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Second Regular Session

Sixty-first General Assembly

LLS NO. 98­0022.01 GWF HOUSE BILL 98­1152

STATE OF COLORADO

BY REPRESENTATIVE George;

also SENATOR Bishop.

REENGROSSED

FINANCE

A BILL FOR AN ACT

CONCERNING PROPERTY TAXATION, AND, IN CONNECTION THEREWITH, SPECIFYING THE VALUATION FOR ASSESSMENT PERCENTAGES FOR CERTAIN CLASSIFICATIONS OF PROPERTY AND ESTABLISHING A HOMESTEAD EXEMPTION FOR A PORTION OF THE ACTUAL VALUE OF OWNER­OCCUPIED RESIDENTIAL PROPERTY USED AS A PRIMARY RESIDENCE AND OWNED BY A PERSON WHO HAS RESIDED IN THE STATE FOR TWO YEARS OR LONGER.

Bill Summary

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

Provides that residential property shall be valued for assessment at 10% of its actual value. Defines "vacant land" and reduces the valuation for assessment ratio for vacant land from 29% to 15% over a period of 7 years. Reduces the valuation for assessment ratio for all other property from 29% to 25% over a period of 7 years.

Repeals the statutory provisions governing the annual adjustment of the ratio of valuation for the assessment of residential real property.

Provides for a homestead exemption for a portion of the actual value of residential real property that is owner­occupied, used as a primary residence, and owned by a person who has resided in the state for 2 years or longer. Specifies the initial amount of the exemption to be the first $25,000 of the actual value or an amount equal to 30% of the actual value, whichever is less, for the property tax year commencing January 1, 2000, and provides for increases in the amount of the exemption every other year over the subsequent 4 tax years to a maximum amount of the first $75,000 of the actual value or an amount equal to 50% of the actual value, whichever is less.

Provides that this act shall not take effect unless the constitutional amendment providing for the provisions contained in the act is adopted by the electorate.

Makes conforming amendments.


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

SECTION 1.  39­1­104 (1), (1.5), and (4), Colorado Revised Statutes, are amended, and the said 39­1­104 is amended BY THE ADDITION OF A NEW SUBSECTION, to read:

39­1­104.  Valuation for assessment. (1)  The valuation for assessment of all taxable property in the state shall be twenty­nine TWENTY­EIGHT percent of the actual value thereof as FOR THE PROPERTY TAX YEARS COMMENCING JANUARY 1, 1999, AND JANUARY 1, 2000; TWENTY­SEVEN PERCENT OF THE ACTUAL VALUE THEREOF FOR THE PROPERTY TAX YEARS COMMENCING JANUARY 1, 2001, AND JANUARY 1, 2002; TWENTY­SIX PERCENT OF THE ACTUAL VALUE THEREOF FOR THE PROPERTY TAX YEARS COMMENCING JANUARY 1, 2003, AND JANUARY 1, 2004; AND TWENTY­FIVE PERCENT FOR THE PROPERTY TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 2005. ACTUAL VALUE SHALL BE determined by the assessor and the administrator in the manner prescribed by law, and such percentage shall be uniformly applied, without exception, to the actual value, so determined, of the various classes and subclasses of real and personal property located within the territorial limits of the authority levying a property tax, and all property taxes shall be levied against the aggregate valuation for assessment resulting from the application of such percentage. This subsection (1) shall not apply to residential real property, VACANT LAND, producing mines, and lands or leaseholds producing oil or gas.

(1.5)  FOR PROPERTY TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 1999, residential real property shall be valued for assessment at twenty­one TEN percent of its actual value. except as provided in section 39­1­104.2.

(1.8)  VACANT LAND SHALL BE VALUED FOR ASSESSMENT AT TWENTY­SIX PERCENT OF ITS ACTUAL VALUE FOR THE PROPERTY TAX YEARS COMMENCING ON JANUARY 1, 1999, AND JANUARY 1, 2000; TWENTY-FOUR PERCENT FOR THE PROPERTY TAX YEARS COMMENCING ON JANUARY 1, 2001, AND JANUARY 1, 2002; TWENTY-TWO PERCENT FOR THE PROPERTY TAX YEARS COMMENCING ON JANUARY 1, 2003, AND JANUARY 1, 2004; AND TWENTY PERCENT FOR THE PROPERTY TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 2005.

