44th legislature - STATE OF NEW MEXICO - second session, 2000

RELATING TO PROPERTY TAXATION; PROVIDING FOR PERSONS SEVENTY YEARS OF AGE OR OLDER TO DEFER THE DATE THAT CERTAIN PROPERTY TAXES ARE DUE; PROVIDING PENALTIES; AMENDING AND ENACTING CERTAIN SECTIONS OF THE NMSA 1978.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 7-38-20 NMSA 1978 (being Laws 1973, Chapter 258, Section 60, as amended) is amended to read:

"7-38-20. COUNTY ASSESSOR AND DEPARTMENT TO MAIL NOTICES OF VALUATION.--

A. By April 1 of each year, the county assessor shall mail a notice to each property owner informing him of the net taxable value of his property that has been valued for property taxation purposes by the assessor.

B. By May 1 of each year, the department shall mail a notice to each property owner informing him of the net taxable value of his property that has been valued for property taxation purposes by the department.

C. Failure to receive the notice required by this section does not invalidate the value set on the property, any property tax based on that value or any subsequent procedure or proceeding instituted for the collection of the tax.

D. The notice required by this section shall state:

(1) the property owner's name and address;

(2) the description or identification of the property valued;

(3) the classification of the property valued;

(4) the value set on the property for property taxation purposes;

(5) the tax ratio;

(6) the taxable value of the property;

(7) the amount of any exemptions allowed and a statement of the net taxable value of the property after deducting the exemptions;

(8) the allocations of net taxable values to the governmental units; [and]

(9) briefly, the procedures for protesting the value determined for property taxation purposes, classification, allocation of values to governmental units or denial of a claim for an exemption; and

(10) in large type and placed conspicuously on the form or attached to the form, the eligibility requirements, procedures and deadline for applying for a deferral of the date certain residential property taxes are due, and shall include the following notice:

"NOTICE TO TAXPAYERS

OPTION TO DEFER PAYMENT OF PROPERTY TAXES

If you are seventy years of age or older and meet income limitations and other requirements, New Mexico law entitles you to DEFER PAYMENT of a portion of property taxes imposed on your home. To get more information or apply for a tax deferral, see the information below.

WARNING: DEFERRING TAXES WILL RESULT IN TAXES BECOMING DUE UPON SALE OR TRANSFER OF YOUR HOME OR UPON YOUR DEATH.".

E. The county assessor may mail the valuation notice required pursuant to Subsection A of this section to taxpayers with the preceding tax year's property tax bills if the net taxable value of the property has not changed since the preceding taxable year. In this early mailing, the county assessor shall provide clear notice to the taxpayer that the valuation notice is for the succeeding tax year and that the deadlines for protest of the value or classification of the property apply to this mailing date."

Section 2. Section 7-38-31 NMSA 1978 (being Laws 1973, Chapter 258, Section 71) is amended to read:

"7-38-31. COUNTY ASSESSOR TO CERTIFY NET TAXABLE VALUES TO THE DEPARTMENT.--After receiving the values for property taxation purposes certified to him by the department, the county assessor shall determine the net taxable value for all property allocated to governmental units in the county and subject to valuation for property taxation purposes, whether valued by him or by the department. No later than June 15 of each year, the county assessor shall certify to the department the net taxable values for all property allocated to governmental units in the county and subject to property taxation. The net taxable values of property shall be certified according to governmental units within the county. The assessor's certification shall include a statement of all property valuations that are the subject of a pending protest, whether protested locally or to the department, [and] a statement of the uncontroverted valuation in the pending protests and the amounts of property valuation increases that were used to calculate an amount of taxes for deferral of the due date pursuant to Section 7-38-38.3 NMSA 1978."

