood
      Rep. Eric Anderson
      Rep. Bob Schaefer
      Rep. Max Black
      Rep. Lenore Barrett 


STATEMENT OF PURPOSE/FISCAL NOTE                         H 579