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Second Substitute H.B. 54

Senator Howard A. Stephenson proposes the following substitute bill:


             1     
PROPERTY TAX AND APPRAISER AMENDMENTS

             2     
2013 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Gage Froerer

             5     
Senate Sponsor: Howard A. Stephenson

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill makes changes related to property appraiser licensing requirements and
             10      property tax appeals.
             11      Highlighted Provisions:
             12          This bill:
             13          .    establishes requirements related to county property tax appeal hearing officers;
             14          .    addresses the consideration and weighing of evidence in a property tax appeal;
             15          .    defines terms;
             16          .    allows a person to present evidence or provide property tax information on behalf of
             17      another person in a property tax appeal under certain circumstances;
             18          .    addresses the duties of a county relative to a property tax appeal;
             19          .    exempts certain persons presenting evidence or providing property tax information
             20      from appraiser licensing provisions in certain circumstances;
             21          .    addresses contingent fees;
             22          .    prohibits the use of certain terms by a person providing a price estimate or property
             23      tax information for a property tax appeal; and
             24          .    makes technical and conforming changes.
             25      Money Appropriated in this Bill:


             26          None
             27      Other Special Clauses:
             28          None
             29      Utah Code Sections Affected:
             30      AMENDS:
             31          59-2-1001, as last amended by Laws of Utah 1993, Chapter 227
             32          59-2-1004, as last amended by Laws of Utah 2012, Chapter 85
             33          59-2-1006, as last amended by Laws of Utah 1992, Chapter 288
             34          61-2g-301, as last amended by Laws of Utah 2012, Chapters 166 and 384
             35          61-2g-406, as renumbered and amended by Laws of Utah 2011, Chapter 289
             36          61-2g-407, as renumbered and amended by Laws of Utah 2011, Chapter 289
             37      ENACTS:
             38          59-2-1017, Utah Code Annotated 1953
             39     
             40      Be it enacted by the Legislature of the state of Utah:
             41          Section 1. Section 59-2-1001 is amended to read:
             42           59-2-1001. County board of equalization -- Public hearings -- Hearing officers --
             43      Notice of decision -- Rulemaking.
             44          (1) The county legislative body is the county board of equalization and the county
             45      auditor is the clerk of the county board of equalization.
             46          (2) The county board of equalization shall adjust and equalize the valuation and
             47      assessment of the real and personal property within the county, subject to regulation and
             48      control by the commission, as prescribed by law. The county board of equalization shall meet
             49      and hold public hearings each year to examine the assessment roll and equalize the assessment
             50      of property in the county, including the assessment for general taxes of all taxing entities
             51      located in the county.
             52          [(3) For the purpose of this chapter, the county board of equalization may appoint
             53      hearing officers for the purpose of examining applicants and witnesses. The hearing officers]
             54          (3) (a) Except as provided in Subsection (3)(d), a county board of equalization may:
             55          (i) appoint an appraiser licensed in accordance with Title 61, Chapter 2g, Real Estate
             56      Appraiser Licensing and Certification Act, as a hearing officer for the purpose of examining an


             57      applicant or a witness; or
             58          (ii) appoint an individual who is not licensed in accordance with Title 61, Chapter 2g,
             59      Real Estate Appraiser Licensing and Certification Act, as a hearing officer for the purpose of
             60      examining an applicant or a witness if the county board of equalization determines that the
             61      individual has competency relevant to the work of a hearing officer, including competency in:
             62          (A) real estate;
             63          (B) finance;
             64          (C) economics;
             65          (D) public administration; or
             66          (E) law.
             67          (b) Except as provided in Subsection (3)(d), beginning on January 1, 2014, a county
             68      board of equalization may only allow an individual to serve as a hearing officer for the
             69      purposes of examining an applicant or a witness if the individual has completed a course the
             70      commission:
             71          (i) develops in accordance with Subsection (3)(c)(i); or
             72          (ii) approves in accordance with Subsection (3)(c)(ii).
             73          (c) (i) On or before January 1, 2014, the commission shall develop a hearing officer
             74      training course that includes training in property valuation and administrative law.
             75          (ii) In addition to the course the commission develops in accordance with Subsection
             76      (3)(c)(i), the commission may approve a hearing officer training course provided by a county or
             77      a private entity if the course includes training in property valuation and administrative law.
             78          (d) A county board of equalization may not appoint a person employed by an assessor's
             79      office as a hearing officer.
             80          (e) A hearing officer shall transmit [their] the hearing officer's findings to the board,
             81      where a quorum shall be required for final action upon any application for exemption, deferral,
             82      reduction, or abatement.
             83          (4) The clerk of the board of equalization shall notify the taxpayer, in writing, of any
             84      decision of the board. The decision shall include any adjustment in the amount of taxes due on
             85      the property resulting from a change in the taxable value and shall be considered the corrected
             86      tax notice.
             87          (5) During the session of the board, the assessor or any deputy whose testimony is


