SB 104-FN – AS INTRODUCED
2005 SESSION
10/03
SENATE BILL 104-FN
AN ACT relative to the tax exemption for water and air pollution control facilities
SPONSORS: Sen. Green, Dist 6; Sen. Gallus, Dist 1; Rep. Twombly, Straf 1; Rep. McLeod, Graf 2
This bill removes the tax exemption for pollution control facilities, devices, appliances, or installations that are only partly for the purpose of reducing pollution, or are installed as part of privately-owned landfills.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
05-0940
10/03
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Five
AN ACT relative to the tax exemption for water and air pollution control facilities
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Water and Air Pollution Control Facilities; Percentage Exemption Removed; Real Estate Exemption Inserted. Amend RSA 72:12-a, I through V to read as follows:
I.(a) Any person, firm or corporation which builds, constructs, installs, or places in use in this state any treatment facility, device, appliance, or installation wholly [or partly] for the purpose of reducing, controlling, or eliminating any source of air or water pollution shall be entitled to have the value of said facility [and any real estate necessary therefor, or a percentage thereof determined in accordance with this section], device, appliance, or installation exempted from the taxes levied under this chapter for the period of years in which the facility, device, appliance, or installation is used in accordance with the provisions of this section. This subparagraph shall not apply to privately-owned landfills or ancillary facilities located at the landfill.
(b) If the pollution control facility, device, appliance, or installation requires additional real estate not otherwise occupied for other uses, and such real estate cannot be used for any other purpose while in use for pollution control, then the real estate shall be considered part of the facility, device, appliance, or installation for purposes of tax exemption under this section. The tax exemption shall be limited to the area actually necessary for pollution control as determined by the department of environmental services. This subparagraph shall not apply to privately-owned landfills and ancillary facilities located at the landfills.
II. The party seeking the exemption shall file an application with the department of environmental services if the exemption sought is for a water pollution control facility or an air pollution control facility, with a copy to the taxing authorities in the municipality where the facility is situated. Said application shall describe the facilities and their function or functions and shall state the applicant’s total investment therein and the portion allocable to each function.
III. The department shall investigate and determine whether the purpose of the facility is solely [or only partially] pollution control. [If the department finds that the purpose of the facility is only partially pollution control it shall determine by an allocation of the applicant’s investment in the facility what percentage of the facility is used to control pollution.] In making its investigation, the department may inspect the facility and request such other information from the applicant as is reasonably necessary to assist it in making its determination.
IV. Upon making its determination, the department shall notify the applicant and the taxing authorities of the municipality where the facility is situated whether the purpose of the facility is solely pollution control[, or, if not, what percentage of the applicant’s investment in the facility should be allocated to pollution control].
V. The taxing authorities shall each year separately appraise and describe the facility and related real estate and cause such appraisal and description to appear in their inventory. In accordance with the provisions of this section, the taxing authority shall exempt from the taxes levied under this chapter the appraised value of the facility and any real estate necessary therefor, [or the exempt percentage thereof,] as determined by the department. The exemption period shall begin as of the April 1 next following the receipt of the department's determination.
2 Facilities Previously Exempted; Percentage Exemption Removed. Amend RSA 72:12-b to read as follows:
72:12-b Facilities Previously Exempted. Upon application by either the municipality or the owner of any pollution control facility previously exempted under RSA 149:5-a the department of environmental services shall review a determination made under RSA 149:5-a [and determine the exempt percentage in the manner provided by RSA 72:12-a]; provided, however, that the period of exemption shall not be extended by any such redetermination. Either the municipality or the owner of the facility may request a rehearing or appeal from such determination in accordance with the provisions of RSA 541.
3 Effective Date. This act shall take effect April 1, 2005.
LBAO
05-0940
1/27/05
SB 104-FN - FISCAL NOTE
AN ACT relative to the tax exemption for water and air pollution control facilities.
FISCAL IMPACT:
The New Hampshire Municipal Association and Department of Revenue Administration state this bill may have an indeterminable fiscal impact on local revenue and expenditures in FY 2005 and each year thereafter. There will be no fiscal impact on state and county revenue or expenditures.
METHODOLOGY:
The New Hampshire Municipal Association states this bill changes the existing property tax exemption for facilities that apply for and are approved for an exemption by the Department of Environmental Services (DES), whereas the exemption would no longer be applicable to facilities, devices, appliances, or installations that are only partly used for pollution control activities. Such facilities would have to be wholly used for pollution control purposes. According to DES, twenty-six municipalities currently have properties within their jurisdictions that have been granted an exemption by the State, and some municipalities have several properties subject to the exemption. Twenty of the various exempt properties have a partial exemption, so those municipalities where the properties reside would see an increase in their tax base if these properties were to lose the exemption and be subject to local property tax. This bill would also grant an exemption for additional real estate that is required for the pollution control purposes but only so much as DES determines is necessary for the specific pollution control. The Association is unable to determine the fiscal impact of this provision at this time.
This bill states that privately owned landfills would not be exempt from property taxation under this statute. The Department of Revenue Administration states this bill would restrict privately owned landfills or ancillary facilities located at landfills from receiving the air and water pollution property tax exemption. The Department states there are three private or public/private landfills in the state, and they are in Success, Rochester, and Bethlehem. Only the Bethlehem facility has applied for and been granted the exemption. This bill will remove the exemption thus increasing the tax base by the amount of the exemption.
LBAO
05-0940
1/27/05
An increase in a municipality’s tax base would not increase or decrease the amount of local property tax revenue received, but would shift the tax burden among taxpayers within a municipality. Local revenue and expenditures would be impacted to the extent that eliminating current exemptions would increase equalized valuation amounts, and could affect a municipality’s adequate education grant and statewide property tax collections at the local level. The exact fiscal impact cannot be determined at this time.