SESSION OF 2021
SUPPLEMENTAL NOTE ON SENATE BILL NO. 13
As Amended by House Committee of the Whole
Brief*
SB 13, as amended, would repeal the property tax lid
law applicable to cities and counties and certain budget
requirements applicable to other municipalities, establish
notice and public hearing requirements for certain taxing
subdivisions seeking to collect property taxes in excess of the
subdivision’s revenue-neutral rate, prohibit valuation
increases resulting solely from normal maintenance of
existing structures, and expand the allowed acceptance of
partial payments or payment plans for property taxes.
The bill would be in effect upon publication in the
Kansas Register.
Tax Lid Repeal
The bill would eliminate, effective January 1, 2021, the
property tax lid that currently requires a public vote for certain
property tax increases by cities and counties. The bill would
also eliminate a requirement that municipalities, other than
cities and counties, that levy at least $1,000 in property taxes
not approve any budget that includes revenue produced by
property taxes in excess of the amount produced the
preceding year without first publishing notice in the official
county newspaper where the municipality is located of the
budget and the scheduled vote thereon.
____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
Notice and Public Hearing Requirements
The bill would establish new notification and public
hearing requirements for all taxing subdivisions seeking to
increase property taxes above those provided for by their
“revenue-neutral rate.” A taxing subdivision would be
prohibited from levying taxes exceeding its revenue-neutral
rate without first approving a resolution or ordinance in
accordance with the procedure provided by the bill.
The bill would require county clerks to notify taxing
subdivisions of their revenue-neutral rate by June 15.
“Revenue-neutral rate” would mean the tax rate for the
current tax year that would generate the same amount of
property tax revenue as levied the previous tax year, using
the current tax year’s total assessed valuation.
Governing bodies of taxing subdivisions would be
required to publish notice of their intent to exceed the
revenue-neutral rate. The bill would require the notice to
include the date, time, and location of a public hearing on the
resolution or ordinance providing for the levy. The bill would
require publication on such governing body’s website at least
ten days in advance of the hearing and in a weekly or daily
newspaper have general circulation within the county. Taxing
subdivisions would be required to notify county clerks by July
15 of their intent to exceed the revenue-neutral rate, including
information concerning the hearing.
Beginning in tax year 2022, county clerks would be
required to mail notification of the intent of the taxing
subdivision to each taxpayer with property within the taxing
subdivision at least ten days in advance of the public hearing.
County clerks would be required to consolidate the
information for all taxing subdivisions relevant to each piece
of property on one notice. Notifications could be sent by
electronic means with the consent of the taxpayer.
The bill would create the Taxpayer Notification Costs
Fund in the State Treasury and provide, for calendar years
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2022 and 2023, for any printing and postage costs incurred
by county clerks to be reimbursed by that fund. County clerks
would be required to notify the Secretary of Revenue of such
costs, and the Secretary would certify such amounts to the
Director of Accounts and Reports, who would then be
required to transfer an equal amount of money from the State
General Fund to the Taxpayer Notification Costs Fund.
Any printing and postage costs incurred by county clerks
for required notices that are not reimbursed from the
Taxpayer Notification Costs Fund would be borne by the
taxing subdivisions proposing to exceed their revenue-neutral
rates in proportion to the total property tax levied by the
subdivisions.
The bill would require the notifications to contain:
● The revenue-neutral rate for each relevant taxing
subdivision;
● The proposed tax rate and amount of tax revenue
to be levied by each taxing subdivision seeking to
exceed its revenue-neutral rate;
● The tax rate and amount of tax from each taxing
subdivision for the property from the previous
year’s tax statement;
● The appraised value and assessed value for the
taxpayer’s property for the current year;
● The estimated amount of tax for the current year
for each subdivision based on the revenue-neutral
rate and any tax rate in excess of the revenue-
neutral rate and the difference between such
amounts for any taxing subdivision seeking to
exceed its revenue-neutral rate;
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● The date, time, and location of the public hearing
for each taxing subdivision seeking to exceed its
revenue-neutral rate; and
● Information concerning statutory mill levies
imposed by the State of Kansas.
The bill would require the hearing on the resolution or
ordinance providing for a taxing subdivision to exceed its
revenue-neutral rate to be held by September 10 and to
include an opportunity for interested taxpayers to present
testimony within reasonable limits and without unreasonable
restrictions on the number of individuals allowed to comment.
The governing body of each taxing subdivision would be
required to approve exceeding the revenue neutral rate by a
majority vote at the public hearing.
Taxing subdivisions failing to comply with the notice and
hearing procedures would be required to refund any property
taxes collected in excess of the revenue-neutral rate.
