S.J.R. 2

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RESIDENTIAL PROPERTY TAX AMENDMENTS
2 RESOLUTION
3 1998 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Howard A. Stephenson
6 Howard C. Nielson
7 Robert M. Muhlestein
8 Mike Dmitrich
Joseph L. Hull
Eddie P. Mayne
Blaze D. Wharton
Craig L. Taylor
Nathan C. Tanner
L. Steven Poulton

9 A JOINT RESOLUTION OF THE LEGISLATURE PROPOSING TO AMEND THE UTAH
10 CONSTITUTION; AMENDING THE REVENUE AND TAXATION ARTICLE TO MODIFY
11 THE RESIDENTIAL PROPERTY EXEMPTION; AUTHORIZING A STATEWIDE
12 AVERAGE EXEMPTION OF 45% OF FAIR MARKET VALUE FOR EACH CLASS OF
13 RESIDENTIAL PROPERTY; REQUIRING CERTAIN STATUTORY PROVISIONS TO BE
14 ENACTED IN PROVIDING FOR THE EXEMPTION; AUTHORIZING CERTAIN
15 STATUTORY PROVISIONS TO BE ENACTED IN PROVIDING FOR THE EXEMPTION;
16 MAKING TECHNICAL CHANGES; AND PROVIDING AN EFFECTIVE DATE.
17 This resolution proposes to change the Utah Constitution as follows:
18 AMENDS:
19 ARTICLE XIII, SECTION 2
20 Be it resolved by the Legislature of the state of Utah, two-thirds of all members elected to each of
21 the two houses voting in favor thereof:
22 Section 1. It is proposed to amend Utah Constitution Article XIII, Section 2, to read:
23 Article XIII, Section 2. [Tangible property to be taxed -- Value ascertained --
24 Exemptions -- Remittance or abatement of taxes of poor -- Treatment of residential property
25 -- Intangible property -- Legislature to provide annual tax for state.]
26 (1) All tangible property in the state, not exempt under the laws of the United States, or
27 under this Constitution, shall be taxed at a uniform and equal rate in proportion to its value, to be

1 ascertained as provided by law.
2 (2) The following are property tax exemptions:
3 (a) the property of the state, school districts, and public libraries;
4 (b) the property of counties, cities, towns, special districts, and all other political
5 subdivisions of the state, except that to the extent and in the manner provided by the Legislature
6 the property of a county, city, town, special district, or other political subdivision of the state
7 located outside of its geographic boundaries as defined by law may be subject to the ad valorem
8 property tax;
9 (c) property owned by a nonprofit entity which is used exclusively for religious, charitable,
10 or educational purposes;
11 (d) places of burial not held or used for private or corporate benefit; and
12 (e) farm equipment and farm machinery as defined by statute. This exemption shall be
13 implemented over a period of time as provided by statute.
14 (3) Tangible personal property present in Utah on January 1, held for sale or processing
15 and which is shipped to final destination outside this state within twelve months may be deemed
16 by law to have acquired no situs in Utah for purposes of ad valorem property taxation and may be
17 exempted by law from such taxation, whether manufactured, processed or produced or otherwise
18 originating within or without the state.
19 (4) Tangible personal property present in Utah on January 1, held for sale in the ordinary
20 course of business and which constitutes the inventory of any retailer, or wholesaler or
21 manufacturer or farmer, or livestock raiser may be deemed for purposes of ad valorem property
22 taxation to be exempted.
23 (5) Water rights, ditches, canals, reservoirs, power plants, pumping plants, transmission
24 lines, pipes and flumes owned and used by individuals or corporations for irrigating land within
25 the state owned by such individuals or corporations, or the individual members thereof, shall be
26 exempted from taxation to the extent that they shall be owned and used for such purposes.
27 (6) Power plants, power transmission lines and other property used for generating and
28 delivering electrical power, a portion of which is used for furnishing power for pumping water for
29 irrigation purposes on lands in the state of Utah, may be exempted from taxation to the extent that
30 such property is used for such purposes. These exemptions shall accrue to the benefit of the users
31 of water so pumped under such regulations as the Legislature may prescribe.

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1 (7) The taxes of the poor may be remitted or abated at such times and in such manner as
2 may be provided by law.
3 (8) [The] Notwithstanding the provisions of Subsection (1) and Article XIII, Section 3
4 requiring tangible property to be taxed at a uniform and equal rate in proportion to its value, the
5 Legislature may provide by [law] statute for the exemption from taxation:
6 (a) of not to exceed a statewide average of 45% of the fair market value of residential
7 property as defined by [law] statute and as provided in Subsection (9); and
8 (b) all household furnishings, furniture, and equipment used exclusively by the owner
9 thereof at his place of abode in maintaining a home for himself and family.
10 (9) Notwithstanding the provisions of Subsection (1) and Article XIII, Section 3 requiring
11 tangible property to be taxed at a uniform and equal rate in proportion to its value, if the
12 Legislature provides by statute an exemption for residential property that does not exceed a
13 statewide average of 45% of the fair market value of the property under Subsection (8), the
14 Legislature:
15 (a) shall enact one or more of the following statutes in providing for the exemption:
16 (i) a statute providing that the value of residential property is based on the date the
17 residential property is acquired as provided by the Legislature;
18 (ii) a statute providing an exemption from taxation of a portion of the fair market value
19 of residential property for an owner purchasing residential property for the first time; or
20 (iii) a statute limiting changes in the value of residential property attributable to inflation
21 or deflation on a statewide or regional basis as provided by the Legislature; and
22 (b) may enact in providing for the exemption a statute other than a statute described in
23 Subsection (9)(a).
24 [(9)] (10) Property owned by disabled persons who were disabled in the line of duty during
25 any war, international conflict, or military training in the military service of the United States or
26 of the state of Utah and by the unmarried surviving spouses and minor orphans of such disabled
27 persons or of persons who during any war, international conflict, or military training in the military
28 service of the United States or the state of Utah were killed in action or died in the line of duty as
29 a result of such service may be exempted as the Legislature may provide.
30 [(10)] (11) Intangible property may be exempted from taxation as property or it may be
31 taxed as property in such manner and to such extent as the Legislature may provide, but if taxed

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1 as property the income therefrom shall not also be taxed. Provided that if intangible property is
2 taxed as property the rate thereof shall not exceed five mills on each dollar of valuation.
3 [(11)] (12) The Legislature shall provide by law for an annual tax sufficient, with other
4 sources of revenue, to defray the estimated ordinary expenses of the state for each fiscal year. For
5 the purpose of paying the state debt, if any there be, the Legislature shall provide for levying a tax
6 annually, sufficient to pay the annual interest and to pay the principal of such debt, within twenty
7 years from the final passage of the law creating the debt.
8 Section 2. Submittal to electors.
9 The lieutenant governor is directed to submit this proposed amendment to the electors of
10 the state of Utah at the next general election in the manner provided by law.
11 Section 3. Effective date.
12 If approved by the electors of the state, the amendment proposed by this joint resolution
13 shall take effect on January 1, 1999.




Legislative Review Note
as of 2-2-98 1:03 PM

A limited legal review of this bill raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel

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