First Substitute H.B. 22

Senator Curtis S. Bramble proposes the following substitute bill:

1 PROPERTY TAX RELIEF
2 2003 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: Wayne A. Harper
5 This act modifies provisions relating to Property Tax Relief. The act amends the
6 definition of household income and defines terms. The act amends provisions relating to
7 eligibility to claim a homeowner's credit or renter's credit. This act makes technical
8 changes. This act has retrospective operation to January 1, 2003.
9 This act affects sections of Utah Code Annotated 1953 as follows:
10 AMENDS:
11 59-2-1202, as last amended by Chapter 221, Laws of Utah 2001
12 59-2-1208, as last amended by Chapter 313, Laws of Utah 1997
13 59-2-1209, as last amended by Chapter 309, Laws of Utah 1998
14 REPEALS:
15 59-2-1218, as renumbered and amended by Chapter 4, Laws of Utah 1987
16 Be it enacted by the Legislature of the state of Utah:
17 Section 1. Section 59-2-1202 is amended to read:
18 59-2-1202. Definitions.
19 As used in this part:
20 (1) (a) "Claimant" means a homeowner or renter who:
21 (i) has filed a claim under this part;
22 (ii) is domiciled in this state for the entire calendar year for which a claim for relief is
23 filed under this part; and
24 (iii) has reached the age of 65 prior to the close of that calendar year.
25 (b) A surviving spouse, who otherwise qualifies under this section, is an eligible

26 claimant regardless of age.
27 (c) If two or more individuals of a household are able to meet the qualifications for a
28 claimant, they may determine among them as to who the claimant shall be, but if they are
29 unable to agree, the matter shall be referred to the county legislative body for a determination
30 of the claimant of an owned residence and to the commission for a determination of the
31 claimant of a rented residence.
32 (2) (a) "Gross rent" means rental actually paid in cash or its equivalent solely for the
33 right of occupancy, at arm's-length, of a residence, exclusive of charges for any utilities,
34 services, furniture, furnishings, or personal appliances furnished by the landlord as a part of the
35 rental agreement.
36 (b) If a claimant occupies two or more residences in the year and does not own the
37 residence as of the lien date, "gross rent" means the total rent paid for the residences during the
38 one-year period for which the renter files a claim under this part.
39 (3) "Homeowner's credit" means a credit against a claimant's property tax liability.
40 (4) "Household" means the association of persons who live in the same dwelling,
41 sharing its furnishings, facilities, accommodations, and expenses.
42 (5) "Household income" means all income received by all persons of a household in:
43 (a) the calendar year [next] preceding the calendar year in which property taxes are
44 due; or
45 (b) [in the case of renters] for purposes of the renter's credit authorized by this part, the
46 year [in] for which a claim is filed.
47 (6) (a) (i) "Income" means the sum of:
48 (A) federal adjusted gross income as defined in Section 62, Internal Revenue Code;
49 and
50 (B) all nontaxable income as defined in Subsection (6)(b).
51 (ii) "Income" does not include:
52 (A) aid, assistance, or contributions from a tax-exempt nongovernmental source;
53 (B) surplus foods;
54 (C) relief in kind supplied by a public or private agency; or
55 (D) relief provided under this part, Section 59-2-1108 , or Section 59-2-1109 .
56 (b) For purposes of Subsection (6)(a)(i), "nontaxable income" means amounts excluded

57 from adjusted gross income under the Internal Revenue Code, including:
58 (i) capital gains;
59 (ii) loss carry forwards claimed during the taxable year in which a claimant files for
60 relief under this part, Section 59-2-1108 , or Section 59-2-1109 ;
61 (iii) depreciation claimed pursuant to the Internal Revenue Code by a claimant on the
62 residence for which the claimant files for relief under this part, Section 59-2-1108 , or Section
63 59-2-1109 ;
64 (iv) support money received;
65 (v) nontaxable strike benefits;
66 (vi) cash public assistance or relief;
67 (vii) the gross amount of a pension or annuity, including benefits under the Railroad
68 Retirement Act of 1974, 45 U.S.C. Sec. 231, and veterans disability pensions;
69 (viii) payments received under the Social Security Act;
70 (ix) state unemployment insurance amounts;
71 (x) nontaxable interest received from any source;
72 (xi) workers' compensation;
73 (xii) the gross amount of "loss of time" insurance; and
74 (xiii) voluntary contributions to a tax-deferred retirement plan.
75 (7) (a) "Property taxes accrued" means property taxes, exclusive of special
76 assessments, delinquent interest, and charges for service, levied on a claimant's residence in
77 this state.
78 (b) For a mobile home, "property taxes accrued" includes taxes imposed on both the
79 land upon which the home is situated and on the structure of the home itself, whether classified
80 as real property or personal property taxes.
81 (c) (i) Beginning on January 1, 1999, for a claimant who owns a residence, "property
82 taxes accrued" are the property taxes described in Subsection (7)(a) levied for the calendar year
83 on 35% of the fair market value of the residence as reflected on the assessment roll.
84 (ii) The amount described in Subsection (7)(c)(i) constitutes:
85 (A) a tax abatement for the poor in accordance with Utah Constitution Article XIII,
86 Section 2; and
87 (B) the residential exemption provided for in Section 59-2-103 .

