Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 97 Third Substitute (2015GS)

Sponsor

Sen. Osmond, A.

Final action

Governor Signed 3/27/2015

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• defines terms;
• creates the Minimum Basic Growth Account;
• amends the calculation of the school minimum basic tax rate;
• requires a certain amount of revenue collected from the minimum basic tax rate to be deposited into the Minimum Basic Growth Account;
• distributes money deposited into the Minimum Basic Growth Account to the Capital Outlay Foundation Program and the Capital Outlay Enrollment Growth Program; and
• makes technical changes.

Every vote on this bill

Bill text

PROPERTY TAX EQUALIZATION AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Aaron Osmond
House Sponsor: 
____________
LONG TITLE
General Description:
This bill makes changes related to school property taxes and funding.
Highlighted Provisions:
This bill:
▸ defines terms;
▸ creates the Minimum Basic Growth Account;
▸ amends the calculation of the school minimum basic tax rate;
▸ requires a certain amount of revenue collected from the minimum basic tax rate to
be deposited into the Minimum Basic Growth Account;
▸ distributes money deposited into the Minimum Basic Growth Account to the
Capital Outlay Foundation Program and the Capital Outlay Enrollment Growth
Program; and
▸ makes technical changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides for retrospective operation.
Utah Code Sections Affected:
AMENDS:
11-13-302
, as last amended by Laws of Utah 2011, Chapter 371
53A-17a-103
, as last amended by Laws of Utah 2014, Chapter 389
53A-17a-135
, as last amended by Laws of Utah 2014, Chapter 4
59-2-102
, as last amended by Laws of Utah 2014, Chapters 65 and 411
59-2-926
, as last amended by Laws of Utah 2009, Chapter 388
ENACTS:
53A-17a-135.1
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
11-13-302
 is amended to read:
11-13-302.
Payment of fee in lieu of ad valorem property tax by certain energy
suppliers -- Method of calculating -- Collection -- Extent of tax lien.
(1) (a) Each project entity created under this chapter that owns a project and that sells
any capacity, service, or other benefit from it to an energy supplier or suppliers whose tangible
property is not exempted by Utah Constitution Article XIII, Section 3, from the payment of ad
valorem property tax, shall pay an annual fee in lieu of ad valorem property tax as provided in
this section to each taxing jurisdiction within which the project or any part of it is located.
(b) For purposes of this section, "annual fee" means the annual fee described in
Subsection (1)(a) that is in lieu of ad valorem property tax.
(c) The requirement to pay an annual fee shall commence:
(i) with respect to each taxing jurisdiction that is a candidate receiving the benefit of
impact alleviation payments under contracts or determination orders provided for in Sections
11-13-305
 and 
11-13-306
, with the fiscal year of the candidate following the fiscal year of the
candidate in which the date of commercial operation of the last generating unit, other than any
generating unit providing additional project capacity, of the project occurs, or, in the case of
any facilities providing additional project capacity, with the fiscal year of the candidate
following the fiscal year of the candidate in which the date of commercial operation of the
generating unit providing the additional project capacity occurs; and
(ii) with respect to any taxing jurisdiction other than a taxing jurisdiction described in
Subsection (1)(c)(i), with the fiscal year of the taxing jurisdiction in which construction of the
project commences, or, in the case of facilities providing additional project capacity, with the
fiscal year of the taxing jurisdiction in which construction of those facilities commences.
(d) The requirement to pay an annual fee shall continue for the period of the useful life
of the project or facilities.
(2) (a) The annual fees due a school district shall be as provided in Subsection (2)(b)
because the ad valorem property tax imposed by a school district and authorized by the
Legislature represents both:
(i) a levy mandated by the state for the state minimum school program under Section
53A-17a-135
; and
(ii) local levies for capital outlay and other purposes under Sections 
53A-16-113
,
53A-17a-133
, and 
53A-17a-164
.
(b) The annual fees due a school district shall be as follows:
(i) the project entity shall pay to the school district an annual fee for the state minimum
school program at the rate imposed by the school district and authorized by the Legislature
under [
Subsection
] 
Section
53A-17a-135
[
(1)
]; and
(ii) for all other local property tax levies authorized to be imposed by a school district,
the project entity shall pay to the school district either:
(A) an annual fee; or
(B) impact alleviation payments under contracts or determination orders provided for
in Sections 
11-13-305
 and 
11-13-306
.
(3) (a) An annual fee due a taxing jurisdiction for a particular year shall be calculated
by multiplying the tax rate or rates of the jurisdiction for that year by the product obtained by
multiplying the fee base or value determined in accordance with Subsection (4) for that year of
the portion of the project located within the jurisdiction by the percentage of the project which
is used to produce the capacity, service, or other benefit sold to the energy supplier or suppliers.
