HB 747-FN-A-LOCAL - AS INTRODUCED
1999 SESSION
HOUSE BILL 747-FN-A-LOCAL
AN ACT relative to the education property tax and adequate education grants.
SPONSORS: Rep. Sapareto, Rock 13; Rep. Sabella, Rock 13
This bill changes the methodology of calculating the rate of the education property tax and the utility property tax and establishes a procedure for education property tax relief claims based on a homestead exemption.
The bill also makes certain changes to the provisions for determining adequate education grants and allows for supplemental distributions to municipalities which are required to raise more than $5 per $1,000 per pupil from non-state sources.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
99-1051
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord One Thousand Nine Hundred and Ninety-Nine
AN ACT relative to the education property tax and adequate education grants.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Chapter; Statewide Education Property Tax. Amend RSA by inserting after chapter 76 the following new chapter:
CHAPTER 76-A
STATEWIDE EDUCATION PROPERTY TAX
76-A:1 Definitions. In this chapter:
I. "Assessing official" means the assessing authority of any town, city, or place.
II. "Claimant" means a person who:
(a) Has filed a claim with a municipality for reduction in such claimant's property taxes under this chapter; and
(b) During the 3 fiscal years preceding the year in which the person files a claim for relief under this chapter:
(1) Has had an ownership interest in a homestead and was domiciled in the homestead upon which education property taxes have accrued and for which the person is making a claim for tax relief from the statewide education property tax in this state; and
(2) Was not a full-time student claimed as a dependent by any taxpayer under the United States Internal Revenue Code.
III. "Commissioner" means the commissioner of the department of revenue administration.
IV. "Consumer price index" means the most recent available consumer price index for the Boston metropolitan area published by the United States Department of Labor.
V. "Department" means the department of revenue administration.
VI. "Education property taxes" means the sum of the statewide education property tax under this chapter and the education portion of property taxes assessed by a municipality.
VII. "Equalized assessed value" or "equalized assessed valuation" means the modified assessed valuation of property equalized by the commissioner pursuant to RSA 21-J:3, XIII. In this paragraph, "modified assessed valuation" means the sum of the assessments of taxable property in a municipality less the statutory exemptions provided in RSA 72:12-a, 72:12-b, 72:37, 72:39-a, and 72:39-b. "Modified assessed valuation" shall not include optional exemptions provided in RSA 72:37-b, 72:62, 72:66, and 72:70.
VIII.(a) "Excess education property taxes" means the sum of:
(1) The product of the state education rate determined by the commissioner pursuant to RSA 76-A:2 multiplied by the equalized value of qualifying homesteads not exceeding $100,000 and exclusive of special assessments not including current use, delinquent interest and charges for service, levied as of April 1 on a claimant's homestead in this state; and
(2) The amount of the education portion of property taxes assessed by the claimant's municipality levied as of April 1 on a claimant's homestead in this state; which is in excess of 10 percent of a claimant's household income for the calendar year preceding the tax year of the excess education property tax claim.
(b) In this paragraph, "equalized assessed value of qualifying homesteads" means the local assessed value of the homestead equalized by applying the equalization ratio for the municipality, as determined by the commissioner pursuant to RSA 21-J:3, XIII, for the year of the claim.
(c) A qualifying homestead is the first $100,000 of equalized value of a homestead. If a homestead is owned by 2 or more persons or entities as joint tenants or tenants in common, and one or more persons or entities are not members of the claimant's household, "excess education property taxes" applies to that part of statewide education property taxes levied on the homestead which reflects the ownership percentage of the claimant and the claimant's household. If a homestead is an integral part of a larger unit such as a multi-dwelling building, the statewide education property taxes shall be that percentage of the total education property taxes accrued as the total inhabitable area of the claimant's dwelling is of the total inhabitable area of the building. For purposes of this paragraph "unit" refers to the parcel of property covered by a single tax statement of which the homestead is a part.
IX.(a) "Homestead" means the dwelling owned by a claimant which is used as the claimant's principal place of residence for not less than 240 days in a calendar year and includes the following:
(1) The land upon which the dwelling stands;
(2) Visual and ordinary appurtenant structures such as but not limited to garages, wood sheds, barns, and other out buildings;
(3) The land upon which such appurtenant structures stand;
(4) Land contiguous to such dwelling and appurtenant structures that is groomed and maintained around them; and
(5) Land necessary to the support and service of the dwelling such as but not limited to driveways and maintained rights-of-way for purposes of ingress and egress to the dwelling.
