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7 LONG TITLE
8 General Description:
9 This bill modifies provisions related to the calculation of locally assessed new growth
10 for property tax purposes.
11 Highlighted Provisions:
12 This bill:
13 ▸ describes the responsibilities of a county assessor in calculating an assessment of
14 new internal accessory dwelling units in a tax area;
15 ▸ describes how that calculation is included in locally assessed new growth for
16 property tax purposes;
17 ▸ provides a sunset date; and
18 ▸ makes technical changes.
19 Money Appropriated in this Bill:
20 None
21 Other Special Clauses:
22 This bill provides a special effective date.
23 Utah Code Sections Affected:
24 AMENDS:
25 59-2-924, as last amended by Laws of Utah 2021, Chapters 214 and 388
26 63I-1-259, as last amended by Laws of Utah 2021, Chapters 64 and 371
27 ENACTS:
28 59-2-301.9, Utah Code Annotated 1953
29
30 Be it enacted by the Legislature of the state of Utah:
31 Section 1. Section 59-2-301.9 is enacted to read:
32 59-2-301.9. Assessment calculation for new internal accessory dwelling units in a
33 tax area.
34 (1) Before May 1 each year, for each tax area in the county, the county recorder shall
35 report to the county assessor the total number of notices for new internal accessory dwelling
36 units in the previous calendar year recorded pursuant to Subsections 10-9a-530(6) and
37 17-27a-526(6).
38 (2) The county assessor shall:
39 (a) multiply the total number of notices for each tax area pursuant to Subsection (1) by
40 the median home value for each tax area in the previous calendar year; and
41 (b) for each tax area in the county, report an amount equal to one-third of the
42 calculation in Subsection (2)(a) as part of the calculation of locally assessed new growth as
43 defined in Section 59-2-924.
44 Section 2. Section 59-2-924 is amended to read:
45 59-2-924. Definitions -- Report of valuation of property to county auditor and
46 commission -- Transmittal by auditor to governing bodies -- Calculation of certified tax
47 rate -- Rulemaking authority -- Adoption of tentative budget -- Notice provided by the
48 commission.
49 (1) As used in this section:
50 (a) (i) "Ad valorem property tax revenue" means revenue collected in accordance with
51 this chapter.
52 (ii) "Ad valorem property tax revenue" does not include:
53 (A) interest;
54 (B) penalties;
55 (C) collections from redemptions; or
56 (D) revenue received by a taxing entity from personal property that is semiconductor
57 manufacturing equipment assessed by a county assessor in accordance with Part 3, County
58 Assessment.
59 (b) "Adjusted tax increment" means the same as that term is defined in Section
60 17C-1-102.
61 (c) (i) "Aggregate taxable value of all property taxed" means:
62 (A) the aggregate taxable value of all real property a county assessor assesses in
63 accordance with Part 3, County Assessment, for the current year;
64 (B) the aggregate taxable value of all real and personal property the commission
65 assesses in accordance with Part 2, Assessment of Property, for the current year; and
66 (C) the aggregate year end taxable value of all personal property a county assessor
67 assesses in accordance with Part 3, County Assessment, contained on the prior year's tax rolls
68 of the taxing entity.
69 (ii) "Aggregate taxable value of all property taxed" does not include the aggregate year
70 end taxable value of personal property that is:
71 (A) semiconductor manufacturing equipment assessed by a county assessor in
72 accordance with Part 3, County Assessment; and
73 (B) contained on the prior year's tax rolls of the taxing entity.
74 (d) "Base taxable value" means:
75 (i) for an authority created under Section 11-58-201, the same as that term is defined in
76 Section 11-58-102;
77 (ii) for an agency created under Section 17C-1-201.5, the same as that term is defined
78 in Section 17C-1-102;
79 (iii) for an authority created under Section 63H-1-201, the same as that term is defined
80 in Section 63H-1-102; or
81 (iv) for a host local government, the same as that term is defined in Section 63N-2-502.
82 (e) "Centrally assessed benchmark value" means an amount equal to the highest year
83 end taxable value of real and personal property the commission assesses in accordance with
84 Part 2, Assessment of Property, for a previous calendar year that begins on or after January 1,
85 2015, adjusted for taxable value attributable to:
86 (i) an annexation to a taxing entity; or
87 (ii) an incorrect allocation of taxable value of real or personal property the commission
88 assesses in accordance with Part 2, Assessment of Property.