(b) As used in this section, "tax rate," when applied in respect to a school district,
includes any assessment to be made by the school district under Subsection (2) or Section
63M-5-302
.
(c) There is to be credited against the annual fee due a taxing jurisdiction for each year,
an amount equal to the debt service, if any, payable in that year by the project entity on bonds,
the proceeds of which were used to provide public facilities and services for impact alleviation
in the taxing jurisdiction in accordance with Sections 
11-13-305
 and 
11-13-306
.
(d) The tax rate for the taxing jurisdiction for that year shall be computed so as to:
(i) take into account the fee base or value of the percentage of the project located
within the taxing jurisdiction determined in accordance with Subsection (4) used to produce the
capacity, service, or other benefit sold to the supplier or suppliers; and
(ii) reflect any credit to be given in that year.
(4) (a) Except as otherwise provided in this section, the annual fees required by this
section shall be paid, collected, and distributed to the taxing jurisdiction as if:
(i) the annual fees were ad valorem property taxes; and
(ii) the project were assessed at the same rate and upon the same measure of value as
taxable property in the state.
(b) (i) Notwithstanding Subsection (4)(a), for purposes of an annual fee required by
this section, the fee base of a project may be determined in accordance with an agreement
among:
(A) the project entity; and
(B) any county that:
(I) is due an annual fee from the project entity; and
(II) agrees to have the fee base of the project determined in accordance with the
agreement described in this Subsection (4).
(ii) The agreement described in Subsection (4)(b)(i):
(A) shall specify each year for which the fee base determined by the agreement shall be
used for purposes of an annual fee; and
(B) may not modify any provision of this chapter except the method by which the fee
base of a project is determined for purposes of an annual fee.
(iii) For purposes of an annual fee imposed by a taxing jurisdiction within a county
described in Subsection (4)(b)(i)(B), the fee base determined by the agreement described in
Subsection (4)(b)(i) shall be used for purposes of an annual fee imposed by that taxing
jurisdiction.
(iv) (A) If there is not agreement as to the fee base of a portion of a project for any
year, for purposes of an annual fee, the State Tax Commission shall determine the value of that
portion of the project for which there is not an agreement:
(I) for that year; and
(II) using the same measure of value as is used for taxable property in the state.
(B) The valuation required by Subsection (4)(b)(iv)(A) shall be made by the State Tax
Commission in accordance with rules made by the State Tax Commission.
(c) Payments of the annual fees shall be made from:
(i) the proceeds of bonds issued for the project; and
(ii) revenues derived by the project entity from the project.
(d) (i) The contracts of the project entity with the purchasers of the capacity, service, or
other benefits of the project whose tangible property is not exempted by Utah Constitution
Article XIII, Section 3, from the payment of ad valorem property tax shall require each
purchaser, whether or not located in the state, to pay, to the extent not otherwise provided for,
its share, determined in accordance with the terms of the contract, of these fees.
(ii) It is the responsibility of the project entity to enforce the obligations of the
purchasers.
(5) (a) The responsibility of the project entity to make payment of the annual fees is
limited to the extent that there is legally available to the project entity, from bond proceeds or
revenues, money to make these payments, and the obligation to make payments of the annual
fees is not otherwise a general obligation or liability of the project entity.
(b) No tax lien may attach upon any property or money of the project entity by virtue of
any failure to pay all or any part of an annual fee.
(c) The project entity or any purchaser may contest the validity of an annual fee to the
same extent as if the payment was a payment of the ad valorem property tax itself.
(d) The payments of an annual fee shall be reduced to the extent that any contest is
successful.
(6) (a) The annual fee described in Subsection (1):
(i) shall be paid by a public agency that:
(A) is not a project entity; and
(B) owns an interest in a facility providing additional project capacity if the interest is
otherwise exempt from taxation pursuant to Utah Constitution, Article XIII, Section 3; and
(ii) for a public agency described in Subsection (6)(a)(i), shall be calculated in
accordance with Subsection (6)(b).
(b) The annual fee required under Subsection (6)(a) shall be an amount equal to the tax
rate or rates of the applicable taxing jurisdiction multiplied by the product of the following:
(i) the fee base or value of the facility providing additional project capacity located
within the jurisdiction;
(ii) the percentage of the ownership interest of the public agency in the facility; and
(iii) the portion, expressed as a percentage, of the public agency's ownership interest
that is attributable to the capacity, service, or other benefit from the facility that is sold by the
public agency to an energy supplier or suppliers whose tangible property is not exempted by
Utah Constitution, Article XIII, Section 3, from the payment of ad valorem property tax.
