The intent and purpose of the tax laws of this state are to have
all property and subjects of
taxation returned at the value which would be realized from the cash
sale, but not the forced sale, of the except as
otherwise provided in this chapter.
(1) "Current use value" of bona fide
conservation use property means the amount a knowledgeable buyer would pay for the
property with the intention of continuing the property in its
existing use and in an arm's length, bona fide sale and shall be
determined in accordance with the specifications and criteria provided for in subsection (b) of Code Section 48-5-269.
(2) "Current use value" of bona fide residential transitional
property means the amount a knowledgeable buyer would pay for the
property with the intention of continuing the property in its existing use and in an arm's length, bona fide sale.
. . .
. . .
(D) Fair market value of "landmark historic property" as such
term is defined in subsection (a) of Code Section 48-5-7.3 means . . .
(E) Timber shall be valued at its fair market value at the time
of its harvest or sale in the manner specified in Code Section
48-5-7.5.
(4) "Foreign merchandise in transit" means personal property of
any description which has been or will be moved by waterborne
commerce through any port located in this state and . . .
48-5-3.
All real property including, but not limited to, leaseholds,
interests less than fee, and all personal property shall be liable
to taxation and shall be taxed, except as otherwise provided by law.
Liability of property for taxation shall not be affected by the
individual or corporate character of the property owner or by the
resident or nonresident status of the property owner.
48-5-4.
Except as prohibited by the Constitution and laws of the United
States, all property owned or possessed in this state by a
corporation organized under the laws of the United States or owned
or possessed by an agency of the United States engaged in this state
in proprietary, as distinguished from governmental, activities shall
be subject to ad valorem taxation in this state at the same rate and
in the same manner as the property of private corporations owning
property in this state and engaged in similar businesses. All laws
relating to ad valorem taxation of private corporations shall apply
to ad valorem taxation of agencies of the United States and
corporations organized under the laws of the United States.
48-5-5.
[omitted]
48-5-6.
All property shall be returned for taxation at its fair market value
except as otherwise provided in this chapter.
48-5-7.
(a) Except as otherwise provided in this Code section, taxable
tangible property shall be assessed at 40 percent of its fair market
value and shall be taxed on a levy made by each respective tax
jurisdiction according to 40 percent of the property's fair market
value.
(b) Tangible real property which is devoted to bona fide
agricultural purposes as defined in this chapter and which otherwise
conforms to the conditions and limitations imposed in this chapter
shall be assessed for ad valorem property tax purposes at 75 percent
of the value which other tangible real property is assessed and
shall be taxed on a levy made by each respective tax jurisdiction
according to said assessment.
(c) Tangible real property which qualifies as rehabilitated historic
property pursuant to the provisions of Code Section 48-5-7.2 shall
be assessed at 40 percent of its fair market value and shall be
taxed on a levy made by each respective tax jurisdiction according
to 40 percent of the property's fair market value. . . .
(c.1) Tangible real property which qualifies as landmark historic
property pursuant to the provisions of Code Section 48-5-7.3 shall
be assessed at 40 percent of its fair market value and shall be
taxed on a levy made by each respective tax jurisdiction according
to 40 percent of the property's fair market value. . . .
(c.2) Tangible real property which is devoted to bona fide
conservation uses as defined in this chapter and which otherwise
conforms to the conditions and limitations imposed in this chapter
shall be assessed for property tax purposes at 40 percent of its
current use value and shall be taxed on a levy made by each
respective tax jurisdiction according to 40 percent of the
property's current use value.
(c.3) Tangible real property located in a transitional developing
area which is devoted to bona fide residential uses and which
otherwise conforms to the conditions and limitations imposed in this
chapter for bona fide residential transitional property shall be
assessed for property tax purposes at 40 percent of its current use
value and shall be taxed on a levy made by each respective tax
jurisdiction according to 40 percent of the property's current use
value.
(d) The requirement contained in this Code section that all tax
jurisdictions assess taxable tangible property at 40 percent of fair
market value shall not apply to any tax jurisdiction whose ratio of
assessed value to fair market value exceeded 40 percent for the tax
year 1971. No tax jurisdiction so exempted shall assess at a ratio
of less than 40 percent except as necessary to effect the
preferential assessment provided in subsection (b) of this Code
section.
(e) Each notice of ad valorem taxes due sent to taxpayers of
counties and municipalities shall include both the fair market value
of the property of the taxpayer which is subject to taxation and the
assessed value of the property after being reduced as provided by
this Code section.
48-5-7.1.
(a) For purposes of this article, "tangible real property which is
devoted to 'bona fide agricultural purposes'":
(1) Is tangible real property, the primary use of which is good
faith commercial production from or on the land of agricultural
products, including horticultural, floricultural, forestry, dairy,
livestock, poultry, and apiarian products and all other forms of
farm products; but
(2) Includes only the value which is $100,000.00 or less of the
fair market value of tangible real property which is devoted to
the storage or processing of agricultural products from or on the
property; and
(3) Excludes the entire value of any residence located on the
property.
(b) No property shall qualify for the preferential ad valorem
property tax assessment provided for in subsection (b) of Code
Section 48-5-7 unless:
(1) It is owned by one or more natural or naturalized citizens; or
(2) It is owned by a family-farm corporation, the controlling
interest of which is owned by individuals related to each other
within the fourth degree by civil reckoning, and such corporation
derived 80 percent or more of its gross income for the year
immediately preceding the year in which application for
preferential assessment is made from bona fide agricultural
pursuits carried out on tangible real property located in this
state, which property is devoted to bona fide agricultural
purposes.
(c) No property shall qualify for said preferential assessment if
such assessment would result in any person who has a beneficial
interest in such property, including any interest in the nature of
stock ownership, receiving in any tax year any benefit of
preferential assessment as to more than 2,000 acres. If any
taxpayer has any beneficial interest in more than 2,000 acres of
tangible real property which is devoted to bona fide agricultural
purposes, such taxpayer shall apply for preferential assessment only
as to 2,000 acres of such land.
