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H0594...............................................by REVENUE AND TAXATION
STATE TAX COMMISSION - Amends existing law to provide that the State Tax
Commission shall calculate what the current levy rate would have been for
each taxing district without the addition to the budget of any amounts
associated with new construction or change of land use classification; to
provide if this levy rate is less than the levy rate of the previous year
that was actually applied in the current year, then the difference between
the two levy rates shall be applied to the current market value subject to
taxation resulting from new construction or change of land use
classification, and the amount resulting shall be subtracted from the
taxing district's subsequent year's annual budget.
03/04 House intro - 1st rdg - to printing
03/05 Rpt prt - to Rev/Tax
03/13 Rpt out - rec d/p - to 2nd rdg
03/14 2nd rdg - to 3rd rdg
03/17 3rd rdg - PASSED - 41-27-2
AYES -- Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black, Block,
Bolz, Bowers, Brackett, Chadderdon, Crane, Eskridge, Hagedorn, Hart,
Harwood, Killen, Kren, Labrador, Lake, Luker, Marriott, Mathews,
McGeachin, Moyle, Nielsen, Patrick, Raybould, Roberts, Schaefer,
Shepherd(08), Shirley, Snodgrass, Stevenson, Thayn, Vander Woude,
Wills, Wood(27), Wood(35), Mr. Speaker
NAYS -- Anderson, Bock, Boe, Chavez, Chew, Clark, Durst, Henbest,
Henderson, Jaquet, King, LeFavour, Loertscher, Mortimer, Nonini,
Pasley-Stuart, Pence, Ringo, Ruchti, Rusche, Sayler, Shepherd(02),
Shively, Smith(30), Smith(24), Thomas, Trail
Absent and excused -- Bradford, Collins
Floor Sponsor - Mathews
Title apvd - to Senate
03/17 Senate intro - 1st rdg - to Loc Gov
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-ninth Legislature Second Regular Session - 2008IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 594 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO BUDGETS OF TAXING DISTRICTS FUNDED BY PROPERTY TAXES; AMENDING 3 SECTION 63-802, IDAHO CODE, TO PROVIDE THAT THE STATE TAX COMMISSION SHALL 4 CALCULATE WHAT THE CURRENT LEVY RATE WOULD HAVE BEEN FOR EACH TAXING DIS- 5 TRICT WITHOUT THE ADDITION TO THE BUDGET OF ANY AMOUNTS ASSOCIATED WITH 6 NEW CONSTRUCTION OR CHANGE OF LAND USE CLASSIFICATION, TO PROVIDE THAT IF 7 THIS LEVY RATE IS LESS THAN THE LEVY RATE OF THE PREVIOUS YEAR THAT WAS 8 ACTUALLY APPLIED IN THE CURRENT YEAR, THEN THE DIFFERENCE BETWEEN THE TWO 9 LEVY RATES SHALL BE APPLIED TO THE CURRENT MARKET VALUE SUBJECT TO TAXA- 10 TION RESULTING FROM NEW CONSTRUCTION OR CHANGE OF LAND USE CLASSIFICATION, 11 AND THE AMOUNT RESULTING SHALL BE SUBTRACTED FROM THE TAXING DISTRICT'S 12 SUBSEQUENT YEAR'S ANNUAL BUDGET, TO PROVIDE FOR NOTIFICATION TO THE COUNTY 13 CLERK, TO PROVIDE DUTIES OF THE COUNTY CLERK AND TO DEFINE TERMS; AND 14 DECLARING AN EMERGENCY. 15 Be It Enacted by the Legislature of the State of Idaho: 16 SECTION 1. That Section 63-802, Idaho Code, be, and the same is hereby 17 amended to read as follows: 18 63-802. LIMITATION ON BUDGET REQUESTS -- LIMITATION ON TAX CHARGES -- 19 EXCEPTIONS. (1) Except as provided in subsections (3) and (5) of this section 20 for tax year19952008, and each year thereafter, no taxing district shall 21 certify a budget request for an amount of property tax revenues to finance an 22 annual budget that exceeds the greater of: 23 (a) The dollar amount of property taxes certified for its annual budget 24 for any one (1) of the three (3) tax years preceding the current tax year, 25 whichever is greater, which amount may be increased by a growth factor of 26 not to exceed three percent (3%) plus the amount of revenue that would 27 have been generated by applying the levy of the previous year, not includ- 28 ing any levy described in subsection (4) of this section, or any school 29 district levy reduction resulting from a distribution of state funds pur- 30 suant to section 63-3638(10), Idaho Code, to any increase in market value 31 subject to taxation resulting from new construction or change of land use 32 classification as evidenced by the value shown on the new construction 33 roll compiled pursuant to section 63-301A, Idaho Code; and by the value of 34 annexation during the previous calendar year, as certified by the state 35 tax commission for market values of operating property of public utilities 36 and by the county assessor; or 37 (b) The dollar amount of property taxes certified for its annual budget 38 during the last year in which a levy was made; or 39 (c) The dollar amount of the actual budget request, if the taxing dis- 40 trict is newly created except as may be provided in subsection (1)(h) of 41 this section; or 42 (d) In the case of school districts, the restriction imposed in section 43 33-802, Idaho Code; or 2 1 (e) In the case of a nonschool district for which less than the maximum 2 allowable increase in the dollar amount of property taxes is certified 3 for annual budget purposes in any one (1) year, such a district may, in 4 any following year, recover the foregone increase by certifying, in addi- 5 tion to any increase otherwise allowed, an amount not to exceed one hun- 6 dred percent (100%) of the increase originally foregone. Said additional 7 amount shall be included in future calculations for increases as allowed; 8 or 9 (f) In the case of cities, if the immediately preceding year's levy sub- 10 ject to the limitation provided by this section, is less than 0.004, the 11 city may increase its budget by an amount not to exceed the difference 12 between 0.004 and actual prior year's levy multiplied by the prior year's 13 market value for assessment purposes. The additional amount must be 14 approved by sixty percent (60%) of the voters voting on the question at an 15 election called for