LB 270 (1997) - Property Tax Administration, Process, and Procedure

LB 270 contains numerous provisions pertaining to property tax administration, process, and procedure. The following material summarizes some of the bill's more important provisions. Especially noteworthy is the bill's clarification of provisions relating to the valuation of agricultural and horticultural land.

LB 270 expressly provides that agricultural land and horticultural land "shall be valued at eighty percent of its actual value." The bill also provides that the value of such land will not be determined using the productivity and earning capacity approach to valuation (this is the current practice, even though the statute had permitted the use of such approaches).

The bill also states that actual value may be determined using professionally accepted mass appraisal "methods," such as the "(1) sales comparison approach, taking into account factors such as location, zoning, and current functional use, (2) income approach, and (3) cost approach." However, LB 270 eliminates language providing that professionally accepted mass appraisal "techniques" include determining the earning capacity of the real property and reproduction cost less depreciation.

As one condition of qualifying for real or tangible personal property tax exemptions, LB 270 requires organizations and societies to apply annually Con or before December 31 of the year for which the exemption is sought") to the county assessor on forms prescribed by the Property Tax Administrator. (This rule does not apply to real property used for cemetery purposes or tangible personal property that is a motor vehicle.) However, if such an entity fails to file a timely exemption application, the entity may still apply, on or before June 30, to the county assessor for exemption, but the organization must also file a written request with the county board of equalization for a waiver. The county board is required to grant such a waiver if good cause exists for failing to meet the December 31 deadline. However, the county assessor must assess a penalty against the organization equal to the lesser of ten percent of the tax that would have been due or $100, for each calendar month or part of a month following the December 31 deadline that the application was late.

LB 270 redefines the phrases "real property" and "improvements," and defines several new terms or phrases including "omitted property," "undervalued and overvalued property," "tax situs," "assessment," and "tax district."

The bill renames the Tax Commissioner Revolving Fund the Property Tax Division Cash Fund (PTDCF) and requires revenue from various fees and penalties to be credited to the fund (eg., county assessor exam fees, the state's three-percent collection fee for administering carrier motor vehicle registrations and air carrier taxes, and various penalties levied against railroad companies, car line companies, and public service entities for filing late reports). Any balance remaining in the Tax Commissioner Revolving Fund will be transferred to the PTDCF, but fund balances in the PTDCF will not lapse into the state General Fund.

LB 270 also creates the Tax Equalization and Review Commission Cash Fund. All money that the commission receives for appeals and services must be credited to the fund, which must be used to carry out the provisions of the Tax Equalization and Review Commission Act. Any unexpended balance will not lapse into the General Fund.

LB 270 passed with the emergency clause 42-0 and was approved by the Governor on June 9, 1997.