Second Regular Session
               Seventieth General Assembly
                    STATE OF COLORADO
                                                 INTRODUCED
                                                           
                                                           
 LLS NO. 16-0186.01 Gregg Fraser x4325   HOUSE BILL 16-1174
                    HOUSE SPONSORSHIP
 Becker J., 
 
                   SENATE SPONSORSHIP
 (None),
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 House Committees
 Senate Committees
 
 
 State, Veterans, & Military Affairs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                         A BILL FOR AN ACT
       Concerning a perpetual conservation easement in gross
            granted for property in Colorado for which a tax
            credit claim has been rejected.
       
       
                           Bill Summary
       
            (Note:  This summary applies to this bill as introduced and does
       not reflect any amendments that may be subsequently adopted. If this bill
       passes third reading in the house of introduction, a bill summary that
       applies to the reengrossed version of this bill will be available at
       http://www.leg.state.co.us/billsummaries.)
       
            Under current law, a state income tax credit is allowed for a
       portion of the value of a perpetual conservation easement that is granted
       by a taxpayer on real property located in Colorado. The bill restricts the
       ability of the executive director of the department of revenue to contest
       an appraisal and credit claimed for an easement donated prior to January
       1, 2008, for which a final settlement has not been reached by July 1,
       2016, unless:
                 The executive director has produced clear and convincing
                 evidence of an overvaluation of the easement, confirmed in
                 writing by the state attorney general prior to a specified
                 date; or
                 The valuation is supported solely by an appraisal from an
                 appraiser convicted of fraud or misrepresentation in
                 connection with preparing the appraisal.
            The law currently allows a conservation easement to be terminated
       in the same manner as any other easement. The bill specifies that, in
       addition, a court may exercise its equitable jurisdiction to terminate a
       conservation easement for which a tax credit has been claimed in certain
       circumstances if the claim has been rejected.
       
       
       
       Be it enacted by the General Assembly of the State of Colorado:
            SECTION 1.  In Colorado Revised Statutes, 39-22-522, add (3.5)
       (c) as follows:
            39-22-522.  Credit against tax - conservation easements.
       (3.5) (c)  Notwithstanding any other provision of this section, for
       any conservation easement in gross donated prior to January 1,
       2008, for which a credit is claimed and a final settlement has not
       been reached with a taxpayer on or before July 1, 2016, the
       credit is allowed and the executive director shall neither
       contest nor require additional information regarding the
       appraised value of the easement, the amount of the credit, or the
       validity of the credit allowed pursuant to subsection (2) of this
       section unless:
            (I)  Prior to July 1, 2016, the executive director has
       produced clear and convincing evidence of an overvaluation of
       the easement, which evidence has been confirmed in writing by
       the attorney general and, prior to such date, a formal rejection
       together with the written confirmation of the attorney general
       and copies of the evidence in possession of the executive director
       has been mailed to the donor at the donor's last-known address;
       or
            (II)  The valuation is supported solely by an appraisal from
       an appraiser convicted of fraud or another criminal act of
       misrepresentation prior to July 1, 2016, in connection with the
       preparation of the appraisal.
            SECTION 2.  In Colorado Revised Statutes, amend 38-30.5-107
       as follows:
            38-30.5-107.  Release - termination. (1)  Conservation easements
       in gross may, in whole or in part, be released, terminated, extinguished,
       or abandoned by merger with the underlying fee interest in the servient
       land or water rights or in any other manner in which easements may be
       lawfully terminated, released, extinguished, or abandoned.
            (2)  In addition to the methods set forth in subsection (1)
       of this section, a court exercising its equitable jurisdiction may
       terminate a conservation easement in gross created for the
       purpose of claiming a state income tax credit pursuant to
       section 39-22-522, C.R.S., if:
            (a)  The state has rejected the claim for the credit;
            (b)  The easement has been appraised to have no value or
       no more than a nominal dollar value; and 
            (c)  The holder of the easement either provided no
       compensation for the easement or has been reimbursed in whole
       for any compensation provided.
            SECTION 3.  Safety clause. The general assembly hereby finds,
       determines, and declares that this act is necessary for the immediate
       preservation of the public peace, health, and safety.