H.B. 399 Enrolled

PROPERTY TAX APPORTIONMENT FOR CERTAIN PROPERTY
1999 GENERAL SESSION
STATE OF UTAH
Sponsor: Sheryl L. Allen
DeMar Bud Bowman
Jeff Alexander
Thomas V. Hatch
Kevin S. Garn
Michael R. Styler
Evan L. Olsen
Craig W. Buttars
Susan J. Koehn
Brad King
Keele Johnson
John W. Hickman
James R. Gowans
Tammy J. Rowan
David Ure
David L. Gladwell
Lowell A. Nelson
Carl R. Saunders
Nora B. Stephens
Jack A. Seitz
Blake D. Chard
David N. Cox
Dennis H. Iverson
Gordon E. Snow
Glenn L. Way
Ben C. Ferry
Bradley T. Johnson
Eli H. Anderson
Lawanna Shurtliff
Rebecca D. Lockhart
Jordan Tanner
Katherine M. Bryson
Richard M. Siddoway

AN ACT RELATING TO THE PROPERTY TAX ACT; PROVIDING DEFINITIONS;
ESTABLISHING THE METHOD FOR THE STATE TAX COMMISSION TO APPORTION TO
CERTAIN TAX AREAS THE TAXABLE VALUE OF CERTAIN REAL AND TANGIBLE
PERSONAL PROPERTY OWNED BY AN AIR CHARTER SERVICE, AIR CONTRACT
SERVICE, OR AIRLINE; REPEALING OBSOLETE LANGUAGE; MAKING TECHNICAL
CHANGES; AND PROVIDING FOR RETROSPECTIVE OPERATION.
This act affects sections of Utah Code Annotated 1953 as follows:
AMENDS:
59-2-102, as last amended by Chapters 264 and 290, Laws of Utah 1998
59-2-801, as last amended by Chapter 322, Laws of Utah 1998
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 59-2-102 is amended to read:
59-2-102. Definitions.
As used in this chapter and title:
(1) "Aerial applicator" means aircraft or rotorcraft used exclusively for the purpose of
engaging in dispensing activities directly affecting agriculture or horticulture with an airworthiness
certificate from the Federal Aviation Administration certifying the aircraft or rotorcraft's use for

agricultural and pest control purposes.
(2) "Air charter service" means an air carrier operation which requires the customer to hire
an entire aircraft rather than book passage in whatever capacity is available on a scheduled trip.
(3) "Air contract service" means an air carrier operation available only to customers who
engage the services of the carrier through a contractual agreement and excess capacity on any trip
and is not available to the public at large.
(4) "Aircraft" is as defined in Section 72-10-102 .
[(4)] (5) "Airline" means any air carrier operating interstate routes on a scheduled basis
which offers to fly passengers or cargo on the basis of available capacity on regularly scheduled
routes.
[(5)] (6) "Assessment roll" means a permanent record of the assessment of property as
assessed by the county assessor and the commission and may be maintained manually or as a
computerized file as a consolidated record or as multiple records by type, classification, or
categories.
[(6)] (7) "Certified revenue levy" means a property tax levy that provides the same amount
of ad valorem property tax revenue as was collected for the prior year, plus new growth, but
exclusive of revenue from collections from redemptions, interest, and penalties.
[(7)] (8) "County-assessed commercial vehicle" means:
(a) any commercial vehicle, trailer, or semitrailer which is not apportioned under Section
41-1a-301 and is not operated interstate to transport the vehicle owner's goods or property in
furtherance of the owner's commercial enterprise;
(b) any passenger vehicle owned by a business and used by its employees for transportation
as a company car or vanpool vehicle; and
(c) vehicles which are:
(i) especially constructed for towing or wrecking, and which are not otherwise used to
transport goods, merchandise, or people for compensation;
(ii) used or licensed as taxicabs or limousines;
(iii) used as rental passenger cars, travel trailers, or motor homes;

