Ch. 122             1997 Session Laws of Kansas             449

Be it enacted by the Legislature of the State of Kansas:

Section 1. K.S.A. 1996 Supp. 79-201j is hereby amended to read as
follows: 79-201j. The following described property, to the extent specified
by this section, shall be exempt from all property or ad valorem taxes
levied under the laws of the state of Kansas:

(a) All farm machinery and equipment. The term ``farm machinery
and equipment'' means that personal property actually and regularly used
exclusively in any farming or ranching operation. The term ``farming or
ranching operation'' shall include the operation of a feedlot and the per-
forming of farm or ranch work for hire. The term ``farm machinery and
equipment'' shall not include any passenger vehicle, truck, truck tractor,
trailer, semitrailer or pole trailer, other than a farm trailer, as the terms
are defined by K.S.A. 8-126 and amendments thereto.

The provisions of this subsection shall apply to all taxable years com-
mencing after December 31, 1984.

(b) (1) All aquaculture machinery and equipment. The term ``aqua-
culture machinery and equipment'' means that personal property actually
and regularly used exclusively in any aquaculture operation. The term
``aquaculture operation'' shall include the feeding out of aquatic plants
and animals; breeding, growing or rearing aquatic plants and animals; and
selling or transporting aquatic plants and animals. The term ``aquaculture
machinery and equipment'' shall not include any passenger vehicle, truck,
truck tractor, trailer, semitrailer or pole trailer.

(2) All Christmas tree machinery and equipment. The term ``Christ-
mas tree machinery and equipment'' means that personal property ac-
tually and regularly used exclusively in any Christmas tree operation. The
term ``Christmas tree operation'' shall include the planting, cultivating
and harvesting of Christmas trees; and selling or transporting Christmas
trees. The term ``Christmas tree machinery and equipment'' shall not
include any passenger vehicle, truck, truck tractor, trailer, semitrailer or
pole trailer.

The provisions of this subsection shall apply to all taxable years com-
mencing after December 31, 1992.

450             1997 Session Laws of Kansas             Ch. 122

Sec. 2. K.S.A. 1996 Supp. 79-201 is hereby amended to read as fol-
lows: 79-201. The following described property, to the extent herein spec-
ified, shall be and is hereby exempt from all property or ad valorem taxes
levied under the laws of the state of Kansas:

First. All buildings used exclusively as places of public worship and all
buildings used exclusively by school districts and school district interlocal
cooperatives organized under the laws of this state, with the furniture and
books therein contained and used exclusively for the accommodation of
religious meetings or for school district or school district interlocal co-
operative purposes, whichever is applicable, together with the grounds
owned thereby if not leased or otherwise used for the realization of profit,
except that: (a) (1) Any school building, or portion thereof, together with
the grounds upon which the building is located, shall be considered to be
used exclusively by the school district for the purposes of this section
when leased by the school district to any political or taxing subdivision of
the state, including a school district interlocal cooperative, or to any as-
sociation, organization or nonprofit corporation entitled to tax exemption
with respect to such property; and (2) any school building, together with
the grounds upon which the building is located, shall be considered to be
used exclusively by a school district interlocal cooperative for the purposes
of this section when being acquired pursuant to a lease-purchase agree-
ment; and (b) any building, or portion thereof, used as a place of worship,
together with the grounds upon which the building is located, shall be
considered to be used exclusively for the religious purposes of this section
when used as a not-for-profit day care center for children which is li-
censed pursuant to K.S.A. 65-501 et seq., and amendments thereto, or
when used to house an area where the congregation of a church society
and others may purchase tracts, books and other items relating to the
promulgation of the church society's religious doctrines.

Second. All real property, and all tangible personal property, actually
and regularly used exclusively for literary, educational, scientific, relig-
ious, benevolent or charitable purposes, including property used exclu-
sively for such purposes by more than one agency or organization for one
or more of such exempt purposes. Except with regard to real property
which is owned by a religious organization, is to be used exclusively for
religious purposes and is not used for a nonexempt purpose prior to its
exclusive use for religious purposes which property shall be deemed to be
actually and regularly used exclusively for religious purposes for the pur-
poses of this paragraph, this exemption shall not apply to such property,
not actually used or occupied for the purposes set forth herein, nor to
such property held or used as an investment even though the income or
rentals received therefrom is used wholly for such literary, educational,
scientific, religious, benevolent or charitable purposes. In the event any
such property which has been exempted pursuant to the preceding sen-
tence is not used for religious purposes prior to its conveyance which

Ch. 122             1997 Session Laws of Kansas             451

results in its use for nonreligious purposes, there shall be a recoupment
of property taxes in an amount equal to the tax which would have been
levied upon such property except for such exemption for all taxable years
for which such exemption was in effect. Such recoupment tax shall become
due and payable in such year as provided by K.S.A. 79-2004, and amend-
ments thereto. A lien for such taxes shall attach to the real property subject
to the same on November 1 in the year such taxes become due and all
such taxes remaining due and unpaid after the date prescribed for the
payment thereof shall be collected in the manner provided by law for the
collection of delinquent taxes. Moneys collected from the recoupment tax
hereunder shall be credited by the county treasurer to the several taxing
subdivisions within which such real property is located in the proportion
that the total tangible property tax levies made in the preceding year for
each such taxing subdivision bear to the total of all such levies made in
that year by all such taxing subdivisions. Such moneys shall be credited
to the general fund of the taxing subdivision or if such taxing subdivision
is making no property tax levy for the support of a general fund such
moneys may be credited to any other tangible property tax fund of general
application of such subdivision. This exemption shall not be deemed in-
applicable to property which would otherwise be exempt pursuant to this
paragraph because an agency or organization: (a) Is reimbursed for the
provision of services accomplishing the purposes enumerated in this par-
agraph based upon the ability to pay by the recipient of such services; or
(b) is reimbursed for the actual expense of using such property for pur-
poses enumerated in this paragraph; or (c) uses such property for a no-
nexempt purpose which is minimal in scope and insubstantial in nature
if such use is incidental to the exempt purposes of this paragraph; or (d)
charges a reasonable fee for admission to cultural or educational activities
or permits the use of its property for such activities by a related agency
or organization, if any such activity is in furtherance of the purposes of
this paragraph.

