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CSHB 156(CRA): "An Act relating to municipal property tax exemptions; extending a mandatory exemption from municipal property taxes for certain assets of the Alaska Industrial Development and Export Authority; and providing for an effective date by amending the effective dates of sec. 2, ch. 10, SLA 2010, as amended by sec. 4, ch. 61, SLA 2012, and sec. 2, ch. 71, SLA 2010, as amended by sec. 5, ch. 61, SLA 2012."

00                       CS FOR HOUSE BILL NO. 156(CRA)                                                                    
01 "An Act relating to municipal property tax exemptions; extending a mandatory                                            
02 exemption from municipal property taxes for certain assets of the Alaska Industrial                                     
03 Development and Export Authority; and providing for an effective date by amending                                       
04 the effective dates of sec. 2, ch. 10, SLA 2010, as amended by sec. 4, ch. 61, SLA 2012,                                
05 and sec. 2, ch. 71, SLA 2010, as amended by sec. 5, ch. 61, SLA 2012."                                                  
06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
07    * Section 1. AS 29.45.030(a) is amended to read:                                                                   
08            (a)  The following property is exempt from general taxation:                                                 
09                 (1)  municipal property, including property held by a public corporation                                
10       of a municipality, state property, property of the University of Alaska, or land that is                          
11       in the trust established by the Alaska Mental Health Enabling Act of 1956, P.L. 84-                               
12       830, 70 Stat. 709, except that                                                                                    
13                      (A)  a private leasehold, contract, or other interest in the                                       
01 property is taxable to the extent of the interest; however, an interest created by                                      
02 an operating agreement or [A] nonexclusive use agreement between the                                                
03 Alaska Industrial Development and Export Authority and a shipyard operator                                          
04 or a user of an integrated transportation and port facility, if the shipyard or                                 
05 integrated transportation and port facility is owned by the authority and                                           
06 initially placed in service before January 1, 1999, is taxable only to the extent                                       
07 of, and for the value associated with, those specific improvements used for                                             
08            lodging purposes;                                                                                            
09 (B)  notwithstanding any other provision of law, property                                                               
10 acquired by an agency, corporation, or other entity of the state through                                                
11 foreclosure or deed in lieu of foreclosure and retained as an investment of a                                           
12 state entity is taxable; this subparagraph does not apply to federal land granted                                       
13 to the University of Alaska under AS 14.40.380 or 14.40.390, or to other land                                           
14 granted to the university by the state to replace land that had been granted                                            
15 under AS 14.40.380 or 14.40.390, or to land conveyed by the state to the                                                
16            university under AS 14.40.365;                                                                               
17 (C)  an ownership interest of a municipality in real property                                                           
18 located outside the municipality acquired after December 31, 1990, is taxable                                           
19 by another municipality; however, a borough may not tax an interest in real                                             
20            property located in the borough and owned by a city in that borough;                                         
21 (2)  household furniture and personal effects of members of a                                                           
22       household;                                                                                                        
23 (3)  property used exclusively for nonprofit religious, charitable,                                                     
24       cemetery, hospital, or educational purposes;                                                                      
25 (4)  property of a nonbusiness organization composed entirely of                                                        
26 persons with 90 days or more of active service in the armed forces of the United States                                 
27 whose conditions of service and separation were other than dishonorable, or the                                         
28       property of an auxiliary of that organization;                                                                    
29                 (5)  money on deposit;                                                                                  
30 (6)  the real property of certain residents of the state to the extent and                                              
31       subject to the conditions provided in (e) of this section;                                                        
01                 (7)  real property or an interest in real property that is                                              
02                      (A)  exempt from taxation under 43 U.S.C. 1620(d), as                                              
03            amended or under 43 U.S.C. 1636(d), as amended; or                                                           
04                      (B)  acquired from a municipality in exchange for land that is                                     
05            exempt from taxation under (A) of this paragraph, and is not developed or                                    
06            made subject to a lease;                                                                                     
07 (8)  property of a political subdivision, agency, corporation, or other                                                 
08 entity of the United States to the extent required by federal law; except that a private                                
09 leasehold, contract, or other interest in the property is taxable to the extent of that                                 
10 interest unless the property is located on a military base or installation and the                                      
11 property interest is created under 10 U.S.C. 2871 - 2885 (Military Housing                                              
12 Privatization Initiative), if [PROVIDED THAT] the leaseholder enters into an                                        
13 agreement to make a payment in lieu of taxes to the political subdivision that has                                      
14       taxing authority;                                                                                                 
15 (9)  natural resources in place including coal, ore bodies, mineral                                                     
16 deposits, and other proven and unproven deposits of valuable materials laid down by                                     
17       natural processes, unharvested aquatic plants and animals, and timber;                                            
