HCS CSSB 161(CRA): "An Act relating to municipal taxation of farm land and farm structures; and providing for an effective date."
00 HOUSE CS FOR CS FOR SENATE BILL NO. 161(CRA) 01 "An Act relating to municipal taxation of farm land and farm structures; and providing 02 for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 29.45.050(t) is amended to read: 05 (t) A municipality may by ordinance [APPROVED BY THE VOTERS] 06 partially or totally exempt from taxation farm land and farm structures [A FARM 07 STRUCTURE] used exclusively for farming activity, or purposes directly related to 08 farming activity, if the farm land or farm structure meets the criteria set out in this 09 subsection. The farm land or farm structure must be [IS] owned or leased by a 10 person that is actively engaged in farming, and the owner or lessee must sell at least 11 $2,500 of agricultural products produced from the land during the tax year and 12 file an Internal Revenue Service Schedule F (Form 1040) with the United States 13 Internal Revenue Service. The farm land or farm [THAT DERIVES AT LEAST 14 10 PERCENT OF THE PERSON'S YEARLY GROSS INCOME FROM FARMING
01 ACTIVITY, AND THE] structure must be [IS] used for 02 (1) the growing, storage, or processing of grains, fruits, vegetables, 03 aquatic farm products as defined in AS 16.40.199, or other crops specified by 04 ordinance [INTENDED FOR HUMAN CONSUMPTION] and produced by the 05 owner's or lessee's farming activity; 06 (2) the storage or processing of 07 (A) feed for livestock; 08 (B) livestock, poultry, or other animals used in the owner's or 09 lessee's farming activity; 10 (C) [(B)] milk or milk products produced by the owner's or 11 lessee's farming activity; or 12 (3) sheltering, stabling, or milking the owner's or lessee's dairy 13 animals, poultry, or livestock. 14 * Sec. 2. AS 29.45.050(y) is amended to read: 15 (y) In this section, "farming activity" means raising and harvesting crops; 16 feeding, breeding, and managing livestock; dairying; propagating, farming, or 17 cultivating an aquatic farm product as defined in AS 16.40.199; or any 18 combination of those activities. 19 * Sec. 3. AS 29.45.050 is amended by adding a new subsection to read: 20 (z) In the event that an owner or lessee of farm use land does not sell $2,500 21 of agricultural products produced from the land during a tax year because of 22 circumstances beyond the control of the owner or lessee, the owner may secure the 23 exemption under (t) of this section if the farm use land qualified for the exemption 24 under (t) of this section for the three preceding tax years. In this subsection, 25 "circumstances beyond the control of the owner or lessee" includes crop failure or 26 physical injury that prevents the owner or lessee from conducting farming activity. 27 * Sec. 4. AS 29.45.060(a) is amended to read: 28 (a) Farm use land, and structures on farm use land that are used for farm 29 operations, included in a farm unit and not dedicated or being used for nonfarm 30 purposes shall be assessed on the basis of full and true value for farm use and may not 31 be assessed as if subdivided or used for some other nonfarm purpose. The assessor
01 shall maintain records valuing the land for both full and true value and farm use value. 02 If the land is sold, leased, or otherwise disposed of for uses incompatible with farm 03 use or converted to a use incompatible with farm use by the owner, the owner is liable 04 to pay an amount equal to the additional tax at the current mill levy together with eight 05 percent interest for the preceding seven years, as though the land had not been 06 assessed for farm use purposes. Payment by the owner shall be made to the state to the 07 extent of its reimbursement for revenue loss under (d) of this section for the preceding 08 seven years. The balance of the payment shall be made to the municipality. 09 * Sec. 5. AS 29.45.060(b) is amended to read: 10 (b) An owner of farm use land shall, to secure the assessment under this 11 section, apply to the assessor on or before May 15 of each year in which the 12 assessment is desired. The application shall be made on [UPON] forms prescribed by 13 the state assessor for the use of the local assessor, and must include information that 14 may reasonably be required to determine the entitlement of the applicant. If the land is 15 leased for farm use purposes, the applicant shall furnish to the assessor a copy of the 16 lease bearing the signatures of both lessee and lessor along with the completed 17 application. The applicant shall furnish the assessor a copy of the lease covering the 18 period for which the exemption is requested. This subsection does not apply to a 19 person with an interest in land that is classified by the state for agricultural use or that 20 is restricted by the state for agricultural purposes. 21 * Sec. 6. AS 29.45.060(c) is amended to read: 22 (c) In the event that an owner or lessee of farm use land does not sell 23 $2,500 of agricultural products produced from the land during a tax year 24 because of circumstances beyond the control of the owner or lessee, the owner 25 may secure the assessment under this section if the farm use land qualified for 26 the assessment under this section for the three preceding tax years. In this 27 subsection, "circumstances beyond the control of the owner or lessee" includes 28 [OF A] crop failure or physical injury that prevents the owner or lessee from 29 conducting farming activity [BY AN ACT OF GOD THE PREVIOUS YEAR, THE 30 OWNER OR LESSEE MAY SUBMIT AN AFFIDAVIT AFFIRMING THAT 10 31 PERCENT OF GROSS INCOME FOR THE PAST THREE YEARS WAS FROM
01 FARMING]. 02 * Sec. 7. AS 29.45.060(f) is amended to read: 03 (f) This section does not apply to land for which the owner has granted, and 04 has outstanding, a lease or option to buy the surface rights. A property owner wishing 05 to file for farm use classification having no history of farm-related income may submit 06 a declaration of intent at the time of filing the application with the assessor setting out 07 the intended use of the land and certifying that the property owner intends to file 08 an Internal Revenue Service Schedule F (Form 1040) with the United States 09 Internal Revenue Service for the current tax year [THE ANTICIPATED 10 PERCENTAGE OF INCOME]. An applicant using this procedure shall file with the 11 assessor on or before April 15 [FEBRUARY 1] of the following year a copy of the 12 Schedule F (Form 1040) the applicant files with the Internal Revenue Service 13 [NOTARIZED STATEMENT OF THE PERCENTAGE OF GROSS INCOME 14 ATTRIBUTABLE TO THE LAND]. Failure to make a [THE] filing required in this 15 subsection forfeits the exemption. 16 * Sec. 8. AS 29.45.060(g) is amended to read: 17 (g) In this section, 18 (1) "farm use" means the use of land for the production of crops, 19 fruits, or other agricultural products for human consumption or for the 20 sustenance or grazing of livestock if the owner or lessee sells at least $2,500 of 21 agricultural products produced from the land during the tax year and files an 22 Internal Revenue Service Schedule F (Form 1040) with the United States Internal 23 Revenue Service; 24 (2) "livestock" includes cattle, hogs, sheep, goats, chickens, 25 turkeys, pigeons, and other poultry raised to provide meat or other products for 26 human consumption [PROFIT FOR RAISING AND HARVESTING CROPS, FOR 27 THE FEEDING, BREEDING, AND MANAGEMENT OF LIVESTOCK, FOR 28 DAIRYING, OR ANOTHER AGRICULTURAL USE, OR ANY COMBINATION 29 OF THESE. TO BE FARM USE LAND, THE OWNER OR LESSEE MUST BE 30 ACTIVELY ENGAGED IN FARMING THE LAND, AND DERIVE AT LEAST 10 31 PERCENT OF YEARLY GROSS INCOME FROM THE LAND].
01 * Sec. 9. This Act takes effect immediately under AS 01.10.070(c).