89 (f) (i) "Centrally assessed new growth" means the greater of:
90 (A) zero; or
91 (B) the amount calculated by subtracting the centrally assessed benchmark value
92 adjusted for prior year end incremental value from the taxable value of real and personal
93 property the commission assesses in accordance with Part 2, Assessment of Property, for the
94 current year, adjusted for current year incremental value.
95 (ii) "Centrally assessed new growth" does not include a change in value as a result of a
96 change in the method of apportioning the value prescribed by the Legislature, a court, or the
97 commission in an administrative rule or administrative order.
98 (g) "Certified tax rate" means a tax rate that will provide the same ad valorem property
99 tax revenue for a taxing entity as was budgeted by that taxing entity for the prior year.
100 (h) "Community reinvestment agency" means the same as that term is defined in
101 Section 17C-1-102.
102 (i) "Eligible new growth" means the greater of:
103 (i) zero; or
104 (ii) the sum of:
105 (A) locally assessed new growth;
106 (B) centrally assessed new growth; and
107 (C) project area new growth or hotel property new growth.
108 (j) "Host local government" means the same as that term is defined in Section
109 63N-2-502.
110 (k) "Hotel property" means the same as that term is defined in Section 63N-2-502.
111 (l) "Hotel property new growth" means an amount equal to the incremental value that
112 is no longer provided to a host local government as incremental property tax revenue.
113 (m) "Incremental property tax revenue" means the same as that term is defined in
114 Section 63N-2-502.
115 (n) "Incremental value" means:
116 (i) for an authority created under Section 11-58-201, the amount calculated by
117 multiplying:
118 (A) the difference between the taxable value and the base taxable value of the property
119 that is located within a project area and on which property tax differential is collected; and
120 (B) the number that represents the percentage of the property tax differential that is
121 paid to the authority;
122 (ii) for an agency created under Section 17C-1-201.5, the amount calculated by
123 multiplying:
124 (A) the difference between the taxable value and the base taxable value of the property
125 located within a project area and on which tax increment is collected; and
126 (B) the number that represents the adjusted tax increment from that project area that is
127 paid to the agency;
128 (iii) for an authority created under Section 63H-1-201, the amount calculated by
129 multiplying:
130 (A) the difference between the taxable value and the base taxable value of the property
131 located within a project area and on which property tax allocation is collected; and
132 (B) the number that represents the percentage of the property tax allocation from that
133 project area that is paid to the authority; or
134 (iv) for a host local government, an amount calculated by multiplying:
135 (A) the difference between the taxable value and the base taxable value of the hotel
136 property on which incremental property tax revenue is collected; and
137 (B) the number that represents the percentage of the incremental property tax revenue
138 from that hotel property that is paid to the host local government.
139 (o) (i) "Locally assessed new growth" means the greater of zero or the amount
140 calculated by:
141 [
142 [
143 property the county assessor assesses in accordance with Part 3, County Assessment, for the
144 previous year, adjusted for prior year end incremental value from the taxable value of real
145 property the county assessor assesses in accordance with Part 3, County Assessment, for the
146 current year, adjusted for current year incremental value; and
147 (B) adding the amount reported by the county assessor in accordance with Subsection
148 59-2-301.9(2)(b).
149 (ii) "Locally assessed new growth" does not include a change in:
150 (A) value as a result of factoring in accordance with Section 59-2-704, reappraisal, or
151 another adjustment;
152 (B) assessed value based on whether a property is allowed a residential exemption for a
153 primary residence under Section 59-2-103;
154 (C) assessed value based on whether a property is assessed under Part 5, Farmland
155 Assessment Act; or
156 (D) assessed value based on whether a property is assessed under Part 17, Urban
157 Farming Assessment Act.
158 (p) "Project area" means:
159 (i) for an authority created under Section 11-58-201, the same as that term is defined in
160 Section 11-58-102;
161 (ii) for an agency created under Section 17C-1-201.5, the same as that term is defined
162 in Section 17C-1-102; or
163 (iii) for an authority created under Section 63H-1-201, the same as that term is defined
164 in Section 63H-1-102.
165 (q) "Project area new growth" means:
166 (i) for an authority created under Section 11-58-201, an amount equal to the
167 incremental value that is no longer provided to an authority as property tax differential;
168 (ii) for an agency created under Section 17C-1-201.5, an amount equal to the
169 incremental value that is no longer provided to an agency as tax increment; or
170 (iii) for an authority created under Section 63H-1-201, an amount equal to the
171 incremental value that is no longer provided to an authority as property tax allocation.