             88      needed shall be present[,] and may make any statement or introduce and examine witnesses on
             89      questions before the board.
             90          (6) The county board of equalization may make and enforce any rule which is
             91      consistent with statute or commission rule[,] and necessary for the government of the board,
             92      the preservation of order, and the transaction of business.
             93          Section 2. Section 59-2-1004 is amended to read:
             94           59-2-1004. Appeal to county board of equalization -- Real property -- Time
             95      period for appeal -- Decision of board -- Extensions approved by commission -- Appeal to
             96      commission.
             97          (1) (a) A taxpayer dissatisfied with the valuation or the equalization of the taxpayer's
             98      real property may make an application to appeal by:
             99          (i) filing the application with the county board of equalization within the time period
             100      described in Subsection (2); or
             101          (ii) making an application by telephone or other electronic means within the time
             102      period described in Subsection (2) if the county legislative body passes a resolution under
             103      Subsection [(5)] (7) authorizing applications to be made by telephone or other electronic
             104      means.
             105          (b) The contents of the application shall be prescribed by rule of the county board of
             106      equalization.
             107          (2) (a) Except as provided in Subsection (2)(b), for purposes of Subsection (1), a
             108      taxpayer shall make an application to appeal the valuation or the equalization of the taxpayer's
             109      real property on or before the later of:
             110          (i) September 15 of the current calendar year; or
             111          (ii) the last day of a 45-day period beginning on the day on which the county auditor
             112      mails the notice under Section 59-2-919.1 .
             113          (b) Notwithstanding Subsection (2)(a), in accordance with Title 63G, Chapter 3, Utah
             114      Administrative Rulemaking Act, the commission shall make rules providing for circumstances
             115      under which the county board of equalization is required to accept an application to appeal that
             116      is filed after the time period prescribed in Subsection (2)(a).
             117          (3) The owner shall include in the application under Subsection (1)(a)(i) the owner's
             118      estimate of the fair market value of the property and any evidence which may indicate that the


             119      assessed valuation of the owner's property is improperly equalized with the assessed valuation
             120      of comparable properties.
             121          (4) In reviewing evidence submitted to a county board of equalization by or on behalf
             122      of an owner or a county assessor, the county board of equalization shall consider and weigh:
             123          (a) the accuracy, reliability, and comparability of the evidence presented by the owner
             124      or the county assessor;
             125          (b) if submitted, the sales price of relevant property that was under contract for sale as
             126      of the lien date but sold after the lien date;
             127          (c) if submitted, the sales offering price of property that was offered for sale as of the
             128      lien date but did not sell, including considering and weighing the amount of time for which,
             129      and manner in which, the property was offered for sale; and
             130          (d) if submitted, other evidence that is relevant to determining the fair market value of
             131      the property.
             132          [(4)] (5) (a) The county board of equalization shall meet and hold public hearings as
             133      prescribed in Section 59-2-1001 .
             134          (b) The county board of equalization shall make a decision on each appeal filed in
             135      accordance with this section within a 60-day period after the day on which the application is
             136      made.
             137          (c) The commission may approve the extension of a time period provided for in
             138      Subsection [(4)] (5)(b) for a county board of equalization to make a decision on an appeal.
             139          (d) Unless the commission approves the extension of a time period under Subsection
             140      (5)(c), if a county board of equalization fails to make a decision on an appeal within the time
             141      period described in Subsection (5)(b), the county legislative body shall:
             142          (i) list the appeal, by property owner and parcel number, on the agenda for the next
             143      meeting of the county legislative body that is held after the expiration of the time period
             144      described in Subsection (5)(b); and
             145          (ii) hear the appeal at the meeting described in Subsection (5)(d)(i).
             146          [(d)] (e) The decision of the board shall contain a determination of the valuation of the
             147      property based on fair market value, and a conclusion that the fair market value is properly
             148      equalized with the assessed value of comparable properties.
             149          [(e)] (f) If no evidence is presented before the county board of equalization, it will be


