Bill Text: AZ SB1352 | 2014 | Fifty-first Legislature 2nd Regular | Chaptered
Bill Title: Property tax roll; corrections
Spectrum: Moderate Partisan Bill (Republican 5-1)
Status: (Passed) 2014-04-30 - Chapter 249 [SB1352 Detail]
Download: Arizona-2014-SB1352-Chaptered.html
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Conference Engrossed |
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State of Arizona Senate Fifty-first Legislature Second Regular Session 2014
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CHAPTER 249
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SENATE BILL 1352 |
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AN ACT
amending sections 42‑15101, 42‑15157, 42‑16051, 42-16214, 42‑16251, 42‑16252, 42‑16253, 42‑16254, 42‑16255, 42‑16256, 42‑16257 and 42‑16258, Arizona Revised Statutes; amending title 42, chapter 16, article 6, Arizona Revised Statutes, by adding section 42‑16259; relating to property tax.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 42-15101, Arizona Revised Statutes, is amended to read:
42-15101. Annual notice of full cash value; amended notice of valuation
A. Except as provided by section 42‑13254, on any date before March 1 of each year the county assessor shall notify each owner of record, or purchaser under a deed of trust or an agreement of sale, of property that is valued by the assessor as to the property's full cash value and the limited property value, if applicable, to be used for assessment purposes.
B. The notice under this section shall be in writing and shall be mailed, delivered by common carrier, or upon on request of the taxpayer transmitted electronically to the person's last known mailing, delivery or electronic address. With respect to any property transferred by a beneficiary deed pursuant to section 33‑405, until the county assessor is notified by the beneficiary in writing, accompanied by a certified copy of the last surviving owner's death certificate and the change of address, mailing of the notice to the last known address of the deceased owner is deemed a mailing to the beneficiary's last known mailing, delivery or electronic address as required by this section.
C. On the same date each year the assessor shall certify to the board of supervisors and the department the date on which all notices under this section were mailed.
D. The director may extend the final date for mailing notices beyond March 1 for a period of not more than thirty days for delays caused by an act of God, flood or fire. If the director extends the mailing date, the extension applies to all property valued by the assessor.
E. Within sixty days after the mailing of the notice of valuation pursuant to this section, if the assessor discovers that property characteristic data applicable to a grouping of properties delineated by neighborhood or classification resulted in an incorrect opinion of value, the assessor may amend the notice of valuation and, if amended, shall notify the property owner of the amended value pursuant to subsection B of this section. The assessor shall transmit any proposed amendments made under this subsection to the department as provided by section 42-11056, subsections b and c, in a format prescribed by the department. The assessor shall not mail the amended notices of valuation until the proposed amendments are transmitted to the department and the department approves the amended values. The assessor shall certify the amended notices of valuation pursuant to subsection c of this section.
E. f. After the mailing date of the notice, any person who owns, claims, possesses or controls property that is valued by the assessor may inquire of and be advised by the assessor as to the valuation of the property determined by the assessor, but the assessor shall not change the roll except as provided by chapter 16, article 2 of this title or as otherwise provided by law.
Sec. 2. Section 42-15157, Arizona Revised Statutes, is amended to read:
42-15157. Destruction of property after rolls closed; proration of valuation and taxes
A. If a property is destroyed after the assessor closes the rolls, the person who is liable for paying the taxes on the property owner may petition the assessor to reduce file a notice of claim pursuant to section 42‑16254 to prorate the valuation of the property from the date of destruction as if the reduction were the correction of an error pursuant to chapter 16, article 6 of this title.
B. If the assessor finds that the property has been destroyed:
1. The assessor shall fix prorate the value of the property from the lien date to the date of destruction.
2. The county treasurer shall compute the amount of taxes assessed against the property by applying the tax rate for the appropriate tax year to the original valuation prorated for the portion of the year the property was intact, plus the tax rate for the appropriate tax year to the reassessed value of the property prorated for the balance of the year.
Sec. 3. Section 42-16051, Arizona Revised Statutes, is amended to read:
42-16051. Petition for assessor review of improper valuation or classification
A. An owner of property that in the owner's opinion has been valued too high or otherwise improperly valued or listed on the roll may file a petition with the assessor on a written form prescribed by the department.