(d) No property shall qualify for preferential assessment unless and
until the owner of such property agrees by covenant with the
appropriate taxing authority to maintain the eligible property in
bona fide agricultural purposes for a period of at least ten years
beginning on the first day of January of the year in which such
property qualifies for preferential assessment and ending on the
last day of December of the tenth year of the covenant period.
After the expiration of any ten-year covenant period, the property
shall not qualify for further preferential assessment until and
unless the owner of the property enters into a renewal covenant for
an additional period of ten years.
(e) No property shall maintain its eligibility for preferential
assessment unless a valid covenant remains in effect and unless the
property is continuously devoted to bona fide agricultural purposes
during the entire period of the covenant.
(f) If any change in ownership of such qualified property occurs
during the covenant period, all qualification requirements must be
met again before the property shall be eligible to be continued for
preferential assessment. If ownership of the property is acquired
during a covenant period by a person qualified to enter into an
original covenant, by a newly formed corporation the stock in which
is owned by the original covenantor or others related to the
original covenantor within the fourth degree by civil reckoning, or
by the personal representative of an owner who was a party to the
covenant, then the original covenant may be continued by such
acquiring party for the remainder of the term, in which event no
breach of the covenant shall be deemed to have occurred.
(g) A penalty shall be imposed under this subsection if during the
period of the covenant entered into by a taxpayer the covenant is
breached. The penalty shall be computed by multiplying the amount by
which the preferential assessment has reduced taxes otherwise due
for the year in which the breach occurs times:
(1) A factor of five if the breach occurs in the first or second
year of the covenant period;
(2) A factor of four if the breach occurs during the third or
fourth year of the covenant period;
(3) A factor of three if the breach occurs during the fifth or
sixth year of the covenant period; or
(4) A factor of two if the breach occurs in the seventh, eighth,
ninth, or tenth year of the covenant period.
(h) A penalty imposed under subsection (g) of this Code section
shall bear interest at the rate specified in Code Section 48-2-40
from the date the covenant is breached.
(i) Penalties and interest imposed under this Code section shall
constitute a lien against the property and shall be collected as
other unpaid ad valorem taxes are collected. Such penalties and
interest shall be distributed pro rata to each taxing jurisdiction
wherein the preferential assessment has been granted based upon the
total amount by which such preferential assessment has reduced taxes
for each such taxing jurisdiction on the property in question as
provided in this Code section.
(j) The penalty imposed by subsection (g) of this Code section shall
not apply in any case where a covenant is breached solely as a
result of:
(1) The acquisition of part or all of the property under the power
of eminent domain;
(2) The sale of part or all of the property to a public or private
entity which would have had the authority to acquire the property
under the power of eminent domain; or
(3) The death of an owner who was a party to the covenant.
(k) All applications for preferential assessment, including the
covenant agreement required under this Code section, shall be filed
on or before the last day for filing ad valorem tax returns in the
county for the tax year for which such preferential assessment shall
be first applicable. An application for continuation of
preferential assessment upon a change in ownership of the qualified
property shall be filed on or before the last date for filing tax
returns in the year following the year in which the change in
ownership occurred. Applications for preferential assessment shall
be filed with the county board of tax assessors who shall approve or
deny the application. If the application is approved on or after
July 1, 1998, the county board of tax assessors shall file a copy of
the approved application in the office of the clerk of the superior
court in the county in which the eligible property is located. The
clerk of the superior court shall file and index such application in
the real property records maintained in the clerk's office.
Applications approved prior to July 1, 1998, shall be filed and
indexed in like manner without payment of any fee. If the
application is not so recorded in the real property records, a
transferee of the property affected shall not be bound by the
covenant or subject to any penalty for its breach. The fee of the
clerk of the superior court for recording such applications approved
on or after July 1, 1998, shall be paid by the owner of the eligible
property with the application for preferential treatment and shall
be paid to the clerk by the board of tax assessors when the
application is filed with the clerk. If the application is denied,
the board of tax assessors shall notify the applicant in the same
manner that notices of assessment are given pursuant to Code Section
48-5-306 and shall return any filing fees advanced by the owner.
Appeals from the denial of an application by the board of tax
assessors shall be made in the same manner that other property tax
appeals are made pursuant to Code Section 48-5-311. As to property
approved for preferential assessment prior to July 1, 1998, the
county board of tax assessors shall file copies of all approved
applications in the office of the clerk of the superior court not
later than August 14, 1998, and the clerk shall file, index, and
record such approved applications, as provided for in this
subsection, with the fee of the clerk of the superior court for
filing, indexing, and recording to be paid out of the general funds
of the county.
(l) The commissioner shall by regulation provide uniform application
and covenant forms to be used in making application for preferential
assessment. Such application shall include an oath or affirmation
by the taxpayer that he has not at any time received, or made a
pending application for, preferential assessment in the same or
another county with respect to any property which taken together
with property for which application is then being made exceeds 2,000
acres.
(m) The commissioner shall annually submit a report to the Governor
and members of the General Assembly which shall show the fiscal
impact of the preferential assessment provided for in this Code
section. The report shall include the amount of assessed value
eliminated from each county's digest as a result of the preferential
assessment; approximate tax dollar losses, by county, to all local
governments affected by such preferential assessment; and any
recommendations regarding state and local administration of this
Code section, with emphasis upon enforcement problems, if any,
attendant with this Code section. The report shall also include any
other data or facts which the commissioner deems relevant.
(n)(1) The transfer prior to July 1, 1988, of a part of the
property subject to a covenant shall not constitute a breach of a
covenant entered into before or after July 1, 1984, if:
(A) The part of the property so transferred is used for
single-family residential purposes and the residence is occupied
by a person who is related within the fourth degree of civil
reckoning to an owner of the property subject to the covenant;
and
(B) The part of the property so transferred, taken together with
any other part of the property so transferred during the
covenant period, does not exceed a total of three acres.