that purpose and held on the date in May or November 16 provided by law, and may be included in the annual budget of the city for 17 purposes of this section; or 18 (g) A taxing district may submit to the electors within the district the 19 question of whether the budget from property tax revenues may be increased 20 beyond the amount authorized in this section, but not beyond the levy 21 authorized by statute. The additional amount must be approved by sixty-six 22 and two-thirds percent (66 2/3%) or more of the voters voting on the ques- 23 tion at an election called for that purpose and held on the May or Novem- 24 ber dates provided by section 34-106, Idaho Code. If approved by the 25 required minimum sixty-six and two-thirds percent (66 2/3%) of the voters 26 voting at the election, the new budget amount shall be the base budget for 27 the purposes of this section; or 28 (h) When a nonschool district consolidates with another nonschool dis- 29 trict or dissolves and a new district performing similar governmental 30 functions as the dissolved district forms with the same boundaries within 31 three (3) years, the maximum amount of a budget of the district from prop- 32 erty tax revenues shall not be greater than the sum of the amounts that 33 would have been authorized by this section for the district itself or for 34 the districts that were consolidated or dissolved and incorporated into a 35 new district; or 36 (i) In the instance or case of cooperative service agencies, the restric- 37 tions imposed in sections 33-315 through 33-318, Idaho Code. 38 (2) In the case of fire districts, during the year immediately following 39 the election of a public utility or public utilities to consent to be provided 40 fire protection pursuant to section 31-1425, Idaho Code, the maximum amount of 41 property tax revenues permitted in subsection (1) of this section may be 42 increased by an amount equal to the current year's taxable value of the con- 43 senting public utility or public utilities multiplied by that portion of the 44 prior year's levy subject to the limitation provided by subsection (1) of this 45 section. 46 (3) No board of county commissioners shall set a levy, nor shall the 47 state tax commission approve a levy for annual budget purposes which exceeds 48 the limitation imposed in subsection (1) of this section, unless authority to 49 exceed such limitation has been approved by a majority of the taxing 50 district's electors voting on the question at an election called for that pur- 51 pose and held pursuant to section 34-106, Idaho Code, provided however, that 52 such voter approval shall be for a period of not to exceed two (2) years. 53 (4) The amount of property tax revenues to finance an annual budget does 54 not include revenues from nonproperty tax sources, and does not include reve- 55 nue from levies that are voter approved for bonds, override levies or supple- 3 1 mental levies, plant facilities reserve fund levies, school emergency fund 2 levies or for levies applicable to newly annexed property or for levies appli- 3 cable to new construction as evidenced by the value of property subject to the 4 occupancy tax pursuant to section 63-317, Idaho Code, for the preceding tax 5 year. 6 (5) The state tax commission shall calculate what the current levy rate 7 would have been for each taxing district without the addition to the budget of 8 any amounts associated with new construction or change of land use classifi- 9 cation, pursuant to subsection (1) of this section. If this levy rate is less 10 than the levy rate of the previous year that was actually applied in the cur- 11 rent year, then the difference between the two (2) levy rates shall be applied 12 to the current market value subject to taxation resulting from new construc- 13 tion or change of land use classification, and the amount resulting shall be 14 subtracted from the taxing district's subsequent year's annual budget, prior 15 to any calculations made pursuant to subsection (1) of this section. After the 16 state tax commission calculates the amounts resulting from this provision, it 17 shall notify each county clerk, who shall notify each taxing district in their 18 county of the effect of its budget authority. For the purpose of defining the 19 first year of implementation of this subsection, the terms "previous year," 20 "current year" and "subsequent year" shall mean tax years 2006, 2007 and 2008, 21 respectively. 22 SECTION 2. An emergency existing therefor, which emergency is hereby 23 declared to exist, this act shall be in full force and effect on and after its 24 passage and approval.
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STATEMENT OF PURPOSE
RS 18026
The purpose of this legislation is to prevent the addition of
new construction from causing an inadvertent tax shift to other
properties. Currently, when new construction property is added to
the budgets of local taxing districts, it is added at the previous
year's levy rate. If the current year's levy rate is declining,
this means that the new construction adds extra money to the
budget, based on the previous year's higher rate. This increased
budget is then paid by all property taxpayers. Moreover, this
shift effect is cumulative.
If enacted, this legislation prevents this tax shift from
accumulating, by causing the extra, tax-shifted money to be
subtracted from the next year's budget, before any budget increase
calculations are made.
FISCAL NOTE
There is no impact to the general fund as a result of this
legislation.
Contact
Name: Rep. Russ Mathews
Phone: 208.332.1000
Rep. Mike Moyle Rep. Cliff Bayer
Rep. Scott Bedke Rep. Janice McGeachin
Rep. Ken Roberts Rep. JoAn Wood
Rep. Lenore Barrett
STATEMENT OF PURPOSE/FISCAL NOTE H 594
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