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S.B. 52 Enrolled

                 

PROPERTY TAX RESTRICTION

                 
1998 GENERAL SESSION

                 
STATE OF UTAH

                 
Sponsor: L. Steven Poulton

                  AN ACT RELATING TO THE PROPERTY TAX ACT; REINSTATING THE REQUIREMENT
                  THAT A TAXING ENTITY OBTAIN VOTER APPROVAL BEFORE IMPOSING A TAX
                  RATE THAT EXCEEDS THE CERTIFIED TAX RATE; PROVIDING EXCEPTIONS TO
                  THE VOTER APPROVAL REQUIREMENT; MAKING TECHNICAL CHANGES; AND
                  PROVIDING FOR RETROSPECTIVE OPERATION.
                  This act affects sections of Utah Code Annotated 1953 as follows:
                  AMENDS:
                      59-2-924, as last amended by Chapter 2, Laws of Utah 1997, Second Special Session
                  Be it enacted by the Legislature of the state of Utah:
                      Section 1. Section 59-2-924 is amended to read:
                       59-2-924. Report of valuation of property to county auditor and commission --
                  Transmittal by auditor to governing bodies -- Certified tax rate -- Adoption of tentative
                  budget -- Voter approval during 1998 of tax rates that exceed the certified tax rate.
                      (1) (a) Before June 1 of each year, the county assessor of each county shall deliver to the
                  county auditor and the commission the following statements:
                      (i) a statement containing the aggregate valuation of all taxable property in each taxing
                  entity; and
                      (ii) a statement containing the taxable value of any additional personal property estimated
                  by the county assessor to be subject to taxation in the current year.
                      (b) The county auditor shall, on or before June 8, transmit to the governing body of each
                  taxing entity:
                      (i) the statements described in Subsections (1)(a)(i) and (ii);
                      (ii) an estimate of the revenue from personal property;
                      (iii) the certified tax rate; and
                      (iv) all forms necessary to submit a tax levy request.


                      (2) (a) (i) The "certified tax rate" means a tax rate that will provide the same ad valorem
                  property tax revenues for a taxing entity as were collected by that taxing entity for the prior year.
                      (ii) For purposes of this Subsection (2), "ad valorem property tax revenues" do not include:
                      (A) collections from redemptions;
                      (B) interest; and
                      (C) penalties.
                      (iii) Except as provided in Subsection (2)(a)(iv), the certified tax rate shall be calculated by
                  dividing the ad valorem property tax revenues collected for the prior year by the taxing entity by the
                  taxable value established in accordance with Section 59-2-913 .
                      (iv) The certified tax rates for the taxing entities described in this Subsection (2)(a)(iv) shall
                  be calculated as follows:
                      (A) except as provided in Subsection (2)(a)(iv)(B), for new taxing entities the certified tax
                  rate is zero;
                      (B) for each municipality incorporated on or after July 1, 1996, the certified tax rate is:
                      (I) in a county of the first, second, or third class, the levy imposed for municipal-type
                  services under Sections 17-34-1 and 17-36-9 ; and
                      (II) in a county of the fourth, fifth, or sixth class, the levy imposed for general county
                  purposes and such other levies imposed solely for the municipal-type services identified in Section
                  17-34-2 and Subsection 17-36-3 (22);
                      (C) for debt service voted on by the public, the certified tax rate shall be the actual levy
                  imposed by that section, except that the certified tax rates for the following levies shall be calculated
                  in accordance with Section 59-2-913 and this section:
                      (I) school leeways provided for under Sections 11-2-7 , 53A-16-110 , 53A-17a-125 ,
                  53A-17a-127 , 53A-17a-134 , 53A-17a-143 , 53A-17a-145 , and 53A-21-103 ; and
                      (II) levies to pay for the costs of state legislative mandates or judicial or administrative
                  orders under Section 59-2-906.3 .
                      (b) (i) For the purpose of calculating the certified tax rate, the county auditor shall use the
                  taxable value of property on the assessment roll.

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                      (ii) For purposes of Subsection (2)(b)(i), the taxable value of property on the assessment roll
                  does not include new growth as defined in Subsection (2)(b)(iii).
                      (iii) "New growth" means:
                      (A) the difference between the increase in taxable value of the taxing entity from the
                  previous calendar year to the current year; minus
                      (B) the amount of increase to locally assessed real property taxable values resulting from
                  factoring, reappraisal, or any other adjustments.
                      (c) Beginning January 1, 1997, if a taxing entity receives increased revenues from uniform
                  fees on tangible personal property under Section 59-2-404 or 59-2-405 as a result of any county
                  imposing a sales and use tax under Title 59, Chapter 12, Part 11, County Option Sales and Use Tax,
                  the taxing entity shall decrease its certified tax rate to offset the increased revenues.
                      (d) (i) Beginning July 1, 1997, if a county has imposed a sales and use tax under Title 59,
                  Chapter 12, Part 11, County Option Sales and Use Tax, the county's certified tax rate shall be:
                      (A) decreased on a one-time basis by the amount of the estimated sales tax revenue to be
                  distributed to the county under Subsection 59-12-1102 (3); and
                      (B) increased by the amount necessary to offset the county's reduction in revenue from
                  uniform fees on tangible personal property under Section 59-2-404 or 59-2-405 as a result of the
                  decrease in the certified tax rate under Subsection (2)(d)(i)(A).
                      (ii) The commission shall determine estimates of sales tax distributions for purposes of
                  Subsection (2)(d)(i).
                      (e) For the calendar year beginning on January 1, 1998, and ending December 31, 1998, a
                  taxing entity's certified tax rate shall be increased by the amount necessary to offset the decrease in
                  revenues from uniform fees on tangible personal property under Section 59-2-405 as a result of the
                  decrease in uniform fees on tangible personal property under Section 59-2-405 enacted by the
                  Legislature during the 1997 Annual General Session.
                      (f) Beginning January 1, 1998, if a municipality has imposed an additional resort
                  communities sales tax under Section 59-12-402 , the municipality's certified tax rate shall be
                  decreased on a one-time basis by the amount necessary to offset the first 12 months of estimated

