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Minutes for HCR5025 - Committee on Taxation
Short Title
Proposing to amend Section 1 of Article 11 of the Constitution of the State of Kansas to determine valuations of residential property based on the average fair market value of the 10 prior years.
Minutes Content for Tue, Mar 19, 2024
Chairperson Smith opened the hearing for HCR5025.
Adam Siebers provided an overview for HCR5025 that is a proposition to amend Section 1 of Article 11 of the Kansas Constitution relating to property tax. The resolution proposes that the valuation or real property used for residential purposes would be determined based on the average fair market value of the parcel of the ten calendar years immediately preceding the year of valuation. (Attachment 20) Mr. Siebers stood for questions from Committee members.
Proponents:
Mark Tomb, testified on behalf of the Kansas Association of Realtors, as a proponent for HCR5025 stating the realtors believe that any changes in structure of the property tax system should provide relief to the largest amount of property taxpayers as possible, while not shifting the burden onto other property taxpayers. HCR5025 would not produce a property tax shift but instead make it so residential values for taxation purposes are applied based on a 10-year average. The Kansas Association of Realtors support HCR5025 because it would provide stability to residential property taxpayers and not shift the tax burden onto other classes of property. (Attachment 21) Mr. Tomb stood for questions from Committee members.
Written testimony was submitted by the following as proponents for HCR5025:
Ganon Evans, Kansas Policy Institute, (Attachment 22)
Sean Miller, Kansas Building Industry Association, (Attachment 23)
Opponents:
Ryan Janzen, Equitable Solutions, testified as an opponent for HCR5025 noting any proposed legislation needs to maintain fair market value, as of January 1, be certified by the County Appraiser to ensure the uniform distribution of property taxes. The proposed legislation does nothing to guarantee or ensure taxes will be lowered. HCR5025 may smooth spikes in valuation, but at the cost of creating a less uniform system, with an uneven distribution of property tax obligations. (Attachment 24) Mr. Janzen stood for questions from Committee members.
Written testimony was submitted by the following in opposition to HCR5025:
Mark Manning, City of Wichita, (Attachment 25)
Lisa Berg, Dickinson County Appraiser, (Attachment 26)
Brad Eldridge, County Appraiser, (Attachment 27)
Kim Frodin, RMA, Scott County Appraiser, (Attachment 28)
Lori L. Reedy, Cowley County Appraiser, (Attachment 29)
Michael Plank, Reno County Appraiser, (Attachment 30)
Neutral:
David Harper, Kansas Department of Revenue, testified as neutral to HCR5025 that would follow for submission to the qualified electors of the state for their approval or rejection of amendments in Section 1 of Article 11 of the Kansas Constitution, establishing the valuing of residential real property for property tax purposes, based on a per parcel average of the prior 10 years of appraised value. (Attachment 31)
Leah Fliter, Kansas Association of School Boards, testified as neutral to HCR5025 noting the proposed constitutional amendment would smooth out some of the peaks and valleys associated with the impacts of annual real property valuation. HCR5025 would give taxpayers protection caused by steep increases in valuation as a result of inflation and would provide school districts some consistency as they building their annual budgets. (Attachment 32)
Jay Hall, Kansas Association of Counties, testified as neutral to HCR5025 that would eliminate the large spikes in valuation for taxpayers. He noted the major drawback of HCR5025 is getting started to implement a new valuation process to begin a 10-year rolling average and informing the public of the change as well as providing the information to taxpayers. (Attachment 33)
Nathan Eberline, Executive Director, League of Kansas Municipalities, testified as neutral to HCR5025 noting the cities of Kansas believe in finding a balance between fair taxation that does not burden citizens while ensuring basic services are paid for to protect the health and safety of Kansans. Mr. Eberline noted it is a sound system to base property valuation on fair market value. The League believes a valuation system that uses an average of multiple years to determine residential values is a positive step (Attachment 34)
The conferees stood for questions from Committee members.
Written testimony was submitted as neutral to HCR5025 by Mike Taylor, Kansas County Commissioners Association. (Attachment 35)
Martha Smith, Kansas Manufactured Housing, noted they have one concern regarding personal property manufactured homes that are not included in either SCR1611 or HCR5025. Ms. Smith stated the manufactured home would stay the same and be assessed and valued as they are currently are. The real estate underneath the manufactured home would either be the 4.0 percent cap or the 10-year average. She requested the Committee to consider including personal property manufactured homes.
Chairperson closed the hearing for HCR5025 and adjourned the meeting.
