HOUSE BILL NO. 665

INTRODUCED BY T. FACEY

A BILL FOR AN ACT ENTITLED: "AN ACT REVISING THE ASSESSMENT AND TAXATION OF NEWLY CONSTRUCTED IMPROVEMENTS TO REAL PROPERTY; PROVIDING FOR THE DISPOSITION OF PROPERTY TAXES COLLECTED ON NEW IMPROVEMENTS; REQUIRING THAT TAXES COLLECTED ON NEW IMPROVEMENTS BE USED TO REDUCE MILL LEVIES; AMENDING SECTION 15-8-201, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND A RETROACTIVE APPLICABILITY DATE."

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

NEW SECTION. Section 1. Assessment of new improvements. (1) Improvements constructed during the tax year that were not assessed or taxable as of the preceding January 1 but that have become occupied or have otherwise come into use during a tax year become the property of a person subject to taxation and must be assessed and taxed from the date of occupation or use.

(2) To determine the amount of tax due for newly constructed improvements, the county treasurer shall multiply the taxable value of the new improvement by the total number of mills levied on the property for the current fiscal year and multiply the product by the ratio that the number of days in the fiscal year that the property will be in taxable status bears to 365.

(3) Because the new improvement will not have been assessed or taxed during the tax year because it did not exist on January 1, the department shall prepare a special assessment for the property and the county treasurer shall determine the amount of taxes that would have been due under subsection (2).

(4) Upon determining the amount of tax due, the county treasurer shall notify the person to whom the tax is assessed, in the same manner as notification is provided under 15-16-101(2), of the amount due and the date or dates on which the taxes due are payable, as provided in 15-16-102.

NEW SECTION. Section 2. Disposition of taxes on new improvements. (1) The county treasurer shall deposit all taxes collected under [section 1] into a separate account.

(2) Except as provided in 7-31-2101, funds in the account may not be expended during the fiscal year in which they are collected.

(3) Funds in the account on June 30 must be used in the subsequent fiscal year to reduce:

(a) the mill levy for the county general fund, as provided in 7-6-2501; or

(b) the all-purpose levy, as provided in 7-6-2522.

Section 3. Section 15-8-201, MCA, is amended to read:

"15-8-201. General assessment day. (1) The department shall, between January 1 and the second Monday of July in each year, ascertain the names of all taxable inhabitants and assess all property subject to taxation in each county.

(2) The department shall assess property to:

(a) the person by whom it was owned or claimed or in whose possession or control it was at midnight of the preceding January 1; or

(b) except in the case of land splits, the new owner if the provisions of 15-7-304 have been met and the transfer certificate has been received and processed prior to determining the taxes that are due as provided in 15-10-305(2).

(3) The department shall also ascertain and assess all mobile homes arriving in the county after midnight of the preceding January 1.

(4) A mistake in the name of the owner or supposed owner of real property does not invalidate the assessment.

(5) The procedure provided by this section does not apply to:

(a) motor vehicles;

(b) motor homes, travel trailers, and campers;

(c) watercraft;

(d) livestock;

(e) property defined in 61-1-104 as special mobile equipment that is subject to assessment for personal property taxes on the date that application is made for a special mobile equipment plate;

(f) mobile homes and manufactured homes held by a distributor or dealer as stock in trade;

(g) property subject to the provisions of 15-16-203; and

(h) new improvements that are subject to the provisions of [section 1].

(6) Credits must be assessed as provided in 15-1-101(1)(f)."

NEW SECTION. Section 4. Codification instruction. (1) [Section 1] is intended to be codified as an integral part of Title 15, chapter 16, part 2, and the provisions of Title 15, chapter 16, part 2, apply to [section 1].

(2) [Section 2] is intended to be codified as an integral part of Title 7, chapter 6, part 25, and the provisions of Title 7, chapter 6, part 25, apply to [section 2].

NEW SECTION. Section 5. Saving clause. [This act] does not affect rights and duties that matured, penalties that were incurred, or proceedings that were begun before [the effective date of this act].

NEW SECTION. Section 6. Severability. If a part of [this act] is invalid, all valid parts that are severable from the invalid part remain in effect. If a part of [this act] is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications.

NEW SECTION. Section 7. Effective date. [This act] is effective on passage and approval.

NEW SECTION. Section 8. Retroactive applicability. [This act] applies retroactively, within the meaning of 1-2-109, to tax years beginning after December 31, 1998.

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