Tax break for developers could be reinstated

[mrhaskellok]

http://www.tulsaworld.com/news/article.aspx?articleID=20080429_1_A4_spanc32238

Tax break for developers could be reinstated


By KEVIN CANFIELD World Staff Writer
4/29/2008

A bill making its way through the state Legislature would reinstate a tax break for developers and builders that was ruled unconstitutional by the state Supreme Court in January, County Assessor Ken Yazel says.

The bill would take millions of dollars worth of property off the tax rolls and likely raise millage rates for other property owners, Yazel said last week. The measure would especially hurt schools in Tulsa County because about 75 percent of property tax collections are dedicated to education, he said.

Senate Bill 958 is sponsored by Sen. Clark Jolley, R-Edmond, and Rep. Randy Terrill, R-Moore. It would require county assessors determining the fair market value of platted land to base assessments on the price the developer paid for the property until the property, with buildings, is sold, occupied by the owner, or leased.

Improvements dedicated to public use, such as roads and sewers, made by the developer before it is sold to a builder could not be considered in assessing the property's fair market value.

Builders buying land from developers, meanwhile, would be taxed at the developers' rate. However, if construction on the property
did not begin within two years, the builder thereafter would be taxed on the price paid for the land.

The practical effect of the legislation would be to allow county assessors to consider surrounding property values and other factors -- but not infrastructure improvements or ongoing construction -- when doing their annual assessments of development property.

Critics of the assessment method say it basically freezes the taxable market value of such properties, sometimes for years.

Yazel estimated that the county would lose more than $1 million a year in tax collections on residential property alone under the bill. The loss on commercial property would be millions more, he said.

Yazel pointed to multimillion-dollar structures going up around the county that would escape the property tax rolls because they are not officially completed by the end of the year.

"I'm supposed to look at that structure and pretend like on Jan. 1 it has no value?" he asked.

The language used in the bill is nearly identical to that found unconstitutional by the state Supreme Court earlier this year, Yazel said.

In that case, Cleveland County resident Harold Liddell sued the Assessor's Office, claiming that it had used existing state law to systematically undervalue some developers' property in 2003 and 2004.

The Supreme Court ruled in Liddell's favor, saying the statute violated the state constitution's requirement that property value be based on its fair market value.

Mike Means, executive vice president of the Oklahoma State Home Builders Association, acknowledged that the legislation is similar to the statute that was struck down. Means said the minor changes proposed address what the Supreme Court found unconstitutional.

Developers and home builders have argued that the Supreme Court ruling will result in higher new home prices as property tax increases are passed along to consumers.

The measure is awaiting action in the Senate on House amendments.

[FOTD]

Fright wingnut Randy Terrible...his "idea" hurts public funding of public education. Faith based politicians need to be outed. Especially these panderers to intolerance and extremism.

[PonderInc]

If you've ever read through all the Oklahoma House and Senate Bills, you spend a lot of time going "HUH?"  This is another one of those.  Crazy, unjustified handout to developers.

[Friendly Bear]

quote:Originally posted by PonderInc

If you've ever read through all the Oklahoma House and Senate Bills, you spend a lot of time going "HUH?"  This is another one of those.  Crazy, unjustified handout to developers.

I'm not surprised.

Since they own the local government, it isn't surprising that they rent the state legislature from time to time.  

[Wrinkle]

I can see pro and con arguments on this issue.

However, the public should be allowed to participate in the discussion and decision.

Direct-to-Lawmakers marketing and subsequent legislation is circumventing that possibility.

Good example of how government directly affects your life without so much as you knowing it until after it happens.

Now my complaint is if it's good enough for developers, shouldn't it also apply to homeowners?