(2) The transfer on or after July 1, 1988, of a part of the
property subject to a covenant shall not constitute a breach of a
covenant entered into before or after July 1, 1988, if:
(A) The part of the property so transferred is transferred to a
person who is related within the fourth degree of civil
reckoning to an owner of the property subject to the covenant;
and
(B) The part of the property so transferred, taken together with
any other part of the property transferred to the same relative
during the covenant period, does not exceed a total of five
acres.
(o) The following shall not constitute a breach of a covenant
entered into before or after July 1, 1984:
(1) Mineral exploration of the property subject to the covenant or
the leasing of the property subject to the covenant for purposes
of mineral exploration if the primary use of the property
continues to be the good faith commercial production from or on
the land of agricultural products; or
(2) Allowing all or part of the property subject to the covenant
to lie fallow or idle for purposes of any land conservation
program, for purposes of any federal agricultural assistance
program, or for other agricultural management purposes.
(p) Property which is subject to preferential assessment shall be
separately classified from all other property on the tax digest; and
such separate classification shall be such as will enable any person
examining the tax digest to readily ascertain that the property is
subject to preferential assessment. Covenants shall be public
records and shall be indexed and maintained in such manner as will
allow members of the public to readily locate the covenant affecting
any particular property subject to preferential assessment.
(q)(1) In any case in which a covenant is breached solely as a
result of the foreclosure of a deed to secure debt, or the
property is conveyed to the lienholder without compensation and in
lieu of foreclosure, the penalty specified by paragraph (2) of
this subsection shall apply and the penalty specified by
subsection (g) of this Code section shall not apply if:
(A) The deed to secure debt was executed as a part of a bona
fide commercial loan transaction in which the grantor of the
deed to secure debt received consideration equal in value to the
principal amount of the debt secured by the deed to secure debt;
(B) The loan was made by a person or financial institution who
or which is regularly engaged in the business of making loans;
and
(C) The deed to secure debt was intended by the parties as
security for the loan and was not intended for the purpose of
carrying out a transfer which would otherwise be subject to the
penalty specified by subsection (g) of this Code section.
(2) When a breach occurs solely as a result of a foreclosure which
meets the qualifications of paragraph (1) of this subsection, the
penalty imposed shall be the amount by which preferential
assessment has reduced taxes otherwise due for the year in which
the covenant is breached.
(3) A penalty imposed under this subsection shall bear interest at
the rate specified in Code Section 48-2-40 from the date the
covenant is breached.
(r)(1) In any case in which a covenant is breached solely as a
result of a medically demonstrable illness or disability which
renders the owner of the real property physically unable to
continue the property in agricultural use, the penalty specified
by paragraph (2) of this subsection shall apply and the penalty
specified by subsection (g) of this Code section shall not apply.
The penalty specified by paragraph (2) of this subsection shall
likewise be substituted for the penalty specified by subsection
(g) of this Code section in any case in which a covenant is
breached solely as a result of a medically demonstrable illness or
disability which renders the operator of the real property
physically unable to continue the property in agricultural use,
provided that the alternative penalty shall apply in this case
only if the operator of the real property is a member of the
family owning a family-farm corporation which owns the real
property.
(2) When a breach occurs which meets the qualifications of
paragraph (1) of this subsection, the penalty imposed shall be the
amount by which preferential assessment has reduced taxes
otherwise due for the year during which the covenant is breached.
(3) A penalty imposed under this subsection shall bear interest at
the rate specified in Code Section 48-2-40 from the date the
covenant is breached.
(4) Prior to the imposition of the alternative penalty authorized
by this subsection in lieu of the penalty specified by subsection
(g) of this Code section, the board of tax assessors shall require
satisfactory evidence which clearly demonstrates that the breach
is the result of a medically demonstrable illness or disability
which meets the qualifications of paragraph (1) of this
subsection.
(s) Property which is subject to preferential assessment and which
is subject to a covenant under this Code section may be changed from
such covenant and placed in a covenant for bona fide conservation
use under Code Section 48-5-7.4 if such property meets all of the
requirements and conditions specified in Code Section
48-5-7.4. Any
such change shall terminate the covenant under this Code section,
shall not constitute a breach of the covenant under this Code
section, and shall require the establishment of a new covenant
period under Code Section 48-5-7.4. No property may be changed
under this subsection more than once.
(t) At such time as the property ceases to be eligible for
preferential assessment or when any ten-year covenant period expires
and the property does not qualify for further preferential
assessment, the owner of the property shall file an application for
release of preferential treatment with the county board of tax
assessors who shall approve the release upon verification that all
taxes and penalties with respect to the property have been
satisfied. After the application for release has been approved by
the board of tax assessors, the board shall file the release in the
office of the clerk of the superior court in the county in which the
original covenant was filed. The clerk of the superior court shall
file and index such release in the real property records maintained
in the clerk's office. No fee shall be paid to the clerk of the
superior court for recording such release. The commissioner shall
by regulation provide uniform release forms.
48-5-7.2.
(a)(1) For the purposes of this article, "rehabilitated historic
property" means tangible real property which . . .
48-5-7.3.
(a)(1) For the purposes of this Code section, "landmark historic property" means tangible real property which
48-5-7.4.