172 (r) "Project area incremental revenue" means the same as that term is defined in
173 Section 17C-1-1001.
174 (s) "Property tax allocation" means the same as that term is defined in Section
175 63H-1-102.
176 (t) "Property tax differential" means the same as that term is defined in Section
177 11-58-102.
178 (u) "Qualifying exempt revenue" means revenue received:
179 (i) for the previous calendar year;
180 (ii) by a taxing entity;
181 (iii) from tangible personal property contained on the prior year's tax rolls that is
182 exempt from property tax under Subsection 59-2-1115(2)(b) for a calendar year beginning on
183 January 1, 2022; and
184 (iv) on the aggregate 2021 year end taxable value of the tangible personal property that
185 exceeds $15,300.
186 (v) "Tax increment" means the same as that term is defined in Section 17C-1-102.
187 (2) Before June 1 of each year, the county assessor of each county shall deliver to the
188 county auditor and the commission the following statements:
189 (a) a statement containing the aggregate valuation of all taxable real property a county
190 assessor assesses in accordance with Part 3, County Assessment, for each taxing entity; and
191 (b) a statement containing the taxable value of all personal property a county assessor
192 assesses in accordance with Part 3, County Assessment, from the prior year end values.
193 (3) The county auditor shall, on or before June 8, transmit to the governing body of
194 each taxing entity:
195 (a) the statements described in Subsections (2)(a) and (b);
196 (b) an estimate of the revenue from personal property;
197 (c) the certified tax rate; and
198 (d) all forms necessary to submit a tax levy request.
199 (4) (a) Except as otherwise provided in this section, the certified tax rate shall be
200 calculated by dividing the ad valorem property tax revenue that a taxing entity budgeted for the
201 prior year minus the qualifying exempt revenue by the amount calculated under Subsection
202 (4)(b).
203 (b) For purposes of Subsection (4)(a), the legislative body of a taxing entity shall
204 calculate an amount as follows:
205 (i) calculate for the taxing entity the difference between:
206 (A) the aggregate taxable value of all property taxed; and
207 (B) any adjustments for current year incremental value;
208 (ii) after making the calculation required by Subsection (4)(b)(i), calculate an amount
209 determined by increasing or decreasing the amount calculated under Subsection (4)(b)(i) by the
210 average of the percentage net change in the value of taxable property for the equalization
211 period for the three calendar years immediately preceding the current calendar year;
212 (iii) after making the calculation required by Subsection (4)(b)(ii), calculate the product
213 of:
214 (A) the amount calculated under Subsection (4)(b)(ii); and
215 (B) the percentage of property taxes collected for the five calendar years immediately
216 preceding the current calendar year; and
217 (iv) after making the calculation required by Subsection (4)(b)(iii), calculate an amount
218 determined by:
219 (A) multiplying the percentage of property taxes collected for the five calendar years
220 immediately preceding the current calendar year by eligible new growth; and
221 (B) subtracting the amount calculated under Subsection (4)(b)(iv)(A) from the amount
222 calculated under Subsection (4)(b)(iii).
223 (5) A certified tax rate for a taxing entity described in this Subsection (5) shall be
224 calculated as follows:
225 (a) except as provided in Subsection (5)(b) or (c), for a new taxing entity, the certified
226 tax rate is zero;
227 (b) for a municipality incorporated on or after July 1, 1996, the certified tax rate is:
228 (i) in a county of the first, second, or third class, the levy imposed for municipal-type
229 services under Sections 17-34-1 and 17-36-9; and
230 (ii) in a county of the fourth, fifth, or sixth class, the levy imposed for general county
231 purposes and such other levies imposed solely for the municipal-type services identified in
232 Section 17-34-1 and Subsection 17-36-3(23);
233 (c) for a community reinvestment agency that received all or a portion of a taxing
234 entity's project area incremental revenue in the prior year under Title 17C, Chapter 1, Part 10,
235 Agency Taxing Authority, the certified tax rate is calculated as described in Subsection (4)
236 except that the commission shall treat the total revenue transferred to the community
237 reinvestment agency as ad valorem property tax revenue that the taxing entity budgeted for the
238 prior year; and
239 (d) for debt service voted on by the public, the certified tax rate is the actual levy
240 imposed by that section, except that a certified tax rate for the following levies shall be
241 calculated in accordance with Section 59-2-913 and this section:
242 (i) a school levy provided for under Section 53F-8-301, 53F-8-302, or 53F-8-303; and
243 (ii) a levy to pay for the costs of state legislative mandates or judicial or administrative
244 orders under Section 59-2-1602.
