Assigned to FIN FOR
COMMITTEE
Assigned to FIN FOR
COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
property tax appeals; court findings
Purpose
An emergency measure that restricts judicial authority to determine the Full Cash Value (FCV) of a property for property tax appeals filed by a county assessor (assessor).
Background
Current law allows a property owner (taxpayer) who believes their property to have been improperly valued or classified for tax purposes to appeal the valuation or classification both administratively and judicially. Only the FCV of the property may be appealed. The FCV is determined as prescribed in statute. If no statutory method is prescribed, then the FCV is synonymous with market value, as determined by standard appraisal methods and techniques (A.R.S. § 42-11001).
A taxpayer may appeal the FCV by requesting administrative review of the valuation or classification of their property by filing a petition with their respective assessor. The petition must be filed within 60 days after the date the assessor mails the notice or amended notice of valuation to the taxpayer and must state the taxpayer's opinion of the FCV and substantial information justifying that opinion for the assessor to consider as a basis for changing the classification or correcting the valuation (A.R.S. § 42-16051). The assessor must consider and rule on each petition by August 15 of each year (A.R.S. §§ 42-16054 and 42-16055).
No further appeal is permitted if the assessor agrees with the petition and grants the requested relief to the taxpayer or if the taxpayer and assessor reach an agreement and waive the right to further appeal. If a petition is denied either in whole or in part, then the taxpayer may appeal to the following within 25 days after the assessor's decision is mailed: 1) the county board of equalization (county board); 2) in absence of a county board, the State Board of Equalization (State Board); or 3) a superior court (court) (A.R.S. § 42-16056).
A taxpayer who is dissatisfied with the valuation or classification of their property may bypass the administrative appeal process and appeal directly to the court, provided that the appeal is filed no later than December 15. If the administrative appeal process occurs first, then the appeal to the court must be filed within 60 days after the decision by the assessor, the county board or the State Board is made (A.R.S. §§ 42-16201; 42-16202; and 42-16203). The court is required to determine the FCV of a property if it finds that the valuation for that property is excessive or insufficient. The FCV determined by the court may be higher or lower than the FCV that was appealed. If the court finds that the classification for the property is in error, then it must determine the correct classification (A.R.S. § 42-16213).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Prohibits, for real property tax appeals filed in court by an assessor, the FCV that is determined by a court from being greater than the FCV that was appealed by a taxpayer to the county board or the State Board.
2. Applies, retroactive to January 1, 2017, to property tax appeals filed in court.
3. Clarifies that the bill does not apply to rollover valuations.
4. Makes technical and conforming changes.
5. Becomes effective on signature of the Governor, if the emergency clause is enacted, with a retroactive provision as noted.
House Action
WM 1/31/18 DP 9-0-0-0
3rd Read 2/12/18 51-7-1-0-1
Prepared by Senate Research
February 26, 2018
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