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Second Regular Session

Sixty-first General Assembly

LLS NO. 98­0134.01 JAP/MAS HOUSE BILL 98­1005

STATE OF COLORADO

BY REPRESENTATIVE Spradley;

also SENATORS Blickensderfer and Coffman.

REVISED

FINANCE

APPROPRIATIONS

A BILL FOR AN ACT

CONCERNING REDUCTION OF PROPERTY TAXES.

Bill Summary

(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments that may be subsequently adopted.)

Explains that it is the general assembly's intent, in creating a partial tax exemption for business personal property, to benefit all Colorado citizens through the resulting increase in business spending and investment and through the resulting reduction in assessed valuation for residential real property that is required to ensure that the aggregate statewide valuation for assessment attributable to residential real property remains the same as in preceding years.

For property tax years beginning on or after January 1, 1999, exempts from the levy and collection of property tax a stated amount of actual value of personal property listed on a personal property schedule.

For property tax years beginning on or after January 1, 1999, but prior to January 1, 2007, requires the state treasurer to transmit a specified amount of moneys for losses in property tax revenue to each local government in which the total assessed value of all taxable property within its taxing jurisdiction decreases below the total assessed value of all taxable property for such government for the 1998 property tax year due to the exemption created in the act. Creates the property tax exemption backfill fund and, for fiscal years beginning on or after January 1, 1999, but prior to January 1, 2007, requires the general assembly to appropriate a specified amount to the fund for reimbursement to local governments. By March 1, 1999, and each year thereafter until 2006, requires the property tax administrator to prepare a report specifying the amount to be transmitted to each local government and to submit the report to the state treasurer and the general assembly.

Repeals the current exemption for business personal property in the amount of $2,500 or less, effective January 1, 1999.


Be it enacted by the General Assembly of the State of Colorado:

SECTION 1. Legislative declaration.  The general assembly hereby finds that the partial tax exemption created in this act for business personal property and the resulting decrease in the amount of property tax paid on business personal property will benefit not just business owners but all citizens of the state, because reducing a business' property tax liability will enable the business to invest or spend the amount of the property tax reduction, thereby stimulating economic growth.

SECTION 2.  Article 3 of title 39, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SECTION to read:

39­3­119.7.  Personal property ­ exemption from school district property tax.  FOR PROPERTY TAX YEARS COMMENCING ON AND AFTER JANUARY 1, 1999, PERSONAL PROPERTY NOT OTHERWISE EXEMPT FROM PROPERTY TAX SHALL BE EXEMPT FROM THE LEVY AND COLLECTION OF PROPERTY TAX BY SCHOOL DISTRICTS FOR THE PAYMENT OF THE COSTS OF THE FINANCIAL BASE OF SUPPORT FOR THE SYSTEM OF FREE PUBLIC SCHOOLS IN THE STATE AS DETERMINED UNDER THE PROVISIONS OF THE "PUBLIC SCHOOL FINANCE ACT OF 1994", ARTICLE 54 OF TITLE 22, C.R.S., AND FOR THE PURPOSE OF GENERATING REVENUE TO REPLACE CATEGORICAL PROGRAM SUPPORT FUNDS THAT SCHOOL DISTRICTS WOULD OTHERWISE BE ELIGIBLE TO RECEIVE FROM THE STATE. THE EXEMPTION GRANTED PURSUANT TO THIS SECTION SHALL APPLY ONLY TO THE FIRST TWENTY­FIVE THOUSAND DOLLARS OF THE ACTUAL VALUE OF THE PERSONAL PROPERTY OWNED BY THE TAXPAYER IN EACH COUNTY; EXCEPT THAT, FOR ANY PUBLIC UTILITY VALUED PURSUANT TO ARTICLE 4 OF THIS TITLE, THE EXEMPTION SHALL APPLY TO THE FIRST TWENTY­FIVE THOUSAND DOLLARS OF THE TOTAL ACTUAL VALUE OF PERSONAL PROPERTY OWNED BY THE PUBLIC UTILITY STATEWIDE.