B. The petition shall state the owner's opinion of the full cash value of the property and substantial information that justifies that opinion of value for the assessor to consider for purposes of basing a change in classification or correction of the valuation. For purposes of this subsection, the owner provides substantial information to justify the opinion of value by stating the method or methods of valuation on which the opinion is based and:
1. Under the income approach, including the information required in section 42‑16052.
2. Under the market approach, including the full cash value of at least one comparable property in the same geographic area or the sale of the subject property.
3. Under the cost approach, including the cost to build or rebuild the property plus the land value.
C. The petition may include more than one parcel of property if they are part of the same economic unit according to department guidelines or if they are owned by the same owner, have the same use, are appealed on the same basis and are located in the same geographic area, as determined pursuant to department guidelines, and are on a form prescribed by the department.
D. The petition shall be filed within sixty days after the date the assessor mailed, delivered by common carrier or transmitted electronically, the notice of valuation or the amended notice of valuation under section 42‑15101. United States postal service postmark dates are evidence of the date petitions were filed for purposes of this subsection.
E. The petition for review form for property that is listed as class three pursuant to section 42‑12003 shall contain simplified instructions and shall be separate from the petition forms used for other classes of property.
Sec. 4. Section 42-16214, Arizona Revised Statutes, is amended to read:
42-16214. Refund or credit of excess payments
A. If judgment is awarded to a taxpayer who paid the taxes to the county treasurer:
1. The county treasurer of the county in which the property is located shall pay the judgment out of monies collected from property taxes during the next fiscal year, unless there are sufficient amounts available in funds budgeted for that purpose by the county to allow an immediate refund, or, if both parties agree, the amount of the judgment may be credited toward any taxes that may be remaining due on the property that is the subject of the appeal, subject in either case to the approval of the board of supervisors.
2. The amount of the judgment shall be subtracted from the amounts due to taxing jurisdictions in the next fiscal year in proportion to the amount each received from the appellant's overpayment of taxes. The affected taxing jurisdictions shall include in their budgets for the next fiscal year the proportional amount of the judgment for which each is liable. Any increase in the budget because of the portion of the judgment being included is not subject to any budget limitation that may be prescribed by law.
3. Interest at the legal rate on the overpayment or underpayment is payable from the date of overpayment or underpayment. For the purpose of computing interest under the judgment, if the tax was paid in installments, a pro rata share of the total overpayment or underpayment is considered to be attributable to each installment. for the purposes of this paragraph, "legal rate" means the rate set by the department as prescribed by section 42‑1123.
B. A judgment in favor of an appellant who paid the taxes to the department shall be paid from the state general fund.
Sec. 5. Section 42-16251, Arizona Revised Statutes, is amended to read:
42-16251. Definitions
In this article, unless the context otherwise requires:
1. "Board" means the county board of equalization or the state board of equalization, as appropriate.
2. "Court" means either the superior court or tax court.
3. "Error" means any mistake in assessing or collecting property taxes resulting from:
(a) An imposition of an incorrect, erroneous or illegal tax rate that resulted in assessing or collecting excessive taxes.
(b) An incorrect designation or description of the use or occupancy of property or its classification pursuant to chapter 12, article 1 of this title.
(c) Applying the incorrect assessment ratio percentages prescribed by chapter 15, article 1 of this title.
(d) Misreporting or failing to report property if a statutory duty exists to report the property.
(e) Subject to the requirements of section 42‑16255, subsection B, a valuation or legal classification that is based on an error that is exclusively factual in nature or due to a specific legal restriction that affects the subject property and that is objectively verifiable without the exercise of discretion, opinion or judgment and that is demonstrated by clear and convincing evidence, such as:
(i) A mistake in the description of the size, use or ownership of land, improvements or personal property.
(ii) Clerical or typographical errors in reporting or entering data that was used directly to establish valuation.
(iii) A failure to timely capture on the tax roll a change in value or legal classification caused by new construction, the destruction or demolition of improvements, the splitting of one parcel of real property into two or more new parcels or the consolidating of two or more parcels of real property into one new parcel existing on the valuation date.
(iv) The existence or nonexistence of the property on the valuation date.
(v) Property that is destroyed after the lien date.
(v) (vi) Any other objectively verifiable error that does not require the exercise of discretion, opinion or judgment.
