(1)The general
assembly hereby finds and declares that it is a matter of statewide concern that
revenues from property taxes on newly constructed buildings may need to be put to
special use in order to accommodate the capital needs resulting from such new
construction, especially to accommodate the capital needs of the public schools in
this state. The general assembly further declares that it is essential that such
revenue be available as soon as possible after the time such new construction is put
to use. The general assembly further finds and declares that the board of county
commissioners is the appropriate governmental unit to determine the extent of the
growth within the county and the finding of severe growth impact shall be at the
sole discretion of the board.
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(1) The general
assembly hereby finds and declares that it is a matter of statewide concern that
revenues from property taxes on newly constructed buildings may need to be put to
special use in order to accommodate the capital needs resulting from such new
construction, especially to accommodate the capital needs of the public schools in
this state. The general assembly further declares that it is essential that such
revenue be available as soon as possible after the time such new construction is put
to use. The general assembly further finds and declares that the board of county
commissioners is the appropriate governmental unit to determine the extent of the
growth within the county and the finding of severe growth impact shall be at the
sole discretion of the board.
(2) (a) (I) (A) If the board of county commissioners determines that a county is
becoming severely impacted by residential growth, the board of county
commissioners shall make a finding of severe growth impact based upon the rate of
increase in the county of the number of residential units being constructed within
the county and an increase in pupil enrollment in school districts within the county
such that at least one school district in the county meets the growth criteria
described in sub-subparagraph (E) of this subparagraph (I), and other factors which
indicate patterns of growth and growth impact, and shall, on or before January 1,
resolve to implement the assessment and levy procedures required under this
section. When a board of county commissioners makes such resolution, the
provisions of this section shall apply countywide notwithstanding any law to the
contrary. The board of county commissioners shall not make a finding of severe
growth impact unless the number of residential units in the county will increase by
over two percent during the county's current fiscal year. The board of county
commissioners may negotiate with taxing authorities in the county to provide the
costs of implementing the assessment and levy procedures required under this
section. Notwithstanding any other provision of law to the contrary, any such taxing
authority is hereby authorized to use moneys from its general fund to provide the
costs specified in this subparagraph (I) and to deposit any moneys received as
reimbursement pursuant to subsection (4) of this section into its general fund.
(B) Whenever construction occurs on any new taxable building within the
boundaries of a county after January 1 of a given year, the assessor shall value the
building on July 1 of that year, and the assessor shall add the valuation for
assessment thereof to the abstract of assessment for such tax year, except that
portion of the valuation for assessment as is excluded by paragraph (b) of this
subsection (2). If the building is complete on July 1, such valuation for assessment
shall be prorated at the same ratio as the number of months it is completed bears
to the full year. Otherwise, the valuation added to the abstract shall be one-half of
the difference between the valuation for assessment on January 1 and the valuation
for assessment on July 1. For the purposes of this section, the total valuation for
assessment of all newly constructed taxable buildings in a county as calculated
pursuant to this subsection (2) shall be known as the growth valuation for
assessment for such county. For purposes of this section, completion shall be
considered to be when a certificate of occupancy is issued, when the building is
ready for use, or after the final inspection, at the sole discretion of the county
assessor. As used in this section, building means a roofed and walled real
property improvement, and any uncertainty concerning whether or not a particular
real property improvement is a building within the meaning of this definition shall
be resolved by the property tax administrator.
(C) The assessor shall give written notification of the valuation of such newly
constructed taxable building to the taxpayer. The notice shall, at a minimum, set
forth the valuation on the assessment date, the prorated valuation of the newly
constructed taxable building, and the total valuation for the property tax year. The
notice shall also advise the taxpayer that he may protest and appeal the valuation
of the newly constructed taxable building at the same time and in the same manner,
pursuant to section 39-5-122, as the total valuation of his property for the next
property tax year may be appealed. If the taxpayer is successful in the protest or
appeal, the amount in excess shall be refunded directly to the taxpayer by the
county treasurer.
