MISSISSIPPI LEGISLATURE
2010 Regular Session
To: Ways and Means
By: Representative Brown
AN ACT TO BRING FORWARD SECTIONS 27-35-15, 27-35-47, 27-35-49, 27-35-50, 27-35-113, 27-35-147 AND 27-35-165, MISSISSIPPI CODE OF 1972, WHICH RELATE TO THE ASSESSMENT OF PROPERTY FOR THE PURPOSE OF AD VALOREM TAXATION, FOR THE PURPOSES OF AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-35-15, Mississippi Code of 1972, is brought forward as follows:
27-35-15. (1) The tax assessors shall annually appraise all personal property subject to taxation in their respective counties at true value and assess it in proportion thereto. They shall set down in the assessment roll the names in full of all persons liable to taxation in the county in alphabetical order under each municipality, but firms or persons owning the same class of property may be listed on the roll together regardless of the alphabetical order. Where there are on the roll more than one (1) person of the same name, the place of residence of each shall be shown, or they shall be otherwise so designated as to identify each and distinguish them. The assessor shall set down each item of personal property liable to taxation and the amount of each individual's taxable property shall be totaled and set down in the column provided, opposite his name. The assessor shall so fill out the blanks on the rolls as to disclose clearly and fully all information indicated by the roll.
The tax assessor shall place in the columns provided on the roll the true value of the property owned by each taxpayer in every road district, school district, levee district or other special taxing district imposing an ad valorem tax; and he shall truly and correctly add every column on the roll and show in the proper column the total amount of property assessed to every taxpayer and the amount assessed to every taxpayer in each and every road district, school district or other special taxing district; and the totals of each column from every page shall be carried to the recapitulation on a page or pages in the back of the roll. The tax assessor shall add the recapitulation and show the total amount of all property assessed in his county and the total for each municipality, school district, road district, levee district or other special taxing district imposing an ad valorem tax. The assessor shall also show in his recapitulation the correct total of each and every column in the roll.
(2) The tax assessors shall include on the personal property roll the list of aircraft received from the State Tax Commission which are liable for registration but which have not been so registered as required by Title 61, Chapter 15, Mississippi Code of 1972.
SECTION 2. Section 27-35-47, Mississippi Code of 1972, is brought forward as follows:
27-35-47. Land shall be assessed for ad valorem taxation for the year 1950 and annually thereafter.
SECTION 3. Section 27-35-49, Mississippi Code of 1972, is brought forward as follows:
27-35-49. It shall be the duty of the tax assessor to assess all the lands in his county and he shall require the owner, agent, or person having possession, or charge, of any lands, to render a list of all lands owned, or in charge, or in possession, of such owner, agent or person, and land shall be appraised according to its true value and assessed in proportion thereto, taking into consideration the improvements thereon.
Every person owning or being in possession, or in charge, of any land shall deliver to the tax assessor on demand, and in any event, not later than April first in each year, a list of all lands owned by, or in possession, or in charge, made out on the tax lists prescribed; and showing the total number of acres (except the land be platted by blocks and lots), the total number of acres of cultivatable lands and the value thereof, and the number of acres of uncultivatable land and the value thereof and the number of acres devoted to agricultural purposes as of January 1 of each year; and buildings or improvements subject to taxation on any lands returned for assessment. If the lands be surveyed and platted, it shall be returned so as to clearly identify it by the recorded plat thereof, and the list rendered shall disclose the value of each lot and the value of any buildings, structures, or improvements thereon. Any person required by this section to render a list of any lands shall show in what road district, school district, levee district, municipality, or other taxing district, the same is located. If any person shall deliver or disclose to an assessor, or deputy assessor, a list, statement or return in regard to his land which, in the opinion of the assessor, or deputy assessor, is false or fraudulent, or contains any understatement or undervaluation, or fails to show the proper classification of lands, or fails to show buildings and improvements, or other elements of value, the assessor shall make an assessment of the land with the proper classification thereof including the omitted things, at a valuation equal to the value at which like lands similarly situated are assessed. Lands not given in by any person shall be assessed in the same manner by the assessor at a valuation equal to the assessment of other like lands similarly situated and all buildings and improvements, or other elements of value shall in all cases be separately valued and assessed.
SECTION 4. Section 27-35-50, Mississippi Code of 1972, is brought forward as follows:
27-35-50. (1) True value shall mean and include, but shall not be limited to, market value, cash value, actual cash value, proper value and value for the purposes of appraisal for ad valorem taxation.
