H.B. 211

1

PROPERTY TAX AMENDMENTS ON
2 AGRICULTURAL LAND
3 2008 GENERAL SESSION
4 STATE OF UTAH
5 Chief Sponsor: Bradley A. Winn
6 Senate Sponsor: ____________
7
8 LONG TITLE
9 General Description:
10 This bill amends provisions in the Property Tax Act relating to the taxation of
11 agricultural land.
12 Highlighted Provisions:
13 This bill:
14 . amends the requirements for the minimum amount of land needed to qualify for
15 property tax assessment based on agricultural use; and
16 . makes technical changes.
17 Monies Appropriated in this Bill:
18 None
19 Other Special Clauses:
20 This bill takes effect on January 1, 2009.
21 Utah Code Sections Affected:
22 AMENDS:
23 59-2-502, as last amended by Laws of Utah 2005, Chapter 254
24 59-2-503, as last amended by Laws of Utah 2003, Chapter 208
25 59-2-511, as last amended by Laws of Utah 2007, Chapter 329
26
27 Be it enacted by the Legislature of the state of Utah:

28 Section 1. Section 59-2-502 is amended to read:
29 59-2-502. Definitions.
30 As used in this part:
31 (1) "Actively devoted to agricultural use" means that the land in agricultural use
32 produces in excess of 50% of the average agricultural production per acre:
33 (a) as determined under Section 59-2-503 ; and
34 (b) for:
35 (i) the given type of land; and
36 (ii) the given county or area.
37 (2) "Conservation easement rollback tax" means the tax imposed under Section
38 59-2-506.5 .
39 (3) "Identical legal ownership" means legal ownership held by:
40 (a) identical legal parties; or
41 (b) identical legal entities.
42 (4) "Land in agricultural use" means:
43 (a) land devoted to the raising of useful plants and animals with a reasonable
44 expectation of profit, including:
45 (i) forages and sod crops;
46 (ii) grains and feed crops;
47 (iii) livestock as defined in Section 59-2-102 ;
48 (iv) trees and fruits; or
49 (v) vegetables, nursery, floral, and ornamental stock; or
50 (b) land devoted to and meeting the requirements and qualifications for payments or
51 other compensation under a crop-land retirement program with an agency of the state or federal
52 government.
53 (5) "Other eligible acreage" means land that is:
54 (a) [five] three or more contiguous acres;
55 (b) eligible for assessment under this part; and
56 (c) (i) located in the same county as land described in Subsection 59-2-503 (1)(a); or
57 (ii) contiguous across county lines with land described in Subsection 59-2-503 (1)(a) as
58 provided in Section 59-2-512 .

59 (6) "Platted" means land in which:
60 (a) parcels of ground are laid out and mapped by their boundaries, course, and extent;
61 and
62 (b) the plat has been approved as provided in Section 10-9a-604 or 17-27a-604 .
63 (7) "Rollback tax" means the tax imposed under Section 59-2-506 .
64 (8) "Withdrawn from this part" means that land that has been assessed under this part is
65 no longer assessed under this part or eligible for assessment under this part for any reason
66 including that:
67 (a) an owner voluntarily requests that the land be withdrawn from this part;
68 (b) the land is no longer actively devoted to agricultural use;
69 (c) (i) the land has a change in ownership; and
70 (ii) (A) the new owner fails to apply for assessment under this part as required by
71 Section 59-2-509 ; or
72 (B) (I) an owner applies for assessment under this part as required by Section
73 59-2-509 ; and
74 (II) the land does not meet the requirements of this part to be assessed under this part;
75 (d) (i) the legal description of the land changes; and
76 (ii) (A) an owner fails to apply for assessment under this part as required by Section
77 59-2-509 ; or
78 (B) (I) an owner applies for assessment under this part as required by Section
79 59-2-509 ; and
80 (II) the land does not meet the requirements of this part to be assessed under this part;
81 (e) if required by the county assessor, the owner of the land:
82 (i) fails to file a new application as provided in Subsection 59-2-508 (4); or
83 (ii) fails to file a signed statement as provided in Subsection 59-2-508 (4); or
84 (f) except as provided in Section 59-2-503 , the land fails to meet a requirement of
85 Section 59-2-503 .
86 Section 2. Section 59-2-503 is amended to read:
87 59-2-503. Qualifications for agricultural use assessment.
88 (1) For general property tax purposes, land may be assessed on the basis of the value
89 that the land has for agricultural use if the land:

90 (a) is not less than [five] three contiguous acres in area, except that land may be
91 assessed on the basis of the value that the land has for agricultural use:
92 (i) if:
93 (A) the land is devoted to agricultural use in conjunction with other eligible acreage;
94 and
95 (B) the land and the other eligible acreage described in Subsection (1)(a)(i)(A) have
96 identical legal ownership; or
97 (ii) as provided under Subsection (4); and
98 (b) except as provided in Subsection (5):
99 (i) is actively devoted to agricultural use; and
100 (ii) has been actively devoted to agricultural use for at least two successive years
101 immediately preceding the tax year for which the land is being assessed under this part.
102 (2) In determining whether land is actively devoted to agricultural use, production per
103 acre for a given county or area and a given type of land shall be determined by using the first
104 applicable of the following:
105 (a) production levels reported in the current publication of the Utah Agricultural
106 Statistics;
107 (b) current crop budgets developed and published by Utah State University; and
108 (c) other acceptable standards of agricultural production designated by the commission
109 by rule adopted in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking
110 Act.
111 (3) Land may be assessed on the basis of the land's agricultural value if the land:
112 (a) is subject to the privilege tax imposed by Section 59-4-101 ;
113 (b) is owned by the state or any of the state's political subdivisions; and
114 (c) meets the requirements of Subsection (1).
115 (4) Notwithstanding Subsection (1)(a), the commission or a county board of
116 equalization may grant a waiver of the acreage limitation for land upon:
117 (a) appeal by the owner; and
118 (b) submission of proof that:
119 (i) 80% or more of the owner's, purchaser's, or lessee's income is derived from
120 agricultural products produced on the property in question; or

121 (ii) (A) the failure to meet the acreage requirement arose solely as a result of an
122 acquisition by a governmental entity by:
123 (I) eminent domain; or
124 (II) the threat or imminence of an eminent domain proceeding;
125 (B) the land is actively devoted to agricultural use; and
126 (C) no change occurs in the ownership of the land.
127 (5) (a) Notwithstanding Subsection (1)(b), the commission or a county board of
128 equalization may grant a waiver of the requirement that the land is actively devoted to
129 agricultural use for the tax year for which the land is being assessed under this part upon:
130 (i) appeal by the owner; and
131 (ii) submission of proof that:
132 (A) the land was assessed on the basis of agricultural use for at least two years
133 immediately preceding that tax year; and
134 (B) the failure to meet the agricultural production requirements for that tax year was
135 due to no fault or act of the owner, purchaser, or lessee.
136 (b) As used in Subsection (5)(a), "fault" does not include:
137 (i) intentional planting of crops or trees which, because of the maturation period, do
138 not give the owner, purchaser, or lessee a reasonable opportunity to satisfy the production
139 levels required for land actively devoted to agricultural use; or
140 (ii) implementation of a bona fide range improvement program, crop rotation program,
141 or other similar accepted cultural practices which do not give the owner, purchaser, or lessee a
142 reasonable opportunity to satisfy the production levels required for land actively devoted to
143 agricultural use.
144 Section 3. Section 59-2-511 is amended to read:
145 59-2-511. Acquisition of land by governmental entity -- Requirements -- Rollback
146 tax -- One-time in lieu fee payment -- Passage of title.
147 (1) For purposes of this section, "governmental entity" means:
148 (a) the United States;
149 (b) the state;
150 (c) a political subdivision of the state, including:
151 (i) a county;