Error does not include a correction that results from a change in the law as a result of a final nonappealable ruling by a court of competent jurisdiction in a case that does not involve the property for which a correction is claimed.
4. "Tax officer" means the department, county assessor or county treasurer, as applicable.
4. 5. "Taxpayer" means the owner of real or personal property that is liable for tax.
Sec. 6. Section 42-16252, Arizona Revised Statutes, is amended to read:
42-16252. Notice of proposed correction; response; petition for review; appeal
A. Subject to the limitations and conditions prescribed by this article, if a county assessor or the department tax officer determines that any real or personal property has been assessed improperly as a result of a property tax error, the county assessor or department tax officer shall send the taxpayer a notice of error proposed correction at the taxpayer's last known address by:
1. Certified mail, return receipt requested, if correction of the error results in an increase in the valuation full cash value or change in legal classification of the property.
2. First class mail or, at the taxpayer's written request, delivery by common carrier or electronic transmittal, if correction of the error does not result in an increase in the valuation of the property.
B. The notice shall:
1. Be in a form prescribed by the department.
2. Clearly identify the subject property by tax parcel number or tax roll number and the year or years for which the correction is proposed.
3. Explain the error, the reasons for the error and the proposed correction of the error.
4. Inform the taxpayer of the procedure and deadlines for appealing all or part of the proposed determination before the tax roll is corrected.
C. Within thirty days after receiving a notice of error proposed correction, the taxpayer may file a written response to the taxing authority tax officer that sent the notice to either consent to or dispute the proposed correction of the error and to state the grounds for disputing the correction. A failure to file a written response within thirty days constitutes consent to the proposed correction unless. a taxpayer may file a request for an extension of time is made within thirty days after receiving the notice of error proposed correction. the extension of time may not exceed thirty days. If an extension is granted, any response that is not filed within the extended due date constitutes consent to the proposed correction.
D. The taxpayer may appeal any valuation or legal classification issue that arises from the proposed correction as provided in this section.
D. e. If an owner of real property the taxpayer consents to the proposed correction, or consents to the proposed correction but disputes the proposed valuation or legal classification as provided on the form prescribed by the department, the tax roll shall be promptly corrected to allow property taxes to be levied and collected in all subsequent tax years, but no additional tax, interest or penalty may be imposed for the current tax year or any tax year preceding the date of the notice of error proposed correction.
f. If an owner of real property the taxpayer disputes the proposed correction and a court determines, after an appeal pursuant to subsection G, that an error occurred, any taxes that are assessed pursuant to this subsection, including all cases involving personal property, are delinquent if not paid within sixty days after the date the supplemental billing is mailed to the taxpayer. If taxes have been overpaid, they shall be refunded with interest at the rate determined pursuant to section 42‑1123 within ninety days after the roll is corrected. The owner may appeal valuation or legal classification issues that arise from the correction as provided in this section.
E. If requested, the assessor or department or the proposed valuation or legal classification, the tax officer shall meet with the taxpayer or the taxpayer's representative in any case in which the taxpayer has timely filed a written response disputing the proposed correction to discuss the proposed correction. If after the meeting the tax officer and the taxpayer reach an agreement on all or part of the proposed correction, the tax officer and the taxpayer shall each sign an agreement and the tax roll must be promptly corrected to the extent agreed on.
F. g. If after the meeting the parties fail to agree on all or part of the proposed correction, the department or assessor tax officer shall serve a notice on the taxpayer by certified mail within thirty days after the meeting date advising the taxpayer that the error tax roll will be corrected within forty‑five day unless to the extent agreed on. the taxpayer files may file a petition on a form prescribed by the department with the county board of equalization, if one is established in the county, or, if one is not established in the county, with the state board of equalization. The department or assessor shall include a petition form with the notice and an explanation of the appeals procedure. The petition must be filed with the county board or the state board within thirty days after the date of the notice prescribed by this subsection is mailed, or it is barred. On receiving the petition, the board shall hold a hearing on the disputed issues in the proposed correction within thirty days and shall issue a written decision pursuant to the board's rules.
G. h. A party that is dissatisfied with the decision of the county board or state board may appeal the decision to court within sixty days after the date the board's decision is mailed, but any additional taxes that are determined to be due must be timely paid before delinquency for the court to retain jurisdiction of the matter.
