Missouri Senate

House Committee Substitute

The imposition of penalties and interest on the erroneous payments of property taxes is prohibited when there is clear and convincing evidence that the county made an error in determining the tax amount due. Any penalty or interest paid by the taxpayer will be refunded upon the discovery of the error or omission. Individuals who are disabled or who are 60 years of age or older by October 15 of the year in which a claim is filed may elect to have the property tax on their homestead deferred if they have lived in their home for at least the previous five years, did not file a homestead exemption credit, have equity interest in the homestead of at least percent, and have the homestead insured for at least the amount of the assessed valuation by filing a claim with the county assessor after January 1 and on or before October 15 of the first year in which a deferral is claimed. A lien for the amount of the deferred taxes, fees, and accrued interest will be placed against the property until the taxes are paid voluntarily, the death of the taxpayer, sale or transfer of the homestead, or after any outstanding indebtedness against the tax-deferred property is refinanced. The Senior Property Tax Deferral Revolving Account is established to receive repayments of deferred property taxes and pay county tax collectors property taxes deferred. Interest will accrue annually on the actual amount of taxes advanced to the county for the tax-deferred property at the rate of the average annual interest rate paid on bonds plus two percent rounded up to the nearest whole percentage. If there is insufficient money in the account to make payments to the counties, as determined by the State Auditor, the necessary amount will be transferred from general revenue and repaid as funds become available or the account may be funded by bonds.

Voter-approved property tax rate increases must to be applied to a political subdivision's most recent total assessed valuation, as certified by the city or county on or before the date of the election. Every political subdivision in a reassessment year must roll back its prior year's tax rate regardless of whether the political subdivision was levying the tax at its tax rate ceiling. A political subdivision may modify its tax rate, not to exceed its maximum authorized voter-approved levy, through the adoption of an ordinance, resolution, or policy statement in a non-reassessment year. All counties and the City of St. Louis must allow public testimony at the public hearing prior to setting the tax rates.

Charter counties and the City of St. Louis will set their tax rates by October 1st instead of September 20th. Assessors for the City of St. Louis and all charter counties must notify taxpayers by June 15th of real property assessment increases and the county provide an estimated tax liability for the property beginning January 1, 2009. Assessors for non-charter counties must notify taxpayers by June 15th of real property assessment increases and the county has to provide an estimated tax liability for the property beginning January 1, 2011. Assessors are required to provide the city or county clerks with assessment books by March 1st of each year to assist with determining the estimated tax liability on properties with increased assessed valuations. The clerks must make abstracts of the assessment books showing the aggregate amount of different types of property and the valuation of each type for each political subdivision levying taxes on property. Governing bodies of political subdivisions have to informally project non-binding tax rate levies from the information provided in the abstracts and provide the projected levies to the clerk by April 8th of each year; County collector must calculate the projected tax liability for each property for which the assessor intends to provide a notice of increased assessed valuation by April 30th by utilizing the projected tax levies. A political subdivision's tax levy will be reduced by twenty percent for the tax year if it fails to provide projected tax levies by April 8th, unless the failure is a direct result of a delinquency in providing, or a failure to provide, the required information by either the clerk or the assessor.

The date that the St. Louis County Board of Equalization convenes is moved back from the first Monday in June to the second Monday in July. The State Tax Commission must develop or enter into contracts for the development of computer software programs which will produce the notice of projected tax liability. Any collector that files a request with the commission before December 31, 2009, will be provided with the computer software programs; The circuit court clerk must send the county collector a notice when a taxpayer timely files an appeal seeking exemption of a final decision of the local board of equalization. The notice must contain the taxpayer's name, the case number assigned by the court, and the parcel or locator number of the property being appealed. The notice to the collector must state that the taxes in dispute are to be impounded. The commission to send the county collector a notice of appeal when a taxpayer timely files an appeal. The notice must contain the taxpayer's name, the appeal number assigned by the commission, the assessed value provided to the local board of equalization, and the assessed value proposed by the taxpayer if the values are available to the commission when the appeal is filed. The notice must also specifically state that the taxes in dispute are to be impounded; and if the notice is filed in an odd-numbered year, it will serve as notice to the collector to impound taxes for the following even-numbered year if no decision has been rendered in the appeal. Taxpayers are relieved from the requirement of filing a statement of protest if the taxpayer filed an appeal from a local board of equalization to the commission or circuit court.

The requirement that certain counties and the City of St. Louis must deduct a percentage of all ad valorem property tax collections and deposit the amount into the county's assessment fund is extended from December 31, 2009, to December 31, 2015. The percentage deducted is increased from either one-eighth of one percent or one-quarter of one percent to either one-eighth of one percent or one-half of one percent and the income limits are increased from one hundred thousand dollars to one hundred twenty-five thousand dollars in any year for first classification and charter counties and from fifty thousand dollars to seventy-five thousand dollars for second, third, and fourth classification counties. If the commission withholds state assessment reimbursement funds from a county for three consecutive quarters, the extra one- eighth of one percent or one-half of one percent collection revenues in the county assessment fund will be forfeited and returned by the county to the political subdivisions within the county; The act changes which counties of the first classification are required to withhold one percent of all ad valorem taxes to be deposited into the county's assessment fund.

The true value in money for assessment purposes of any possessor interest in real property on or adjacent to a certain commercial airport and owned by a political subdivision will be the true value in money of the possessor interest in the real property less the total costs paid toward any new construction or improvements on the property if included in the possessor interest, unless paid by the political subdivision, regardless of the year the costs were incurred. Beginning January 1, 2009, a taxpayer may receive a property tax credit for expenses incurred to manufacture, maintain, or improve a freight line company's qualified rolling stock up to the amount of such taxpayer's tax liability. The state will annually reimburse a political subdivision for any loss in revenue resulting from utilization of the tax credit.

The act modifies several provisions of law regarding the notification of appeal of assessment and the impounding, investing, and refunding of protested tax payments. School districts which levy a tax rate below the performance levy due to mandatory roll-backs will continue to be eligible to receive grants currently provided to small school districts. Political subdivisions with voter-approved rate increases subsequent to setting their most recent tax rate are exempt from the provisions regarding the mandatory rollback in reassessment years. The requirement that the commission notify each school district of the equivalent sales ratio for the previous year which was adopted to determine the equalized assessed valuation of the property and the equalized operating levy of the school district for distributions under the previous school foundation formula is repealed. The position of taxpayer advocate is created, within the state tax commission, to represent and protect the interests of taxpayers regarding property taxation.

JASON ZAMKUS