88 (d) (i) For purposes of this Subsection (7) property taxes accrued are levied on the lien
89 date.
90 (ii) If a claimant owns a residence on the lien date, property taxes accrued mean taxes
91 levied on the lien date, even if that claimant does not own a residence for the entire year.
92 (e) When a household owns and occupies two or more different residences in this state
93 in the same calendar year, property taxes accrued shall relate only to the residence occupied on
94 the lien date by the household as its principal place of residence.
95 (f) (i) If a residence is an integral part of a large unit such as a farm or a multipurpose
96 or multidwelling building, property taxes accrued shall be the same percentage of the total
97 property taxes accrued as the value of the residence is of the total value.
98 (ii) For purposes of this Subsection (7)(f), "unit" refers to the parcel of property
99 covered by a single tax statement of which the residence is a part.
100 (8) (a) As used in this section, "rental assistance payment" means any payment that:
101 (i) is made by a:
102 (A) governmental entity; or
103 (B) (I) charitable organization; or
104 (II) religious organization; and
105 (ii) is specifically designated for the payment of rent of a claimant:
106 (A) for the calendar year for which the claimant seeks a renter's credit under this part;
107 and
108 (B) regardless of whether the payment is made to the:
109 (I) claimant; or
110 (II) landlord; and
111 (b) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
112 commission may make rules defining the terms:
113 (i) governmental entity;
114 (ii) charitable organization; or
115 (iii) religious organization.
116 [(8)] (9) (a) "Residence" means the dwelling, whether owned or rented, and so much of
117 the land surrounding it, not exceeding one acre, as is reasonably necessary for use of the
118 dwelling as a home, and may consist of a part of a multidwelling or multipurpose building and

119 a part of the land upon which it is built and includes a mobile home or houseboat.
120 (b) "Residence" does not include personal property such as furniture, furnishings, or
121 appliances.
122 (c) For purposes of this Subsection [(8)] (9), "owned" includes a vendee in possession
123 under a land contract or one or more joint tenants or tenants in common.
124 Section 2. Section 59-2-1208 is amended to read:
125 59-2-1208. Amount of homeowner's credit -- Cost-of-living adjustment --
126 Limitation -- General Fund as source of credit.
127 (1) (a) [For taxable] Subject to Subsection (2), for calendar years beginning on or after
128 January 1, 1998, a claimant [is entitled to] may claim a homeowner's credit that does not
129 exceed the following amounts:
130 If household income is Homeowner's credit
131 $0 -- $7,358 $577
132 $7,359 -- $9,812 $504
133 $9,813 -- $12,264 $432
134 $12,265 -- $14,717 $324
135 $14,718 -- $17,171 $252
136 $17,172 -- $19,479 $144
137 $19,480 -- $21,644 $71
138 (b) (i) For [taxable] calendar years beginning on or after January 1, 1999, the
139 commission shall increase or decrease the household income eligibility amounts and the credits
140 under Subsection (1)(a) [in] by a percentage equal to the percentage difference between the
141 consumer price index for the preceding calendar year and the consumer price index for
142 calendar year 1997.
143 (ii) For purposes of Subsection (1)(b)(i), the commission shall calculate the consumer
144 price index as provided in Sections [(1)(f)(4)] 1(f)(4) and [(1)(f)(5)] 1(f)(5), Internal Revenue
145 Code.
146 (2) An individual who is claimed as a personal exemption on another individual's
147 [return] individual income tax return during any portion of a calendar year for which the
148 individual seeks to claim a homeowner's credit under this section may not receive [a] the
149 homeowner's credit.

150 (3) The homeowner's credit allowed by this section, and provided for in Section
151 59-2-1204 , shall be derived from the General Fund and appropriate transfers made to effectuate
152 this credit.
153 Section 3. Section 59-2-1209 is amended to read:
154 59-2-1209. Amount of renter's credit -- Cost-of-living adjustment -- Limitation --
155 General Fund as source of credit -- Maximum credit -- Renter's credit may be claimed
156 only for rent that does not constitute a rental assistance payment.
157 (1) (a) [For any taxable year] Subject to Subsections (2) and (3), for any calendar year a
158 claimant [is entitled to] may claim a renter's credit for the previous calendar year that does not
159 exceed the following amounts:
160 If household income is Percentage of rent
161 allowed as a credit
162 $0 -- $7,358 9.5%
163 $7,359 -- $9,812 8.5%
164 $9,813 -- $12,264 7.0%
165 $12,265 -- $14,717 5.5%
166 $14,718 -- $17,171 4.0%
167 $17,172 -- $19,479 3.0%
168 $19,480 -- $21,644 2.5%
169 (b) (i) For [taxable] calendar years beginning on or after January 1, 1999, the
170 commission shall increase or decrease the household income eligibility amounts under
171 Subsection (1)(a) [in] by a percentage equal to the percentage difference between the consumer
172 price index for the preceding calendar year and the consumer price index for calendar year
173 1997.
174 (ii) For purposes of Subsection (1)(b)(i), the commission shall calculate the consumer
175 price index as provided in Sections [(1)(f)(4)] 1(f)(4) and [(1)(f)(5)] 1(f)(5), Internal Revenue
176 Code.
177 (2) A claimant may claim a renter's credit under this part only for rent that does not
178 constitute a rental assistance payment.
179 [(2)] (3) An individual who is claimed as a personal exemption on another individual's
180 [return] individual income tax return during any portion of a calendar year for which the

181 individual seeks to claim a renter's credit under this section may not receive a renter's credit.
182 [(3)] (4) The renter's credit allowed by this section, and provided for in Section
183 59-2-1204 , shall be derived from the General Fund and appropriate transfers made to effectuate
184 this credit.
185 [(4)] (5) For [taxable] calendar years beginning on or after January 1, 1998, a credit
186 under this section may not exceed the maximum amount allowed as a homeowner's credit for
187 each income bracket under Subsection 59-2-1208 (1)(a).
188 Section 4. Repealer.
189 This act repeals:
190 Section 59-2-1218, Recipients of public funds for payment of rent ineligible for
191 refund.
192 Section 5. Retrospective operation.
193 This act has retrospective operation to January 1, 2003.