Sec. 7. Section 42-16253, Arizona Revised Statutes, is amended to read:
42-16253. Reporting personal property tax error before notice of proposed correction is issued
If a person taxpayer whose personal property taxes have been assessed in error reports the error to the taxing authority before receiving a notice of error proposed correction, no penalty may be applied and the tax roll shall be corrected to allow property taxes for the period affected by the error to be levied and collected.
Sec. 8. Section 42-16254, Arizona Revised Statutes, is amended to read:
42-16254. Notice of claim; response; petition for review; appeal
A. If a taxpayer believes that the taxpayer's property has been assessed improperly as a result of a property tax error, the taxpayer shall file a notice of claim with the appropriate tax officer, either personally or by certified mail, as follows:
1. If the alleged error concerns the valuation or classification of property by the county assessor, the notice shall be filed with the assessor. On receiving the notice, the assessor shall immediately transmit a copy to the department.
2. If the alleged error concerns the valuation or classification of property by the department, the notice shall be filed with the department.
3. If the alleged error concerns the imposition of any tax rate, the notice shall be filed with the county board of supervisors. The clerk of the board of supervisors shall notify each affected taxing entity to allow the entity to file a response to the claim.
B. The notice shall:
1. Be in a form prescribed by the department.
2. Clearly identify the subject property by tax parcel number or tax roll number and the year or years for which the correction is proposed.
3. State the claim and the evidence to support the claim for correcting the alleged error.
C. Within sixty days after receiving a notice of claim, the tax officer may file a written response to the taxpayer to either consent to or dispute the error and to state the grounds for disputing the error. A failure to file a written response within sixty days constitutes consent to the error, and the board of supervisors shall direct the county treasurer to correct the tax roll on the taxpayer's written demand supported by proof of the date of the notice of claim and the tax officer's failure to timely dispute the error.
D. If the tax officer disputes the error, the tax officer shall notify the taxpayer of a time and place for a meeting between a representative of the tax officer and the taxpayer or the taxpayer's representative within sixty days to discuss the basis for the dispute.
E. If, after the meeting, the parties agree on all or part of the proposed correction notice of claim, the board of supervisors shall direct the county treasurer to correct the tax roll must be corrected promptly to the extent agreed, on and any taxes that have been overpaid shall be refunded with interest at the rate determined pursuant to section 42‑1123 42‑16259. within ninety days after the roll is corrected or pursuant to section 42‑16214, subsection A. The county treasurer shall pay the legal rate on the day the payment is rendered. If the taxpayer owes additional taxes, they shall be assessed by supplemental billing to the taxpayer plus interest as provided by law. Any taxes assessed pursuant to this subsection are delinquent if not paid within sixty days after the date the supplemental billing is mailed to the taxpayer. For the purposes of this subsection, "legal rate" means the interest rate set by the department.
F. If the parties fail to agree on all or part of the proposed correction notice of claim, the taxpayer may file a petition with the county board of equalization, if one is established in the county, or, if one is not established in the county, with the state board of equalization on a form prescribed by the department and shall send a copy to the tax officer by certified mail. The petition must be filed with the county board or state board within one hundred fifty ninety days after the notice of claim is filed date of the meeting or it is barred. On receiving the petition, the appropriate board shall hold a hearing on the proposed correction disputed issues in the notice of claim within thirty days and shall issue a written decision pursuant to the board's rules.
G. A party that is dissatisfied with the decision of the county board or state board may appeal the decision to court within sixty days after the date the board's decision is mailed, but any additional taxes that are determined to be due must be timely paid before delinquency for the court to retain jurisdiction of the matter. In addition, in order for a taxpayer to recover a refund for taxes paid in a preceding tax year as a result of an error, all taxes that were levied and assessed against the property for the tax year must be paid before delinquency in order for the court to retain jurisdiction of the matter.
H. For the purposes of this section, "tax officer" means the department, county assessor or county board of supervisors, whichever is appropriate under the circumstances described in subsection A, paragraph 1, 2 or 3 of this section.
Sec. 9. Section 42-16255, Arizona Revised Statutes, is amended to read:
42-16255. Evidence that may be considered at hearings; pending administrative and judicial appeals
A. In any hearing before the county board, state board or court in an appeal under this article, either party may present any evidence regarding property tax errors regardless of whether a the evidence was presented when the notice of error proposed correction or notice of claim was filed. The board or court has jurisdiction to make any such correction.
