A BILL to amend and reenact section one-b, article three, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, relating to specifying a fair methodology for the appraisal of real property undergoing development; setting forth definitions; establishing factor for valuation; providing that the sale or development of one lot within a recorded plan shall not be the sole factor in valuing the remaining property for ad valorem real property tax purposes; and setting effective dates.

ARTICLE 3. ASSESSMENTS GENERALLY.

§11-3-1b. Recordation of plat or designation of land use not to be basis for assessment; factors for valuation; legislative rule; effective dates.

The valuation of real property contained in a recorded plan or plat is as follows:
(1) When a lot or parcel within a recorded plan or plat is sold, that lot shall be revalued by the county assessor or tax commissioner. In no event may the remaining lots within the recorded plan or plat be automatically revalued solely based upon the sale of other lots within the recorded plan or plat.
(2) When land contained within a recorded plan or plat is first developed and actually used for a commercial, residential or industrial purpose, the land shall be revalued by the county assessor or the tax commissioner, depending upon whoever has authority over the land, but in no event may the remaining lots within the recorded plan or plat be automatically revalued solely based upon the sale of other lots within the recorded plan or plat.
(b) For valuation of the remaining lots or parcels or undeveloped portion within the recorded plan or plat, the following factors shall be taken into consideration in determining the valuation: (1) Availability of improved roads; (2) availability of sewage disposal and drinking water supply, including, but not limited to, the use of such factors as availability of public water and sewage systems, private water systems, water wells, private sewage and septic systems or potential private sewage and septic systems; (3) availability of electrical, telephone and other utility services; and (4) percentage of completion of improvements and infrastructure development. The assessor shall annually determine the percentage of completion of improvements and infrastructure development. For purposes of classification of property for levy purposes under section five, article eight of this chapter, developed lots or parcels shall not be reclassified from Class III to Class II or from Class IV to Class II until the developed lot or parcel is used and occupied by the owner thereof exclusively for residential purposes as defined in section three, article four of this chapter.
(c) The designation of proposed land use by a county or municipal planning authority may not be used or considered by an assessor in determining the appraised value of property included under a designation of proposed land use by a county or municipal planning authority until such time as the actual use of the real property has changed to correspond to the proposed use. For purposes of this section, the actual use of real property shall be treated as having changed to correspond to a different proposed use on the date when all improvements on the property necessary for the proposed use are completed, placed in service for federal income tax purposes and occupied by persons for the proposed use.
(d) The amendments made to this section by the Legislature in two thousand shall become effective on the first day of July, two thousand, and shall be effective as to all plans or plats filed after the thirtieth day of June, two thousand. The provisions of the amendments made to this section in two thousand do not apply to unsold lots or parcels or undeveloped land contained within recorded plans or plats which were recorded prior to the first day of July, two thousand:

, That in no event may the appraised value of unsold lots or parcels or undeveloped land contained within these recorded plans or plats be less than their appraised value as of first day of July, one thousand nine hundred ninety-nine.
(e) Notwithstanding any other provisions of this code to the contrary, for ad valorem tax purposes, in no event shall the appraised value of any lot, taxable in Class III or IV and held primarily for sale to customers in the ordinary course of business, exceed the owner's cost allocated to the lot as inventory for federal income tax purposes.