Summary of 2017 Arkansas Property Tax Legislation

Here is a summary of 2017 Arkansas property tax legislation. The most significant bill is Act 659, a property tax procedure fairness bill supported by the Arkansas State Chamber that should bring significantly more equity to Arkansas property tax disputes. 

Act 49 clarifies administration of the homestead property tax credit by expressly limiting property owners to one homestead tax credit and allowing irrevocable trusts to claim the homestead credit. Effective January 26, 2017.

Act 152 delays the beginning of accrual of penalty and interest on delinquent property taxes from October 11 in the year of delinquency to October 16, and allows a homestead property tax credit to be claimed on the following business day if the deadline falls on a weekend or a holiday observed by the US Postal Service.

Act 162 clarifies that the county equalization board does not have jurisdiction over the valuation of agricultural, pasture or timberland, which are based on valuation tables issued by the Assessment Coordination Department; or the county assessor's determination of a property's tax exempt status.

Act 197 extends the deadline by which a county collector must transfer taxes to the country treasurer from within 5 days of the first day of the month to within 10 days. Removes the requirement that penalties associated with personal property taxes shall be divided fifty percent (50%) to the county general fund and fifty percent (50%) to the county common school fund.

Act 375 authorizes a local petition and ballot question process to provide funding for seat belts on school buses through a property tax increase.

Act 394 authorizes lessors of heavy equipment to include in their rental agreements property tax recovery fees of 1.25% of rental charges, to be used for payment of property taxes. Effective January 1, 2018.

Act 514 requires a county collector, before initiating collection on delinquent mineral interest taxes, to prepare a list of such delinquent taxes, including the owner and location of the interest, and publish the list on a dedicated website as well as provide the list to the Association of Arkansas Counties. Effective for tax years beginning on or after January 1, 2017.

Act 656 removes the requirement that deeds representing transactions that are exempt from the Real Property Transfer Tax be accompanied by a receipt from the Department of Finance and Administration showing proof of tax payment.

Act 659 was a pro-taxpayer property tax fairness bill, inspired by the success of Act 896 of 2015's state-level tax administration reforms: 

APSC Tax Division Changes. In the case of assessments issued by the Tax Division of the Arkansas Public Service Commission for utilities, carriers, and other taxpayers whose properties are subject to unit valuation principles, the Act:   

Extends the deadline for filing "petitions for review" (protests) of Tax Division assessments from 10 to 30 days, with an opportunity for the deadline to be extended by an additional 15 days by order of the Public Service Commission or State Highway Commission, depending on jurisdiction. 

Provides that petitions for review may be signed by an officer or agent of the taxpayer, rather than a licensed attorney, eliminating a trap for the unwary.

Permits hearings on petitions for review that must now be concluded by November 1, to be continued for up to 90 days by order of the appropriate commission.

County Equalization Board Changes. In the case of County Equalization Boards, the Act:

Eliminated restrictions on County Equalization Board authority added over the years and empowers EQ Boards to equalize assessments according to valuation principles prescribed by law.

Prescribes basic hearing procedures for County EQ Boards; prohibits ex parte communications between assessors or taxpayers and EQ Board members; and directs the Director of the Assessment Coordination Department to establish more detailed uniform hearing procedures.

Establishes education and continuing education requirements for EQ Board members under the direction of the Director of the Assessment Coordination Department.

Lowers the taxpayers' burden of proof when appealing EQ Board decisions, and specifically provides that Courts must not presume that an EQ Board's valuation decision is correct or is entitled to some special weight.

Provides that errors in the tax books must be corrected and tax refunds must be issued for up to 3 years, regardless of the circumstances under which the errors were made.

Act 729 prohibits the clerk of a county court from charging a filing fee to a taxpayer for petitioning for a property tax refund.

Act 1053 amends provisions governing the Land Commissioner's handling or tax-delinquent lands that do not sell at auction. 

Act 1076 provides that property owned by the state and leased to private businesses is subject to property tax, with certain exceptions. This is intended to reverse the result of Washington County v. Board of Trustees of the Univ. of Arkansas, 2016 Ark. 34 (Feb. 4, 2016). 

 

(If an effective date is not specifically listed, it should be 90 days after adjournment sine die, on or around July 30, 2017.)

 

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