Section 3. Section 7-38-32 NMSA 1978 (being Laws 1973, Chapter 258, Section 72, as amended) is amended to read:

"7-38-32. DEPARTMENT TO PREPARE A COMPILATION OF NET TAXABLE VALUES TO BE USED FOR BUDGET-MAKING AND RATE-SETTING.--

A. No later than June 30 of each year, the department shall prepare a compilation of all net taxable values certified to it by the county assessors and shall include in the compilation the information regarding protested values required to be furnished by the assessors to the department and the amounts of the increases in net taxable value that were used to calculate an amount of taxes for deferral of the due date pursuant to Section 7-38-38.3 NMSA 1978. The compilation shall be prepared in a form appropriate for use and shall be used for the purpose of making budgets. The compilation of net taxable values shall be sent immediately to the secretary of finance and administration.

B. No later than August 1 of each year, the department shall prepare an amended compilation of net taxable values and send it immediately to the secretary of finance and administration. This amended compilation shall include final valuations resulting from completed protests, [and] information on pending protests and deletion of the amounts of increases in net taxable value that were used to calculate an amount of taxes for deferral of the due date pursuant to Section 7-38-38.3 NMSA 1978. It shall be used by the department of finance and administration in setting property tax rates.

C. In the budget-making process for local units of government including school districts, the net taxable values from the immediately preceding tax year may be considered for the purpose of estimating available revenue from the current tax year when the compilation of net taxable values certified under Subsection A of this section is incomplete or indefinite due to pending protests."

Section 4. Section 7-38-35 NMSA 1978 (being Laws 1973, Chapter 258, Section 75, as amended) is amended to read:

"7-38-35. PREPARATION OF PROPERTY TAX SCHEDULE BY ASSESSOR.--

A. After receipt of the rate-setting order and the order imposing the tax, but no later than October 1 of each tax year, the county assessor shall prepare a property tax schedule for all property subject to property taxation in the county. This schedule shall be in a form and contain the information required by [regulations] rules of the [division] department and shall contain at least the following information:

(1) the description of the property taxed and, if the property is personal property, its location;

(2) the property owner's name and address and the name and address of any person other than the owner to whom the tax bill is to be sent;

(3) the classification of the property;

(4) the value of the property determined for property taxation purposes;

(5) the tax ratio;

(6) the taxable value of the property;

(7) the amount of any exemption allowed and a statement of the net taxable value of the property after deducting the exemption;

(8) the allocations of net taxable value to the governmental units;

(9) the tax rate in dollars per thousand of net taxable value for all taxes imposed on the property;

(10) the amount of taxes due on the described property; [and]

(11) the amount of any penalties and interest already imposed and due on the described property; and

(12) the amount of taxes deferred, if any.

B. The property tax schedule is a public record and a part of the valuation records."

Section 5. Section 7-38-37 NMSA 1978 (being Laws 1973, Chapter 258, Section 77, as amended) is amended to read:

"7-38-37. CONTENTS OF PROPERTY TAX BILL.--Each property tax bill shall be in a form and contain the information required by [regulations] rules of the department and shall contain at least the following:

A. all of the information required to be contained in the property tax schedule;

B. the amount of property taxes due on each installment, the due dates of the installments and the dates on which taxes become delinquent;

C. a brief statement of the option available to make prepayments of the property tax due pursuant to Section 7-38-38.2 NMSA 1978;

D. a brief statement of the procedure under Section 7-38-39 NMSA 1978 for protesting values for property taxation purposes, classification, allocation of values to governmental units or a denial of a claim for an exemption;

E. a statement of the interest and penalties imposed by law for delinquency in the payment of property taxes and the remedies available against the taxpayer and the property for nonpayment of the amount due;

F. a statement advising the property owner that the property tax bill is the only notice he will receive for payment of both installments of the tax if no separate notice will be sent with respect to the second installment; [and]

G. the amount of any prepayment of the first installment made pursuant to Section 7-38-38.2 NMSA 1978; and

H. the actual amount of property taxes deferred pursuant to Section 7-38-38.3 NMSA 1978 for the current tax year and the accrued amount of all property taxes deferred from all tax years."