(b) A homestead may consist of a part of a multi-unit dwelling and its proportionate share of the land upon which it stands and other ordinary appurtenant common facilities.
(c) In this paragraph the term "owned" includes a vendee in possession under a land contract and one or more joint tenants or tenants in common.
(d) "Homestead" shall not include personal property such as furniture, furnishings or appliances, or structures.
(e) Manufactured housing may be a homestead.
X. "Household income" means federal adjusted gross income as defined in the United States Internal Revenue Code.
XI. "Municipality" means a city, town, or place.
XII. "Statewide education property tax" means a tax levied at an equal and uniform rate on the equalized assessed valuation of property.
XIII. "Tax collector" means the appointed or elected collector of taxes for a municipality.
XIV. "United States Internal Revenue Code" means the United States Internal Revenue Code of 1986, as amended, without the rules, regulations, forms, and procedures of the United States Internal Revenue Service. The rules, regulations, forms and procedures of the United States Internal Revenue Service may, however, be used by the commissioner of revenue administration in formulating rules for adoption under RSA 541-A. This definition shall be operative unless and until a specific statutory exception to its adoption is provided in this chapter, or until the application of one of its provisions is held to violate the New Hampshire constitution.
76-A:2 Statewide Education Property Tax Established.
I. A statewide education property tax is levied annually on all taxable real estate in the state, except property subject to the tax under RSA 82 and RSA 83-F, to compensate each municipality, on an equal per pupil basis by grade, for its costs in the preceding school year to:
(a) Provide a constitutionally adequate education pursuant to part 2, article 83 of the New Hampshire constitution.
(b) Compensate each municipality on an equal per pupil basis for kindergarten where provided in the last completed school year or where provided in the current school year and not in the last completed school year.
(c) Provide additional grants to certain qualifying municipalities whose tax effort per pupil exceeds an equalized rate of $5.
II. Valuation of the property for the purpose of apportionment and setting the equalized state education rate shall be determined by equalized assessed valuation as prepared annually by the department.
III. The total amount to be raised, each year, shall be the sum calculated pursuant to RSA 198:40, 40-a, 40-b, and 41.
IV. The rate shall be established by the commissioner of revenue administration each year based on the equalized state education rate required to raise the total amount in RSA 76-A:2, III. The commissioner shall report to the legislature on or before December 1 of each year.
76-A:3 Apportionment. The commissioner, before December 15 of every year, shall apportion the amount to be raised by each municipality according to its proportion of the equalized assessed valuation of the state from the most recently available equalization survey. The commissioner shall report the amounts assessed against each municipality to the state treasurer and to each municipality.
76-A:4 Time of Assessment and Payment. The statewide education property tax shall be deemed assessed on April 1 in each year and is payable on demand to the education trust fund on or after said date.
76-A:5 Collection. The assessing officials for each municipality shall make a list of all statewide education property taxes by them assessed against property under their hands and seals to the tax collector, directing the tax collector to collect the statewide education property taxes along with other property taxes. It shall be listed as a separate line on the single municipal property tax bill. Upon application by the assessing officials, the commissioner for good cause may extend the time for delivery of the statewide education property tax warrant.
76-A:6 Remedies for Collection. The statewide education property tax may be collected by all of the means and methods provided for the collection of property taxes under RSA 80.
76-A:7 Interest and Charges for Nonpayment. Nonpayment of the statewide education property tax shall incur the same charges and interest accruing to municipalities as are imposed by law for nonpayment of property taxes.
76-A:8 Liability of Cities and Towns. Each municipality shall be liable to the state for all statewide education property taxes lawfully assessed in such municipality.
76-A:9 Payment to State. Each municipality shall cause its tax collector to certify such information as the state treasurer shall require, and shall cause its treasurer to pay over to the state treasurer, less any payments due from the state treasurer or which would be due to the state treasurer attributable to this chapter, 25 percent, of the assessed statewide property taxes on each of the following dates: July 1, October 1, January 1, and April 1.
76-A:10 Failure to Make Payment. If any municipality fails to make payments as provided in this chapter:
I. The state treasurer shall withhold an amount equal to any unremitted statewide education property taxes for which the municipality is liable, from any amounts payable by the state to such municipality. The state treasurer shall not pay to any municipality any amounts that may be due it from the state until all payments of statewide education property tax as due have been paid; and
II. The commissioner shall penalize the municipality for an amount which is twice the amount owed by the municipality under this chapter.
