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REFERENCE TITLE: tax credit; just compensation |
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State of Arizona House of Representatives Fifty-first Legislature Second Regular Session 2014
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HB 2331 |
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Introduced by Representatives Livingston, Farnsworth E
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AN ACT
amending title 43, chapter 10, article 5, Arizona Revised Statutes, by adding section 43‑1077; amending title 43, chapter 11, article 6, Arizona Revised Statutes, by adding section 43‑1177; relating to regulatory tax credit.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 43, chapter 10, article 5, Arizona Revised Statutes, is amended by adding section 43-1077, to read:
43-1077. Credit for just compensation
A. In this section, unless the context otherwise requires:
1. "Fair market value" means the most likely price estimated in terms of money which the land would bring if exposed for sale in the open market, with reasonable time allowed in which to find a purchaser, buying with knowledge of all the uses and purposes to which it is adapted and for which it is capable.
2. "Just compensation" for purposes of a credit claimed pursuant to this section means the sum of money that is equal to the reduction in fair market value of the property resulting from the enactment of the land use law as of the date of enactment of the land use law.
3. "Land use law" means any statute, rule, ordinance, resolution or law enacted by this state or a political subdivision of this state that regulates the use or division of land or any interest in land or that regulates accepted farming or forestry practices.
4. "Owner" means the holder of fee title to the subject real property.
B. Notwithstanding any law to the contrary, if The existing rights to use, divide, sell or possess private real property are reduced by the enactment or applicability of any land use law enacted after the date the property is transferred to the owner and such action reduces the fair market value of the property the owner is entitled to a credit against the owner's tax liability assessed pursuant to chapter 10, 11, 13 or 14 of this title in the amount of just compensation, provided that the credit is claimed by the owner in lieu of asserting any rights under title 12, chapter 8, article 2.1, section 12‑1134.
C. With respect to any county, city or town that enacted the land use law for which a credit has been claimed pursuant to this section, the state treasurer shall:
1. Withhold from the distribution of monies pursuant to title 42, chapter 5, article 1, section 42‑5029, as amended or superseded from time to time, to the affected county, city or town the respective aggregate amount of credits claimed under this section.
2. Credit monies withheld pursuant to this subsection to the state general fund as provided by section 42‑5029, subsection D, paragraph 4 as amended or superseded from time to time.
D. With respect to any political subdivision of this state other than those identified in subsection C of this section or any state agency that enacted or promulgated the land use law for which a credit has been claimed pursuant to this section, the state treasurer shall:
1. Withhold from the distribution of monies from the general fund to the affected political subdivision or state agency the respective aggregate amount of credits claimed under this section.
2. Credit monies withheld pursuant to this subsection to the state general fund.
E. This section does not apply to land use laws that:
1. Limit or prohibit a use or division of real property for the protection of the public health and safety, including rules and regulations relating to fire and building codes, health and sanitation, transportation or traffic control, solid or hazardous waste and pollution control;
2. Limit or prohibit the use or division of real property commonly and historically recognized as a public nuisance under common law;
3. Are required by federal law;
4. Limit or prohibit the use or division of a property for the purpose of housing sex offenders, selling illegal drugs, liquor control, or pornography, obscenity, nude or topless dancing, and other adult oriented businesses if the land use laws are consistent with the constitutions of this state and the United States;
5. Establish locations for utility facilities;
6. Do not directly regulate an owner's land; or
7. Were enacted before the effective date of title 12, chapter 8, article 2.1, section 12-1134.
F. In any challenge to a credit claimed pursuant to this section, this state or the political subdivision of this state that enacted the land use law has the burden of demonstrating that the land use law is exempt pursuant to subsection E of this section and that the amount of the credit claimed is unreasonable.
G. the owner shall not be required to first submit a land use application to remove, modify, vary or otherwise alter the application of the land use law to the owner's property as a prerequisite to demanding or receiving just compensation in the form of a credit pursuant to this section.
H. If a land use law continues to apply to private real property more than sixty days after the owner of the property makes a written demand in a specific amount for just compensation in the form of a credit pursuant to this section to this state or the political subdivision of this state that enacted the land use law, the owner is entitled to just compensation in the form of a credit pursuant to this section, unless this state or political subdivision of this state and the owner reach an agreement on the amount of just compensation to be paid, or unless this state or the political subdivision of this state amends, repeals or issues to the landowner a binding waiver of enforcement of the land use law on the owner's specific parcel.
I. Any demand for landowner relief or any waiver that is granted in lieu of compensation runs with the land.
J. Any claim for just compensation in the form of a credit pursuant to this section based on diminution in value must be made or forever barred within three years of the effective date of the land use law, or of the first date the reduction of the existing rights to use, divide, sell or possess property applies to the owner's parcel, whichever is later.
K. If the amount of the credit under this section exceeds the amount that may be applied for the taxable year, the amount of the credit not used as an offset against the tax liability for that taxable year may be carried forward as a credit against up to ten consecutive subsequent taxable years, but not exceeding the owner's tax liability in each subsequent taxable year.
L. Except for any rights under title 12, chapter 8, article 2.1, section 12-1134, which are fully waived and compromised by claiming a credit under this section, the remedy created by this section is in addition to any other remedy that is provided by the laws and constitution of this state or the united states and is not intended to modify or replace any other remedy.
