2012 -- S 2107

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LC00369

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

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A N A C T

RELATING TO TAXATION - ASSESSMENT

     Introduced By: Senators Tassoni, and Doyle

     Date Introduced: January 18, 2012

     Referred To: Senate Finance

It is enacted by the General Assembly as follows:

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     SECTION 1. Sections 44-5-12 and 44-5-13.11 of the General Laws in Chapter 44-5

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entitled "Levy and Assessment of Local Taxes" are hereby amended to read as follows:

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     44-5-12. Assessment at full and fair cash value. -- (a) All real property subject to

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taxation shall be assessed at its full and fair cash value, or at a uniform percentage of its value,

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not to exceed one hundred percent (100%), to be determined by the assessors in each town or

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city; provided, that:

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      (1) Any In assessing any residential property, or the improvements thereon, encumbered

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by a covenant recorded in the land records in favor of a governmental unit, or Rhode Island

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housing and mortgage finance corporation, or a section 501(3)(c) nonprofit corporation restricting

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(i) The sale price of an owner occupied single-family property, including a residential

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condominium unit; (ii) either or both the The rents that may be charged or the incomes of to the

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occupants; or (iii) the The maximum incomes of the occupants, such property shall be assessed

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and taxed in accordance with section 44-5-13.11;

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      (2) In assessing real estate which is classified as farm land, forest, or open space land in

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accordance with chapter 27 of this title the assessors shall consider no factors in determining the

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full and fair cash value of the real estate other than those which relate to that use without regard

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to neighborhood land use of a more intensive nature;

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      (3) Warwick. - The city council of the city of Warwick is authorized to provide, by

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ordinance, that the owner of any dwelling of one to three (3) family units in the city of Warwick

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who makes any improvements or additions on his or her principal place of residence in the

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amount up to fifteen thousand dollars ($15,000), as may be determined by the tax assessor of the

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city of Warwick, is exempt from reassessment of property taxes on the improvement or addition

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until the next general citywide reevaluation of property values by the tax assessor. For the

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purposes of this section, "residence" is defined as voting address. This exemption does not apply

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to any commercial structure. The property owner shall supply all necessary plans to the building

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official for the improvements or addition and shall pay all requisite building and other permitting

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fees as now are required by law; and

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      (4) Central Falls. - The city council of the city of Central Falls is authorized to provide,

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by ordinance, that the owner of any dwelling of one to eight (8) units who makes any

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improvements or additions to his or her residential or rental property in an amount not to exceed

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twenty thousand dollars ($20,000) as determined by the tax assessor of the city of Central Falls is

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exempt from reassessment of property taxes on the improvement or addition until the next general

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citywide reevaluation of property values by the tax assessor. The property owner shall supply all

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necessary plans to the building official for the improvements or additions and shall pay all

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requisite building and other permitting fees as are now required by law.

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      (5) Tangible property shall be assessed according to the asset classification table as

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defined in section 44-5-12.1.

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      (b) Municipalities shall make available to every land owner whose property is taxed

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under the provisions of this section a document which may be signed before a notary public

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containing language to the effect that they are aware of the additional taxes imposed by the

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provisions of section 44-5-39 in the event that they use land classified as farm, forest, or open

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space land for another purpose.

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      (c) Pursuant to the provisions of section 44-3-29.1, all wholesale and retail inventory

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subject to taxation is assessed at its full and fair cash value, or at a uniform percentage of its

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value, not to exceed one hundred percent (100%), for fiscal year 1999, by the assessors in each

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town and city. Once the fiscal year 1999 value of the inventory has been assessed, this value shall

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not increase. The phase-out rate schedule established in section 44-3-29.1(d) applies to this fixed

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value in each year of the phase-out.

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     44-5-13.11. Qualifying low-income housing -- Assessment and taxation. – (a) Any

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residential rental property that has been issued an occupancy permit on or after January 1, 1995,

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after substantial rehabilitation as defined by the U.S. Department of Housing and Urban

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Development and is encumbered by a covenant recorded in the land records in favor of a

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governmental unit or Rhode Island housing and mortgage finance corporation restricting either or

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both the rents that may be charged to tenants of the property or the incomes of the occupants of

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the property, is subject to a tax that equals eight percent (8%) of the property's previous years'

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gross scheduled rental income or a lesser percentage as determined by each municipality.

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     (b) Any owner occupied single-family property or the improvements thereon, including a

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residential condominium unit, which is encumbered by a covenant recorded in the land evidence

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records in favor of a governmental unit, Rhode Island housing and mortgage finance corporation,

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or a section 501(3)(c) nonprofit corporation restricting the sale price during the effective period of

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the covenant (“affordability period”) shall be assessed by taking into account the effect of the

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covenant on the value of the property. In no case shall such an encumbered property be assessed

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at a value that exceeds its full and fair cash value without the encumbrance.

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     SECTION 2. This act shall take effect on December 31, 2012.

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LC00369

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO TAXATION - ASSESSMENT

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     This act would require that the effect of a covenant in favor of a governmental or a

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501(3)(c) nonprofit unit be considered in determining the value of property for purposes of

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assessment of taxes.

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     This act would take effect December 31, 2012.

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LC00369

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