B. This article does not authorize an independent review of the overall valuation or legal classification of property that could have been appealed pursuant to article 2, 3, 4 or 5 of this chapter or chapter 19, article 2 of this title. If an administrative or judicial appeal is pending regarding the subject property, the any alleged error that was already the subject of a notice of proposed correction under section 42‑16252 or a notice of claim under section 42‑16254 shall be adjudicated as part of the administrative or judicial appeal for the affected tax year without requiring the parties to exhaust their administrative appeal remedies under this article. If a specific error of fact, not previously known, was not addressed in a prior appeal, an appeal may be brought pursuant to this section.
Sec. 10. Section 42-16256, Arizona Revised Statutes, is amended to read:
42-16256. Limitations
A. In the case of real or personal property, the correction of errors under this article is limited to the period during which the current owner of record held title to the property, if the owner is a purchaser in good faith and without notice of any error that could have caused proceedings to be initiated to correct the tax roll when the owner purchased the property.
B. Except as provided in subsection C of this section, and subject to the provisions of section 42‑16252, subsection D e, a notice of error proposed correction or notice of claim filed under this article is limited to the current tax year in which the notice of error proposed correction or notice of claim is filed and the three immediately preceding tax years.
C. If a specific error involving a particular property is established by a final nonappealable ruling by a court of competent jurisdiction in favor of the party who brought the action, the error may be corrected as of the date the action was filed or as of the date a notice of claim or notice of error proposed correction was filed pursuant to this article, whichever is earlier, but no additional assessment or refund for any period before that date is permitted.
D. this article does not authorize an independent review of the overall valuation or legal classification of property that is not the result of an error as defined in section 42‑16251.
E. the correction of errors under this article is limited to real property that has not been issued a certificate of purchase pursuant to chapter 18, article 3 of this title.
Sec. 11. Section 42-16257, Arizona Revised Statutes, is amended to read:
42-16257. Valuation of property
In valuing any property pursuant to this article, the assessor, department or reviewing body tax officer shall use the valuation and legal classification criteria that were in effect on the valuation date for the tax year of the correction.
Sec. 12. Section 42-16258, Arizona Revised Statutes, is amended to read:
42-16258. Correcting tax roll by county treasurer
A. After receiving the tax roll, if the county treasurer determines that any property is omitted from the roll, or has reason to believe that any personal property that is omitted from the roll has not been taxed in any other county for that year, the treasurer shall immediately list and request the assessor to determine the valuation of the property.
B. The treasurer shall enter the valuation on the roll following the levies made and delivered by the county board of supervisors. The entries shall be designated as additional valuations, and the taxes so computed by the county treasurer are valid for all purposes.
C. If there is an error on the roll in the name of the person taxpayer who should be assessed or taxed, the county treasurer may change the name and collect the tax from the person who should be taxed, if that person is liable for the tax and can be identified by the treasurer correct taxpayer.
D. If an error or omission is determined under this section, the taxpayer shall be notified of the proposed correction and the taxpayer may appeal the proposed correction pursuant to section 42‑16252.
Sec. 13. Title 42, chapter 16, article 6, Arizona Revised Statutes, is amended by adding section 42-16259, to read:
42-16259. Transmittal of corrected billing to taxpayer; delinquency; refunds; interest
A. The county treasurer shall mail a corrected billing to the taxpayer on the occurrence of any of the following:
1. The consent of the taxpayer to a tax roll correction.
2. The consent of the tax officer to the notice of claim.
3. The decision of the board of equalization.
4. The final nonappealable ruling by a court of competent jurisdiction.
B. Any taxes that are assessed pursuant to this article are delinquent if not paid within ninety days after the date the corrected billing is mailed to the taxpayer.
C. If taxes have been overpaid, the amount of taxes overpaid shall be refunded with interest at the legal rate set by the department as prescribed by section 42-1123 within ninety days after the tax roll is corrected. for the purpose of computing interest under this subsection, if the tax was paid in installments, a pro rata share of the total overpayment is considered to be attributable to each installment.
APPROVED BY THE GOVERNOR APRIL 30, 2014.
FILED IN THE OFFICE OF THE SECRETARY OF STATE APRIL 30, 2014.