(D) In order to promote the most efficient administration of this section, each
county or municipality shall ensure that any office or agency that received
information relative to the state of completion of new taxable buildings shall
promptly transmit such information to the county assessor. After January 1, 1987,
the property tax administrator shall transmit to the assessor in August of each year
both the assessed value of any newly constructed buildings owned by public utility
companies and their state of completion on July 1 as well as their value on the
previous January 1.
(E) The growth criteria for school districts for purposes of sub-subparagraph
(A) of this subparagraph (I) shall be whether the commissioner of education or the
commissioner's designee certifies that the pupil enrollment of the district for the
past three years, as determined on October 1 of each year in accordance with
former section 22-53-103 (7) or section 22-54-103 (10), has increased by three
percent or more over each preceding year for those districts with pupil enrollments
of at least one thousand pupils or by twenty-five or more pupils each year for those
districts with pupil enrollments of less than one thousand pupils.
(II) All general property taxes which are levied on all other taxable real and
personal property within a county in the tax year during which such construction
occurs shall also be levied against the growth valuation for assessment of such
county for collection the following year. Revenues raised from taxes levied on such
growth valuation for assessment shall be credited to the county's capital growth
fund, which each board of county commissioners shall establish, for use and
distribution pursuant to subsection (4) of this section. The actual value and
valuation for assessment of such newly constructed taxable building for
subsequent years shall be the actual value and valuation for assessment as
determined by the provisions of law other than this section, and tax revenues
attributable thereto shall be distributed as provided by law without regard to this
section.
(b) The provisions of this section shall not apply to that portion of the
valuation for assessment of a newly constructed taxable building and the land
underlying such building which is contained in the abstract of assessment on the
assessment date.
(c) If the newly constructed taxable building is a residential unit, the
assessment percentage to be applied to the land underlying such building shall be
based on a residential classification of the land. If the land underlying such building
was classified as vacant land, the classification shall be changed to residential on
the abstract of assessment for the tax year in which the assessor added the
valuation of the newly taxable residential building to the abstract for assessment.
(3) By August 25 of each year, the assessor shall notify the board of county
commissioners of the amount of the growth valuation for assessment of the county
for that tax year, the percentage that such growth valuation for assessment bears
to the total valuation for assessment of the county for such tax year, the portion of
such growth valuation for assessment that is attributable to newly constructed
taxable buildings within the boundaries of each taxing authority in the county, and
the percentage that such portion bears to the total valuation for assessment of
each taxing authority in which such newly constructed taxable buildings are
located.
(4) Upon collection of taxes on the growth valuation for assessment in the
first year, the board of county commissioners shall reimburse the county general
fund and the taxing authorities which contributed to the costs of implementing the
procedures specified pursuant to this section and shall also pay into the county
general fund the projected budgeted costs of implementation in this second year.
The remaining moneys shall be distributed to the taxing authorities as next
specified in this subsection (4). In the second and subsequent years that procedures
are implemented pursuant to this section, the board of county commissioners, after
depositing into the county general fund the projected budgeted costs of
administering this section in the current year, shall distribute the moneys in the
county's capital growth fund to the taxing authorities where the newly constructed
taxable building is actually located in the same manner as all other property tax
revenues collected on similar taxable buildings are distributed; except that such
moneys shall be used by the taxing authority for capital expenditures only and not
for operating expenses. Every taxing authority receiving funds pursuant to this
subsection (4) shall make capital expenditures so that they benefit the taxing
authority within the county levying on the growth valuation for assessment
pursuant to this section, unless such governing body finds a compelling reason for
making expenditures so that they benefit the taxing authority within another
county.
(5) Money received by a school district pursuant to this section must be
deposited in the district's capital reserve fund and must not be included in
calculating the amount of revenue that a district is entitled to receive from the
property tax levy for the general fund of the district under the Public School
Finance Act of 2025, article 54 of title 22.
(6) When the board of county commissioners determines that a county is no
longer being severely impacted by residential growth, the board of county
commissioners shall so find and shall, on or before January 1, resolve to end
implementation of the assessment and levy procedures required under this section.
(7) Nothing in this section affects tax increment financing implemented
pursuant to sections 31-25-107 (9), 30-31-109 (13), and 31-25-807 (3), nor the
distribution of specific ownership taxes pursuant to section 42-3-107 (24).