152 (ii) a city;
153 (iii) a town;
154 (iv) a school district;
155 (v) a local district; or
156 (vi) a special service district; or
157 (d) an entity created by the state or the United States, including:
158 (i) an agency;
159 (ii) a board;
160 (iii) a bureau;
161 (iv) a commission;
162 (v) a committee;
163 (vi) a department;
164 (vii) a division;
165 (viii) an institution;
166 (ix) an instrumentality; or
167 (x) an office.
168 (2) (a) Except as provided in Subsections (3) and (4), land acquired by a governmental
169 entity is subject to the rollback tax imposed by this part if:
170 (i) prior to the governmental entity acquiring the land, the land is assessed under this
171 part; and
172 (ii) after the governmental entity acquires the land, the land does not meet the
173 requirements of Section 59-2-503 for assessment under this part.
174 (b) A person dedicating a public right-of-way to a governmental entity shall pay the
175 rollback tax imposed by this part if:
176 (i) a portion of the public right-of-way is located within a subdivision as defined in
177 Section 10-9a-103 ; or
178 (ii) in exchange for the dedication, the person dedicating the public right-of-way
179 receives:
180 (A) money; or
181 (B) other consideration.
182 (3) (a) Except as provided in Subsection (4), land acquired by a governmental entity is

183 not subject to the rollback tax imposed by this part, but is subject to a one-time in lieu fee
184 payment as provided in Subsection (3)(b), if:
185 (i) the governmental entity acquires the land by eminent domain;
186 (ii) (A) the land is under the threat or imminence of eminent domain proceedings; and
187 (B) the governmental entity provides written notice of the proceedings to the owner; or
188 (iii) the land is donated to the governmental entity.
189 (b) (i) If a governmental entity acquires land under Subsection (3)(a)(iii), the
190 governmental entity shall make a one-time in lieu fee payment:
191 (A) to the county treasurer of the county in which the land is located; and
192 (B) in an amount equal to the amount of rollback tax calculated under Section
193 59-2-506 .
194 (ii) If a governmental entity acquires land under Subsection (3)(a)(i) or (3)(a)(ii), the
195 governmental entity shall make a one-time in lieu fee payment:
196 (A) to the county treasurer of the county in which the land is located; and
197 (B) (I) if the land remaining after the acquisition by the governmental entity meets the
198 requirements of Section 59-2-503 , in an amount equal to the rollback tax under Section
199 59-2-506 on the land acquired by the governmental entity; or
200 (II) if the land remaining after the acquisition by the governmental entity is less than
201 [five] three acres, in an amount equal to the rollback tax under Section 59-2-506 on the land
202 acquired by the governmental entity and the land remaining after the acquisition by the
203 governmental entity.
204 (iii) For purposes of Subsection (3)(b)(ii), "land remaining after the acquisition by the
205 governmental entity" includes other eligible acreage that is used in conjunction with the land
206 remaining after the acquisition by the governmental entity.
207 (c) A county receiving an in lieu fee payment under Subsection (3)(b) shall distribute
208 the revenues generated by the payment:
209 (i) to the taxing entities in which the land is located; and
210 (ii) in the same proportion as the revenue from real property taxes is distributed.
211 (4) Except as provided in Section 59-2-506.5 , if land acquired by a governmental entity
212 is made subject to a conservation easement in accordance with Section 59-2-506.5 :
213 (a) the land is not subject to the rollback tax imposed by this part; and

214 (b) the governmental entity acquiring the land is not required to make an in lieu fee
215 payment under Subsection (3)(b).
216 (5) If a governmental entity acquires land subject to assessment under this part, title to
217 the land may not pass to the governmental entity until the following are paid to the county
218 treasurer:
219 (a) any tax due under this part;
220 (b) any one-time in lieu fee payment due under this part; and
221 (c) any interest due under this part.
222 Section 4. Effective date.
223 This bill takes effect on January 1, 2009.




Legislative Review Note
as of 2-14-08 6:47 AM

Office of Legislative Research and General Counsel