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                  revenue from the additional resort communities sales tax imposed under Section 59-12-402 .
                      (3) (a) On or before June 22, each taxing entity shall annually adopt a tentative budget.
                      (b) If the taxing entity intends to exceed the certified tax rate, it shall notify the county
                  auditor of:
                      (i) its intent to exceed the certified tax rate; and
                      (ii) the amount by which it proposes to exceed the certified tax rate.
                      (c) The county auditor shall notify all property owners of any intent to exceed the certified
                  tax rate in accordance with Subsection 59-2-919 (2).
                      (4) (a) The taxable value for the base year under Subsection 17A-2-1247 (2)(a) or
                  17A-2-1202 (2), as the case may be, shall be reduced for any year to the extent necessary to provide
                  a redevelopment agency established under Title 17A, Chapter 2, Part 12, Utah Neighborhood
                  [Redevelopment Agencies] Development Act, with approximately the same amount of money the
                  agency would have received without a reduction in the county's certified tax rate if:
                      (i) in that year there is a decrease in the certified tax rate under Subsection (2)(c) or (2)(d)(i);
                      (ii) the amount of the decrease is more than 20% of the county's certified tax rate of the
                  previous year; and
                      (iii) the decrease results in a reduction of the amount to be paid to the agency under Section
                  17A-2-1247 or 17A-2-1247.5 .
                      (b) The taxable value of the base year under Subsection 17A-2-1247 (2)(a) or 17A-2-1202 (2),
                  as the case may be, shall be increased in any year to the extent necessary to provide a redevelopment
                  agency with approximately the same amount of money as the agency would have received without
                  an increase in the certified tax rate that year if:
                      (i) in that year the taxable value for the base year under Subsection 17A-2-1247 (2) or
                  17A-2-1202 (2) is reduced due to a decrease in the certified tax rate under Subsection (2)(c) or
                  (2)(d)(i); and
                      (ii) The certified tax rate of a city, school district, or special district increases independent
                  of the adjustment to the taxable value of the base year.
                      (c) Notwithstanding a decrease in the certified tax rate under Subsection (2)(c) or (2)(d)(i),

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                  the amount of money allocated and, when collected, paid each year to a redevelopment agency
                  established under Title 17A, Chapter 2, Part 12, Neighborhood Redevelopment Agencies, for the
                  payment of bonds or other contract indebtedness, but not for administrative costs, may not be less
                  than that amount would have been without a decrease in the certified tax rate under Subsection (2)(c)
                  or (2)(d)(i).
                      (5) (a) Except as provided in Subsections (5)(d) through (f), for the calendar year beginning
                  on January 1, 1998, and ending December 31, 1998, to impose a tax rate that exceeds the certified
                  tax rate established in Subsection (2), a taxing entity shall obtain approval for the tax increase by a
                  majority vote of the:
                      (i) governing body; and
                      (ii) people as provided in Subsection (5)(b).
                      (b) To obtain voter approval for a tax increase under Subsection (5)(a), a taxing entity shall:
                      (i) hold an election on the fourth Tuesday in June; and
                      (ii) conduct the election according to the procedures and requirements of Title 20A, Election
                  Code, governing local elections.
                      (c) A tax rate imposed by a taxing entity under this Subsection (5) may not exceed the
                  maximum levy permitted by law under Section 59-2-908 .
                      (d) Notwithstanding Subsection (5)(a), a school district is not required to obtain voter
                  approval under this Subsection (5) to impose a tax rate that exceeds the certified tax rate:
                      (i) under Section 53A-17a-135 , if the Legislature increases the minimum basic tax rate under
                  Section 53A-17a-135 ;
                      (ii) under Section 53A-21-103 ;
                      (iii) under Section 53A-16-111 ;
                      (iv) if, on or after January 1, 1997, but on or before December 31, 1997, the school district
                  obtained voter approval to impose the tax rate; or
                      (v) if, on or after January 1, 1998, the school district obtains voter approval to impose the
                  tax rate under a statutory provision, other than the provisions of this section, requiring voter approval
                  to impose the tax rate.

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                      (e) Notwithstanding Subsection (5)(a), a municipality is not required to obtain voter approval
                  under this Subsection (5) to impose a tax rate that exceeds the certified tax rate if:
                      (i) the municipality meets the requirements of Sections 59-2-918 and 59-2-919 ; and
                      (ii) in adopting the resolution required under Section 59-2-919 , the municipal legislative
                  body obtains approval to impose the tax rate by two-thirds of all members of the municipal
                  legislative body.
                      (f) Notwithstanding Subsection (5)(a), a county or municipality is not required to obtain voter
                  approval under this Subsection (5) to impose a tax rate under Section 17A-2-1322 that exceeds the
                  certified tax rate calculated for a special service district established under Title 17A, Chapter 2, Part
                  13, Utah Special Service District Act, if the county or municipality obtained voter approval to
                  impose a tax on property within the special service district:
                      (i) under Section 17A-2-1322 ; and
                      (ii) on or after June 1, 1996.
                      Section 2. Retrospective operation.
                      This act has retrospective operation to January 1, 1998.

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