(4)  Except as provided in section 39­7­109, FOR PROPERTY TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 1999, nonproducing severed mineral interests are to be valued at twenty­nine percent THE SAME PERCENTAGE of actual value AND in the same manner as other real property AS PROVIDED IN SUBSECTION (1) OF THIS SECTION. Such valuation shall be determined by the assessing officer only upon preponderant evidence shown by such officer that the cost approach, market approach, and income approach result in uniform and just and equal valuation.

SECTION 2.  39­1­102 (8), Colorado Revised Statutes, is amended, and the said 39­1­102 is further amended BY THE ADDITION OF THE FOLLOWING NEW SUBSECTIONS, to read:

39­1­102.  Definitions.  As used in articles 1 to 13 of this title, unless the context otherwise requires:

(8)  "Mobile home" means a manufactured home as defined in section 42­1­102 (106) (b), C.R.S. "MINOR STRUCTURES" MEANS IMPROVEMENTS THAT DO NOT ADD VALUE TO THE LAND ON WHICH THEY ARE LOCATED AND THAT ARE NOT SUITABLE TO BE USED FOR AND ARE NOT ACTUALLY USED FOR ANY COMMERCIAL, RESIDENTIAL, OR AGRICULTURAL PURPOSE.

(8.3)  "MOBILE HOME" MEANS A MANUFACTURED HOME AS DEFINED IN SECTION 42­1­102 (106) (b), C.R.S.

(15.7)  "SITE IMPROVEMENTS" MEANS STREETS WITH CURBS AND GUTTERS, CULVERTS AND OTHER SEWAGE AND DRAINAGE FACILITIES, AND UTILITY EASEMENTS AND HOOKUPS FOR INDIVIDUAL LOTS OR PARCELS.

(17.5)  "VACANT LAND" MEANS ANY LOT, PARCEL, SITE, OR TRACT OF LAND UPON WHICH NO BUILDINGS OR FIXTURES OTHER THAN MINOR STRUCTURES ARE LOCATED. "VACANT LAND" MAY INCLUDE LAND WITH SITE IMPROVEMENTS. "VACANT LAND" INCLUDES LAND THAT IS PART OF A DEVELOPMENT TRACT OR SUBDIVISION WHEN USING PRESENT WORTH DISCOUNTING IN THE MARKET APPROACH TO APPRAISAL; HOWEVER, "VACANT LAND" SHALL NOT INCLUDE ANY LOTS WITHIN SUCH SUBDIVISION OR ANY PORTION OF SUCH DEVELOPMENT TRACT THAT IMPROVEMENTS, OTHER THAN SITE IMPROVEMENTS OR MINOR STRUCTURES, HAVE BEEN ERECTED UPON OR AFFIXED THERETO. "VACANT LAND" DOES NOT INCLUDE AGRICULTURAL LAND, PRODUCING OIL AND GAS PROPERTIES, SEVERED MINERAL INTERESTS, OR ANY MINES, WHETHER PRODUCING OR NONPRODUCING.

SECTION 3.  Repeal.  39­1­103 (14) (c), Colorado Revised Statutes, is repealed as follows:

39­1­103.  Actual value determined ­ when. (14) (c) (I)  For purposes of this subsection (14), "vacant land" means any lot, parcel, site, or tract of land upon which no buildings or fixtures, other than minor structures, are located. "Vacant land" may include land with site improvements. "Vacant land" includes land that is part of a development tract or subdivision when using present worth discounting in the market approach to appraisal; however, "vacant land" shall not include any lots within such subdivision or any portion of such development tract that improvements, other than site improvements or minor structures, have been erected upon or affixed thereto. "Vacant land" does not include agricultural land, producing oil and gas properties, severed mineral interests, and all mines, whether producing or nonproducing.

(II)  For purposes of this subsection (14):

(A)  "Minor structures" means improvements that do not add value to the land on which they are located and that are not suitable to be used for and are not actually used for any commercial, residential, or agricultural purpose.

(B)  "Site improvements" means streets with curbs and gutters, culverts and other sewage and drainage facilities, and utility easements and hookups for individual lots or parcels.

