HOUSE FILE _____

BY  (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON SANDS)

A BILL FOR

An Act relating to the assessment and taxation of qualifying local exchange carrier property.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

   Section 1.  Section 433.4, Code 2011, is amended to read as follows:
   433.4  Assessment.
   The Except as otherwise provided in section 433.16, the director of revenue shall on or before October 31 each year, proceed to find the actual value of the property of these companies in this state, taking into consideration the information obtained from the statements required, and any further information the director can obtain, using the same as a means for determining the actual cash value of the property of these companies within this state. The director shall also take into consideration the valuation of all property of these companies, including franchises and the use of the property in connection with lines outside the state, and making these deductions as may be necessary on account of extra value of property outside the state as compared with the value of property in the state, in order that the actual cash value of the property of the company within this state may be ascertained. The assessment shall include all property of every kind and character whatsoever, real, personal, or mixed, used by the companies in the transaction of telegraph and telephone business; and the property so included in the assessment shall not be taxed in any other manner than as provided in this chapter.
   Sec. 2.  NEW SECTION.  433.16  Qualifying local exchange carriers —— assessment and taxation —— exception.
   1.  For assessment years beginning on or after January 1, 2012, the property of qualifying local exchange carriers shall be assessed for taxation according to subsections 2 and 3, exclusive of any other provision of this chapter. For purposes of this section,“qualifying local exchange carriers”means telecommunications companies that provide local exchange service and have less than fifty thousand customer access lines located in this state.
   2.  For valuations established on or after January 1, 2012, the director shall determine the value of the land, buildings, structures, and improvements of qualifying local exchange carriers in the same manner as all other property assessed as commercial property by the local assessor pursuant to chapters 427, 427A, 427B, 428, and 441. All reporting, protest, and appeal procedures for qualifying local exchange carriers shall be determined according to those provisions.
   3.  Notwithstanding any other provision of this section or chapter 427, 427A, 427B, 428, or 441 to the contrary, telephone wires, fiber optic cables, electronics, and similar items used by qualifying local exchange carriers to transmit sounds or data shall not be included when determining the value of a qualifying local exchange carrier’s land, buildings, structures, and improvements for purposes of this section.
EXPLANATION
   This bill provides that property of certain local exchange carriers shall be assessed for taxation by the department of revenue in the same manner as commercial property is assessed by the local assessor. The bill defines “qualifying local exchange carriers” as telecommunications companies that provide local exchange service and have less than 50,000 customer access lines in Iowa.
   The assessment provisions of Code section 433.4 currently provide that in ascertaining the actual value of telecommunications company property, including local exchange carrier property, the director of revenue shall include all property of every kind and character whatsoever, real, personal, or mixed, used by the company in the transaction of telegraph and telephone business.
   The bill provides that for assessments issued on and after January 1, 2012, the land, buildings, structures, and improvements of qualifying local exchange carriers shall be assessed by the department of revenue for taxation in the same manner as all other commercial property is assessed pursuant to Code chapters 427, 427A, 427B, 428, and 441 by the local assessor. The bill provides that all reporting and appeal procedures for qualifying local exchange carriers shall be determined pursuant to those Code chapters.
   The bill provides that telephone wires, fiber optic cables, electronics, and similar items used by qualifying local exchange carriers to transmit sounds or data shall not be included when determining the value of a qualifying local exchange carrier’s land, buildings, structures, and improvements.