ASSEMBLY SUBSTITUTE AMENDMENT 1, TO ASSEMBLY BILL 2

February 10, 2021 - Offered by Joint Committee on Finance.

AB2-ASA1,2,16 An Act to repeal 71.01 (6) (c), (d), (e), (f), (g), (h) and (i), 71.05 (1) (ae), 71.05 (6) (b) 17. and 18., 71.05 (6) (b) 20., 36., 37., 39., 40. and 41., 71.22 (4) (c), (d), (e), (f), (g), (h) and (i), 71.22 (4m) (c), (d), (e), (f), (g), (h) and (i), 71.26 (2) (b) 3., 4., 5., 6., 7., 8. and 9., 71.34 (1g) (c), (d), (e), (f), (g), (h) and (i), 71.42 (2) (c), (d), (e), (f), (g), (h) and (i), 77.51 (13gm) (a) 1. and 2., 77.51 (13gm) (d) 1. and 77.51 (13gm) (d) 3. and 4.; to renumber and amend 71.05 (6) (b) 4., 71.76 and 77.51 (13gm) (a) (intro.); to amend 48.561 (3) (a) 3., 48.561 (3) (b), 59.25 (3) (i), 66.0602 (3) (h) 2. a., 66.0602 (6) (a), 66.0602 (6) (b), 66.1105 (6m) (d) 4., 70.46 (4), 70.855 (4) (b), 70.995 (8) (c) 1., 70.995 (8) (d), 70.995 (14) (b), 71.01 (6) (k) 3., 71.01 (6) (L) 1., 71.01 (6) (L) 3., 71.01 (6) (L) 4., 71.05 (1) (am), 71.05 (1) (an), 71.05 (6) (b) 19. c., 71.05 (6) (b) 19. d., 71.07 (5) (a) 15., 71.07 (9m) (h), 71.22 (4) (k) 3., 71.22 (4) (L) 1., 71.22 (4) (L) 3., 71.22 (4) (L) 4., 71.22 (4m) (k) 3., 71.22 (4m) (L) 1., 71.22 (4m) (L) 3., 71.22 (4m) (L) 4., 71.26 (2) (b) 10. d., 71.26 (2) (b) 11. d., 71.26 (2) (b) 12. a., 71.26 (2) (b) 12. d., 71.26 (2) (b) 12. e., 71.28 (6) (h), 71.34 (1g) (k) 3., 71.34 (1g) (L) 1., 71.34 (1g) (L) 3., 71.34 (1g) (L) 4., 71.42 (2) (k) 3., 71.42 (2) (L) 1., 71.42 (2) (L) 3., 71.42 (2) (L) 5., 71.47 (6) (h), 71.55 (10), 71.77 (7) (b), 71.83 (1) (a) 6., 73.0305, 73.09 (4) (c), 73.09 (5), 74.315 (1), 74.315 (2), 74.315 (3), 76.04 (1), 76.07 (1), 76.075, 76.13 (1), 76.13 (3), 76.28 (4) (b), 76.28 (11), 76.39 (4) (d), 76.48 (5), 77.51 (13gm) (b), 77.51 (13gm) (c), 77.51 (13gm) (d) 2., 77.51 (13gm) (d) 5., 77.52 (2m) (b), 77.54 (6) (am) 2., 77.54 (9a) (f), 77.54 (9m), 79.02 (1), 79.02 (2) (b), 79.02 (3) (a), 79.02 (3) (e), 79.035 (6), 79.035 (7) (b), 79.05 (1) (am) and 79.05 (2m); and to create 70.11 (4) (b) 3., 71.01 (6) (j) 3. m., 71.01 (6) (j) 3. n., 71.01 (6) (m), 71.01 (7g), 71.05 (6) (b) 4. a. to c., 71.05 (6) (b) 19. cm., 71.05 (6) (b) 19. dm., 71.05 (6) (b) 54., 71.22 (4) (j) 3. m., 71.22 (4) (j) 3. n., 71.22 (4) (m), 71.22 (4m) (j) 3. m., 71.22 (4m) (j) 3. n., 71.22 (4m) (m), 71.22 (5g), 71.26 (2) (b) 13., 71.26 (2) (b) 14., 71.34 (1g) (j) 3. m., 71.34 (1g) (j) 3. n., 71.34 (1g) (m), 71.34 (1u), 71.42 (2) (j) 3. m., 71.42 (2) (j) 3. n., 71.42 (2) (m), 71.42 (2p), 71.52 (1g), 71.76 (2), 74.315 (1m) and 77.61 (5) (b) 8m. of the statutes; relating to: various changes to the laws administered and enforced by the Department of Revenue.