SECTION  3. Article 40 of title 22, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SECTION to read:

22­40­102.5.  Personal property ­ exemption.  NOTWITHSTANDING ANY PROVISION OF THIS ARTICLE TO THE CONTRARY, FOR PROPERTY TAX YEARS COMMENCING ON AND AFTER JANUARY 1, 1999, PERSONAL PROPERTY NOT OTHERWISE EXEMPT FROM PROPERTY TAX SHALL BE EXEMPT FROM THE LEVY AND COLLECTION OF PROPERTY TAX BY SCHOOL DISTRICTS FOR THE PAYMENT OF THE COSTS OF THE FINANCIAL BASE OF SUPPORT FOR THE SYSTEM OF FREE PUBLIC SCHOOLS IN THE STATE AS DETERMINED UNDER THE PROVISIONS OF THE "PUBLIC SCHOOL FINANCE ACT OF 1994", ARTICLE 54 OF THIS TITLE, AND FOR THE PURPOSE OF GENERATING REVENUE TO REPLACE CATEGORICAL PROGRAM SUPPORT FUNDS THAT SCHOOL DISTRICTS WOULD OTHERWISE BE ELIGIBLE TO RECEIVE FROM THE STATE. THE EXEMPTION GRANTED PURSUANT TO THIS SECTION SHALL APPLY ONLY TO THE FIRST TWENTY­FIVE THOUSAND DOLLARS OF THE ACTUAL VALUE OF THE PERSONAL PROPERTY OWNED BY THE TAXPAYER IN EACH COUNTY; EXCEPT THAT, FOR ANY PUBLIC UTILITY VALUED PURSUANT TO ARTICLE 4 OF TITLE 39, C.R.S., THE EXEMPTION SHALL APPLY TO THE FIRST TWENTY­FIVE THOUSAND DOLLARS OF THE TOTAL ACTUAL VALUE OF PERSONAL PROPERTY OWNED BY THE PUBLIC UTILITY STATEWIDE.

SECTION 4.  22­54­106 (2), Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW PARAGRAPH to read:

22­54­106.  Local and state shares of district total program. (2) (d)  IN DETERMINING THE NUMBER OF MILLS IT WILL LEVY FOR THE 1999­2000 BUDGET YEAR, EACH SCHOOL DISTRICT SHALL BASE THE DETERMINATION ON THE SCHOOL DISTRICT'S ASSESSED VALUATION FOR THE 1999 PROPERTY TAX YEAR, PLUS THE ASSESSED VALUATION OF ALL PERSONAL PROPERTY THAT IS EXEMPT FROM THE LEVY AND COLLECTION OF PROPERTY TAX BY THE SCHOOL DISTRICT PURSUANT TO SECTION 39­3­119.7, C.R.S.

SECTION 5. 22­54­106 (9), Colorado Revised Statutes, is amended to read:

22­54­106.  Local and state shares of district total program. (9) (a)  If a district reduces or ends business personal property taxes through action taken pursuant to section 20 (8) (b) of article X of the state constitution, the state's share of the district's total program for the budget year in which such action is taken and any budget year thereafter shall be the amount by which the district's total program exceeds the amount of specific ownership tax revenue paid to the district and the amount of property tax revenue which the district would have been entitled to receive if such action had not been taken by the district.

(b)  THE PROVISIONS OF THIS SUBSECTION (9) SHALL NOT APPLY TO THE PROPERTY TAX EXEMPTION CREATED PURSUANT TO SECTION 39­3­119.7, C.R.S.

SECTION 6.  39­3­119.5, Colorado Revised Statutes, is amended to read:

39­3­119.5.  Personal property ­ exemption. (1)  For property tax years commencing on and after January 1, 1997, personal property not otherwise exempt from property tax shall be exempt from the levy and collection of property tax if the personal property would otherwise be listed on a single personal property schedule and the actual value of such personal property is two thousand five hundred dollars or less.

(2)  FOR PROPERTY TAX YEARS COMMENCING ON AND AFTER JANUARY 1, 1997, THE EXEMPTION CREATED IN SUBSECTION (1) OF THIS SECTION SHALL APPLY ONLY IF THE ACTUAL VALUE OF THE PERSONAL PROPERTY OWNED BY THE TAXPAYER IN EACH COUNTY IS TWO THOUSAND FIVE HUNDRED DOLLARS OR LESS; EXCEPT THAT A PUBLIC UTILITY VALUED UNDER ARTICLE 4 OF THIS TITLE SHALL QUALIFY FOR THE EXEMPTION CREATED IN SUBSECTION (1) OF THIS SECTION ONLY IF THE TOTAL ACTUAL VALUE OF THE PUBLIC UTILITY'S PERSONAL PROPERTY IN THE STATE IS TWO THOUSAND FIVE HUNDRED DOLLARS OR LESS

SECTION 7. 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.