15-972; Version 2

15-972. State limitation on homeowner property
taxes; additional state aid to school districts;
definitions

A. Notwithstanding section 15-971, there shall be additional state aid for
education computed for school districts as provided in subsection B of this section.

B. The clerk of the board of supervisors shall compute such additional state aid
for education as follows:

1. For a high school district or for a common school district within a high school
district which does not offer instruction in high school subjects as provided in section
15-447:

(a) Determine the qualifying tax rate pursuant to section 41-1276 for the school
district.

(b) Determine the following percentage of the qualifying tax rate determined in
subdivision (a) of this paragraph:

(i) Thirty-five per cent through December 31, 2005.

(ii) Thirty-six per cent beginning from and after December 31, 2005 through
December 31, 2006.

(iii) Thirty-seven per cent beginning from and after December 31, 2006 through
December 31, 2007.

(iv) Thirty-eight per cent beginning from and after December 31, 2007 through
December 31, 2008.

(v) Thirty-nine per cent beginning from and after December 31, 2008 through
December 31, 2009.

(vi) Forty per cent beginning from and after December 31, 2009.

(c) Select the lesser of the amount determined in subdivision (b) of this paragraph
or forty per cent of the primary property tax rate that would be levied in lieu of the
provisions of this section for the district.

(d) Multiply the rate selected in subdivision (c) of this paragraph as a rate per
one hundred dollars assessed valuation by the assessed valuation used for primary
property taxes of the residential property in the school district.

2. For a unified school district, for a common school district not within a high
school district or for a common school district which offers instruction in high school
subjects as provided in section 15-447:

(a) Determine the qualifying tax rate pursuant to section 41-1276 for the school
district.

(b) Determine the following percentage of the tax rate determined in subdivision
(a) of this paragraph:

(i) Thirty-five per cent through December 31, 2005.

(ii) Thirty-six per cent beginning from and after December 31, 2005 through
December 31, 2006.

(iii) Thirty-seven per cent beginning from and after December 31, 2006 through
December 31, 2007.

(iv) Thirty-eight per cent beginning from and after December 31, 2007 through
December 31, 2008.

(v) Thirty-nine per cent beginning from and after December 31, 2008 through
December 31, 2009.

(vi) Forty per cent beginning from and after December 31, 2009.

C. The clerk of the board of supervisors shall report to the department of revenue
not later than the Friday following the third Monday in August of each year the amount by
school district of additional state aid for education and the data used for computing the
amount as provided in subsection B of this section. The department of revenue shall
verify all of the amounts and report to the county board of supervisors not later than
August 30 of each year the property tax rate or rates which shall be used for property
tax reduction as provided in subsection E of this section.

D. The board of supervisors shall reduce the property tax rate or rates that would
be levied in lieu of the provisions of this section by the school district or districts
on the assessed valuation used for primary property taxes of the residential property in
the school district or districts by the rate or rates selected in subsection B, paragraph
1, subdivision (c) and paragraph 2, subdivision (c) of this section. The excess of the
reduction in property taxes for a parcel of property resulting from the reduction in the
property tax rate pursuant to this subsection over the amounts listed in this subsection
shall be deducted from the amount of additional state aid for education. The reduction in
property taxes on a parcel of property resulting from the reduction in the property tax
rate pursuant to this subsection shall not exceed the following amounts except as
provided in subsection I of this section:

1. Five hundred dollars through December 31, 2005.

2. Five hundred twenty dollars beginning from and after December 31, 2005 through
December 31, 2006.

3. Five hundred forty dollars beginning from and after December 31, 2006 through
December 31, 2007.

4. Five hundred sixty dollars beginning from and after December 31, 2007 through
December 31, 2008.

5. Five hundred eighty dollars beginning from and after December 31, 2008 through
December 31, 2009.

6. Six hundred dollars beginning from and after December 31, 2009.

E. Prior to the levying of taxes for school purposes the board of supervisors shall
determine whether the total primary property taxes to be levied for all taxing
jurisdictions on each parcel of residential property, in lieu of the provisions of this
subsection, violate article IX, section 18, Constitution of Arizona. For those properties
that qualify for property tax exemptions pursuant to article IX, sections 2, 2.1 and 2.2,
Constitution of Arizona, eligibility for the credit is determined on the basis of the
limited property value that corresponds to the taxable assessed value after reduction for
the applicable exemption. If the board of supervisors determines that such a situation
exists, the board shall apply a credit against the primary property taxes due from each
such parcel in the amount in excess of article IX, section 18, Constitution of Arizona.
Such excess amounts shall also be additional state aid for education for the school
district or districts in which such parcel of property is located.

F. The clerk of the board of supervisors shall report to the department of revenue
not later than September 5 of each year the amount by school district of additional state
aid for education and the data used for computing the amount as provided in subsection B
of this section. The department of revenue shall verify all of the amounts and report to
the board of supervisors not later than September 10 of each year the property tax rate
which shall be used for property tax reduction as provided in subsection E of this
section.

G. The clerk of the board of supervisors shall report to the department of revenue
not later than September 30 of each year in writing the following:

1. The data processing specifications used in the calculations provided for in
subsections B and E of this section.

2. At a minimum, copies of two actual tax bills for residential property for each
distinct tax area.

H. The department of revenue shall report to the state board of education not later
than October 12 of each year the amount by school district of additional state aid for
education as provided in this section. The additional state aid for education provided in
this section shall be apportioned as provided in section 15-973.

I. If a parcel of property is owned by a cooperative apartment corporation or is
owned by the tenants of a cooperative apartment corporation as tenants in common, the
reduction in the property taxes prescribed in subsection D of this section shall not
exceed the amounts listed in subsection D of this section for each owner occupied housing
unit on the property. The assessed value used for determining the reduction in taxes for
the property is equal to the total assessed value of the property times the ratio of the
number of owner occupied housing units to the total number of housing units on the
property. For the purposes of this subsection, "cooperative apartment corporation" means
a corporation:

1. Having only one class of outstanding stock.

2. All of the stockholders of which are entitled, solely by reason of their
ownership of stock in the corporation, to occupy for dwelling purposes apartments in a
building owned or leased by such corporation and who are not entitled, either
conditionally or unconditionally, except upon a complete or partial liquidation of the
corporation, to receive any distribution not out of earnings and profits of the
corporation.

3. Eighty per cent or more of the gross income of which is derived from
tenant-stockholders. For the purposes of this paragraph, "gross income" means gross
income as defined by the United States internal revenue code, as defined in section
43-105.

J. The total amount of state monies that may be spent in any fiscal year for state
aid for education in this section shall not exceed the amount appropriated or authorized
by section 35-173 for that purpose. This section shall not be construed to impose a duty
on an officer, agent or employee of this state to discharge a responsibility or to create
any right in a person or group if the discharge or right would require an expenditure of
state monies in excess of the expenditure authorized by legislative appropriation for
that specific purpose.

K. For the purposes of this section:

1. "Owner" includes any purchaser under a contract of sale or under a deed of
trust.

2. "Residential property" includes all owner occupied real property and
improvements to the property and all owner occupied mobile homes that are used for
residential purposes.