245 (6) (a) A judgment levy imposed under Section 59-2-1328 or 59-2-1330 may be
246 imposed at a rate that is sufficient to generate only the revenue required to satisfy one or more
247 eligible judgments.
248 (b) The ad valorem property tax revenue generated by a judgment levy described in
249 Subsection (6)(a) may not be considered in establishing a taxing entity's aggregate certified tax
250 rate.
251 (7) (a) For the purpose of calculating the certified tax rate, the county auditor shall use:
252 (i) the taxable value of real property:
253 (A) the county assessor assesses in accordance with Part 3, County Assessment; and
254 (B) contained on the assessment roll;
255 (ii) the year end taxable value of personal property:
256 (A) a county assessor assesses in accordance with Part 3, County Assessment; and
257 (B) contained on the prior year's assessment roll; and
258 (iii) the taxable value of real and personal property the commission assesses in
259 accordance with Part 2, Assessment of Property.
260 (b) For purposes of Subsection (7)(a), taxable value does not include eligible new
261 growth.
262 (8) (a) On or before June 30, a taxing entity shall annually adopt a tentative budget.
263 (b) If a taxing entity intends to exceed the certified tax rate, the taxing entity shall
264 notify the county auditor of:
265 (i) the taxing entity's intent to exceed the certified tax rate; and
266 (ii) the amount by which the taxing entity proposes to exceed the certified tax rate.
267 (c) The county auditor shall notify property owners of any intent to levy a tax rate that
268 exceeds the certified tax rate in accordance with Sections 59-2-919 and 59-2-919.1.
269 (9) (a) Subject to Subsection (9)(d), the commission shall provide notice, through
270 electronic means on or before July 31, to a taxing entity and the Revenue and Taxation Interim
271 Committee if:
272 (i) the amount calculated under Subsection (9)(b) is 10% or more of the year end
273 taxable value of the real and personal property the commission assesses in accordance with
274 Part 2, Assessment of Property, for the previous year, adjusted for prior year end incremental
275 value; and
276 (ii) the amount calculated under Subsection (9)(c) is 50% or more of the total year end
277 taxable value of the real and personal property of a taxpayer the commission assesses in
278 accordance with Part 2, Assessment of Property, for the previous year.
279 (b) For purposes of Subsection (9)(a)(i), the commission shall calculate an amount by
280 subtracting the taxable value of real and personal property the commission assesses in
281 accordance with Part 2, Assessment of Property, for the current year, adjusted for current year
282 incremental value, from the year end taxable value of the real and personal property the
283 commission assesses in accordance with Part 2, Assessment of Property, for the previous year,
284 adjusted for prior year end incremental value.
285 (c) For purposes of Subsection (9)(a)(ii), the commission shall calculate an amount by
286 subtracting the total taxable value of real and personal property of a taxpayer the commission
287 assesses in accordance with Part 2, Assessment of Property, for the current year, from the total
288 year end taxable value of the real and personal property of a taxpayer the commission assesses
289 in accordance with Part 2, Assessment of Property, for the previous year.
290 (d) The notification under Subsection (9)(a) shall include a list of taxpayers that meet
291 the requirement under Subsection (9)(a)(ii).
292 Section 3. Section 63I-1-259 is amended to read:
293 63I-1-259. Repeal dates, Title 59.
294 (1) Section 59-1-213.1 is repealed on May 9, 2024.
295 (2) Section 59-1-213.2 is repealed on May 9, 2024.
296 (3) Subsection 59-1-405(1)(g) is repealed on May 9, 2024.
297 (4) Subsection 59-1-405(2)(b) is repealed on May 9, 2024.
298 (5) Section 59-2-301.9 is repealed on January 1, 2028.
299 (6) Subsection 59-2-924(1)(o)(i)(B), regarding adding an amount to "locally assessed
300 new growth" based on an amount report by the county assessor in accordance with Subsection
301 59-2-301.9(2)(b), is repealed on January 1, 2028, and the Office of Legislative Research and
302 General Counsel is authorized to renumber the remaining subsections accordingly.
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307 1, 2023.
308 Section 4. Effective date.
309 This bill takes effect on January 1, 2023.