(a) For purposes of this article, the term "bona fide conservation
use property" means property described in and meeting the
requirements of paragraph (1) or (2) of this subsection, as follows:
(1) Not more than 2,000 acres of tangible real property of a
single owner, the primary purpose of which is any good faith
production, including, but not limited to, subsistence farming or
commercial production from or on the land of agricultural products
or timber, subject to the following qualifications:
(A) Such property includes the value of tangible property
permanently affixed to the real property which is directly
connected to such owner's production of agricultural products or
timber and which is devoted to the storage and processing of
such agricultural products or timber from or on such real
property;
(B) Such property excludes the entire value of any residence
located on the property;
(C) Such property must be owned by:
(i) One or more natural or naturalized citizens;
(ii) An estate of which the devisees or heirs are one or more
natural or naturalized citizens;
(iii) A trust of which the beneficiaries are one or more
natural or naturalized citizens;
(iv) A family owned farm entity, such as a family corporation,
a family partnership, a family general partnership, a family
limited partnership, a family limited corporation, or a family
limited liability company, all of the interest of which is
owned by one or more natural or naturalized citizens related
to each other by blood or marriage within the fourth degree of
civil reckoning, except that, solely with respect to a family
limited partnership, a corporation, limited partnership,
limited corporation, or limited liability company may serve as
a general partner of the family limited partnership and hold
no more than a 5 percent interest in such family limited
partnership, an estate of which the devisees or heirs are one
or more natural or naturalized citizens, or a trust of which
the beneficiaries are one or more natural or naturalized
citizens and which family owned farm entity derived 80 percent
or more of its gross income from bona fide conservation uses,
including earnings on investments directly related to past or
future bona fide conservation uses, within this state within
the year immediately preceding the year in which eligibility
is sought; provided, however, that in the case of a newly
formed family farm entity, an estimate of the income of such
entity may be used to determine its eligibility;
(v) A bona fide nonprofit conservation organization designated
under Section 501(c)(3) of the Internal Revenue Code; or
(vi) A bona fide club organized for pleasure, recreation, and
other nonprofitable purposes pursuant to Section 501(c)(7) of
the Internal Revenue Code;
(D) Factors which may be considered in determining if such
property is qualified may include, but not be limited to:
(i) The nature of the terrain;
(ii) The density of the marketable product on the land;
(iii) The past usage of the land;
(iv) The economic merchantability of the agricultural product;
and
(v) The utilization or nonutilization of recognized care,
cultivation, harvesting, and like practices applicable to the
product involved and any implemented plans thereof; and
(E) Such property shall, if otherwise qualified, include, but
not be limited to, property used for:
(i) Raising, harvesting, or storing crops;
(ii) Feeding, breeding, or managing livestock or poultry;
(iii) Producing plants, trees, fowl, or animals; or
(iv) Production of aquaculture, horticulture, floriculture,
forestry, dairy, livestock, poultry, and apiarian products; or
(2) Not more than 2,000 acres of tangible real property, excluding
the value of any improvements thereon, of a single owner of the
types of environmentally sensitive property specified in this
paragraph and certified as such by the Department of Natural
Resources, if the primary use of such property is its maintenance
in its natural condition and if such owner meets the
qualifications of subparagraph (C) of paragraph (1) of this
subsection:
(A) Environmentally sensitive areas, including any otherwise
qualified land area 1,000 feet or more above the lowest
elevation of the county in which such area is located that has a
percentage slope, which is the difference in elevation between
two points 500 feet apart on the earth divided by the horizontal
distance between those two points, of 25 percent or greater and
shall include the crests, summits, and ridge tops which lie at
elevations higher than any such area;
(B) Wetland areas that are determined by the United States Army
Corps of Engineers to be wetlands under their jurisdiction
pursuant to Section 404 of the federal Clean Water Act, as
amended, or wetland areas that are depicted or delineated on
maps compiled by the Department of Natural Resources or the
United States Fish and Wildlife Service pursuant to its National
Wetlands Inventory Program;
(C) Significant ground-water recharge areas as identified on
maps or data compiled by the Department of Natural Resources;
(D) Undeveloped barrier islands or portions thereof as provided
for in the federal Coastal Barrier Resources Act, as amended;
(E) Habitats as certified by the Department of Natural Resources
as containing species that have been listed as either endangered
or threatened under the federal Endangered Species Act of 1973,
as amended; and
(F) River corridors which shall be defined as those undeveloped
lands adjacent to rivers and perennial streams that are within
the 100 year flood plain as depicted on official maps prepared
by the Federal Emergency Management Agency.
(b) The following additional rules shall apply to the qualification
of conservation use property for current use assessment:
(1) When one-half or more of the area of a single tract of real
property is used for a qualifying purpose, then such tract shall
be considered as used for such qualifying purpose unless some
other type of business is being operated on the unused portion;
provided, however, that such unused portion must be minimally
managed so that it does not contribute significantly to erosion or
other environmental or conservation problems. The lease of
hunting rights shall not constitute another type of business;
(2) The owner of a tract, lot, or parcel of land totaling less
than ten acres shall be required by the tax assessor to submit
additional relevant records regarding proof of bona fide
conservation use;
(3) No property shall qualify as bona fide conservation use
property if such current use assessment would result in any person
who has a beneficial interest in such property, including any
interest in the nature of stock ownership, receiving in any tax
year any benefit of current use assessment as to more than 2,000
acres. If any taxpayer has any beneficial interest in more than
2,000 acres of tangible real property which is devoted to bona
fide conservation uses, such taxpayer shall apply for current use
assessment only as to 2,000 acres of such land;
(4) No property shall qualify as bona fide conservation use
property if it is leased to a person or entity which would not be
entitled to conservation use assessment;
(5) No property shall qualify as bona fide conservation use
property if such property is at the time of application for
current use assessment subject to a restrictive covenant which
prohibits the use of the property for any purpose described in
subparagraph (a)(1)(E) of this Code section; and
(6) No otherwise qualified property shall be denied current use
assessment on the grounds that no soil map is available for the
county in which such property is located; provided, however, that
if no soil map is available for the county in which such property
is located, the owner making an application for current use
assessment shall provide the board of tax assessors with a
certified soil survey of the subject property unless another
method for determining the soil type of the subject property is
authorized in writing by such board.
(c) For purposes of this article, the term "bona fide residential
transitional property" means not more than five acres of tangible
real property of a single owner which is private single-family
residential owner occupied property located in a transitional
developing area. Such classification shall apply to all otherwise
qualified real property which is located in an area which is
undergoing a change in use from single-family residential use to
agricultural, commercial, industrial, office-institutional,
multifamily, or utility use or a combination of such uses. Change
in use may be evidenced by recent zoning changes, purchase by a
developer, affidavits of intent, or close proximity to property
which has undergone a change from single-family residential use. To
qualify as residential transitional property, the valuation must
reflect a change in value attributable to such property's proximity
to or location in a transitional area.