(c) A public agency paying the annual fee pursuant to Subsection (6)(a) shall have the
obligations, credits, rights, and protections set forth in Subsections (1) through (5) with respect
to its ownership interest as though it were a project entity.
Section 2. Section 
53A-17a-103
 is amended to read:
53A-17a-103.
Definitions.
As used in this chapter:
(1) "Basic state-supported school program" or "basic program" means public education
programs for kindergarten, elementary, and secondary school students that are operated and
maintained for the amount derived by multiplying the number of weighted pupil units for each
school district or charter school by the value established each year in statute, except as
otherwise provided in this chapter.
(2) (a) "Certified revenue levy" means a property tax levy that provides an amount of
ad valorem property tax revenue equal to the sum of:
(i) the amount of ad valorem property tax revenue to be generated statewide in the
previous year from imposing a minimum basic tax rate, as specified in [
Subsection
] 
Section
53A-17a-135
[
(1)(a)
]; and
(ii) the product of:
(A) new growth, as defined in:
(I) Section 
59-2-924
; and
(II) rules of the State Tax Commission; and
(B) the minimum basic tax rate certified by the State Tax Commission for the previous
year.
(b) For purposes of this Subsection (2), "ad valorem property tax revenue" does not
include property tax revenue received statewide from personal property that is:
(i) assessed by a county assessor in accordance with Title 59, Chapter 2, Part 3, County
Assessment; and
(ii) semiconductor manufacturing equipment.
(c) For purposes of calculating the certified revenue levy described in this Subsection
(2), the State Tax Commission shall use:
(i) the taxable value of real property assessed by a county assessor contained on the
assessment roll;
(ii) the taxable value of real and personal property assessed by the State Tax
Commission; and
(iii) the taxable year end value of personal property assessed by a county assessor
contained on the prior year's assessment roll.
(3) "Pupil in average daily membership (ADM)" means a full-day equivalent pupil.
(4) (a) "State-supported minimum school program" or "Minimum School Program"
means public school programs for kindergarten, elementary, and secondary schools as
described in this Subsection (4).
(b) The minimum school program established in school districts and charter schools
shall include the equivalent of a school term of nine months as determined by the State Board
of Education.
(c) (i) The board shall establish the number of days or equivalent instructional hours
that school is held for an academic school year.
(ii) Education, enhanced by utilization of technologically enriched delivery systems,
when approved by local school boards or charter school governing boards, shall receive full
support by the State Board of Education as it pertains to fulfilling the attendance requirements,
excluding time spent viewing commercial advertising.
(d) (i) A local school board or charter school governing board may reallocate up to 32
instructional hours or 4 school days established under Subsection (4)(c) for teacher preparation
time or teacher professional development.
(ii) A reallocation of instructional hours or school days under Subsection (4)(d)(i) is
subject to the approval of two-thirds of the members of a local school board or charter school
governing board voting in a regularly scheduled meeting:
(A) at which a quorum of the local school board or charter school governing board is
present; and
(B) held in compliance with Title 52, Chapter 4, Open and Public Meetings Act.
(iii) If a local school board or charter school governing board reallocates instructional
hours or school days as provided by this Subsection (4)(d), the school district or charter school
shall notify students' parents and guardians of the school calendar at least 90 days before the
beginning of the school year.
(iv) Instructional hours or school days reallocated for teacher preparation time or
teacher professional development pursuant to this Subsection (4)(d) is considered part of a
school term referred to in Subsection (4)(b).
(e) The Minimum School Program includes a program or allocation funded by a line
item appropriation or other appropriation designated as follows:
(i) Basic School Program;
(ii) Related to Basic Programs;
(iii) Voted and Board Levy Programs; or
(iv) Minimum School Program.
(5) "Weighted pupil unit or units or WPU or WPUs" means the unit of measure of
factors that is computed in accordance with this chapter for the purpose of determining the
costs of a program on a uniform basis for each district.
Section 3. Section 
53A-17a-135
 is amended to read:
53A-17a-135.
Minimum basic tax rate -- Certified revenue levy.
(1) As used in this section, "basic levy increment rate" means:
(a) for each calendar year beginning with the calendar year that begins on January 1,
2015, and ending with the calendar year that ends on December 31, 2019, a rate equal to the
difference between:
(i) the minimum basic tax rate provided in Subsection (2); and
(ii) the certified revenue levy for the calendar year beginning on January 1, 2015; and
(b) for a calendar year beginning on or after January 1, 2020, a rate that will generate
an amount of revenue equal to $75,000,000.
[
(1)
] 
(2)
 (a) In order to qualify for receipt of the state contribution toward the basic
program and as its contribution toward its costs of the basic program, each school district shall
impose a minimum basic tax rate per dollar of taxable value [
that generates $296,709,700 in
revenues statewide
] 
in accordance with this section
.
