H. B. 2904
(By Delegates Hatfield and Rowe)
[Introduced February 25, 1999; referred to the
Committee on Finance.]
A BILL to amend and reenact section eleven-b, article one-c,
chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to taxation of
real property; and providing formula for valuation of
managed timberland.
Be it enacted by the Legislature of West Virginia:
That section eleven-b, article one-c, chapter eleven of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
ARTICLE 1C. FAIR AND EQUITABLE PROPERTY VALUATION.
§11-1C-11b. Valuation; rulemaking; aggrieved person and
taxpayer protests; exhaustion of remedies;
compliance inspection; notice of revocation;
appeal; effective date.
(a) The tax commissioner shall establish by legislative rule
two methodologies a method for determining the appraised value of
managed timberland, based upon the land's potential to produce
future income according to its use and productive potential as
managed timberland. and whether the property is classified as
Class II property or as Class III or IV property for property tax
purposes. These values shall be determined by discounting the
potential future net income of the timberland to its present
value utilizing a discounted cash flow model based upon whether
the property is classified as Class II property or as Class III
or IV property for property tax purposes. The formula to be used
in determining the appraised value of property categorized as
managed timberland is as follows: "Appraised value" = ("total
yield per acre" x "stumpage price" - "management costs per acre"
divided by 80) divided by "capitalization rate".
(b) The tax commissioner shall also establish by legislative
rule a method to determine the appraised value of timberland that
is not certified as managed timberland. All timberland that is
not certified as managed timberland shall be valued at its market
value, except for farm woodlots which shall be valued as part of
the farm.
(c) Notwithstanding the provisions of section five-a of this
article, the legislative rules required by subsections (a) and
(b) of this section may be promulgated as emergency legislative rules if they are filed in the state register on or before the
first day of July, one thousand nine hundred ninety-eight.
(d) The value of an acre of managed timberland in a county
shall always be less than the value of an acre of timberland of
comparable soil quality in the county that is not certified as
managed timberland.
(e) Any person aggrieved by any valuation of timberland may
file a written objection to the valuation with the county
assessor on or before the fifteenth day of January of the
assessment year. The written objection shall then be treated as
a protest filed by the taxpayer under section twenty-four-a,
article three of this chapter. If any person fails to exhaust
the administrative and judicial remedies provided in said
section, that person shall be barred from taking any further
administrative or judicial action regarding the classification of
the property for that assessment year.
(f) Upon request of the tax commissioner or the assessor or
county commission of the county in which the managed timberland
is located, the director of the division of forestry shall
inspect the property and determine whether or not the property
continues to qualify for preferential valuation as managed
timberland under this article. In the event the director of
forestry determines that a property does not qualify as managed
timberland due to a change in its use, or it is discovered that a material misstatement of fact was made by the owner of the
property in the certification of the property as managed
timberland under subdivision (1), subsection (d), section ten of
this article, or it is discovered that the property owner is not
complying with the terms of the managed timberland plan,
including any period of time for coming into compliance granted
the owner by the director of forestry, the director shall give
written notice to the owner of the property by certified mail,
return receipt requested, the tax commissioner and the assessor
of each county in which the property is located that the
certification of the property as managed timberland is revoked.
(g) The aggrieved owner of the property which had its
managed timberland certification revoked pursuant to any
provision of this code may, at any time up to sixty days from the
date of notification from the director of forestry, petition the
circuit court of the county in which the property is located for
relief.
(h) The provisions of this section shall apply to tax years
beginning on or after the first day of January, one thousand nine
hundred ninety-nine.
NOTE: The purpose of this bill is to reestablish the site
index valuation method for valuation of managed timberland.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.