(2) With respect to each and every parcel of property subject to assessment, the tax assessor shall, in ascertaining true value, consider whenever possible the income capitalization approach to value, the cost approach to value and the market data approach to value, as such approaches are determined by the State Tax Commission. For differing types of categories of property, differing approaches may be appropriate. The choice of the particular valuation approach or approaches to be used should be made by the assessor upon a consideration of the category or nature of the property, the approaches to value for which the highest quality data is available, and the current use of the property.
(3) Except as otherwise provided in subsection (4) of this section, in determining the true value of land and improvements thereon, factors to be taken into consideration are the proximity to navigation; to a highway; to a railroad; to a city, town, village or road; and any other circumstances that tend to affect its value, and not what it might bring at a forced sale but what the owner would be willing to accept and would expect to receive for it if he were disposed to sell it to another able and willing to buy.
(4) (a) In arriving at the true value of all Class I and Class II property and improvements, the appraisal shall be made according to current use, regardless of location.
(b) In arriving at the true value of any land used for agricultural purposes, the appraisal shall be made according to its use on January 1 of each year, regardless of its location; in making the appraisal, the assessor shall use soil types, productivity and other criteria set forth in the land appraisal manuals of the State Tax Commission, which criteria shall include, but not be limited to, an income capitalization approach with a capitalization rate of not less than ten percent (10%) and a moving average of not more than ten (10) years. However, for the year 1990, the moving average shall not be more than five (5) years; for the year 1991, not more than six (6) years; for the year 1992, not more than seven (7) years; for the year 1993, not more than eight (8) years; and for the year 1994, not more than nine (9) years; and for the year 1990, the variation up or down from the previous year shall not exceed twenty percent (20%) and thereafter, the variation, up or down, from a previous year shall not exceed ten percent (10%). The land shall be deemed to be used for agricultural purposes when it is devoted to the commercial production of crops and other commercial products of the soil, including, but not limited to, the production of fruits and timber or the raising of livestock and poultry; however, enrollment in the federal Conservation Reserve Program or in any other United States Department of Agriculture conservation program shall not preclude land being deemed to be used for agricultural purposes solely on the ground that the land is not being devoted to the production of commercial products of the soil, and income derived from participation in the federal program may be used in combination with other relevant criteria to determine the true value of such land. The true value of aquaculture shall be determined in the same manner as that used to determine the true value of row crops.
(c) In determining the true value based upon current use, no consideration shall be taken of the prospective value such property might have if it were put to some other possible use.
(d) In arriving at the true value of affordable rental housing, the assessor shall use the appraisal procedure set forth in land appraisal manuals of the State Tax Commission. Such procedure shall prescribe that the appraisal shall be made according to actual net operating income attributable to the property, capitalized at a market value capitalization rate prescribed by the State Tax Commission that reflects the prevailing cost of capital for commercial real estate in the geographical market in which the affordable rental housing is located adjusted for the enhanced risk that any recorded land use regulation places on the net operating income from the property. The owner of affordable rental housing shall provide to the county tax assessor on or before April 1 of each year, an accurate statement of the actual net operating income attributable to the property for the immediately preceding year prepared in accordance with generally acceptable accounting principles. As used in this paragraph:
(i) "Affordable rental housing" means residential housing consisting of one or more rental units, the construction and/or rental of which is subject to Section 42 of the Internal Revenue Code (26 USC 42), the Home Investment Partnership Program under the Cranston-Gonzalez National Affordable Housing Act (42 USC 12741 et seq.), the Federal Home Loan Banks Affordable Housing Program established pursuant to the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) of 1989 (Public Law 101-73), or any other federal, state or similar program intended to provide affordable housing to persons of low or moderate income and the occupancy and maximum rental rates of such housing are restricted based on the income of the persons occupying such housing.
(ii) "Land use regulation" means a restriction imposed by an extended low-income housing agreement or other covenant recorded in the applicable land records or by applicable law or regulation restricting the maximum income of residents and/or the maximum rental rate in the affordable rental housing.
(5) The true value of each class of property shall be determined annually.
(6) The State Tax Commission shall have the power to adopt, amend or repeal such rules or regulations in a manner consistent with the Constitution of the State of Mississippi to implement the duties assigned to the commission in this section.