[
(b) The preliminary estimate for the 2014-15 minimum basic tax rate is .001477.
]
[
(c) The State Tax Commission shall certify on or before June 22 the rate that
generates $296,709,700 in revenues statewide.
]
[
(d) If the minimum basic tax rate exceeds the certified revenue levy as defined in
Section 
53A-17a-103
, the state is subject to the notice requirements of Section 
59-2-926
.
]
(b) For each calendar year beginning with the calendar year that begins on January 1,
2015, and ending with the calendar year that ends on December 31, 2019, the minimum basic
tax rate is a rate that will generate an amount of revenue equal to the sum of:
(i) the amount of revenue that would be generated statewide by imposing the certified
revenue levy for that taxable year; and
(ii) $15,000,000.
(c) For a calendar year beginning on or after January 1, 2020, the minimum basic tax
rate is a rate that will generate an amount of revenue equal to the amount of revenue that would
be generated statewide by imposing the certified revenue levy for that taxable year.
[
(2)
] 
(3)
 (a) The state shall contribute to each district toward the cost of the basic
program in the district that portion [
which
] 
that
 exceeds the proceeds of [
the levy authorized
under Subsection (1).
] 
the difference between:
(i) the minimum basic rate to be imposed under Subsection (2); and
(ii) the basic levy increment rate.
(b) In accord with the state strategic plan for public education and to fulfill its
responsibility for the development and implementation of that plan, the Legislature instructs
the State Board of Education, the governor, and the Office of Legislative Fiscal Analyst in each
of the coming five years to develop budgets that will fully fund student enrollment growth.
[
(3)
] 
(4)
 (a) If the [
proceeds of the levy authorized under Subsection (1) equal or
exceed
] 
difference described in Subsection (3)(a) equals or exceeds
 the cost of the basic
program in a school district, no state contribution shall be made to the basic program.
(b) The proceeds of the [
levy authorized under Subsection (1) which
] 
difference
described in Subsection (3)(a) that
 exceed the cost of the basic program shall be paid into the
Uniform School Fund as provided by law.
(5) The State Board of Education shall:
(a) deduct from state funds that a school district is authorized to receive under this
chapter an amount equal to the proceeds generated within the school district by the basic levy
increment rate; and
(b) deposit the money described in Subsection (5)(a) into the Minimum Basic Growth
Account created in Section 
53A-17a-135.1
.
Section 4. Section 
53A-17a-135.1
 is enacted to read:
 53A-17a-135.1.
Minimum Basic Growth Account.
(1) As used in this section, "account" means the Minimum Basic Growth Account
created in this section.
(2) There is created within the Education Fund a restricted account known as the
"Minimum Basic Growth Account."
(3) The account shall be funded by amounts appropriated into the account in
accordance with Section 
53A-17a-135
.
(4) The account shall earn interest.
(5) Interest earned on the account shall be deposited into the account.
(6) Upon appropriation by the Legislature:
(a) 25% of the money from the account shall be used to fund the Capital Outlay
Foundation Program as provided in Chapter 21, Part 2, Capital Outlay Foundation Program;
and
(b) 75% of the money from the account shall be used to fund the Capital Outlay
Enrollment Growth Program as provided in Chapter 21, Part 3, Capital Outlay Enrollment
Growth Program.
Section 5. Section 
59-2-102
 is amended to read:
59-2-102.
Definitions.
As used in this chapter and title:
(1) "Aerial applicator" means aircraft or rotorcraft used exclusively for the purpose of
engaging in dispensing activities directly affecting agriculture or horticulture with an
airworthiness certificate from the Federal Aviation Administration certifying the aircraft or
rotorcraft's use for agricultural and pest control purposes.
(2) "Air charter service" means an air carrier operation which requires the customer to
hire an entire aircraft rather than book passage in whatever capacity is available on a scheduled
trip.
(3) "Air contract service" means an air carrier operation available only to customers
who engage the services of the carrier through a contractual agreement and excess capacity on
any trip and is not available to the public at large.
(4) "Aircraft" is as defined in Section 
72-10-102
.
(5) (a) Except as provided in Subsection (5)(b), "airline" means an air carrier that:
(i) operates:
(A) on an interstate route; and
(B) on a scheduled basis; and
(ii) offers to fly one or more passengers or cargo on the basis of available capacity on a
regularly scheduled route.
(b) "Airline" does not include an:
(i) air charter service; or
(ii) air contract service.
(6) "Assessment roll" means a permanent record of the assessment of property as
assessed by the county assessor and the commission and may be maintained manually or as a
computerized file as a consolidated record or as multiple records by type, classification, or
categories.