(d) No property shall qualify for current use assessment under this
Code section unless and until the owner of such property agrees by
covenant with the appropriate taxing authority to maintain the
eligible property in bona fide qualifying use for a period of ten
years beginning on the first day of January of the year in which
such property qualifies for such current use assessment and ending
on the last day of December of the final year of the covenant
period. After the owner has applied for and has been allowed
current use assessment provided for in this Code section, it shall
not be necessary to make application thereafter for any year in
which the covenant period is in effect and current use assessment
shall continue to be allowed such owner as specified in this Code
section. Upon the expiration of any covenant period, the property
shall not qualify for further current use assessment under this Code
section unless and until the owner of the property has entered into
a renewal covenant for an additional period of ten years.
(e) A single owner shall be authorized to enter into more than one
covenant under this Code section for bona fide conservation use
property, provided that the aggregate number of acres of qualified
property of such owner to be entered into such covenants does not
exceed 2,000 acres. Any such qualified property may include a tract
or tracts of land which are located in more than one county. A
single owner shall be authorized to enter qualified property in a
covenant for bona fide conservation use purposes and to enter
simultaneously the residence located on such property in a covenant
for bona fide residential transitional use if the qualifications for
each such covenant are met. A single owner shall be authorized to
enter qualified property in a covenant for bona fide conservation
use purposes and to enter other qualified property of such owner in
a covenant for bona fide residential transitional use.
(f) An owner shall not be authorized to make application for and
receive current use assessment under this Code section for any
property which at the time of such application is receiving
preferential assessment under Code Section 48-5-7.1 except that such
owner shall be authorized to change such preferential assessment
covenant in the manner provided for in subsection (s) of Code
Section 48-5-7.1.
(g) Except as otherwise provided in this subsection, no property
shall maintain its eligibility for current use assessment under this
Code section unless a valid covenant remains in effect and unless
the property is continuously devoted to an applicable bona fide
qualifying use during the entire period of the covenant. An owner
shall be authorized to change the type of bona fide qualifying
conservation use of the property to another bona fide qualifying
conservation use and the penalty imposed by subsection (l) of this
Code section shall not apply, but such owner shall give notice of
any such change in use to the board of tax assessors.
(h) If any breach of a covenant occurs, the existing covenant shall
be terminated and all qualification requirements must be met again
before the property shall be eligible for current use assessment
under this Code section.
(i) If ownership of all or a part of the property is acquired during
a covenant period by a person or entity qualified to enter into an
original covenant, then the original covenant may be continued by
such acquiring party for the remainder of the term, in which event
no breach of the covenant shall be deemed to have occurred.
(j)(1) All applications for current use assessment under this Code
section, including the covenant agreement required under this Code
section, shall be filed on or before the last day for filing ad
valorem tax returns in the county for the tax year for which such
current use assessment is sought, except that in the case of
property which is the subject of a reassessment by the board of
tax assessors an application for current use assessment may be
filed in conjunction with or in lieu of an appeal of the
reassessment. An application for continuation of such current use
assessment upon a change in ownership of all or a part of the
qualified property shall be filed on or before the last date for
filing tax returns in the year following the year in which the
change in ownership occurred. Applications for current use
assessment under this Code section shall be filed with the county
board of tax assessors who shall approve or deny the application.
If the application is approved on or after July 1, 1998, the
county board of tax assessors shall file a copy of the approved
application in the office of the clerk of the superior court in
the county in which the eligible property is located. The clerk
of the superior court shall file and index such application in the
real property records maintained in the clerk's office.
Applications approved prior to July 1, 1998, shall be filed and
indexed in like manner without payment of any fee. If the
application is not so recorded in the real property records, a
transferee of the property affected shall not be bound by the
covenant or subject to any penalty for its breach. The fee of the
clerk of the superior court for recording such applications
approved on or after July 1, 1998, shall be paid by the owner of
the eligible property with the application for preferential
treatment and shall be paid to the clerk by the board of tax
assessors when the application is filed with the clerk. If the
application is denied, the board of tax assessors shall notify
the applicant in the same manner that notices of assessment are
given pursuant to Code Section 48-5-306 and shall return any
filing fees advanced by the owner. Appeals from the denial of an
application by the board of tax assessors shall be made in the
same manner that other property tax appeals are made pursuant to
Code Section 48-5-311.
(2) In the event such application is approved, the taxpayer shall
continue to receive annual notification of any change in the fair
market value of such property and any appeals with respect to such
valuation shall be made in the same manner as other property tax
appeals are made pursuant to Code Section 48-5-311.
(k) The commissioner shall by regulation provide uniform application
and covenant forms to be used in making application for current use
assessment under this Code section. Such application shall include
an oath or affirmation by the taxpayer that he is in compliance with
the provisions of paragraphs (3) and (4) of subsection (b) of this
Code section.
(l) A penalty shall be imposed under this subsection if during the
period of the covenant entered into by a taxpayer the covenant is
breached. The penalty shall be applicable to the entire tract which
is the subject of the covenant and shall be twice the difference
between the total amount of tax paid pursuant to current use
assessment under this Code section and the total amount of taxes
which would otherwise have been due under this chapter for each
completed or partially completed year of the covenant period. Any
such penalty shall bear interest at the rate specified in Code
Section 48-2-40 from the date the covenant is breached.
(m) Penalties and interest imposed under this Code section shall
constitute a lien against the property and shall be collected in the
same manner as unpaid ad valorem taxes are collected. Such
penalties and interest shall be distributed pro rata to each taxing
jurisdiction wherein current use assessment under this Code section
has been granted based upon the total amount by which such current
use assessment has reduced taxes for each such taxing jurisdiction
on the property in question as provided in this Code section.
(n) The penalty imposed by subsection (l) of this Code section shall
not apply in any case where a covenant is breached solely as a
result of:
(1) The acquisition of part or all of the property under the power
of eminent domain;
(2) The sale of part or all of the property to a public or private
entity which would have had the authority to acquire the property
under the power of eminent domain; or
(3) The death of an owner who was a party to the covenant.