             150      presumed that the equalization issue has been met.
             151          [(f)] (g) (i) If the fair market value of the property that is the subject of the appeal
             152      deviates plus or minus 5% from the assessed value of comparable properties, the valuation of
             153      the appealed property shall be adjusted to reflect a value equalized with the assessed value of
             154      comparable properties.
             155          (ii) Subject to Sections 59-2-301.1 , 59-2-301.2 , 59-2-301.3 , and 59-2-301.4 , equalized
             156      value established under Subsection [(4)(f)(i)] (5)(g)(i) shall be the assessed value for property
             157      tax purposes until the county assessor is able to evaluate and equalize the assessed value of all
             158      comparable properties to bring them all into conformity with full fair market value.
             159          [(5)] (6) If any taxpayer is dissatisfied with the decision of the county board of
             160      equalization, the taxpayer may file an appeal with the commission as prescribed in Section
             161      59-2-1006 .
             162          [(6)] (7) A county legislative body may pass a resolution authorizing taxpayers owing
             163      taxes on property assessed by that county to file property tax appeals applications under this
             164      section by telephone or other electronic means.
             165          Section 3. Section 59-2-1006 is amended to read:
             166           59-2-1006. Appeal to commission -- Duties of auditor -- Decision by commission.
             167          (1) Any person dissatisfied with the decision of the county board of equalization
             168      concerning the assessment and equalization of any property, or the determination of any
             169      exemption in which the person has an interest, may appeal that decision to the commission by
             170      filing a notice of appeal specifying the grounds for the appeal with the county auditor within 30
             171      days after the final action of the county board.
             172          (2) The auditor shall:
             173          (a) file one notice with the commission;
             174          (b) certify and transmit to the commission:
             175          (i) the minutes of the proceedings of the county board of equalization for the matter
             176      appealed;
             177          (ii) all documentary evidence received in that proceeding; and
             178          (iii) a transcript of any testimony taken at that proceeding that was preserved; and
             179          (c) if the appeal is from a hearing where an exemption was granted or denied, certify
             180      and transmit to the commission the written decision of the board of equalization as required by


             181      Section 59-2-1102 .
             182          (3) In reviewing the county board's decision, the commission may:
             183          (a) admit additional evidence;
             184          (b) issue orders that it considers to be just and proper; and
             185          (c) make any correction or change in the assessment or order of the county board of
             186      equalization.
             187          (4) In reviewing evidence submitted to the commission by or on behalf of an owner or
             188      a county, the commission shall consider and weigh:
             189          (a) the accuracy, reliability, and comparability of the evidence presented by the owner
             190      or the county;
             191          (b) if submitted, the sales price of relevant property that was under contract for sale as
             192      of the lien date but sold after the lien date;
             193          (c) if submitted, the sales offering price of property that was offered for sale as of the
             194      lien date but did not sell, including considering and weighing the amount of time for which,
             195      and manner in which, the property was offered for sale; and
             196          (d) if submitted, other evidence that is relevant to determining the fair market value of
             197      the property.
             198          [(4)] (5) In reviewing the county board's decision, the commission shall adjust property
             199      valuations to reflect a value equalized with the assessed value of other comparable properties
             200      if:
             201          (a) the issue of equalization of property values is raised; and
             202          (b) the commission determines that the property that is the subject of the appeal
             203      deviates in value plus or minus 5% from the assessed value of comparable properties.
             204          [(5)] (6) The commission shall decide all appeals taken pursuant to this section not
             205      later than March 1 of the following year for real property and within 90 days for personal
             206      property, and shall report its decision, order, or assessment to the county auditor, who shall
             207      make all changes necessary to comply with the decision, order, or assessment.
             208          Section 4. Section 59-2-1017 is enacted to read:
             209          59-2-1017. Property tax appeal assistance.
             210          (1) As used in this section:
             211          (a) "Licensed appraiser" means an appraiser licensed in accordance with Title 61,


             212      Chapter 2g, Real Estate Appraiser Licensing and Certification Act.
             213          (b) "Opinion of value" means an estimate of fair market value that:
             214          (i) is made by a licensed appraiser; and
             215          (ii) complies with the Uniform Standards of Professional Appraisal Practice
             216      promulgated by the Appraisal Standards Board as described in 12 U.S.C. Sec. 3339.
             217          (c) "Present evidence" means to present information:
             218          (i) to a county board of equalization or the commission; and
             219          (ii) related to a property tax appeal made in accordance with this part.
             220          (d) "Price estimate" means an estimate:
             221          (i) of the price that property would sell for; and
             222          (ii) that is not an opinion of value.
             223          (e) "Provide property tax information" means to provide information related to a
             224      property tax appeal made in accordance with this part to another person.
             225          (2) Subject to the other provisions of this section, a person may:
             226          (a) present evidence in a property tax appeal on behalf of another person after
             227      obtaining permission from that other person; or
             228          (b) provide property tax information to another person.
             229          (3) For purposes of Subsection (2):
             230          (a) only a person who is a licensed appraiser may present or provide an opinion of
             231      value; and
             232          (b) only a person who is not a licensed appraiser may present or provide a price
             233      estimate.
             234          (4) (a) A licensed appraiser who presents evidence or provides property tax
             235      information in accordance with Subsection (2) is subject to Sections 61-2g-304 , 61-2g-403 ,
             236      61-2g-406 , and 62-2g-407 .
             237          (b) A person who is not a licensed appraiser, who presents evidence or provides
             238      property tax information in accordance with Subsection (2):
             239          (i) is subject to Section 61-2g-407 ; and
             240          (ii) if the person charges a contingent fee, is subject to Section 61-2g-406 .
             241          (5) A county board of equalization or the commission may evaluate the reliability or
             242      accuracy of evidence presented or property tax information provided in accordance with