Information regarding the revenue-neutral rate and
taxing subdivision’s decision to levy taxes in excess of the
rate would also be required to be published in the taxing
subdivision’s annual budget form prescribed by the Division
of Accounts and Reports within the State Department of
Administration.
Prohibited Valuation Increases
The bill would prohibit an increase in the appraised
value of real property solely as a result of normal repair,
replacement, or maintenance of existing structures,
equipment, or other improvements on the property.
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Partial Payments and Payment Plans
The bill would authorize county treasurers to accept
partial payments and establish payment plans for all property
taxes. Current law allows treasurers to accept partial
payments for delinquent property taxes.
Background
The bill was introduced by Senators Tyson, Alley,
Baumgardner, Erickson, Fagg, Hilderbrand, Kerschen,
Longbine, Peck, Steffen, Thompson, and Warren.
Senate Committee on Assessment and Taxation
In the Senate Committee hearing on January 12, 2021,
representatives of the Kansas Chamber of Commerce,
Kansas Policy Institute, and National Federation of
Independent Business-Kansas testified as proponents,
stating the bill’s provisions would improve property tax
transparency and clarity.
A representative of the League of Kansas Municipalities
offered neutral testimony, specifically recommending
amendments clarifying portions of the bill and adjusting
deadlines within the bill.
A representative of the Sierra Club offered testimony in
opposition to the bill, stating opposition to the time frame
between the hearing on the bill and the notice of the public
hearing for the bill.
Written-only proponent testimony was provided by
representatives of the Kansas Association of Realtors and
Americans for Prosperity Kansas. Written-only testimony in
support of the bill with certain suggested amendments was
provided by a representative of Sedgwick County.
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A representative of the City of Topeka provided neutral
written-only testimony with suggested amendments.
The Senate Committee amended the bill to clarify that
the costs to be borne by taxing subdivisions for the notices
were limited to printing and mailing costs.
House Committee on Taxation
In the House Committee hearing on January 26, 2021,
proponent testimony was offered by Senator Tyson and
representatives of the Kansas Association of Realtors, the
Kansas Chamber of Commerce, the Kansas Health and
Fitness Association, the Kansas Policy Institute, the National
Federation of Independent Business, the Sedgwick County
Board of County Commissioners, and the Wichita Regional
Chamber of Commerce. Proponents generally stated the
provisions of the bill would provide important property tax
transparency and would be a better approach than the
current property tax lid. Written-only proponent testimony
was provided by representatives of Americans for Prosperity-
Kansas, the Kansas Association of Wheat Growers, and the
Kansas Farm Bureau.
Opponent testimony was provided by a representative
of the Central Kansas Library System, who stated that the
provisions of the bill could not neatly be applied to library
systems. Written-only opponent testimony was provided by a
representative of the City of Haysville.
Neutral testimony on the bill was provided by
representatives of the Kansas Association of Counties, the
City of Ottawa, the Kansas County Clerks and Election
Officials Association, and the League of Kansas
Municipalities. Written-only neutral testimony was provided by
representatives of numerous municipalities.
The House Committee amended the bill to provide for
publication notice and a one-year delay to the mailing
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notification requirements, to exclude municipal universities
and municipalities levying less than $100,000 of property
taxes, to provide for cost sharing in proportion to the amount
of property taxes levied by taxing subdivisions, to require the
inclusion of the revenue-neutral rate information on annual
budget forms, and to provide for the repeal of certain budget
publication requirements for municipalities other than cities
and counties.
House Committee of the Whole
The House Committee of the Whole amended the bill to
eliminate exemptions from the notice and public hearing
requirements for certain taxing subdivisions and to provide for
state reimbursement of printing and postage costs incurred in
calendar years 2022 and 2023.
Fiscal Information
According to the fiscal note prepared by the Division of
the Budget on the bill as introduced, the provisions of the bill
would have no fiscal effect on state revenues and the costs
for the State to implement the bill would be negligible and
could be absorbed within existing state resources. The
Kansas Association of Counties and League of Kansas
Municipalities indicate the notice and hearing provisions of
the bill would require substantial administrative costs for local
governments to implement.
An estimate of the fiscal effect on the State General
Fund for transfers to the Taxpayer Notification Costs Fund, as
provided by the House Committee of the Whole, was not
immediately available.
Taxation; property tax
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Statutes affected: As introduced: 79-1460, 79-1801, 79-2024, 79-2925c
As Amended by Senate Committee: 79-1460, 79-1801, 79-2024, 79-2925c
As Amended by House Committee: 79-1460, 79-1801, 79-2024, 79-2925c, 79-2929, 79-2925b
{As Amended by House Committee of the Whole}: 79-1460, 79-1801, 79-2024, 79-2925c, 79-2929, 79-2925b
Enrolled: 79-1460, 79-1801, 79-2024, 79-2925c, 79-2929, 79-2925b