(7) (a) "Certified revenue levy" means a property tax levy that provides an amount of
ad valorem property tax revenue equal to the sum of:
(i) the amount of ad valorem property tax revenue to be generated statewide in the
previous year from imposing a school minimum basic tax rate, as specified in [
Subsection
]
Section
53A-17a-135
[
(1)(a)
], or multicounty assessing and collecting levy, as specified in
Section 
59-2-1602
; and
(ii) the product of:
(A) new growth, as defined in:
(I) Section 
59-2-924
; and
(II) rules of the commission; and
(B) the school minimum basic tax rate or multicounty assessing and collecting levy
certified by the commission for the previous year.
(b) For purposes of this Subsection (7), "ad valorem property tax revenue" does not
include property tax revenue received by a taxing entity from personal property that is:
(i) assessed by a county assessor in accordance with Part 3, County Assessment; and
(ii) semiconductor manufacturing equipment.
(c) For purposes of calculating the certified revenue levy described in this Subsection
(7), the commission shall use:
(i) the taxable value of real property assessed by a county assessor contained on the
assessment roll;
(ii) the taxable value of real and personal property assessed by the commission; and
(iii) the taxable year end value of personal property assessed by a county assessor
contained on the prior year's assessment roll.
(8) "County-assessed commercial vehicle" means:
(a) any commercial vehicle, trailer, or semitrailer which is not apportioned under
Section 
41-1a-301
 and is not operated interstate to transport the vehicle owner's goods or
property in furtherance of the owner's commercial enterprise;
(b) any passenger vehicle owned by a business and used by its employees for
transportation as a company car or vanpool vehicle; and
(c) vehicles that are:
(i) especially constructed for towing or wrecking, and that are not otherwise used to
transport goods, merchandise, or people for compensation;
(ii) used or licensed as taxicabs or limousines;
(iii) used as rental passenger cars, travel trailers, or motor homes;
(iv) used or licensed in this state for use as ambulances or hearses;
(v) especially designed and used for garbage and rubbish collection; or
(vi) used exclusively to transport students or their instructors to or from any private,
public, or religious school or school activities.
(9) (a) Except as provided in Subsection (9)(b), for purposes of Section 
59-2-801
,
"designated tax area" means a tax area created by the overlapping boundaries of only the
following taxing entities:
(i) a county; and
(ii) a school district.
(b) Notwithstanding Subsection (9)(a), "designated tax area" includes a tax area created
by the overlapping boundaries of:
(i) the taxing entities described in Subsection (9)(a); and
(ii) (A) a city or town if the boundaries of the school district under Subsection (9)(a)
and the boundaries of the city or town are identical; or
(B) a special service district if the boundaries of the school district under Subsection
(9)(a) are located entirely within the special service district.
(10) "Eligible judgment" means a final and unappealable judgment or order under
Section 
59-2-1330
:
(a) that became a final and unappealable judgment or order no more than 14 months
prior to the day on which the notice required by Section 
59-2-919.1
 is required to be mailed;
and
(b) for which a taxing entity's share of the final and unappealable judgment or order is
greater than or equal to the lesser of:
(i) $5,000; or
(ii) 2.5% of the total ad valorem property taxes collected by the taxing entity in the
previous fiscal year.
(11) (a) "Escaped property" means any property, whether personal, land, or any
improvements to the property, subject to taxation and is:
(i) inadvertently omitted from the tax rolls, assigned to the incorrect parcel, or assessed
to the wrong taxpayer by the assessing authority;
(ii) undervalued or omitted from the tax rolls because of the failure of the taxpayer to
comply with the reporting requirements of this chapter; or
(iii) undervalued because of errors made by the assessing authority based upon
incomplete or erroneous information furnished by the taxpayer.
(b) Property that is undervalued because of the use of a different valuation
methodology or because of a different application of the same valuation methodology is not
"escaped property."
(12) "Fair market value" means the amount at which property would change hands
between a willing buyer and a willing seller, neither being under any compulsion to buy or sell
and both having reasonable knowledge of the relevant facts. For purposes of taxation, "fair
market value" shall be determined using the current zoning laws applicable to the property in
question, except in cases where there is a reasonable probability of a change in the zoning laws
affecting that property in the tax year in question and the change would have an appreciable
influence upon the value.
(13) "Farm machinery and equipment," for purposes of the exemption provided under
Section 
59-2-1101
, means tractors, milking equipment and storage and cooling facilities, feed
handling equipment, irrigation equipment, harvesters, choppers, grain drills and planters, tillage
tools, scales, combines, spreaders, sprayers, haying equipment, including balers and cubers,
and any other machinery or equipment used primarily for agricultural purposes; but does not
include vehicles required to be registered with the Motor Vehicle Division or vehicles or other
equipment used for business purposes other than farming.