SECTION 4.  Article 3 of title 39, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SECTION to read:

39­3­101.5.  Homestead ­ exemption. (1)  THE FOLLOWING PORTIONS OF THE ACTUAL VALUE OF RESIDENTIAL REAL PROPERTY THAT, AS OF THE ASSESSMENT DATE, IS OWNER­OCCUPIED AND IS USED AS THE PRIMARY RESIDENCE OF THE OWNER SHALL BE EXEMPT FROM PROPERTY TAXATION:

(a)  FOR THE PROPERTY TAX YEARS COMMENCING ON JANUARY 1, 2000, AND JANUARY 1, 2001, THE FIRST TWENTY­FIVE THOUSAND DOLLARS OF THE ACTUAL VALUE OR AN AMOUNT EQUAL TO THIRTY PERCENT OF THE ACTUAL VALUE, WHICHEVER IS LESS;

(b)  FOR THE PROPERTY TAX YEARS COMMENCING ON JANUARY 1, 2002, AND JANUARY 1, 2003, THE FIRST FIFTY THOUSAND DOLLARS OF THE ACTUAL VALUE OR AN AMOUNT EQUAL TO FORTY PERCENT OF THE ACTUAL VALUE, WHICHEVER IS LESS;

(c)  FOR PROPERTY TAX YEARS COMMENCING ON OR AFTER JANUARY 1, 2004, THE FIRST SEVENTY­FIVE THOUSAND DOLLARS OF THE ACTUAL VALUE OR AN AMOUNT EQUAL TO FIFTY PERCENT OF THE ACTUAL VALUE, WHICHEVER IS LESS.

SECTION 5.  39­5­122 (2), Colorado Revised Statutes, is amended to read:

39­5­122.  Taxpayer's remedies to correct errors. (2)  If any person is of the opinion that his OR HER property has been valued too high, or has been twice valued, or is exempt by law from taxation or that property has been erroneously assessed to him OR HER, he OR SHE may appear before the assessor and object, he OR SHE may complete the form mailed with his OR HER notice of valuation pursuant to section 39­5­121 (1) or (1.5), or he OR SHE may file a written letter of objection and protest by mail with the assessor's office before the last day specified in the notice, stating in general terms the reason for the objection and protest. Reasons for the objection and protest may include, but shall not be limited to, the installation and operation of surface equipment relating to oil and gas wells on agricultural land. Any change or adjustment of any ratio of valuation for assessment for residential real property pursuant to the provisions of section 39­1­104.2 shall not constitute grounds for such objection. If the form initiating an appeal or the written letter of objection and protest is filed by mail, it shall be presumed that it was received as of the day it was postmarked. If the form initiating an appeal or the written letter of objection and protest is hand­delivered, the date it was received by the assessor shall be stamped on the form or letter. As stated in the public notice given by the assessor pursuant to subsection (1) of this section, if the taxpayer notifies the assessor of his OR HER objection and protest to the adjustment in valuation by mail, such notification shall be postmarked by May 27 in the case of real property and June 30 in the case of personal property. If the taxpayer notifies the assessor in person, such notice shall be given by June 1 in the case of real property and July 5 in the case of personal property. All such forms and letters received from protesters shall be presumed to be on time unless the assessor can present evidence to show otherwise. The county shall not prescribe the written form of objection and protest to be used. The protester shall have the opportunity on the days specified in the public notice to present his OR HER objection by mail or protest in person and be heard, whether or not there has been a change in valuation of such property from the previous year and whether or not any change is the result of a determination by the assessor for the current year or by the state board of equalization for the previous year. If the assessor finds any valuation to be erroneous or otherwise improper, he OR SHE shall correct such error, but, if he OR SHE declines to change any valuation which he OR SHE has determined, he OR SHE shall state his OR HER reasons in writing on the form described in section 39­8­106, shall insert the information otherwise required by the form, and shall, on or before the last regular working day of the assessor in June in the case of real property and July 10 in the case of personal property, mail two copies of such completed form to the person presenting the objection and protest so denied.

SECTION 6.  39­10­114 (1) (a) (I) (C), Colorado Revised Statutes, is amended to read:

39­10­114.  Abatement, cancellation of taxes ­ repeal. (1) (a) (I) (C)  The change or adjustment of any ratio of valuation for assessment for residential real property pursuant to the provisions of section 39­1­104.2 shall not constitute grounds for abatement of taxes as provided in sub­subparagraph (A) of this subparagraph (I). THIS SUB­SUBPARAGRAPH (C) IS REPEALED, EFFECTIVE JULY 1, 2000.

SECTION 7.  39­1­104.2, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SUBSECTION to read:

39­1­104.2.  Legislative declaration ­ adjustment of residential rate ­ repeal. (8)  THIS SECTION IS REPEALED, EFFECTIVE JULY 1, 2000.

SECTION 8.  Effective date.  This act shall take effect following proclamation by the governor of the vote of the registered electors at the 1998 general election approving House Concurrent Resolution 98­____. This act shall not take effect if the registered electors at the 1998 general election disapprove House Concurrent Resolution 98­____.

SECTION 9.  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.