SENATE BILL NO. 135
INTRODUCED BY SPRAGUE M
BY REQUEST OF THE INTERIM PROPERTY TAX COMMITTEE
A BILL FOR AN ACT ENTITLED: "AN ACT REQUIRING THAT FULL MARKET VALUE BE THE BASIS UPON WHICH PROPERTY SUBJECT TO TAXATION IS APPRAISED, ASSESSED, AND TAXED; AMENDING SECTION 15-8-111, MCA; PROVIDING FOR A CONTINGENT ELECTION; PROVIDING A CONTINGENT VOIDNESS PROVISION; AND PROVIDING EFFECTIVE DATES AND AN APPLICABILITY DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 15-8-111, MCA, is amended to read:
"15-8-111. Assessment -- market value standard -- exceptions. (1) All taxable property must be assessed at 100% of its market value except as otherwise provided.
(2) (a) Market value is the value at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts.
(b) If the department uses construction cost as one approximation of market value, the department shall fully consider reduction in value caused by depreciation, whether through physical depreciation, functional obsolescence, or economic obsolescence.
(c) Except as provided in subsection (3), the market value of special mobile equipment and agricultural tools,
implements, and machinery is the average wholesale value shown in national appraisal guides and manuals or the value
before reconditioning and profit margin. The department shall prepare valuation schedules showing the average wholesale
value when a national appraisal guide does not exist.
(3) The department may not adopt a lower or different standard of value from market value in making the official
assessment and appraisal of the value of property, except:
(a) the wholesale value for agricultural implements and machinery is the average wholesale value category as shown in
Guides 2000, Northwest Region Official Guide, published by the North American equipment dealers association, St. Louis,
Missouri. If the guide or the average wholesale value category is unavailable, the department shall use a comparable
publication or wholesale value category.
(b) for agricultural implements and machinery not listed in an official guide, the department shall prepare a supplemental
manual in which the values reflect the same depreciation as those found in the official guide; and
(c) as otherwise authorized in Titles 15 and 61.
(4) For purposes of taxation, assessed value is the same as appraised value.
(5) The taxable value for all property, including housetrailers and mobile homes taxed under 15-24-202, is the
percentage of market or assessed value established for each class of property as provided in this section.
(6) The assessed value of properties in 15-6-131 through 15-6-133 is as follows:
(a) Properties in 15-6-131, under class one, are assessed under Title 15, chapter 23, part 5, are valued at 100% of the
product of 14 times the annual net proceeds of mines and mining claims after deducting the expenses specified and allowed
by provided in 15-23-503 or, if applicable, as provided in 15-23-515, 15-23-516, 15-23-517, or 15-23-518.
(b)(7) Properties in 15-6-132, under class two, are assessed under Title 15, chapter 23, part 8, are valued at 100% of the
annual gross proceeds.
(c)(8) (a) Properties in 15-6-133, under class three, Agricultural lands are assessed at 100% of the productive capacity
of the lands when valued for agricultural purposes. All lands that meet the qualifications of 15-7-202 are valued as
agricultural lands for tax purposes.
(b) Parcels of land that consist of 20 acres or more but less than 160 acres, that are under one ownership, and that are not eligible for valuation, assessment, and taxation as agricultural land under 15-7-202(1) are assessed at 100% of the product of 7 times the productive capacity of grazing land, at the average grade of grazing land. The land may not be devoted to a commercial or industrial purpose.
(d)(9) Properties in 15-6-143, under class ten, are Forest land is assessed at 100% of the forest productivity value of the
land when valued as forest land as provided in Title 15, chapter 44.
(7)(10) Land and the improvements on the land are separately assessed when any of the following conditions occur:
(a) ownership of the improvements is different from ownership of the land;
(b) the taxpayer makes a written request; or
(c) the land is outside an incorporated city or town."
NEW SECTION. Section 2. 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 3. 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 4. Effective date. (1) Except as provided in subsection (2), this act is effective on approval of LC 220 by the electorate.
(2) If an election is held as provided in section 5, this act is effective upon approval of this act by the electorate.
NEW SECTION. Section 5. Election. Pursuant to Article VIII, section 17, of The Constitution of the State of Montana, this act shall be submitted to the qualified electors of Montana for their approval or disapproval at the tax election to be held in 1999 by printing on the ballot the full title of this act and the following:
SHALL THE PROPERTY TAX BE INCREASED ANNUALLY IN THE FOLLOWING MANNER? THE VALUE, FOR TAX PURPOSES, OF PROPERTY SUBJECT TO TAXATION MUST BE BASED ON THE FULL MARKET VALUE OF THE PROPERTY.
[] FOR increasing the property tax base through the use of full market value as the basis for the taxation of property.
[] AGAINST increasing the property tax base through the use of full market value as the basis for the taxation of property.
NEW SECTION. Section 6. Applicability. Section 1 applies on and after January 1, 2000, and to tax years beginning after December 31, 1999.
NEW SECTION. Section 7. Contingent voidness. (1) If Constitutional Initiative No. 75, enacting Article VIII, section 17, of the Montana constitution, is declared invalid prior to November 2, 1999, then section 5 is void.
(2) If Constitutional Initiative No. 75, enacting Article VIII, section 17, of the Montana constitution, remains valid on the date upon which LC 220 is voted, then section 4(1) is void.
NEW SECTION. Section 8. Coordination. If LC 220 and LC 1228 are not passed and approved, then this act is void.
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Latest Version of SB 135 (SB0135.01)
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