(o) The transfer of a part of the property subject to a covenant for
a bona fide conservation use shall not constitute a breach of a
covenant if:
(1) The part of the property so transferred is used for
single-family residential purposes, starting within one year of
the date of transfer and continuing for the remainder of the
covenant period, and the residence is occupied by a person who is
related within the fourth degree of civil reckoning to an owner of
the property subject to the covenant; and
(2) The part of the property so transferred, taken together with
any other part of the property so transferred to the same relative
during the covenant period, does not exceed a total of five acres;
and in any such case the property so transferred shall not be
eligible for a covenant for bona fide conservation use, but shall,
if otherwise qualified, be eligible for current use assessment as
residential transitional property and the remainder of the property
from which such transfer was made shall continue under the existing
covenant until a terminating breach occurs or until the end of the
specified covenant period.
(p) The following shall not constitute a breach of a covenant:
(1) Mineral exploration of the property subject to the covenant or
the leasing of the property subject to the covenant for purposes
of mineral exploration if the primary use of the property
continues to be the good faith production from or on the land of
agricultural products;
(2) Allowing all or part of the property subject to the covenant
to lie fallow or idle for purposes of any land conservation
program, for purposes of any federal agricultural assistance
program, or for other agricultural management purposes;
(3) Allowing all or part of the property subject to the covenant
to lie fallow or idle due to economic or financial hardship if the
owner notifies the board of tax assessors on or before the last
day for filing a tax return in the county where the land lying
fallow or idle is located and if such owner does not allow the
land to lie fallow or idle for more than two years of any
five-year period; or
(4)(A) Any property which is subject to a covenant for bona fide
conservation use being transferred to a place of religious
worship or burial or an institution of purely public charity if
such place or institution is qualified to receive the exemption
from ad valorem taxation provided for under subsection (a) of
Code Section 48-5-41. No person shall be entitled to transfer
more than 25 acres of such person's property in the aggregate
under this paragraph.
(B) Any property transferred under subparagraph (A) of this
paragraph shall not be used by the transferee for any purpose
other than for a purpose which would entitle such property to
the applicable exemption from ad valorem taxation provided for
under subsection (a) of Code Section 48-5-41 or subsequently
transferred until the expiration of the term of the covenant
period. Any such use or transfer shall constitute a breach of
the covenant.
(q) In the following cases, the penalty specified by subsection (l)
of this Code section shall not apply and the penalty imposed shall
be the amount by which current use assessment has reduced taxes
otherwise due for the year in which the covenant is breached, such
penalty to bear interest at the rate specified in Code Section
48-2-40 from the date of the breach:
(1) Any case in which a covenant is breached solely as a result of
the foreclosure of a deed to secure debt or the property is
conveyed to the lienholder without compensation and in lieu of
foreclosure, if:
(A) the deed to secure debt was executed as a
part of a bona fide commercial loan transaction in which the
grantor of the deed to secure debt received consideration equal in
value to the principal amount of the debt secured by the deed to
secure debt;
(B) the loan was made by a person or financial
institution who or which is regularly engaged in the business of
making loans; and
(C) the deed to secure debt was intended by the
parties as security for the loan and was not intended for the
purpose of carrying out a transfer which would otherwise be
subject to the penalty specified by subsection (l) of this Code
section; or
(2) Any case in which a covenant is breached solely as a result of
a medically demonstrable illness or disability which renders the
owner of the real property physically unable to continue the
property in the qualifying use, provided that the board of tax
assessors shall require satisfactory evidence which clearly
demonstrates that the breach is the result of a medically
demonstrable illness or disability.
(r) Property which is subject to current use assessment under this
Code section shall be separately classified from all other property
on the tax digest; and such separate classification shall be such as
will enable any person examining the tax digest to ascertain readily
that the property is subject to current use assessment under this
Code section. Covenants shall be public records and shall be
indexed and maintained in such manner as will allow members of the
public to locate readily the covenant affecting any particular
property subject to current use assessment under this Code section.
Based on information submitted by the county boards of tax
assessors, the commissioner shall maintain a central registry of
conservation use property, indexed by owners, so as to ensure that
the 2,000 acre limitations of this Code section are complied with on
a state-wide basis.
(s) The commissioner shall annually submit a report to the Governor,
the Department of Agriculture, the Georgia Agricultural Statistical
Service, the Georgia Forestry Commission, the Department of Natural
Resources, and the University of Georgia Cooperative Extension
Service and the House Ways and Means, Natural Resources and
Environment, and Agriculture and Consumer Affairs committees and the
Senate Finance and Public Utilities, Natural Resources, and
Agriculture committees and shall make such report available to other
members of the General Assembly, which report shall show the fiscal
impact of the assessments provided for in this Code section and Code
Section 48-5-7.5. The report shall include the amount of assessed
value eliminated from each county's digest as a result of such
assessments; approximate tax dollar losses, by county, to all local
governments affected by such assessments; and any recommendations
regarding state and local administration of this Code section and
Code Section 48-5-7.5, with emphasis upon enforcement problems, if
any, attendant with this Code section and Code Section 48-5-7.5.
The report shall also include any other data or facts which the
commissioner deems relevant.
(t) A public notice containing a brief, factual summary of the
provisions of this Code section shall be posted in a prominent
location readily viewable by the public in the office of the board
of tax assessors and in the office of the tax commissioner of each
county in this state.
(u) Property which is subject to a covenant under this Code section
which was entered into during the taxable year beginning January 1,
1992, may be changed from such covenant and placed in a new covenant
for bona fide conservation use under this Code section if such
property meets all of the requirements and conditions otherwise
specified under this Code section and if the owner files a written
request with the board of tax assessors indicating such owner's
desire to exercise this termination option on or before the last day
for the payment of ad valorem taxes in such county for the taxable
year beginning January 1, 1993, but not later than December 31,
1993. Any such change shall terminate the covenant under this Code
section, shall not constitute a breach of the covenant under this
Code section, and shall require the establishment of a new covenant
period under this Code section. No property may be changed under
this subsection more than once.