M. Nothing in this section prohibits this state or any political subdivision of this state from reaching an agreement with a private property owner to waive a claim for diminution in value regarding any proposed action by this state or a political subdivision of this state or action requested by the property owner.
Sec. 2. Title 43, chapter 11, article 6, Arizona Revised Statutes, is amended by adding section 43-1177, to read:
43-1177. Credit for just compensation
A. In this section, unless the context otherwise requires:
1. "Fair market value" means the most likely price estimated in terms of money which the land would bring if exposed for sale in the open market, with reasonable time allowed in which to find a purchaser, buying with knowledge of all the uses and purposes to which it is adapted and for which it is capable.
2. "Just compensation" for purposes of a credit claimed pursuant to this section means the sum of money that is equal to the reduction in fair market value of the property resulting from the enactment of the land use law as of the date of enactment of the land use law.
3. "Land use law" means any statute, rule, ordinance, resolution or law enacted by this state or a political subdivision of this state that regulates the use or division of land or any interest in land or that regulates accepted farming or forestry practices.
4. "Owner" means the holder of fee title to the subject real property.
B. Notwithstanding any law to the contrary, if The existing rights to use, divide, sell or possess private real property are reduced by the enactment or applicability of any land use law enacted after the date the property is transferred to the owner and such action reduces the fair market value of the property the owner is entitled to a credit against the owner's tax liability assessed pursuant to chapter 10, 11, 13 or 14 of this title in the amount of just compensation, provided that the credit is claimed by the owner in lieu of asserting any rights under title 12, chapter 8, article 2.1, section 12‑1134.
C. With respect to any county, city or town that enacted the land use law for which a credit has been claimed pursuant to this section, the state treasurer shall:
1. Withhold from the distribution of monies pursuant to title 42, chapter 5, article 1, section 42‑5029, as amended or superseded from time to time, to the affected county, city or town the respective aggregate amount of credits claimed under this section.
2. Credit monies withheld pursuant to this subsection to the state general fund as provided by section 42‑5029, subsection D, paragraph 4 as amended or superseded from time to time.
D. With respect to any political subdivision of this state other than those identified in subsection C of this section or any state agency that enacted or promulgated the land use law for which a credit has been claimed pursuant to this section, the state treasurer shall:
1. Withhold from the distribution of monies from the general fund to the affected political subdivision or state agency the respective aggregate amount of credits claimed under this section.
2. Credit monies withheld pursuant to this subsection to the state general fund.
E. This section does not apply to land use laws that:
1. Limit or prohibit a use or division of real property for the protection of the public health and safety, including rules and regulations relating to fire and building codes, health and sanitation, transportation or traffic control, solid or hazardous waste and pollution control;
2. Limit or prohibit the use or division of real property commonly and historically recognized as a public nuisance under common law;
3. Are required by federal law;
4. Limit or prohibit the use or division of a property for the purpose of housing sex offenders, selling illegal drugs, liquor control, or pornography, obscenity, nude or topless dancing, and other adult oriented businesses if the land use laws are consistent with the constitutions of this state and the United States;
5. Establish locations for utility facilities;
6. Do not directly regulate an owner's land; or
7. Were enacted before the effective date of title 12, chapter 8, article 2.1, section 12-1134.
F. In any challenge to a credit claimed pursuant to this section, this state or the political subdivision of this state that enacted the land use law has the burden of demonstrating that the land use law is exempt pursuant to subsection E of this section and that the amount of the credit claimed is unreasonable.
G. the owner shall not be required to first submit a land use application to remove, modify, vary or otherwise alter the application of the land use law to the owner's property as a prerequisite to demanding or receiving just compensation in the form of a credit pursuant to this section.
H. If a land use law continues to apply to private real property more than sixty days after the owner of the property makes a written demand in a specific amount for just compensation in the form of a credit pursuant to this section to this state or the political subdivision of this state that enacted the land use law, the owner is entitled to just compensation in the form of a credit pursuant to this section, unless this state or political subdivision of this state and the owner reach an agreement on the amount of just compensation to be paid, or unless this state or the political subdivision of this state amends, repeals or issues to the landowner a binding waiver of enforcement of the land use law on the owner's specific parcel.
I. Any demand for landowner relief or any waiver that is granted in lieu of compensation runs with the land.
J. Any claim for just compensation in the form of a credit pursuant to this section based on diminution in value must be made or forever barred within three years of the effective date of the land use law, or of the first date the reduction of the existing rights to use, divide, sell or possess property applies to the owner's parcel, whichever is later.
K. If the amount of the credit under this section exceeds the amount that may be applied for the taxable year, the amount of the credit not used as an offset against the tax liability for that taxable year may be carried forward as a credit against up to ten consecutive subsequent taxable years, but not exceeding the owner's tax liability in each subsequent taxable year.
L. Except for any rights under title 12, chapter 8, article 2.1, section 12-1134, which are fully waived and compromised by claiming a credit under this section, the remedy created by this section is in addition to any other remedy that is provided by the laws and constitution of this state or the united states and is not intended to modify or replace any other remedy.
M. Nothing in this section prohibits this state or any political subdivision of this state from reaching an agreement with a private property owner to waive a claim for diminution in value regarding any proposed action by this state or a political subdivision of this state or action requested by the property owner.