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(iv) used or licensed in this state for use as ambulances or hearses;
(v) especially designed and used for garbage and rubbish collection; or
(vi) used exclusively to transport students or their instructors to or from any private, public,
or religious school or school activities.
(9) (a) Except as provided in Subsection (9)(b), for purposes of Section 59-2-801 ,
"designated tax area" means a tax area created by the overlapping boundaries of only the following
taxing entities:
(i) a county; and
(ii) a school district.
(b) Notwithstanding Subsection (9)(a), "designated tax area" includes a tax area created by
the overlapping boundaries of:
(i) the taxing entities described in Subsection (9)(a); and
(ii) (A) a city or town if the boundaries of the school district under Subsection (9)(a) and the
boundaries of the city or town are identical; or
(B) a special service district if the boundaries of the school district under Subsection (9)(a)
are located entirely within the special service district.
[(8)] (10) (a) "Escaped property" means any property, whether personal, land, or any
improvements to the property, subject to taxation and is:
(i) inadvertently omitted from the tax rolls, assigned to the incorrect parcel, or assessed to
the wrong taxpayer by the assessing authority;
(ii) undervalued or omitted from the tax rolls because of the failure of the taxpayer to comply
with the reporting requirements of this chapter; or
(iii) undervalued because of errors made by the assessing authority based upon incomplete
or erroneous information furnished by the taxpayer.
(b) Property which is undervalued because of the use of a different valuation methodology
or because of a different application of the same valuation methodology is not "escaped property."
[(9)] (11) "Fair market value" means the amount at which property would change hands
between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and

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both having reasonable knowledge of the relevant facts. For purposes of taxation, "fair market
value" shall be determined using the current zoning laws applicable to the property in question,
except in cases where there is a reasonable probability of a change in the zoning laws affecting that
property in the tax year in question and the change would have an appreciable influence upon the
value.
[(10)] (12) "Farm machinery and equipment," for purposes of the exemption provided under
Section 59-2-1101 , means tractors, milking equipment and storage and cooling facilities, feed
handling equipment, irrigation equipment, harvesters, choppers, grain drills and planters, tillage
tools, scales, combines, spreaders, sprayers, haying equipment, and any other machinery or
equipment used primarily for agricultural purposes; but does not include vehicles required to be
registered with the Motor Vehicle Division or vehicles or other equipment used for business
purposes other than farming.
[(11)] (13) "Geothermal fluid" means water in any form at temperatures greater than 120
degrees centigrade naturally present in a geothermal system.
[(12)] (14) "Geothermal resource" means:
(a) the natural heat of the earth at temperatures greater than 120 degrees centigrade; and
(b) the energy, in whatever form, including pressure, present in, resulting from, created by,
or which may be extracted from that natural heat, directly or through a material medium.
[(13)] (15) "Improvements" includes all buildings, structures, fixtures, fences, and
improvements erected upon or affixed to the land, whether the title has been acquired to the land or
not.
[(14)] (16) "Intangible property:"
(a) means property that is capable of private ownership separate from tangible property; and
(b) includes:
(i) moneys;
(ii) credits;
(iii) bonds;
(iv) stocks;

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(v) representative property;
(vi) franchises;
(vii) licenses;
(viii) trade names;
(ix) copyrights; and
(x) patents.
[(15)] (17) "Metalliferous minerals" includes gold, silver, copper, lead, zinc, and uranium.
[(16)] (18) "Mine" means a natural deposit of either metalliferous or nonmetalliferous
valuable mineral.
[(17)] (19) "Mining" means the process of producing, extracting, leaching, evaporating, or
otherwise removing a mineral from a mine.
(20) (a) "Mobile flight equipment" means tangible personal property that is:
(i) owned or operated by an:
(A) air charter service;
(B) air contract service; or
(C) airline; and
(ii) (A) capable of flight;
(B) attached to an aircraft that is capable of flight; or
(C) contained in an aircraft that is capable of flight if the tangible personal property is
intended to be used:
(I) during multiple flights;
(II) during a takeoff, flight, or landing; and
(III) as a service provided by an air charter service, air contract service, or airline.
(b) (i) "Mobile flight equipment" does not include a spare part other than a spare engine that
is rotated:
(A) at regular intervals; and
(B) with an engine that is attached to the aircraft.
(ii) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the