(v) The commissioner shall continue to compute a table of values
established under subsection (a) of Code Section 48-5-269, in
accordance with the law applicable to the tax year beginning on
January 1, 1992, to be used to value property entered into a
covenant during that tax year and the covenants valued thereunder
for the remainder of the covenant period applicable to such persons
shall be known as "92-Style" conservation use covenants. Such duty
shall terminate with the tax year beginning January 1, 2001. With
respect to any county for which the "A2" benchmark value for
agricultural land in the table of values established by the
commissioner for the tax year beginning on January 1, 1993, exceeds
by 50 percent or more the "C2" benchmark value for cropland in the
table of values established by the commissioner for the tax year
beginning on January 1, 1992, a person within such county desiring
to enter into a conservation use covenant for any taxable year
beginning on or after January 1, 1994, shall be authorized, at such
person's option, to enter a 92-Style conservation use covenant. A
person entering such covenant shall be governed by the prior law
applicable to such covenants and the applicable table of values and
such covenant shall expire on December 31, 2001.
(w) At such time as the property ceases to be eligible for current
use assessment or when any ten-year covenant period expires and the
property does not qualify for further current use assessment, the
owner of the property shall file an application for release of
current use treatment with the county board of tax assessors who
shall approve the release upon verification that all taxes and
penalties with respect to the property have been satisfied. After
the application for release has been approved by the board of tax
assessors, the board shall file the release in the office of the
clerk of the superior court in the county in which the original
covenant was filed. The clerk of the superior court shall file and
index such release in the real property records maintained in the
clerk's office. No fee shall be paid to the clerk of the superior
court for recording such release. The commissioner shall by
regulation provide uniform release forms.
(x) Notwithstanding any other provision of this Code section to the
contrary, in any case where a renewal covenant is breached by the
original covenantor or a transferee who is related to that original
covenantor within the fourth degree by civil reckoning, the penalty
otherwise imposed by subsection (l) of this Code section shall not
apply if the breach occurs during the sixth through tenth years of
such renewal covenant, and the only penalty imposed shall be the
amount by which current use assessment has reduced taxes otherwise
due for each year in which such renewal covenant was in effect, plus
interest at the rate specified in Code Section 48-2-40 from the date
the covenant is breached.
48-5-7.5.
(a) Standing timber shall be assessed for ad valorem taxation only
once and such assessment shall be made following its harvest or sale
as provided for in this Code section. Such timber shall be subject
to ad valorem taxation notwithstanding the fact that the underlying
land is exempt from taxation, unless such taxation is prohibited by
federal law or treaty. Such timber shall be assessed at 100 percent
of its fair market value and shall be taxed on a levy made by each
respective taxing jurisdiction according to such 100 percent fair
market value. Such assessment shall be made in the county where the
timber was grown and shall be taxable by that county and any other
taxing jurisdiction therein in which the timber was grown.
(b) For purposes of this Code section, the term "sale" of timber
shall mean the arm's length, bona fide sale of standing timber for
harvest separate and apart from the underlying land and shall not
include the simultaneous sale of a tract of land and the timber
thereon.
(c) Lump sum sales.
(1) Where standing timber is sold, in an arm's length, bona fide
sale, by timber deed, contract, lease, agreement, or otherwise to
be harvested within a three-year period after the date of the sale
and for a lump sum price, so much of said timber as will be
harvested within three years shall be assessed for taxation as of
the date of the sale. The fair market value of such timber for
purposes of ad valorem taxation shall be the lump sum price paid
by the purchaser in the arm's length, bona fide sale. Any timber
described in any sale instrument which is not harvested within
three years after the date of the sale shall later be assessed for
taxation following its future harvest or sale. Ad valorem taxes
shall be payable by the seller and shall be calculated by
multiplying the 100 percent fair market value of the timber times
the millage rate levied by the taxing authority on tangible
property for the previous calendar year. Immediately upon receipt
by the seller of the purchase price, the seller shall remit to the
purchaser the amount of ad valorem tax due on the sale, in the
form of a negotiable instrument payable to the tax collector or
tax commissioner. Such negotiable instrument shall be remitted by
the purchaser to the tax collector or tax commissioner not later
than five days after receipt of the tax from the seller. A
purchaser failing to make such remittance shall be personally
liable for the tax. With said remittance, the purchaser shall
present to the board of tax assessors and to the tax collector or
tax commissioner a report of the sale showing the lump sum sales
price of the standing timber, the date of sale, the addresses of
the seller and purchaser, and the location of the standing timber
in the county. The tax collector or tax commissioner shall
collect from the purchaser the seller's negotiable instrument in
payment of the tax; and a receipt showing payment of the tax shall
promptly be delivered by the tax collector or tax commissioner to
the seller.
(2) Upon request of the purchaser, the tax collector or tax
commissioner shall enter upon or attach to the instrument
conveying the standing timber a certification that the ad valorem
tax has been paid, the date, and the amount of the tax. The
certificate shall be signed by the tax collector or tax
commissioner or his deputy. The purchaser may then present the
instrument together with the certificate to the clerk of superior
court of the county or counties in which the standing timber is
located, who shall then file the instrument for record. The ad
valorem tax levied under this subsection on lump sum sales of
standing timber shall be paid to the tax collector or tax
commissioner prior to and as a prerequisite to the filing for
record of the instrument with the clerk of superior court, and the
clerk shall not be permitted to file the instrument for record
unless the instrument discloses on its face the proper certificate
showing that the tax has been paid; and the certificate shall be
recorded with the instrument.
(d) Unit price sales.
