HCS SS SCS SB 960 -- PROPERTY TAX REASSESSMENTS

SPONSOR:  Gibbons (Cooper, 120)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Tax Policy
by a vote of 11 to 0.

This substitute makes technical clarifications to various
provisions of the property tax law that were changed in HB 1150
enacted in 2002.  It clarifies that the inflationary growth
factor allowed to be applied for each class or subclass of
property upon reassessment may differ among the types of
property.  The limit for growth will be equal to the actual
assessment in the class or subclass.  However, the net limit for
the political subdivision will still be the Consumer Price Index
or 5%, as set by the Missouri Constitution.

The substitute prevents the rollback calculation of the rates for
the four classes of property from causing a roll-up of the
personal property tax rate.  It clarifies that when a rate must
be revised-up to hold the political subdivision harmless after
making the above calculation, the revision will be weighted based
on the relative assessed valuation of the class or subclass of
the property.

The substitute requires that all existing and any future rules or
forms interpreting the rate calculation in Section 137.073, RSMo,
must be promulgated by rule and not incorporated into a rule by
reference.

The City of St. Louis and counties other than St. Louis County
are allowed to opt-out of the provisions of HB 1150.  Current law
makes these provisions effective January 1, 2005, but the
substitute changes the effective date to October 1, 2004, but
then allows an opt-out provision before January 1, 2005.  Once
the provisions of HB 1150 are implemented in a county in a year
of general reassessment, the county cannot opt-out.  Any county
that does opt-out may opt-in at a later date.  If a political
subdivision lies on the border of two or more counties, and one
of those counties has opted out without the others doing so, the
governing body of the political subdivision must calculate a
single blended rate for the school districts in the political
subdivision.

FISCAL NOTE:  No impact on state funds in FY 2005, FY 2006, and
FY 2007.

PROPONENTS:  Supporters say that the current law is too favorable
to business and doesn't protect tax receipts of political
subdivisions.  The bill will save third classification counties
significant expense with the opt-out language.

Testifying for the bill were Senator Gibbons; Missouri School
Boards Association; Missouri County Clerks Association; Carroll
County; Cooperative Greater Kansas City School Districts;
Missouri Association of County Clerks and Election Authorities;
Missouri Assessor's Association; St. Louis County Municipal
League; East Central College; Cooperative School Districts of St.
Louis; and County Commissioners Association of Missouri.

OPPONENTS:  Those who oppose the bill say that they favor the
change to correct the rate calculations in St. Louis and oppose
the business personal property tax portion of the original bill.
The definitions are unclear; and the depreciation schedules are
too accelerated, do not include installation costs, and do not
reflect the actual value of properties.

Testifying against the bill were Associated Industries of
Missouri; and Missouri Council of School Administrators.

OTHERS:  Others testifying on the bill say they would have
opposed this substitute if the business personal property tax
portion of the original bill had not been removed.

Others testifying on the bill was DaimlerChrysler Corporation.

Karla Strobel, Legislative Analyst

Missouri House of Representatives
92nd General Assembly, 2nd Regular Session
Last Updated September 23, 2004 at 11:16 am