18                 (10)  property not exempt under (3) of this subsection that                                             
19 (A)  is owned by a private, nonprofit college or university that is                                                     
20 accredited by a regional or national accrediting agency recognized by the                                               
21 Council for Higher Education Accreditation or the United States Department                                              
22            of Education, or both; and                                                                                   
23 (B)  was subject to a private leasehold, contract, or other private                                                     
24 interest on January 1, 2010, except that a holder of a private leasehold,                                               
25 contract, or other interest in the property shall be taxed to the extent of that                                        
26            interest.                                                                                                    
27    * Sec. 2. AS 29.45.050(m) is amended to read:                                                                      
28 (m)  A municipality may by ordinance partially or totally exempt all or some                                            
29 types of economic development property from taxation for a designated period.                                       
30 Except as otherwise provided by an ordinance enacted by the municipality before                                     
31 January 1, 2017 [UP TO FIVE YEARS. THE MUNICIPALITY MAY PROVIDE                                                     
01 FOR RENEWAL OF THE EXEMPTION UNDER CONDITIONS ESTABLISHED                                                               
02 IN THE ORDINANCE. HOWEVER, UNDER A RENEWAL], a municipality that is                                                     
03 a school district may only exempt all or a portion of the amount of taxes that exceeds                                  
04 the amount levied on other property for the school district's required local                                        
05 contribution under AS 14.17.410(b)(2) [DISTRICT]. A municipality may by                                             
06 ordinance permit deferral of payment of taxes on all or some types of economic                                          
07 development property for a designated period. A municipality may not apply an                                       
08 exemption or deferral under this subsection to taxes levied for special services in                                 
09 a service area that is supervised by a board under AS 29.35.460 [UP TO FIVE                                         
10 YEARS. THE MUNICIPALITY MAY PROVIDE FOR RENEWAL OF THE                                                                  
11 DEFERRAL UNDER CONDITIONS ESTABLISHED IN THE ORDINANCE]. A                                                              
12 municipality may adopt an ordinance under this subsection only if, before it is                                         
13 adopted, copies of the proposed ordinance made available at a public hearing on it                                      
14 contain written notice that the ordinance, if adopted, may be repealed by the voters                                    
15 through referendum. An ordinance adopted under this subsection must include specific                                    
16 eligibility requirements and require a written application for each exemption or                                        
17 deferral. In this subsection, "economic development property" means real or personal                                    
18 property, including developed property conveyed under 43 U.S.C. 1601 et seq.                                            
19       (Alaska Native Claims Settlement Act) [, THAT]                                                                    
20                 (1)  to which one or more of the following applies:                                                 
21 (A)  the property has not previously been taxed as real or                                                          
22            personal property by the municipality;                                                                       
23 (B)  the property [(2)] is used in a trade or business in a way                                                     
24            that                                                                                                         
25                           (i) [(A)]  creates employment in the municipality;                                        
26 (ii) [(B)]  generates sales outside of the municipality of                                                          
27                 goods or services produced in the municipality; or                                                      
28 (iii) [(C)]  materially reduces the importation of goods or                                                         
29                 services from outside the municipality;                                                                 
30 (C)  an exemption or deferral on the property enables a                                                             
31            significant capital investment in physical infrastructure that                                           
01                           (i)  expands the tax base of the municipality; and                                        
02                           (ii)  will generate property tax revenue after the                                        
03                 exemption expires; or                                                                               
04 (2)  that [AND (3)] has not been used in the same trade or business in                                              
05 another municipality for at least six months before the application for deferral or                                     
06 exemption is filed; this paragraph does not apply if the property was used in the same                                  
07 trade or business in an area that has been annexed to the municipality within six                                       
08 months before the application for deferral or exemption is filed; this paragraph does                                   
09       not apply to inventories.                                                                                         
10    * Sec. 3. The uncodified law of the State of Alaska is amended by adding a new section to                          
11 read:                                                                                                                   
12 REVISOR'S INSTRUCTION. When implementing secs. 2 and 3, ch. 10, SLA 2010,                                               
13 and sec. 2, ch. 71, SLA 2010, the legislature does not intend to retain the amendments to                               
14 AS 29.45.030(a)(1) made by sec. 1 of this Act, but does intend to retain the amendment to                               
15 AS 29.45.030(a)(8) made by sec. 1 of this Act.                                                                          
16    * Sec. 4. Section 8, ch. 10, SLA 2010, as amended by sec. 4, ch. 61, SLA 2012, is amended                          
17 to read:                                                                                                                
18            Sec. 8. Section 2, ch. 10, SLA 2010, takes effect November 30, 2027 [2017].                          
19    * Sec. 5. Section 10, ch. 71, SLA 2010, as amended by sec. 5, ch. 61, SLA 2012, is                                 
20 amended to read:                                                                                                        
21            Sec. 10. Section 2, ch. 71, SLA 2010, takes effect November 30, 2027 [2017].