SECTION 5. Section 27-35-113, Mississippi Code of 1972, is brought forward as follows:
27-35-113. (1) It shall be the duty of the Department of Revenue to carefully examine the recapitulations of the assessment rolls of the counties, when received, to compare the assessed valuation of the various classes of property in the respective counties, to investigate and determine if the assessed valuation of any classes of property in any one or more counties of the state is not equal and uniform with the assessed values fixed upon the same classes of property in other counties of the state, and to ascertain if any class of property in any one or more counties is assessed contrary to law.
(2) The department shall, by regulation, establish performance standards and acceptable parameters for evaluation of the accuracy of assessments. These standards shall include, but not be limited to, the following:
(a) Assessment level: The ratio of assessments to current true value or market value;
(b) Assessment uniformity: The test of uniformity or fairness of individual assessments; and
(c) Assessment equity: The test of price-related bias.
(3) To perform its examination of the recapitulations of the assessment rolls of the counties, the department shall annually conduct assessment/ratio studies of each county or utilize other means, as determined appropriate by the department, to determine if each county's assessment records comply with acceptable performance standards. The department shall send notice of the results of this examination to the assessor and the board of supervisors of each county no later than thirty (30) days after receipt of the board of supervisors' recapitulation. Any county not in compliance with the acceptable performance standards shall, within ninety (90) days from the date of the notice concerning the department's examination of the county's assessments records, adopt and submit to the department for approval a plan for achieving compliance and begin the implementation of the plan so that compliance can be achieved by the second succeeding year's assessment roll after the tax year for which the department's notice of noncompliance with performance standards was issued. Failure to adopt and submit an approved plan for achieving compliance or failure to properly implement and follow an approved plan shall cause the department to withhold the county's homestead exemption reimbursement monies until such time as the county has complied with this provision. In the event the county has not complied with this provision by the end of the state's fiscal year, then the department shall place the funds so held in a special escrow account. All interest shall accrue to the benefit of the county on this account.
(4) The department shall approve the recapitulation of the assessment rolls and the property tax rolls of any county operating under a supervised plan to achieve compliance within the first two (2) roll years as provided for in the paragraph above, notwithstanding that the county may be failing a test or tests of the accuracy or equity of assessment.
(5) Any county failing to achieve such compliance for the second succeeding year's assessment roll as outlined above shall be subject to the following restrictions until such time as said tax rolls come into compliance:
(a) The department shall place into escrow all homestead exemption reimbursements;
(b) The county shall levy and pay over to the department, for purposes of being placed in the escrow account, the proceeds of the one (1) mill levy provided for in Section 27-39-329(1)(b). All interest shall accrue to the benefit of the county on any funds placed in an escrow account; and
(c) The department shall identify the class or classes of property whose assessment level is not in conformity with the regulation of the department governing same, and shall have the authority to adjust and equalize that class or classes of property by, either requiring a fixed percent (1) to be added to the assessed valuation of any class of property in any county found too low; or (2) to be deducted from the assessed valuation of any class of property found too high; in order that the class or classes of property are being assessed in conformity with the department's regulation.
(6) Once the county achieves compliance with the standard of performance as to assessment level, uniformity and equity as established by the rules and regulations of the Department of Revenue, the department shall release to the county all funds held in escrow on its behalf during the period of noncompliance.
(7) The board of supervisors of any county aggrieved by the decision of the department regarding the department's examination of the recapitulations of its assessment rolls may appeal such decision to the Board of Tax Appeals within thirty (30) days from the date of the notice from the department advising the county of the results of the department's examination of the recapitulation of the assessment rolls of the county. The Board of Tax Appeals shall hear the objections by the board of supervisors and grant whatever relief it deems appropriate; however, the Board of Tax Appeals shall not have the authority to grant relief which is inconsistent with this section. The decision of the Board of Tax Appeals shall be final.
(8) It is the intent of this section and that of this chapter to vest the Department of Revenue with authority to investigate and determine the assessed valuation of classes of property, and to further establish and/or clarify that tax assessors and the boards of supervisors are vested with the absolute authority to investigate and determine the assessed valuations of individual parcels of property located in their particular county in a manner consistent with the laws of this state.
SECTION 6. Section 27-35-147, Mississippi Code of 1972, is brought forward as follows:
27-35-147. The board of supervisors, upon its own motion, or upon notice from the tax assessor, the State Tax Commission, or other officer authorized to assess, or have assessed property escaping taxation, shall have power, at any time in the current year that an assessment roll is in force, to increase an assessment subject to approval as hereinafter provided, or to assess property or persons omitted from such roll or rolls under the following circumstances:
1. When lands have been assessed and buildings and improvements thereon have been omitted from the roll.
2. When the value of lands, assessed according to the number of acres or as an entire tract, has increased because actually subdivided into lots or smaller tracts, on or before the preceding tax lien date.