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commission may make rules defining the term "regular intervals."
[(18)] (21) "Nonmetalliferous minerals" includes, but is not limited to, oil, gas, coal, salts,
sand, rock, gravel, and all carboniferous materials.
[(19)] (22) "Personal property" includes:
(a) every class of property as defined in Subsection [(20)] (23) which is the subject of
ownership and not included within the meaning of the terms "real estate" and "improvements";
(b) gas and water mains and pipes laid in roads, streets, or alleys;
(c) bridges and ferries; and
(d) livestock which, for the purposes of the exemption provided under Section 59-2-1112 ,
means all domestic animals, honeybees, poultry, fur-bearing animals, and fish.
[(20)] (23) (a) "Property" means property that is subject to assessment and taxation according
to its value.
(b) "Property" does not include intangible property as defined in this section.
[(21)] (24) "Public utility," for purposes of this chapter, means the operating property of a
railroad, gas corporation, oil or gas transportation or pipeline company, coal slurry pipeline company,
electrical corporation, telephone corporation, sewerage corporation, or heat corporation where the
company performs the service for, or delivers the commodity to, the public generally or companies
serving the public generally, or in the case of a gas corporation or an electrical corporation, where
the gas or electricity is sold or furnished to any member or consumers within the state for domestic,
commercial, or industrial use. Public utility also means the operating property of any entity or
person defined under Section 54-2-1 except water corporations.
[(22)] (25) "Real estate or property" includes:
(a) the possession of, claim to, ownership of, or right to the possession of land;
(b) all mines, minerals, and quarries in and under the land, all timber belonging to
individuals or corporations growing or being on the lands of this state or the United States, and all
rights and privileges appertaining to these; and
(c) improvements.
[(23)] (26) "Residential property," for the purposes of the reductions and adjustments under

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this chapter, means any property used for residential purposes as a primary residence. It does not
include property used for transient residential use or condominiums used in rental pools.
(27) For purposes of Subsection 59-2-801 (1)(e), "route miles" means the number of miles
calculated by the commission that is:
(a) measured in a straight line by the commission; and
(b) equal to the distance between a geographical location that begins or ends:
(i) at a boundary of the state; and
(ii) where an aircraft:
(A) takes off; or
(B) lands.
[(24)] (28) (a) "State-assessed commercial vehicle" means:
(i) any commercial vehicle, trailer, or semitrailer which operates interstate or intrastate to
transport passengers, freight, merchandise, or other property for hire; or
(ii) any commercial vehicle, trailer, or semitrailer which operates interstate and transports
the vehicle owner's goods or property in furtherance of the owner's commercial enterprise.
(b) "State-assessed commercial vehicle" does not include vehicles used for hire which are
specified in Subsection [(7)] (8)(c) as county-assessed commercial vehicles.
[(25)] (29) "Taxable value" means fair market value less any applicable reduction allowed
for residential property under Section 59-2-103 .
(30) "Tax area" means a geographic area created by the overlapping boundaries of one or
more taxing entities.
[(26)] (31) "Taxing entity" means any county, city, town, school district, special taxing
district, or any other political subdivision of the state with the authority to levy a tax on property.
[(27)] (32) "Tax roll" means a permanent record of the taxes charged on property, as
extended on the assessment roll and may be maintained on the same record or records as the
assessment roll or may be maintained on a separate record properly indexed to the assessment roll.
It includes tax books, tax lists, and other similar materials.
Section 2. Section 59-2-801 is amended to read:

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59-2-801. Apportionment of property assessed by commission.
(1) [After all objections are heard and disposed of and before] Before May 25 of each year,
the commission shall apportion [the] to each tax area the total assessment of all of the property
[assessed by it to the several tax areas] the commission assesses as [follows:] provided in
Subsections (1)(a) through (f).
(a) (i) [all property of public utilities] The commission shall apportion the assessments of
the property described in Subsection (1)(a)(ii):
(A) to each tax area through which the public utility or company described in Subsection
(1)(a)(ii) operates; and
(B) in proportion to the property's value in each tax area.
(ii) Subsection (1)(a)(i) applies to property owned by:
(A) a public utility, except for the rolling stock[, and all property] of a public utility;
(B) a pipeline[,] company;
(C) a power[,] company;
(D) a canal[, and] company; or
(E) an irrigation [companies, to each tax area through which the public utility, pipeline,
power, canal, or irrigation company operates, in proportion to its value in each tax area;] company.
[(b) the rolling stock of all railroads and street railroads, except the rolling stock included
in Subsection (2),]
(b) The commission shall apportion the assessments of the rolling stock of a railroad:
(i) to the tax areas through which railroads operate[,]; and
(ii) in the proportion [which] that the length of the main tracks, sidetracks, passing tracks,
switches, and tramways of [those] the railroads in each tax area bears to the total length of the main
tracks, [passing tracks and] sidetracks, passing tracks, switches, and tramways in the state[, with
rolling stock of standard and narrow gauge railroads apportioned to their standard and narrow gauge
lines, respectively;].
(c) The commission shall apportion the assessments of the property of a car [companies,]
company to [the several]:

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(i) each tax [areas] area in which [railroads are] a railroad is operated[,]; and
(ii) in the proportion [which] that the length of the main tracks, passing tracks, sidetracks,
switches, and tramways of all of the railroads in each tax area bears to the total length of the main
tracks, passing tracks, sidetracks, switches, and tramways of all of the railroads in the state[; and].
(d) (i) The commission shall apportion the assessments of the property described in
Subsection (1)(d)(ii) [the assessment of all mines and mining claims and properties respectively] to
[the] each tax area in which the [mines or mining claims and properties assessed are] property is
located.
(ii) Subsection (1)(d)(i) applies to the following property:
(A) mines;
(B) mining claims; or
(C) mining property.
(e) (i) The commission shall apportion the assessments of the property described in
Subsection (1)(e)(ii) to:
(A) each designated tax area; and
(B) in the proportion that the route miles in each designated tax area bear to the total route
miles in the state.
(ii) Subsection (1)(e)(i) applies to the mobile flight equipment owned by an:
(A) air charter service;
(B) air contract service; or
(C) airline.
(f) (i) The commission shall apportion the assessments of the property described in
Subsection (1)(f)(ii) to each tax area in which the property is located as of January 1 of each year.
(ii) Subsection (1)(f)(i) applies to the real and tangible personal property, other than mobile
flight equipment, owned by an:
(A) air charter service;
(B) air contract service; or
(C) airline.

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(2) (a) (i) (A) State-assessed commercial vehicles that weigh 12,001 pounds or more shall
be taxed at a statewide average rate which is calculated from the overall county average tax rates
from the preceding year, exclusive of the property subject to the statewide uniform fee, weighted by
lane miles of principal routes in each county.
[(ii)] (B) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act,
the commission shall adopt rules to define "principal routes."
[(b)] (ii) State-assessed commercial vehicles that weigh 12,000 pounds or less are subject
to the uniform fee provided in Section 59-2-405.1 .
[(3)] (b) The combined revenue from all state-assessed commercial vehicles shall be
apportioned to the counties based on:
[(a)] (i) 40% by the percentage of lane miles of principal routes within each county as
determined by the commission; and
[(b)] (ii) 60% by the percentage of total state-assessed vehicles having business situs in each
county.
[(4)] (c) At least quarterly, the commission shall apportion the total taxes paid on
state-assessed commercial vehicles to the counties.
[(5)] (d) Each county shall apportion its share of the revenues under this Subsection (2) to
the taxing entities within its boundaries in the same proportion as the assessments of other:
(i) real [and ] property;
(ii) tangible personal property; and [other state-assessed]
(iii) property [values] assessed by the commission.
Section 3. Retrospective operation.
This act has retrospective operation to January 1, 1999.

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