Analysis by the Legislative Reference Bureau

This bill makes changes to the laws administered and enforced by the Department of Revenue.

shared revenue

Reimbursement amounts

Under current law, the state reduces the shared revenue payments to counties and municipalities for various purposes, including for the collection of penalties and the reimbursement for other amounts. However, current law is not consistent with regard to which components of shared revenue are reduced for these purposes. This bill provides that all such reductions are from the payment of all shared revenue components that the counties and municipalities receive on the fourth Monday in July and the third Monday in November.

Expenditure restraint payments

Under current law, counties and municipalities receive 15 percent of their shared revenue payments on the fourth Monday in July and the remainder on the third Monday in November, except that municipalities receive the entire amount of their payment under the expenditure restraint program on the fourth Monday in July. The bill allows municipalities to receive their entire expenditure restraint payment before the fourth Monday in July, upon certification by DOR.

Under current law, the inflation factor used to compute a municipality's expenditure restraint payment is a percentage equal to the average annual percentage change in the U.S. consumer price index for all urban consumers, U.S. city average, as determined by the U.S. Department of Labor, for the 12 months ending on September 30. The bill modifies the consumer price index provision so that it is for the 12 months ending on August 31.

property

Omitted property

Current law requires a taxation district clerk to annually submit to DOR a listing of the taxes on property omitted from assessment in any of the previous two years that are to be included in the next assessment. However, the clerk reports the omitted taxes only if those taxes exceed $5,000. The bill modifies that $5,000 threshold so that the clerk reports the omitted taxes that are $250 or more for any single description of property. The bill also provides that the clerk may not list an omitted tax that was levied on property within a tax incremental district unless the current value of the district is lower than the tax incremental base.

Objections

Current law requires a person who files an objection to the assessment of the person's manufacturing property to pay a $45 fee. The bill increases the filing fee to $200.

License fees

Current law imposes license fees instead of property taxes on certain public utilities. The fees are based, generally, on the value of a utility's property. Utilities that are subject to the fees include light, heat, and power companies, pipeline companies, and railroad companies. Each such company, other than a railroad company, must file a report with DOR on or before May 1 of each year. DOR determines the value of the company's property on or before September 15. A railroad company must file its report on or before April 15 and its value is determined on or before August 1. The bill changes the filing and determination dates for a railroad company so that those dates are the same as those for other public utilities.

The bill also decreases the interest rate paid on refunds of license fees paid by public utilities from 9 percent to 3 percent.

Board of review

Current law requires that at least one member of the board of review attend DOR training within the two-year period beginning on the date of the board's first meeting. The bill requires one member of the board of review to complete the training each year.

Assessor certification

Current law requires a person applying for an assessor certification examination to submit a $20 fee with the application. A person applying for a renewal of an assessor certification pays a $20 recertification fee with the application. The bill allows DOR to determine the amount of the fee for an assessor certification examination on the basis of DOR's estimate of the actual cost to administer and grade the examination, but the fee may not exceed $75. The bill also allows DOR to determine the recertification fee.

Levy limit; joint fire departments

The property tax levy limit under current law does not apply to the amount that a city, village, or town levies to pay for charges assessed by a joint fire department or joint emergency medical services district if the current year increase in such charges is equal to or less than the percentage change in the U.S. consumer price index for all urban consumers, U.S. city average, as determined by the U.S. Department of Labor, for the 12 months ending on September 30 of the year of the levy, plus 2 percent. The bill modifies the consumer price index provision so that it is for the 12 months ending on August 31 of the year of the levy.

Leasing property owned by a church or religious organization