Section 6. A new section of the Property Tax Code, Section 7-38-38.3 NMSA 1978, is enacted to read:

"7-38-38.3. [NEW MATERIAL] DEFERRAL OF PROPERTY TAX DUE DATE--ELIGIBILITY.--

A. Each property tax year a claimant is entitled to apply for and the county treasurer may grant a deferral of the date on which some portion of the property taxes are due on the residential property that is the claimant's principal residence. A claimant may defer that portion of the property tax due on the claimant's principal residence equal to the amount obtained by applying the current year's tax rates to the increase in valuation of the property for property taxation purposes from the prior tax year to the current year.

B. When two or more individuals are qualified as claimants for one principal residence, they shall determine who the claimant shall be. The department shall prescribe the manner in which a claimant, who for any reason is incapacitated, may appoint the claimant's spouse or an authorized agent or have any such person appointed for the claimant, for the purpose of claiming a deferral of the date property taxes are due pursuant to this section.

C. Property taxes deferred pursuant to this section shall be due on November 10 of the year in which the first of any of the following events occurs, unless the event occurs after October 1, and in that case the deferred property taxes shall be due on April 10 of the following year:

(1) the claimant ceases to occupy the residential property as his principal residence or sells or otherwise disposes of that principal residence;

(2) the claimant dies; provided that if the surviving spouse or a joint tenant with rights of survivorship owning and occupying the principal residence and eligible to defer property taxes due pursuant to this section continues to own and occupy the residential property as that person's principal residence and chooses to claim a deferral of the date the deferred property taxes are due, then the deferred amounts shall not be due until that claimant dies or ceases to occupy the principal residence; or

(3) the county treasurer determines that deferral was erroneously allowed because eligibility requirements were not met.

D. No initial or additional tax deferral shall be granted if the total amount of deferred taxes plus the total amount of unpaid indebtedness secured by a security interest in the claimant's principal residence and all other encumbrances on the claimant's principal residence exceeds eighty-five percent of the value of the property for property taxation purposes for the tax year for which the claimant seeks deferral.

E. As used in this section, "claimant" means an individual who:

(1) is seventy years of age or older on the last day of the applicable tax year;

(2) is an owner and occupant of residential property that is his principal residence on the last day of the applicable tax year; and

(3) qualifies for the maximum exemption allowable pursuant to Section 7-2-5.2 NMSA for the taxable year beginning in the year prior to the tax year."

Section 7. A new section of the Property Tax Code, Section 7-38-38.4 NMSA 1978, is enacted to read:

"7-38-38.4. [NEW MATERIAL] PROPERTY TAX DEFERRAL--APPLICATION--CERTIFICATION--COLLECTION OF TAXES.--

A. To make application for a property tax deferral authorized pursuant to Section 7-38-38.3 NMSA 1978, a claimant shall file an application for deferral on or before June 1 of the tax year in which the property taxes are imposed. Application shall be made at the office of the county treasurer. The department shall provide for uniform application forms and procedures.

B. If deferral is granted by the county treasurer, the county treasurer shall issue to the claimant a certificate of deferral. The certificate of deferral shall state that the exact amount of tax deferred will be stated on the property tax bill mailed after October 1 of the tax year to the claimant or to the lender holding an escrow or similar account from which the claimant's property taxes are paid.

C. All or part of the taxes deferred pursuant to Section 7-38-38.3 NMSA 1978 may be paid at any time prior to the due date to the county treasurer by the claimant or any person on behalf of the claimant.

D. When any taxes deferred pursuant to Section

7-38-38.3 NMSA 1978 are collected, the county treasurer shall maintain a record of the payment, a description of the property and the amount of taxes collected for the property. The county treasurer shall apportion and distribute the receipts from the property taxes collected in the same manner as the current property taxes on that property are apportioned and distributed to the applicable governmental units as provided by law and in accordance with the provisions of the Property Tax Code."