(1) Any person purchasing standing timber, in an arm's length,
bona fide sale, by timber deed, contract, lease, agreement, or
otherwise by unit prices shall furnish a report to the seller and
the county board of tax assessors within 45 days after the end of
each calendar quarter. The report shall show the total dollar
value of standing timber paid to the seller and the volume, in
pounds, if available, or measured volume, of softwood and hardwood
pulpwood, chip and saw logs, saw timber, poles, posts, and fuel
wood harvested. Such report shall include such data through the
last business day of the calendar quarter, the names and addresses
of the seller and the purchaser, and the location of the harvested
timber. A copy of such report shall also be furnished by the
seller to the tax assessors within 60 days after the end of the
calendar quarter. The fair market value of such timber for
purposes of ad valorem taxation shall be the total dollar values
paid by the purchaser in the arm's length, bona fide sale. Ad
valorem taxes shall be payable by the seller in the unit price
sales transaction as provided in subsection (h) of this Code
section and shall be calculated by multiplying the 100 percent
fair market value of the timber times the millage rate levied by
the taxing authority on tangible property for the previous
calendar year.
(2) Reports to the tax assessors shall be confidential, shall not
be revealed to any person other than authorized tax officials, and
shall be exempt from disclosure under Article 4 of Chapter 18 of
Title 50.
(e) Owner harvests. Owners of real property in this state who
harvest standing timber from their own lands shall report the
volume, in pounds, if available, or measured volume, of softwood and
hardwood pulpwood, chip and saw logs, saw timber, poles, posts, and
fuel wood harvested through the last business day of each calendar
quarter from said lands to the tax assessors within 45 days after
the end of each calendar quarter. Such reports shall also identify
the location of the tract from which the standing timber was
harvested. The fair market value of such timber for purposes of ad
valorem taxation shall be as determined under subsection (g) of this
Code section. Ad valorem taxes shall be paid by the landowner as
provided in subsection (h) of this Code section and shall be
calculated by multiplying the 100 percent fair market value of the
timber times the millage rate levied by the taxing authority on
tangible property for the previous calendar year.
(f) Other sales and harvests. Every sale and every harvest of timber
not previously taxed (excepting only a sale not for harvest within
three years) shall be a taxable event. If any such sale or harvest
is not a reportable taxable event described under subsection (c),
(d), or (e) of this Code section, such timber shall be subject to ad
valorem taxation under this subsection; and such sale or harvest
shall be reported and taxed under the provisions of subsection (c),
(d), or (e) of this Code section, whichever is most nearly
applicable.
(g) The commissioner, after consultation with the Georgia Forestry
Commission, shall provide the tax assessors of each county with the
weighted average price paid, in pounds and measured volume, during
each calendar year for softwood and hardwood pulpwood, chip and saw
logs, saw timber, poles, posts, and fuel wood in each county or
multicounty area within 60 days of the end of each calendar year.
The most recent weighted average prices provided by the commissioner
shall be applied by the tax assessors to the volume of wood removals
reported as provided in this Code section to determine the fair
market value of timber harvested other than under a taxable lump sum
sale or taxable unit price sale.
(h)(1)(A) Based on the reports and data provided under
subsections (d), (f), and (g) of this Code section, the tax
collector or tax commissioner shall on a quarterly basis mail
tax bills for sales and harvests other than lump sum sales. Ad
valorem taxes on such sales and harvests shall be payable by the
landowner within 30 days of receipt of the bill from the tax
collector or tax commissioner.
(B) Based upon the reports and data provided under subsections
(e) and (g) of this Code section, ad valorem taxes for owner
harvests shall be payable by the landowner to the tax collector
or tax commissioner within 45 days after the end of each
calendar quarter.
(2) Any ad valorem tax or penalty which is not timely paid as
provided in this Code section shall bear interest at the rate
specified in Code Section 48-2-40 from the due date. Unpaid
taxes, penalty, and interest imposed under this Code section shall
constitute a lien against the property of the person responsible
for payment of such tax and shall be collected in the same manner
as other unpaid ad valorem taxes are collected.
(i) The millage rate applicable at the time of sale or the time of
harvest of standing timber shall be the millage rate levied by the
taxing authority on tangible property for the preceding calendar
year.
(j) Any person who fails to timely make any report or disclosure
required by this Code section shall pay a penalty of 50 percent of
the tax due, except that if the failure to comply is unintentional
and the report or disclosure is filed within 12 months after the due
date the amount of the penalty shall be 1 percent for each month or
part of a month that the report or disclosure is late.
(k) Forms for reports required by this Code section shall be
supplied to each county by the department.
(l)(1) In any county in which the ad valorem taxation of timber
pursuant to this Code section reduces the total property tax
digest of such county for tax year 1992 by more than 20 percent of
the amount of the total property tax digest of such county for the
immediately preceding taxable year, such digest shall be
supplemented as follows:
(A) The difference between the total property tax digest for the
county and the total property tax digest less the total assessed
value of standing timber removed from the digest shall be
calculated;
(B) The difference calculated under subparagraph (A) of this
paragraph shall be reduced by the fair market value of sold or
harvested timber; and
(C) If the amount calculated under subparagraph (B) of this
paragraph is more than 20 percent of the amount of the total
property tax digest of such county for the immediately preceding
taxable year, the resulting amount shall be assigned and taxed
on a levy made by the tax officials of such county in a pro rata
manner against the land underlying the standing timber so
removed from the digest.
(2) Where a digest is so supplemented for tax year 1992, it shall
be supplemented in subsequent years as follows:
(A) For tax year 1993, such supplemental assessment shall be in
an amount equal to 75 percent of the supplemental assessment
received for tax year 1992;
(B) For tax year 1994, such supplemental assessment shall be in
an amount equal to 50 percent of the supplemental assessment
received for tax year 1992;
(C) For tax year 1995, such supplemental assessment shall be in
an amount equal to 25 percent of the supplemental assessment
received for tax year 1992; and
(D) For tax year 1996 and future tax years, no supplemental
assessment shall be received.
(m)(1) Any supplemental assessment added to a digest pursuant to
shall not be included in the
calculation of the equalized adjusted school property tax digest
under Code Section 48-5-274 for the purpose of calculating the
required local five mill share for school funding purposes under
Code Section 20-2-164.
(2) The fair market value of timber harvested or sold added to a
digest pursuant to this Code section shall be included in the
calculation of the equalized adjusted school property tax digest
under Code Section 48-5-274 for the purpose of calculating the
required local five mill share for school funding purposes under
Code Section 20-2-164.
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