Senate Study Bill 1252 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON FEENSTRA) A BILL FOR An Act relating to the assessment and taxation of pipeline 1 companies and including applicability provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 2578XC (2) 88 md/jh
S.F. _____ Section 1. Section 438.2, Code 2019, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 2A. “Personal equipment property” , as 3 used in this chapter, means all of the following if used in 4 the operation of the pipeline company and not “attached” as 5 defined in section 427A.1, subsection 2, to the real estate or 6 pipelines of the pipeline company: 7 a. Office furniture, equipment, and computers. 8 b. Transportation equipment. 9 c. Tools, shop, garage, and stores equipment. 10 d. Laboratory equipment. 11 e. Power-operated equipment. 12 f. Communications equipment. 13 Sec. 2. Section 438.3, subsection 9, Code 2019, is amended 14 to read as follows: 15 9. Any and all other property owned by said the pipeline 16 company within the state which property must be classified 17 and scheduled in such a manner as the director of revenue may 18 by rule require. For assessment years beginning on or after 19 January 1, 2020, the information provided under this subsection 20 shall also identify that portion of the property owned by the 21 pipeline company that is personal equipment property. 22 Sec. 3. Section 438.13, Code 2019, is amended to read as 23 follows: 24 438.13 Basis of valuation and assessment. 25 1. The said Each company’s property shall be valued at 26 its actual value, and the assessments shall be made upon the 27 taxable value of the entire pipeline property within the state, 28 except as otherwise provided, and the actual and taxable 29 value so ascertained shall be assessed as provided by section 30 441.21 ; and shall include the rights-of-way, easements, the 31 pipelines, stations, grounds, shops, buildings, pumps, and 32 all other property, real and personal exclusively used in the 33 operation of such pipeline , subject to the exemption provided 34 in subsection 2 . In assessing said the pipeline company and 35 -1- LSB 2578XC (2) 88 md/jh 1/ 3
S.F. _____ its equipment company’s taxable property , the department of 1 revenue shall take into consideration the gross earnings and 2 the net earnings for the entire property, and per mile, for 3 the year ending December 31 preceding, and any and all other 4 matters necessary to enable the department to make a just and 5 equitable assessment of said the pipeline property. 6 2. For assessment years beginning on or after January 1, 7 2020, pipeline company property that is personal equipment 8 property shall not be assessed and taxed under this chapter. 9 Sec. 4. IMPLEMENTATION. Section 25B.7 shall not apply to 10 this Act. 11 Sec. 5. SAVINGS PROVISION. This Act, pursuant to section 12 4.13, does not affect the operation of, or prohibit the 13 application of, prior provisions of chapter 438, or rules 14 adopted under chapter 17A to administer prior provisions of 15 chapter 438, for assessment years beginning before January 1, 16 2020, and for duties, powers, protests, appeals, proceedings, 17 actions, or remedies attributable to an assessment year 18 beginning before January 1, 2020. 19 Sec. 6. APPLICABILITY. This Act applies to assessment years 20 beginning on or after January 1, 2020. 21 EXPLANATION 22 The inclusion of this explanation does not constitute agreement with 23 the explanation’s substance by the members of the general assembly. 24 This bill relates to the assessment and taxation of pipeline 25 companies. Under Code chapter 438, pipeline companies are 26 assessed by the department of revenue for property tax purposes 27 on all property, real and personal, owned by the pipeline 28 company and used in the operation of the pipeline. The 29 valuation determined by the department of revenue is then 30 reported and apportioned to the local taxing districts and the 31 value is taxed in the same manner as other property within the 32 applicable taxing districts. 33 The bill provides that for assessment years beginning on 34 or after January 1, 2020, pipeline company property that is 35 -2- LSB 2578XC (2) 88 md/jh 2/ 3
S.F. _____ personal equipment property shall not be assessed and taxed 1 under Code chapter 438. Accordingly, the bill requires 2 the annual property statement prepared and filed by each 3 pipeline company with the department of revenue to identify 4 the company’s personal equipment property. The bill defines 5 “personal equipment property” to include the following if used 6 in the operation of the pipeline company and not attached to 7 the real estate or pipelines of the pipeline company: (1) 8 office furniture, equipment, and computers; (2) transportation 9 equipment; (3) tools, shop, garage, and stores equipment; (4) 10 laboratory equipment; (5) power-operated equipment; and (6) 11 communications equipment. 12 The bill applies to assessment years beginning on or after 13 January 1, 2020. 14 -3- LSB 2578XC (2) 88 md/jh 3/ 3