Section 8. A new section of the Property Tax Code, Section 7-38-38.5 NMSA 1978, is enacted to read:

"7-38-38.5. [NEW MATERIAL] PROPERTY TAX DEFERRAL--EFFECT OF DEFERRAL ON OBLIGATION OF BORROWER TO LENDER--EXCEPTIONS--REFUND.--

A. The deferral of property taxes pursuant to Section 7-38-38.3 NMSA 1978 shall not affect the obligation of a borrower to continue to make payments to a lender for deposit in an escrow account or other similar account that is established for payment of property taxes prior to January 1, 2002.

B. Once a borrower has elected to defer the date that some property taxes are due and has submitted to the lender the certificate of that deferral pursuant to Sections 7-38-38.3 and 7-38-38.4 NMSA 1978, the lender shall not require the borrower to maintain an escrow account or similar type of account with regard to those taxes, except where required by federal law or regulation or in the case of a loan that is made, guaranteed or insured by a federal government lending or insuring agency requiring a borrower to make payments to a lender for deposit in an escrow account or other similar account or where the provisions of Sections 7-38-38.3 and 7-38-38.4 NMSA 1978 would impair the obligations of a loan agreement executed prior to January 1, 2002. Any payments made by the borrower to such a trust or other similar type of account with regard to taxes for the tax year prior to the time of submission of the certificate of deferral to the lender, if not previously used in payment or partial payment of such taxes, shall be refunded to the borrower within thirty days after receipt of notice of the tax due date deferral."

Section 9. A new section of the Property Tax Code, Section 7-38-38.6 NMSA 1978, is enacted to read:

"7-38-38.6. [NEW MATERIAL] PROPERTY TAX DEFERRAL--NOTICE--PENALTIES.--

A. The claimant or the claimant's agent shall notify the county treasurer within thirty days of the date of a change in the claimant's principal place of residence or the sale of the claimant's principal place of residence.

B. Upon the death of a claimant, the personal representative of the claimant shall notify the county treasurer of the death no later than ninety days after the claimant's death.

C. Any person who intentionally refuses to provide notice as required under Subsection A or B of this section is guilty of a misdemeanor and shall be punished by the imposition of a fine of not more than one thousand dollars ($1,000).

D. Any person who intentionally refuses to provide notice as required under Subsection A or B of this section with the intent to defraud is liable for a civil penalty in an amount equal to twenty-five percent of the deferred property taxes due or two thousand dollars ($2,000), whichever is greater.

E. Any person who fails to provide notice as required under Subsection A or B of this section is liable for a civil penalty in an amount equal to five percent of the deferred property taxes due or twenty-five dollars ($25.00), whichever is greater.

F. The civil penalties authorized under this section shall be imposed and collected at the time and in the manner the deferred property taxes are collected."

Section 10. A new section of the Property Tax Code, Section 7-38-38.7 NMSA 1978, is enacted to read:

"7-38-38.7. [NEW MATERIAL] PROPERTY TAX DEFERRAL--PROTEST--REMEDY.--

A. After receiving his property tax bill and making payment prior to the delinquency date of all property taxes due and not deferred in accordance with the bill, a claimant may protest to the county treasurer the stated amount of property tax deferred for that tax year or the stated total amount of accrued property taxes deferred if the claimant believes either stated amount is incorrect.

B. Upon the due date of deferred property taxes and payment prior to the delinquency date of the amount of deferred property taxes due as stated on the property tax bill, a claimant or the claimant's agent or personal representative may protest the amount of deferred property taxes due if the claimant, the claimant's agent or personal representative believes the amount is incorrect.

C. Upon filing of a protest pursuant to Subsection A or B of this section, the county treasurer shall review the protest and take appropriate action to determine if there is any error in the amount of taxes deferred or the amount of deferred taxes due and to correct that error. If the person protesting is not satisfied with the county treasurer's action, he may bring an action in district court on the grounds that there was an error in the computation of deferred taxes or an error in the property tax schedule relating to the payment or nonpayment of deferred taxes. The action shall be brought in the district court for the county in which the property is located."

Section 11. APPLICABILITY.--The provisions of this act apply to the 2002 and subsequent property tax years.