SB 167: "An Act relating to property exempt from municipal taxation."
00 SENATE BILL NO. 167 01 "An Act relating to property exempt from municipal taxation." 02 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 03 * Section 1. AS 29.45.030(a) is amended to read: 04 (a) The following property is exempt from general taxation: 05 (1) municipal property, including property held by a public corporation 06 of a municipality, state property, property of the University of Alaska, or land that is 07 in the trust established by the Alaska Mental Health Enabling Act of 1956, P.L. 84- 08 830, 70 Stat. 709, except that 09 (A) a private leasehold, contract, or other interest in the 10 property is taxable to the extent of the interest; however, an interest created by 11 an operating agreement or nonexclusive use agreement between the Alaska 12 Industrial Development and Export Authority and a user of a shipyard or an 13 integrated transportation and port facility, if the shipyard or integrated 14 transportation and port facility is owned by the authority and initially placed in 15 service before January 1, 1999, is taxable only to the extent of, and for the
01 value associated with, those specific improvements used for lodging purposes; 02 (B) notwithstanding any other provision of law, property 03 acquired by an agency, corporation, or other entity of the state through 04 foreclosure or deed in lieu of foreclosure and retained as an investment of a 05 state entity is taxable; this subparagraph does not apply to federal land granted 06 to the University of Alaska under AS 14.40.380 or 14.40.390, or to other land 07 granted to the university by the state to replace land that had been granted 08 under AS 14.40.380 or 14.40.390, or to land conveyed by the state to the 09 university under AS 14.40.365; 10 (C) an ownership interest of a municipality in real property 11 located outside the municipality acquired after December 31, 1990, is taxable 12 by another municipality; however, a borough may not tax an interest in real 13 property located in the borough and owned by a city in that borough; 14 (2) household furniture and personal effects of members of a 15 household; 16 (3) property used primarily [EXCLUSIVELY] for nonprofit religious, 17 charitable, cemetery, hospital, or educational purposes; 18 (4) property of a nonbusiness organization composed entirely of 19 persons with 90 days or more of active service in the armed forces of the United States 20 whose conditions of service and separation were other than dishonorable, or the 21 property of an auxiliary of that organization; 22 (5) money on deposit; 23 (6) the real property of certain residents of the state to the extent and 24 subject to the conditions provided in (e) of this section; 25 (7) real property or an interest in real property that is 26 (A) exempt from taxation under 43 U.S.C. 1620(d), as 27 amended or under 43 U.S.C. 1636(d), as amended; or 28 (B) acquired from a municipality in exchange for land that is 29 exempt from taxation under (A) of this paragraph, and is not developed or 30 made subject to a lease; 31 (8) property of a political subdivision, agency, corporation, or other
01 entity of the United States to the extent required by federal law; except that a private 02 leasehold, contract, or other interest in the property is taxable to the extent of that 03 interest unless the property is located on a military base or installation and the 04 property interest is created under 10 U.S.C. 2871 - 2885 (Military Housing 05 Privatization Initiative), if the leaseholder enters into an agreement to make a payment 06 in lieu of taxes to the political subdivision that has taxing authority; 07 (9) natural resources in place including coal, ore bodies, mineral 08 deposits, and other proven and unproven deposits of valuable materials laid down by 09 natural processes, unharvested aquatic plants and animals, and timber; 10 (10) property not exempt under (3) of this subsection that 11 (A) is owned by a private, nonprofit college or university that is 12 accredited by a regional or national accrediting agency recognized by the 13 Council for Higher Education Accreditation or the United States Department 14 of Education, or both; and 15 (B) was subject to a private leasehold, contract, or other private 16 interest on January 1, 2010, except that a holder of a private leasehold, 17 contract, or other interest in the property shall be taxed to the extent of that 18 interest; 19 (11) parking lots that are primarily used to serve real property 20 that is exempt under this subsection. 21 * Sec. 2. AS 29.45.030(b) is amended to read: 22 (b) In (a) of this section, "property used primarily [EXCLUSIVELY] for 23 nonprofit religious purposes" includes the following property owned by a religious 24 organization: 25 (1) the residence of an educator in a private religious or parochial 26 school or a bishop, pastor, priest, rabbi, minister, or religious order of a recognized 27 religious organization; for purposes of this paragraph, "minister" means an individual 28 who is 29 (A) ordained, commissioned, or licensed as a minister 30 according to standards of the religious organization for its ministers; and 31 (B) employed by the religious organization to carry out a
01 ministry of that religious organization; 02 (2) a structure, its furniture, and its fixtures used primarily [SOLELY] 03 for public worship, charitable purposes, religious administrative offices, religious 04 education, or a nonprofit hospital; 05 (3) lots required by local ordinance for parking near a structure defined 06 in (2) of this subsection. 07 * Sec. 3. AS 29.45.030(c) is repealed and reenacted to read: 08 (c) Property described in (a)(3) or (4) of this section from which income is 09 derived is exempt from general taxation only if the income is from 10 (1) use of the property by a nonprofit religious, charitable, or hospital 11 group; 12 (2) use of the property by an educational group exclusively as 13 classroom space; 14 (3) use of the property for fundraising for a nonprofit religious, 15 charitable, hospital, or educational group; or 16 (4) leasing the property to another person to accomplish the purpose 17 for which the property is exempt; this paragraph does not apply to property owned by 18 an educational group. 19 * Sec. 4. AS 29.45.030 is amended by adding new subsections to read: 20 (o) Property described in (a)(3) of this section that is under construction or 21 reconstruction and intended to be used primarily for exempt purposes upon completion 22 is exempt from general taxation if the construction or reconstruction is completed 23 within two years after the date a building or zoning permit is issued for the property. 24 In this subsection, construction or reconstruction is completed on the first day the 25 property is occupied and used for the exempt purpose. 26 (p) Property described in (a)(3) of this section remains exempt from general 27 taxation if the property is used for 28 (1) a purpose that is directly incidental to and vitally necessary for the 29 exempt use of other property; or 30 (2) a nonexempt purpose for an insubstantial period of time.