76-A:11 Extents. The state treasurer may also issue an extent for the amounts of all statewide education property taxes not remitted by any municipality as provided in this chapter.
76-A:12 Supplementary Bond of Collector. Whenever the commissioner considers it necessary, a tax collector may be required to furnish a further and additional bond beyond that required by other provisions of law, with sureties, in such form and amount as the commissioner approves. The additional premium costs shall be paid by the state from the education trust fund established by RSA 198:39.
76-A:13 Disposition of Taxes. All funds received by the state treasurer under the provisions of this chapter shall be deposited in the education trust fund established by RSA 198:39.
Statewide Education Property Tax Relief
76-A:14 Claims for Statewide Education Property Tax Relief.
I.(a) A claimant shall be entitled to make claim to the taxing municipality for statewide education property tax relief equal to the excess education property taxes as levied under this chapter on the first $100,000 of equalized valuation of the claimants homestead. Such claims shall not exceed $2,250 per claimant during any calendar year. A claimant shall not be entitled to any statewide education property tax relief if there are no excess education property taxes or for any excess education property taxes which accrued prior to January 1 of the preceding calendar year.
(b) No claim with respect to relief by a claimant under this subdivision shall be allowed unless the claim is filed with the municipality by March 1 following the date of notice of tax as defined in RSA 72:1-d. The municipality shall include all necessary forms for filing as provided by the department in the first bill.
II. No interest shall be allowed on any relief to which a claimant may be entitled under this subdivision.
76-A:15 Rebate to Claimant. Within 30 days of receipt of a claim, the municipality shall reduce the claimant's tax bill by the qualifying excess education property taxes. Where more than one tax bill is issued by the municipality, the excess education property taxes shall be divided proportionally between the bills. Timely payment to the municipality of net taxes by the claimant is not required to receive the tax reduction under this chapter.
76-A:16 Reports of Claims. Municipalities shall report to the department by April 1 of each year on the total amount of rebates made under RSA 76-A:15. By April 15 of each year, the department shall report to the state treasurer the total amount of rebates made by each municipality under RSA 76-A:15.
76-A:17 Reimbursement to Municipalities for Claims. Within 30 days of receipt of the report by the department required under RSA 76-A:16, the state treasurer shall reimburse municipalities for the total of qualified claims received under RSA 76-A:15. Such payments shall be charged against the education trust fund established in RSA 198:39.
76-A:18 One Claimant Per Household. Only one claimant per household per year shall be entitled to relief under this subdivision.
76-A:19 Claim is Personal. The right to file a claim under this subdivision shall be personal to the claimant. The right to file a claim under this subdivision shall survive the claimant's death to the extent that this right may be exercised on behalf of a claimant by a legal guardian, attorney, spouse, or another person who could have qualified as the claimant had the decedent not filed.
76-A:20 Administration; Rulemaking.
I. This subdivision shall be administered and enforced by the department.
II. The department shall adopt rules, pursuant to RSA 541-A, necessary to administer and enforce this subdivision.
76-A:21 Forms for Claim.
I. The commissioner of revenue administration shall make available to municipalities suitable forms with instructions for claimants. Such forms may require claimants to provide all information reasonably necessary to determining the accuracy of claims, including, but not limited to, property taxes accrued, changes of homestead, household membership, household income, size and nature of property claimed as the homestead, and a statement that the property taxes have been or will be paid by the claimant.
II. Municipalities shall make such forms available to claimants.
76-A:22 Verification of Claim; Redetermination.
I. If a municipality has reason to suspect the accuracy of a claim, the municipality may request that the department verify the household income of the claimant.
II. Upon receipt of such income verification from the department, the municipality may redetermine the claim and assess and collect, in the same manner as provided for property taxes under RSA 80, any amount of such claim in excess of the predetermined amount.
76-A:23 Fraudulent Claims; Penalty. A person shall be guilty of a class A misdemeanor who:
I. Files a fraudulent claim.
II. With fraudulent intent, assisted in the preparation or filing of the fraudulent claim or supplied information upon which the fraudulent claim was prepared.
76-A:24 Appeals. Any person aggrieved by the denial in whole or in part of a claim under this subdivision, except when the denial is based upon late filing of claim, may appeal the denial to the board of tax and land appeals or to the superior court in the county in which the person resides by filing a petition within 30 days after such denial. Procedures for an appeal of a denial of a claim shall be the same as the procedures for an appeal of a denial of an abatement of property tax under RSA 76:16-a-76:17.
