S.J.R. L: COMMITTEE SUMMARY - SPECIAL ASSESSMENTS: TAXABLE VALUE

Senate Joint Resolution L (as introduced 4-23-97)

Committee: Finance

Date Completed: 5-20-97

CONTENT

The resolution proposes an amendment to Article 9 of the State Constitution to provide that an ad valorem special assessment levied in any year after 1996 would have to be levied on the taxable value of the property that was assessed; and that the assessment cap on property taxes in Article 9, Section 3 would apply to special assessments levied in any year after 1996.

(Various State statutes authorize special assessments. In general, a special assessment is an assessment on a parcel of property's State equalized valuation (SEV) that is levied for a specific purpose, such as lighting, streets, sewers, or water, that benefits the property subject to the special assessment; however, some special assessments are levied on all taxable real property within a local unit, for such things as police and fire services. Pursuant to the assessment cap placed in Article 9, Section 3 of the State Constitution by the voters in 1994, the assessment on a parcel of property can increase, from one year to the next, only by the lesser of 5% or the rate of inflation; once a parcel is sold, the property is assessed at its market value and the new cap begins to apply again. Both the "taxable value" and the SEV of property are calculated each year; the taxable value reflecting the value at which the property is taxed pursuant to the assessment cap, and the SEV reflecting the property's increase (or decrease) in market value.)

- Legislative Analyst: G. Towne

FISCAL IMPACT

The Senate Joint Resolution specifies that special assessments levied for 1997 and subsequent years would have to be based on the taxable value of the assessed property. Local units that currently use the SEV for special assessments and do not increase millage rates would decrease special assessment collections by using the taxable value.

- Fiscal Analyst: R. Ross

S9798\SSJRLSA

This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.