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REFERENCE TITLE: property tax roll; corrections |
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State of Arizona Senate Fifty-first Legislature First Regular Session 2013
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SB 1315 |
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Introduced by Senators Yarbrough: Worsley
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AN ACT
transferring and renumbering section 42-16109, Arizona Revised Statutes, for placement in title 42, chapter 15, article 4, Arizona Revised Statutes, as section 42-15154; amending section 42-15154, Arizona Revised Statutes, as transferred and renumbered by this act; amending sections 42-15157, 42-16251, 42-16252, 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 42-16109, Arizona Revised Statutes, is transferred and renumbered for placement in title 42, chapter 15, article 4, Arizona Revised Statutes, as section 42-15154 and, as so renumbered, is amended to read:
42-15154. Corrections and changes to tax roll
A. After the roll has been certified by the assessor pursuant to section 42-15153, the county board of supervisors may correct any error, as defined in section 42-16251, or mistake in the assessor's valuation or legal classification under the law when if the county board considers it necessary to properly list the property on the roll at its full cash value.
B. The county board shall require the assessor to place on the roll and determine the valuation or legal classification of any property that is subject to taxation but that is not on the roll. In the absence of the assessor, the county board shall determine the valuation or legal classification of the omitted property and transmit the proposed valuation or legal classification to the department as provided by section 42‑11056. and shall notify the property owner of the roll correction. The property owner may appeal the correction as provided by chapter 16, article 6 of this title.
C. The county assessor shall make the necessary changes in the tax roll and records to reflect the county board's determination and transmit notice of the corrected valuation or legal classification to the department as prescribed by section 42-11056.
D. The department has the right to intervene and be heard in any proceeding pursuant to this section.
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 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 42-16251, 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":
(a) Means any mistake in 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 assessing or collecting property taxes resulting from:
(a) (i) An imposition of an incorrect, erroneous or illegal tax rate that resulted in assessing or collecting excessive taxes.
(b) (ii) 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) (iii) Applying the incorrect assessment ratio percentages prescribed by chapter 15, article 1 of this title.
(d) (iv) 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) (v) A mistake in the description of the size, use or ownership of land, improvements or personal property.
(ii) (vi) Clerical or typographical errors in reporting or entering data that was used directly to establish valuation.
(iii) (vii) 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) (viii) The existence or nonexistence of the property on the valuation date.
(ix) As limited by this article, the discovery of an error in property characteristic data after mailing the annual notice of value pursuant to section 42-15101 to a grouping of properties delineated by neighborhood or classification.
(v) (x) Any other objectively verifiable error that does not require the exercise of discretion, opinion or judgment.
(b) 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, a county assessor or a county board of supervisors, whichever is appropriate under the circumstances.
4. 5. "Taxpayer" means the owner of real or personal property that is liable for tax.
Sec. 4. 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 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 shall 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. If an owner of real property the taxpayer consents to the proposed correction, or consents to the 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. If an owner of real property 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 taxpayer disputes the proposed correction, the assessor or department 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 basis of the dispute. If, after the meeting, the parties reach an agreement on the proposed correction, the roll shall be corrected promptly.
F. If after the meeting the parties fail to agree on all or part of the proposed correction, the department or assessor shall serve a notice on the taxpayer by certified mail advising the taxpayer that the error will be corrected within forty‑five days unless 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 notice prescribed by this subsection is mailed, date of the meeting or it is barred. On receiving the petition, the board shall hold a hearing on the proposed correction 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.
Sec. 5. 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 to discuss the basis for the dispute.
E. If, after the meeting, the parties agree on all or part of the proposed correction, the board of supervisors shall direct the county treasurer to correct the tax roll to the extent agreed, and any taxes that have been overpaid shall be refunded with interest at the rate determined pursuant to section 42‑1123 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 shall be corrected promptly.
F. If after the meeting the parties fail to agree on all or part of the proposed correction, 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 sixty 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 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. 6. 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 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 alleged error shall be adjudicated as part of the administrative or judicial appeal for the affected tax year. 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. 7. Section 42-16256, Arizona Revised Statutes, is amended to read:
42-16256. Limitations
A. In the case of real or personal property, 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, and a certificate of purchase for delinquent taxes has not been issued pursuant to chapter 18, article 3 of this title.
B. Except as provided in subsection C of this section, and subject to the provisions of section 42‑16252, subsection D, a notice of error proposed correction or notice of claim 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 and any future tax years for which a notice of value has been mailed pursuant to section 42‑15101 or 42-15105. If the error is discovered after the roll has been extended pursuant to section 42-17152, additional tax, interest or penalties shall not be imposed. This limitation does not apply to property discovered on audit or investigation pursuant to chapter 15, article 2 of this title.
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. For an error described in section 42-16251, paragraph 3, subdivision (a), item (i), a notice of proposed correction is limited to the tax year for which the annual notice of value was mailed and must be mailed to the property owner on or before June 30 of the valuation year.
E. 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.
F. This section shall not be construed to limit the correction of the roll for the current tax year or any subsequent valuation year for which a notice of value has been sent to the taxpayer. All roll corrections shall be processed in a timely manner to allow property taxes to be properly levied and promptly collected.
Sec. 8. 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 shall use the valuation and legal classification criteria that were in effect on the valuation date for the tax year of the correction.
Sec. 9. 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 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.
D. If an error or omission is determined under this section, the property owner shall be notified of the roll correction and may appeal the correction pursuant to section 42-16252.
Sec. 10. Title 42, chapter 16, article 6, Arizona Revised Statutes, is amended by adding section 42-16259, to read:
42-16259. Transmitting corrections and claims to county treasurer; billing
A. The county treasurer shall mail a corrected billing to the taxpayer on any of the following:
1. The consent of the taxpayer to the roll correction.
2. The consent of the taxing authority to the notice of claim.
3. The decision of the board of equalization.
B. Any taxes that are assessed pursuant to this article are delinquent if they are not paid within sixty days after the date the corrected billing is mailed to the taxpayer. If taxes have been overpaid, they shall be refunded with interest at the rate prescribed in section 42-16214 within ninety days after the roll is corrected.