2021 -- S 0115

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO TAXATION -- LEVY AND ASSESSMENT OF LOCAL TAXES

     Introduced By: Senators Seveney, Coyne, Murray, and DiPalma

     Date Introduced: January 26, 2021

     Referred To: Senate Housing & Municipal Government

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 44-5-1, 44-5-12, 44-5-13 and 44-5-30 of the General Laws in

Chapter 44-5 entitled "Levy and Assessment of Local Taxes" are hereby amended to read as

follows:

     44-5-1. Powers of city or town electors to levy -- Date of assessment of valuations.

     The electors of any city or town qualified to vote on any proposition to impose a tax or for

the expenditure of money, when legally assembled, may levy a tax for the purposes authorized by

law, on the ratable property of the city or town, either in a sum certain, or in a sum not less than a

certain sum and not more than a certain sum. The tax is apportioned upon the assessed valuations

pursuant to § 44-5-12 as determined by the assessors of the city or town as of December 31 in each

year at 12:00 A.M. midnight, the date being known as the date of assessment of city or town

valuations.

     44-5-12. Assessment at full and fair cash value.

     (a) All real property subject to taxation shall be assessed at its full and fair cash value, as

of December 31 in the year of the last update or revaluation, or at a uniform percentage of its value

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

or city; provided, that:

     (1) Any residential property encumbered by a covenant recorded in the land records in

favor of a governmental unit or Rhode Island housing and mortgage finance corporation restricting

either or both the rents that may be charged or the incomes of the occupants shall be assessed and

taxed in accordance with § 44-5-13.11;

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

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

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

neighborhood land use of a more intensive nature;

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

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

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

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

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

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

section, "residence" is defined as voting address. This exemption does not apply to any commercial

structure. The property owner shall supply all necessary plans to the building official for the

improvements or addition and shall pay all requisite building and other permitting fees as now are

required by law; and

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

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

or additions to his or her residential or rental property in an amount not to exceed twenty-five

thousand dollars ($25,000), as determined by the tax assessor of the city of Central Falls, is exempt

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

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

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

and other permitting fees as are now required by law.

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

in § 44-5-12.1.

     (6) Provided, however, that, for taxes levied after December 31, 2015, new construction on

development property is exempt from the assessment of taxes under this chapter at the full and fair

cash value of the improvements, as long as:

     (i) An owner of development property files an affidavit claiming the exemption with the

local tax assessor by December 31 each year; and

     (ii) The assessor shall then determine if the real property on which new construction is

located is development property. If the real property is development property, the assessor shall

exempt the new construction located on that development property from the collection of taxes on

improvements, until such time as the real property no longer qualifies as development property, as

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defined herein.

     For the purposes of this section, "development property" means: (A) Real property on

which a single-family residential dwelling or residential condominium is situated and said single-

family residential dwelling or residential condominium unit is not occupied, has never been

occupied, is not under contract, and is on the market for sale; or (B) Improvements and/or

rehabilitation of single-family residential dwellings or residential condominiums that the owner of

such development property purchased out of a foreclosure sale, auction, or from a bank, and which

property is not occupied. Such property described in § 44-5-12(a)(6)(ii) shall continue to be taxed

at the assessed value at the time of purchase until such time as such property is sold or occupied

and no longer qualifies as development property. As to residential condominiums, this exemption

shall not affect taxes on the common areas and facilities as set forth in § 34-36-27. In no

circumstance shall such designation as development property extend beyond two (2) tax years and

a qualification as a development property shall only apply to property that applies for, or receives,

construction permits after July 1, 2015. Further, the exemptions set forth in this section shall not

apply to land.

     The exemptions set forth in this subsection (a)(6) for development property shall expire as

of December 31, 2021.

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

the provisions of this section a document that may be signed before a notary public containing

language to the effect that they are aware of the additional taxes imposed by the provisions of § 44-

5-39 in the event that they use land classified as farm, forest, or open space land for another purpose.

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

taxation is assessed at its full and fair cash value, or at a uniform percentage of its value, not to

exceed one hundred percent (100%), for fiscal year 1999, by the assessors in each town and city.

Once the fiscal year 1999 value of the inventory has been assessed, this value shall not increase.

The phase-out rate schedule established in § 44-3-29.1(d) applies to this fixed value in each year

of the phase out.

     44-5-13. Assessment and apportionment according to law -- Date of assessment.

     The assessors shall assess all valuation and apportion any tax levy on the inhabitants of the

city or town and the ratable property in the city or town according to law, and the assessed valuation

of the ratable property is made as of the date of assessment provided in § 44-5-1 and shall be in

accordance with the provisions of § 44-5-12; except that personal property consisting of stocks in

trade and materials used in manufacture, which include raw materials, fuel, goods in process of

manufacture, and completed products, except those which are specifically exempt by statute, are

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estimated at the average of the personalty kept on hand or located in the taxing district during the

twelve (12) months ending with the date of assessment, or the average of any portion of the twelve

(12) months when the business has not been carried on or located in the taxing district for a year.

     44-5-30. Judgment on petition where taxpayer has filed account.

     If the taxpayer has given in an account, and if on the trial of the petition, either with or

without a jury, it appears that the taxpayer's real estate, tangible personal property, or intangible

personal property has been assessed, if assessment has been made at full and fair cash value, at a

value in excess of its full and fair cash value, or if assessment has purportedly been made at a

uniform percentage of full and fair cash value, at a percentage in excess of the uniform percentage,

in excess of the provisions of § 44-5-12 or if it appears that the tax assessed is illegal in whole or

in part, the court shall give judgment that the sum by which the taxpayer has been so overtaxed, or

illegally taxed, with his or her costs, be deducted from his or her tax; but if the taxpayer's tax be

paid, whether before or after the filing of the petition, then the court shall give judgment for the

petitioner for the sum by which he or she has been so overtaxed, or illegally taxed, plus the amount

of any penalty paid on the tax, with interest from the date on which the tax and penalty were paid

and costs, which judgment shall be paid to the petitioner by the city or town treasurer out of the

treasury. If, however, on the trial of the petition, it appears that the taxpayer has fraudulently

concealed or omitted any property from his or her account, or if it appears that the assessors have

not assessed either the taxpayer's real estate or his or her tangible personal property or his or her

intangible personal property at a value in excess of its full and fair cash value, if assessment has

been made at full and fair cash value, or if assessment has purportedly been made at a uniform

percentage of full and fair cash value, at a percentage in excess of the uniform percentage the

provisions of § 44-5-12, and that the taxpayer has not been illegally taxed, the assessors shall have

judgment and execution for their costs.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION -- LEVY AND ASSESSMENT OF LOCAL TAXES

***

     This act would authorize tax assessors in the cities and towns to use the last statutory update

or revaluation as the assessed valuation upon which to levy taxes regarding their real property.

     This act would take effect upon passage.

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