3. When the value of the lands has been increased by reason of changes or improvements made in or on adjacent lands before the preceding tax lien date, and the lands have been assessed without taking into consideration the changed conditions.
4. When lands or improvements thereon have been listed as exempt from taxation, but were subject to assessment and taxation on the preceding tax lien date.
5. When the property is liable for a special district levy tax but has not been assessed for the benefit of such district.
When the board of supervisors shall change any assessment as provided in this section, it shall require its clerk to give ten (10) days' notice in writing, and the notice may be given by mail to the last known address of the party, or by newspaper publication, and all objections to such change shall be heard at the next meeting of the board of supervisors. The party affected by the order may appeal from the decision of the board in the manner provided for appeal from other assessments.
SECTION 7. Section 27-35-165, Mississippi Code of 1972, is brought forward as follows:
27-35-165. (1) No county shall expend funds for the reappraisal of property or for property appraisal updates unless the plans for reappraisal or the contract for reappraisal is in conformity with the then existing rules and regulations of the State Tax Commission and has been approved by the State Tax Commission.
(2) Reappraisals or appraisal updates by a county may be accomplished by:
(a) Contracting with private firms for performance of the work;
(b) Hiring private consultants to perform certain functions of the work; or
(c) Employing, schooling and training county employees to perform all of the work under the supervision of the tax assessor.
(3) (a) All contracts made pursuant to subsection (2)(a) of this section shall require that the contractor furnish a payment and performance bond in an amount not less than one hundred percent (100%) of the contract price, which bond shall be conditioned, in part, to guarantee successful completion of the contract and may be conditioned upon payment of the cost of defense of any suits which may be brought against the county, the board of supervisors or the assessor arising out of such reappraisal for a period of one (1) year after completion thereof.
(b) (i) When work is performed under a contract with a private firm pursuant to subsection (2)(a) of this section and the work is performed under the direction of the county tax assessor, all personnel employed or otherwise engaged by such private firm to appraise property shall be certified under the provisions of Section 27-3-52 with expertise in mass appraisals as prescribed by the State Tax Commission.
(ii) When work is performed under a contract with a private firm pursuant to subsection (2)(a) of this section and the work is not performed under the direction of the county tax assessor, all personnel employed or otherwise engaged by such private firm to appraise property shall work under the direction of a state certified real estate appraiser as defined in Section 73-34-3 with expertise in mass appraisals as prescribed by the State Tax Commission. When a board of supervisors, pursuant to Section 27-35-129, determines to contract with a private firm not working under the direction of the county tax assessor, it may do so upon the issuance of an order by the State Tax Commission stating that the county is not in compliance with State Tax Commission rules and regulations.
(iii) When a private consultant is hired pursuant to subsection (2)(b) of this section to appraise property and the work is performed under the direction of the county tax assessor, the private consultant and all personnel employed or otherwise engaged by such private consultant to appraise property shall be certified under the provisions of Section 27-3-52.
(iv) When a private consultant is hired pursuant to subsection (2)(b) of this section to appraise property and the work is not performed under the direction of the county tax assessor, the private consultant shall be a state certified real estate appraiser as defined in Section 73-34-3 with expertise in mass appraisals as prescribed by the State Tax Commission. When a board of supervisors, pursuant to Section 27-35-129, determines to contract with a private consultant not working under the direction of the county tax assessor, it may do so upon the issuance of an order by the State Tax Commission stating that the county is not in compliance with State Tax Commission rules and regulations.
(c) A contract entered into with a private firm or a private consultant pursuant to subsection (2) of this section shall be executed by the county tax assessor and the board of supervisors if the work performed under such contract is to be performed under the direction of the county tax assessor.
(4) Each county engaged in reappraisal of property shall submit such periodic reports to the State Tax Commission as the commission may require. If, at any time, the State Tax Commission determines that the reappraisal or property appraisal update is not in conformity to the approved plan or contract, the commission shall notify the affected board of supervisors of the deficiencies and the board shall take action acceptable to the commission to correct the deficiencies within thirty (30) days or make no further expenditures on the project until the necessary corrective actions are approved by the commission.
(5) Upon payment for any work done on any contract regarding reappraisal or property appraisal update, the work product for which payment is made shall become the property of the county.
SECTION 8. This act shall take effect and be in force from and after July 1, 2010.