76-A:25 Claim Applied Against Outstanding Liabilities. The amount of any claim otherwise payable under this subdivision may be applied by the municipality against any liability outstanding against the claimant or against anyone who was a member of the household in the taxable year to which the claim relates.
2 Education Trust Fund. Amend RSA 6:12, I(www) to read as follows:
(www) Money received under RSA 76-A, RSA 77-A, RSA 77-E, RSA 78, RSA 78-A, RSA 78-B, RSA 83-F, RSA 198:46, and from the sweepstakes fund, which shall be credited to the education trust fund under RSA 198:39.
3 Rate of Utility Property Tax Increased. Amend RSA 83-F:2 to read as follows:
83-F:2 Tax Imposed. For taxable periods beginning April 1, 1999, a tax is imposed upon the value of utility property at the rate [of $6.60] established by the commissioner under RSA 76-A:2, IV on each $1000 of such value, to be assessed annually as of April 1, and every year thereafter, and paid in accordance with this chapter.
4 Utility Property; Exemption. Amend RSA 83-F:9 to read as follows:
83-F:9 Exemption from [Local Taxation] Statewide Education Property Tax. Persons and property subject to taxation under this chapter shall not be subject to tax under RSA [76:3] 76-A; provided, however, that nothing in this chapter shall be construed to exempt such persons or property from local school, municipal, district, or county taxation under RSA 76.
5 New Paragraph; Definition; Tax Effort Per Pupil. Amend RSA 198:38 by inserting after paragraph XI the following new paragraph:
XII. "Tax effort per pupil" means the equalized education tax rate for a municipality based on equalized assessed valuation that is required to raise $1,000 per pupil above that provided by the adequate education grant in this subdivision and other non-municipal sources. Pupil counts are based on the average daily membership in residences, as defined in paragraph X.
6 Payments to Cap Tax Effort Per Pupil Added. Amend the introductory paragraph of RSA 198:39, I to read as follows:
I. The state treasurer shall establish an education trust fund in the treasury. Moneys in such fund shall not be used for any purpose other than to distribute adequate education grants to municipalities' school districts pursuant to RSA 198:42 and make payments to municipalities to cap their tax effort per pupil under this subdivision. The state treasurer shall deposit into this fund immediately upon receipt:
7 New Subparagraph; Education Trust Fund. Amend RSA 198:39, I by inserting after subparagraph (k) the following new subparagraph:
(l) The full amount of the statewide property tax under RSA 76-A.
8 New Sections; Supplemental Distributions Per Pupil. Amend RSA 198 by inserting after section 40 the following new sections:
198:40-a Determination of the Maximum Tax Effort Per Pupil. The maximum tax effort per pupil is set at the equalized rate of $5 using the latest available equalization survey for equalized value.
198:40-b Supplemental Distributions to Cap Tax Effort per Pupil. Any municipality for which there is a dollar amount needed to reduce the municipality's tax effort per pupil to an equalized rate of $5 for education spending greater than provided by the education trust fund and all other non-municipal sources for the last completed school year for any fiscal year shall be entitled to a quarterly supplemental distribution over the next school year equal to that amount which would have reduced the municipality's tax effort per pupil, in the immediately preceding tax year, as defined in RSA 198:38, XII, to a rate of $5 based on equalized assessed valuation. Such supplemental distributions shall be distributed in the same manner as adequate education grants under RSA 198:42.
9 New Section; Use of Funds. Amend RSA 198 by inserting after section 43 the following new section:
198:43-a Use of Funds.
I. Municipalities shall apply the entire amount of aid received under RSA 198:42 to education. On or before June 30 of each year, the individual with fiscal responsibility in each municipality shall submit a statement to the commissioner of education that the adequate education grant received under RSA 198:42 was applied entirely to education. The statement shall include the following: "I certify, under the pains and penalties of perjury, that all of the information contained in this document is true, accurate, and complete."
10 Repeal. RSA 76:3, relative to the education property tax, is repealed.
11 Effective Date. This act shall take effect 60 days after its passage.
LBAO
99-1051
6/22/99
HB 747-FN-A-LOCAL - FISCAL NOTE
AN ACT relative to the education property tax and adequate education grants.
FISCAL IMPACT:
The Office of Legislative Budget Assistant is unable to complete a fiscal note for this bill as it is awaiting information from an agency.