HB 2415 — Establishes a definition of "assessment value" for real property assessment purposes

SECOND REGULAR SESSION HOUSE COMMITTEE SUBSTITUTE FOR HOUSE BILL NO.

2415 103RD GENERAL ASSEMBLY INTRODUCED4066H.02C BYJOSEPH REPRESENTATIVEENGLER, VANChief SCHOIACK.Clerk AN ACT To repeal sections 137.016 and 138.390, RSMo, and to enact in lieu thereof two new sections relating to the assessment of real property.

4066H.01I JOSEPH ENGLER, Chief Clerk AN ACT To repeal section 137.016, RSMo, and to enact in lieu thereof one new section relating to the assessment value of real property.

SectionSections 137.016,137.016 and 138.390, RSMo, isare repealed and onetwo new sectionsections enacted in lieu thereof, to be known as sectionsections 137.016,137.016 and 138.390, to read as follows:

Agricultural and horticultural property shall also include land devoted to and qualifying for payments or other EXPLANATION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is intended to be omitted from the law.

HCS HB 2415 2 horticultural property shall also include land devoted to and qualifying for payments or other compensation under a soil conservation or agricultural assistance program under an agreement with an agency of the federal government.

(4) "Assessment value":value", for real property assessment purposes:

(a) For a building, the value of the building using the replacement cost approach, reconciled with other applicable approaches to real property assessmentvaluation; purposes:

a.(b) For land other than agricultural or horticultural land, such land's value as determined by the market;

Forand a(c) building,For theagricultural valueand ofhorticultural theland, building using the replacementproductive costcapability approachof adjustedthe byland theas qualitydetermined ofunder thesection construction;137.021.

b.2.

For land other than agricultural or horticultural land, such land's value as determined by the market;

and c.

For agricultural and horticultural land, the productive capability of the land as determined under section 137.021.

(b) When the terms "assessed valuation", "assessed value", "free market value", "market value", "property values", "true value in money", and "value" are used in the revised statutes of Missouri for real property assessment purposes, such terms shall be construed to refer to "assessment value" as defined in paragraph (a) of this subdivision.

HB 2415 3 2.

For purposes of this section, loss in revenue shall include the difference between the revenue that would have been collected on such property under its classification prior to enactment of this section and the HCS HB 2415 3 amount to be collected under its classification under this section.

HB 2415 4 (5) Availability of water, electricity, gas, sewers, street lighting, and other public services for such property;

All lands classified as forest croplands shall not, for taxation purposes, be classified as subclass (1), subclass (2), or subclass (3) real property, as such classes are HCS HB 2415 4 prescribed in Section 4(b) of Article X of the Missouri Constitution and defined in this section, but shall be taxed in accordance with the laws enacted to implement Section 7 of Article X of the Missouri Constitution.

138.390.

1.

The state tax commission shall equalize the valuation of real and tangible personal property among the several counties in the state in the following manner:

with the abstracts of all the taxable property in the several counties of the state and the abstracts of the sales of real estate in such counties as returned by the respective county clerks and the assessor of the city of St.

Louis, the commission shall classify all real estate situate in cities, towns, and villages, as town lots, and all other real estate as farming lands, and shall classify all tangible personal property as follows:

banking corporations, railroad corporations, street railroad corporations, all other corporations, horses, mares and geldings, mules, asses and jennets, neat cattle, sheep, swine, goats, domesticated small animals and all other livestock, poultry, power machinery, farm implements, other tangible personal property.

2.

(1) The state tax commission shall equalize the valuation of each class or subclass of property thereof among the respective counties of the state in the following manner:

[(1)] (a) It shall add to the valuation of each class, subclass, or portion thereof of the property, real or tangible personal, of each county which it believes to be valued below its real value in money such amount or percent as will increase the same in each case to its true value;

[(2)] (b) It shall deduct from the valuation of each class, subclass, or portion thereof of the property, real or tangible personal, of each county which it believes to be valued above its real value in money such amount or percent as will reduce the same in each case to its true value.

(2) (a) For the purposes of this subsection, the state tax commission shall utilize ratio studies to determine whether a class or subclass of property is valued below or above its true value in money.

(b) A class or subclass of property shall be considered to be valued below its true value in money if:

a.

The weighted median ratio is less than seventy percent and the coefficient of dispersion is greater than twenty-five percent;

or b.

The weighted median ratio is less than seventy percent and the upper bound of the ninety-five percent confidence interval for the weighted median is less than seventy percent.

(c) A class or subclass of property shall be considered to be valued above its true value in money if:

a.

The weighted median ratio is greater than one hundred percent and the coefficient of dispersion is greater than twenty-five percent;

or HCS HB 2415 5 b.

The weighted median ratio is greater than one hundred percent and the upper bound of the ninety-five percent confidence interval for the weighted median is greater than one hundred percent.