             243      Subsection (2).
             244          Section 5. Section 61-2g-301 is amended to read:
             245           61-2g-301. License or certification required.
             246          (1) Except as provided in Subsection (2), it is unlawful for a person to prepare, for
             247      valuable consideration, an appraisal, an appraisal report, a certified appraisal report, or perform
             248      a consultation service relating to real estate or real property in this state without first being
             249      licensed or certified in accordance with this chapter.
             250          (2) This section does not apply to:
             251          (a) a principal broker, associate broker, or sales agent as defined by Section 61-2f-102
             252      licensed by this state who, in the ordinary course of the broker's or sales agent's business, gives
             253      an opinion:
             254          (i) regarding the value of real estate;
             255          (ii) to a potential seller or third-party recommending a listing price of real estate; or
             256          (iii) to a potential buyer or third-party recommending a purchase price of real estate;
             257          (b) an employee of a company who states an opinion of value or prepares a report
             258      containing value conclusions relating to real estate or real property solely for the company's
             259      use;
             260          (c) an official or employee of a government agency while acting solely within the scope
             261      of the official's or employee's duties, unless otherwise required by Utah law;
             262          (d) an auditor or accountant who states an opinion of value or prepares a report
             263      containing value conclusions relating to real estate or real property while performing an audit;
             264          (e) an individual, except an individual who is required to be licensed or certified under
             265      this chapter, who states an opinion about the value of property in which the person has an
             266      ownership interest;
             267          (f) an individual who states an opinion of value if no consideration is paid or agreed to
             268      be paid for the opinion and no other party is reasonably expected to rely on the individual's
             269      appraisal expertise;
             270          (g) an individual, such as a researcher or a secretary, who does not render significant
             271      professional assistance, as defined by the board, in arriving at a real estate appraisal analysis,
             272      opinion, or conclusion; [or]
             273          (h) an attorney authorized to practice law in any state who, in the course of the


             274      attorney's practice or tax appeal services, uses an appraisal report governed by this chapter or
             275      who states an opinion of the value of real estate[.]; or
             276          (i) a person who is not an appraiser who presents or provides a price estimate,
             277      evidence, or property tax information solely for a property tax appeal in accordance with
             278      Section 59-2-1017 .
             279          (3) An opinion of value or report containing value conclusions exempt under
             280      Subsection (2) may not be referred to as an appraisal.
             281          (4) Except as provided in Subsection (2), to prepare or cause to be prepared in this state
             282      an appraisal, an appraisal report, or a certified appraisal report, an individual shall:
             283          (a) apply in writing for licensure or certification as provided in this chapter in the form
             284      [as] the division may prescribe; and
             285          (b) become licensed or certified under this chapter.
             286          Section 6. Section 61-2g-406 is amended to read:
             287           61-2g-406. Contingent fees.
             288          (1) A person licensed or certified under this chapter who enters into an agreement to
             289      perform an appraisal may not accept a contingent fee.
             290          (2) A person who presents or provides a price estimate or property tax information in
             291      accordance with Section 59-2-1017 , or a person who is licensed or certified under this chapter
             292      who enters into an agreement to provide consultation services, may be paid a fixed fee or a
             293      contingent fee.
             294          (3) (a) If a person who presents or provides a price estimate or property tax information
             295      in accordance with Section 59-2-1017 , or a person who is licensed or certified under this
             296      chapter, enters into an agreement to perform consultation services for a contingent fee, this fact
             297      shall be clearly stated in each oral statement.
             298          (b) In addition to the requirements of Subsection (3)(a), if a person who presents or
             299      provides a price estimate or property tax information in accordance with Section 59-2-1017 , or
             300      a person who is licensed or certified under this chapter, prepares a written consultation report
             301      or summary, letter of transmittal, or certification statement for a contingent fee, the person shall
             302      clearly state in the price estimate property tax information, report, summary, letter of
             303      transmittal, or certification statement that the report is prepared under a contingent fee
             304      arrangement.


             305          Section 7. Section 61-2g-407 is amended to read:
             306           61-2g-407. Consultation reports -- Restrictions on use of terms.
             307          A person who presents or provides a price estimate or property tax information in
             308      accordance with Section 59-2-1017 , or prepares a written or oral consultation report, may not
             309      refer to the price estimate, property tax information, or consultation report as an appraisal, an
             310      appraisal report, or in any manner that may be interpreted as referring to an appraisal or an
             311      appraisal report.


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