Third. All moneys and credits belonging exclusively to universities, col-
leges, academies or other public schools of any kind, or to religious, lit-
erary, scientific or benevolent and charitable institutions or associations,
appropriated solely to sustain such institutions or associations, not ex-
ceeding in amount or in income arising therefrom the limit prescribed
by the charter of such institution or association.

Fourth. The reserve or emergency funds of fraternal benefit societies
authorized to do business under the laws of the state of Kansas.

Fifth. All buildings of private nonprofit universities or colleges which
are owned and operated by such universities and colleges as student union
buildings, presidents' homes and student dormitories.

Sixth. All real and tangible personal property actually and regularly
used exclusively by the alumni association associated by its articles of
incorporation with any public or nonprofit Kansas college or university

452             1997 Session Laws of Kansas             Ch. 122

approved by the Kansas board of regents to confer academic degrees or
with any community college approved by its board of trustees to grant
certificates of completion of courses or curriculum, to provide accom-
modations and services to such college or university or to the alumni, staff
or faculty thereof.

Seventh. All parsonages owned by a church society and actually and
regularly occupied and used exclusively predominantly as a residence by
a minister or other clergyman of such church society who is actually and
regularly engaged in conducting the services and religious ministrations
of such society, and the land upon which such parsonage is located to the
extent necessary for the accommodation of such parsonage.

Eighth. All real property, all buildings located on such property and all
personal property contained therein, actually and regularly used exclu-
sively by any individually chartered organization of honorably discharged
military veterans of the United States armed forces or auxiliary of any
such organization, which is exempt from federal income taxation pursuant
to section 501(c)(19) of the federal internal revenue code of 1986, for
clubhouse, place of meeting or memorial hall purposes, and real property
to the extent of not more than two acres, and all buildings located on
such property, actually and regularly used exclusively by any such veter-
ans' organization or its auxiliary as a memorial park.

Ninth. All real property and tangible personal property actually and
regularly used by a community service organization for the predominant
purpose of providing humanitarian services, which is owned and operated
by a corporation organized not for profit under the laws of the state of
Kansas or by a corporation organized not for profit under the laws of
another state and duly admitted to engage in business in this state as a
foreign not-for-profit corporation if: (a) The directors of such corporation
serve without pay for such services; (b) the corporation is operated in a
manner which does not result in the accrual of distributable profits, re-
alization of private gain resulting from the payment of compensation in
excess of a reasonable allowance for salary or other compensation for
services rendered or the realization of any other form of private gain; (c)
no officer, director or member of such corporation has any pecuniary
interest in the property for which exemption is claimed; (d) the corpo-
ration is organized for the purpose of providing humanitarian services;
(e) the actual use of property for which an exemption is claimed must be
substantially and predominantly related to the purpose of providing hu-
manitarian services, except that, the use of such property for a nonexempt
purpose which is minimal in scope and insubstantial in nature shall not
result in the loss of exemption if such use is incidental to the purpose of
providing humanitarian services by the corporation; (f) the corporation is
exempt from federal income taxation pursuant to section 501(c)(3) of the
internal revenue code of 1986 and; (g) contributions to the corporation
are deductible under the Kansas income tax act. As used in this clause,

Ch. 122             1997 Session Laws of Kansas             453

``humanitarian services'' means the conduct of activities which substan-
tially and predominantly meet a demonstrated community need and
which improve the physical, mental, social, cultural or spiritual welfare of
others or the relief, comfort or assistance of persons in distress or any
combination thereof including but not limited to health and recreation
services, child care, individual and family counseling, employment and
training programs for handicapped persons and meals or feeding pro-
grams. Notwithstanding any other provision of this clause, motor vehicles
shall not be exempt hereunder unless such vehicles are exclusively used
for the purposes described therein.

Tenth. For all taxable years commencing after December 31, 1986, any
building, and the land upon which such building is located to the extent
necessary for the accommodation of such building, owned by a church or
nonprofit religious society or order which is exempt from federal income
taxation pursuant to section 501(c)(3) of the federal internal revenue code
of 1986, and actually and regularly occupied and used exclusively for
residential and religious purposes by a community of persons who are
bound by vows to a religious life and who conduct or assist in the conduct
of religious services and actually and regularly engage in religious, be-
nevolent, charitable or educational ministrations or the performance of
health care services.

The provisions of this section, except as otherwise more specifically
provided, shall apply to all taxable years commencing after December 31,
1988 1995.

Sec. 3. K.S.A. 1996 Supp. 79-201 and 79-201j are hereby repealed.

Sec. 4. This act shall take effect and be in force from and after its
publication in the statute book.

Approved April 24, 1997.