(14) "Geothermal fluid" means water in any form at temperatures greater than 120
degrees centigrade naturally present in a geothermal system.
(15) "Geothermal resource" means:
(a) the natural heat of the earth at temperatures greater than 120 degrees centigrade;
and
(b) the energy, in whatever form, including pressure, present in, resulting from, created
by, or which may be extracted from that natural heat, directly or through a material medium.
(16) (a) "Goodwill" means:
(i) acquired goodwill that is reported as goodwill on the books and records:
(A) of a taxpayer; and
(B) that are maintained for financial reporting purposes; or
(ii) the ability of a business to:
(A) generate income:
(I) that exceeds a normal rate of return on assets; and
(II) resulting from a factor described in Subsection (16)(b); or
(B) obtain an economic or competitive advantage resulting from a factor described in
Subsection (16)(b).
(b) The following factors apply to Subsection (16)(a)(ii):
(i) superior management skills;
(ii) reputation;
(iii) customer relationships;
(iv) patronage; or
(v) a factor similar to Subsections (16)(b)(i) through (iv).
(c) "Goodwill" does not include:
(i) the intangible property described in Subsection (20)(a) or (b);
(ii) locational attributes of real property, including:
(A) zoning;
(B) location;
(C) view;
(D) a geographic feature;
(E) an easement;
(F) a covenant;
(G) proximity to raw materials;
(H) the condition of surrounding property; or
(I) proximity to markets;
(iii) value attributable to the identification of an improvement to real property,
including:
(A) reputation of the designer, builder, or architect of the improvement;
(B) a name given to, or associated with, the improvement; or
(C) the historic significance of an improvement; or
(iv) the enhancement or assemblage value specifically attributable to the interrelation
of the existing tangible property in place working together as a unit.
(17) "Governing body" means:
(a) for a county, city, or town, the legislative body of the county, city, or town;
(b) for a local district under Title 17B, Limited Purpose Local Government Entities -
Local Districts, the local district's board of trustees;
(c) for a school district, the local board of education; or
(d) for a special service district under Title 17D, Chapter 1, Special Service District
Act:
(i) the legislative body of the county or municipality that created the special service
district, to the extent that the county or municipal legislative body has not delegated authority
to an administrative control board established under Section 
17D-1-301
; or
(ii) the administrative control board, to the extent that the county or municipal
legislative body has delegated authority to an administrative control board established under
Section 
17D-1-301
.
(18) (a) For purposes of Section 
59-2-103
:
(i) "household" means the association of persons who live in the same dwelling,
sharing its furnishings, facilities, accommodations, and expenses; and
(ii) "household" includes married individuals, who are not legally separated, that have
established domiciles at separate locations within the state.
(b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may make rules defining the term "domicile."
(19) (a) Except as provided in Subsection (19)(c), "improvement" means a building,
structure, fixture, fence, or other item that is permanently attached to land, regardless of
whether the title has been acquired to the land, if:
(i) (A) attachment to land is essential to the operation or use of the item; and
(B) the manner of attachment to land suggests that the item will remain attached to the
land in the same place over the useful life of the item; or
(ii) removal of the item would:
(A) cause substantial damage to the item; or
(B) require substantial alteration or repair of a structure to which the item is attached.
(b) "Improvement" includes:
(i) an accessory to an item described in Subsection (19)(a) if the accessory is:
(A) essential to the operation of the item described in Subsection (19)(a); and
(B) installed solely to serve the operation of the item described in Subsection (19)(a);
and
(ii) an item described in Subsection (19)(a) that:
(A) is temporarily detached from the land for repairs; and
(B) remains located on the land.
(c) Notwithstanding Subsections (19)(a) and (b), "improvement" does not include:
(i) an item considered to be personal property pursuant to rules made in accordance
with Section 
59-2-107
;
(ii) a moveable item that is attached to land:
(A) for stability only; or
(B) for an obvious temporary purpose;
(iii) (A) manufacturing equipment and machinery; or
(B) essential accessories to manufacturing equipment and machinery;
(iv) an item attached to the land in a manner that facilitates removal without substantial
damage to:
(A) the land; or
(B) the item; or
(v) a transportable factory-built housing unit as defined in Section 
59-2-1502
 if that
transportable factory-built housing unit is considered to be personal property under Section
59-2-1503
.
(20) "Intangible property" means:
(a) property that is capable of private ownership separate from tangible property,
including:
(i) money;
(ii) credits;
(iii) bonds;
(iv) stocks;
(v) representative property;
(vi) franchises;
(vii) licenses;
(viii) trade names;
(ix) copyrights; and
(x) patents;
(b) a low-income housing tax credit;
(c) goodwill; or
(d) a renewable energy tax credit or incentive, including:
(i) a federal renewable energy production tax credit under Section 45, Internal Revenue
Code;
(ii) a federal energy credit for qualified renewable electricity production facilities under
Section 48, Internal Revenue Code;
(iii) a federal grant for a renewable energy property under American Recovery and
Reinvestment Act of 2009, Pub. L. No. 111-5, Section 1603; and
(iv) a tax credit under Subsection 
59-7-614
(2)(c).
(21) "Livestock" means:
(a) a domestic animal;
(b) a fur-bearing animal;
(c) a honeybee; or
(d) poultry.
(22) "Low-income housing tax credit" means:
(a) a federal low-income housing tax credit under Section 42, Internal Revenue Code;
or
(b) a low-income housing tax credit under:
(i) Section 
59-7-607
; or
(ii) Section 
59-10-1010
.
(23) "Metalliferous minerals" includes gold, silver, copper, lead, zinc, and uranium.
(24) "Mine" means a natural deposit of either metalliferous or nonmetalliferous
valuable mineral.
(25) "Mining" means the process of producing, extracting, leaching, evaporating, or
otherwise removing a mineral from a mine.
(26) (a) "Mobile flight equipment" means tangible personal property that is:
(i) owned or operated by an:
(A) air charter service;
(B) air contract service; or
(C) airline; and
(ii) (A) capable of flight;
(B) attached to an aircraft that is capable of flight; or
(C) contained in an aircraft that is capable of flight if the tangible personal property is
intended to be used:
(I) during multiple flights;
(II) during a takeoff, flight, or landing; and
(III) as a service provided by an air charter service, air contract service, or airline.
(b) (i) "Mobile flight equipment" does not include a spare part other than a spare
engine that is rotated:
(A) at regular intervals; and
(B) with an engine that is attached to the aircraft.
(ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may make rules defining the term "regular intervals."
(27) "Nonmetalliferous minerals" includes, but is not limited to, oil, gas, coal, salts,
sand, rock, gravel, and all carboniferous materials.
(28) "Part-year residential property" means property that is not residential property on
January 1 of a calendar year but becomes residential property after January 1 of the calendar
year.
(29) "Personal property" includes:
(a) every class of property as defined in Subsection (30) that is the subject of
ownership and not included within the meaning of the terms "real estate" and "improvements";
(b) gas and water mains and pipes laid in roads, streets, or alleys;
(c) bridges and ferries;
(d) livestock; and
(e) outdoor advertising structures as defined in Section 
72-7-502
.
(30) (a) "Property" means property that is subject to assessment and taxation according
to its value.
(b) "Property" does not include intangible property as defined in this section.
(31) "Public utility," for purposes of this chapter, means the operating property of a
railroad, gas corporation, oil or gas transportation or pipeline company, coal slurry pipeline
company, electrical corporation, telephone corporation, sewerage corporation, or heat
corporation where the company performs the service for, or delivers the commodity to, the
public generally or companies serving the public generally, or in the case of a gas corporation
or an electrical corporation, where the gas or electricity is sold or furnished to any member or
consumers within the state for domestic, commercial, or industrial use. Public utility also
means the operating property of any entity or person defined under Section 
54-2-1
 except water
corporations.
(32) (a) Subject to Subsection (32)(b), "qualifying exempt primary residential rental
personal property" means household furnishings, furniture, and equipment that:
(i) are used exclusively within a dwelling unit that is the primary residence of a tenant;
(ii) are owned by the owner of the dwelling unit that is the primary residence of a
tenant; and
(iii) after applying the residential exemption described in Section 
59-2-103
, are exempt
from taxation under this chapter in accordance with Subsection 
59-2-1115
(2).
(b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may by rule define the term "dwelling unit" for purposes of this Subsection (32)
and Subsection (35).
(33) "Real estate" or "real property" includes:
(a) the possession of, claim to, ownership of, or right to the possession of land;
(b) all mines, minerals, and quarries in and under the land, all timber belonging to
individuals or corporations growing or being on the lands of this state or the United States, and
all rights and privileges appertaining to these; and
(c) improvements.
(34) "Relationship with an owner of the property's land surface rights" means a
relationship described in Subsection 267(b), Internal Revenue Code:
(a) except that notwithstanding Subsection 267(b), Internal Revenue Code, the term
25% shall be substituted for the term 50% in Subsection 267(b), Internal Revenue Code; and
(b) using the ownership rules of Subsection 267(c), Internal Revenue Code, for
determining the ownership of stock.
(35) (a) Subject to Subsection (35)(b), "residential property," for the purposes of the
reductions and adjustments under this chapter, means any property used for residential
purposes as a primary residence.
(b) Subject to Subsection (35)(c), "residential property":
(i) except as provided in Subsection (35)(b)(ii), includes household furnishings,
furniture, and equipment if the household furnishings, furniture, and equipment are:
(A) used exclusively within a dwelling unit that is the primary residence of a tenant;
and
(B) owned by the owner of the dwelling unit that is the primary residence of a tenant;
and
(ii) does not include property used for transient residential use.
(c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may by rule define the term "dwelling unit" for purposes of Subsection (32) and
this Subsection (35).
(36) "Split estate mineral rights owner" means a person who:
(a) has a legal right to extract a mineral from property;
(b) does not hold more than a 25% interest in:
(i) the land surface rights of the property where the wellhead is located; or
(ii) an entity with an ownership interest in the land surface rights of the property where
the wellhead is located;
(c) is not an entity in which the owner of the land surface rights of the property where
the wellhead is located holds more than a 25% interest; and
(d) does not have a relationship with an owner of the land surface rights of the property
where the wellhead is located.
(37) (a) "State-assessed commercial vehicle" means:
(i) any commercial vehicle, trailer, or semitrailer which operates interstate or intrastate
to transport passengers, freight, merchandise, or other property for hire; or
(ii) any commercial vehicle, trailer, or semitrailer which operates interstate and
transports the vehicle owner's goods or property in furtherance of the owner's commercial
enterprise.
(b) "State-assessed commercial vehicle" does not include vehicles used for hire which
are specified in Subsection (8)(c) as county-assessed commercial vehicles.
(38) "Taxable value" means fair market value less any applicable reduction allowed for
residential property under Section 
59-2-103
.
(39) "Tax area" means a geographic area created by the overlapping boundaries of one
or more taxing entities.
(40) "Taxing entity" means any county, city, town, school district, special taxing
district, local district under Title 17B, Limited Purpose Local Government Entities - Local
Districts, or other political subdivision of the state with the authority to levy a tax on property.
(41) "Tax roll" means a permanent record of the taxes charged on property, as extended
on the assessment roll and may be maintained on the same record or records as the assessment
roll or may be maintained on a separate record properly indexed to the assessment roll. It
includes tax books, tax lists, and other similar materials.
Section 6. Section 
59-2-926
 is amended to read:
59-2-926.
Proposed tax increase by state -- Notice -- Contents -- Dates.
If the state authorizes a levy pursuant to [
Section 
53A-17a-135
 that exceeds the
certified revenue levy as defined in Section 
53A-17a-103
 or authorizes a levy pursuant to
]
Section 
59-2-1602
 that exceeds the certified revenue levy as defined in Section 
59-2-102
, the
state shall publish a notice no later than 10 days after the last day of the annual legislative
general session that meets the following requirements:
(1) (a) The Office of the Legislative Fiscal Analyst shall advertise that the state
authorized a levy that generates revenue in excess of the previous year's ad valorem tax
revenue, plus new growth, but exclusive of revenue from collections from redemptions,
interest, and penalties:
(i) in a newspaper of general circulation in the state; and
(ii) as required in Section 
45-1-101
.
(b) Except an advertisement published on a website, the advertisement described in
Subsection (1)(a):
(i) shall be no less than 1/4 page in size and the type used shall be no smaller than 18
point, and surrounded by a 1/4-inch border:
(ii) may not be placed in that portion of the newspaper where legal notices and
classified advertisements appear; and
(iii) shall be run once.
(2) The form and content of the notice shall be substantially as follows:
"NOTICE OF TAX INCREASE
The state has budgeted an increase in its property tax revenue from $__________ to
$__________ or ____%. The increase in property tax revenues will come from the following
sources (include all of the following provisions):
(a) $__________ of the increase will come from (provide an explanation of the cause
of adjustment or increased revenues, such as reappraisals or factoring orders);
(b) $__________ of the increase will come from natural increases in the value of the
tax base due to (explain cause of new growth, such as new building activity, annexation, etc.);
(c) a home valued at $100,000 in the state of Utah
,
 which based on last year's [
(levy for
the basic state-supported school program,
] levy for the Property Tax Valuation Agency Fund[
,
or both)
] paid $____________ in property taxes
,
 would pay the following:
(i) $__________ if the state of Utah did not budget an increase in property tax revenue
exclusive of new growth; and
(ii) $__________ under the increased property tax revenues exclusive of new growth
budgeted by the state of Utah."
Section 7. 
Retrospective operation.
This bill has retrospective operation to January 1, 2015.
Legislative Review Note
 as of 9-17-14 2:26 PM
Office of Legislative Research and General Counsel