As Amended by Senate Committee
Session of 2000
Substitute for HOUSE BILL No. 2702
By Committee on Agriculture
2-17
11 AN ACT
concerning property taxation; exempting nursery and
green-
12 house
machinery and equipment relating to exemptions
therefrom;
13 amending K.S.A. 1999
Supp. 79-201 and 79-201j and repealing the
14 existing
section sections; also repealing
K.S.A. 1999 Supp. 79-
15
5a01b.
16
17 Be it enacted by the Legislature of the
State of Kansas:
18 Section
1. K.S.A. 1999 Supp. 79-201j is hereby amended to read as
19 follows: 79-201j. The following described
property, to the extent specified
20 by this section, shall be exempt from all
property or ad valorem taxes
21 levied under the laws of the state of
Kansas:
22 (a) All farm
machinery and equipment. The term ``farm machinery
23 and equipment'' means that personal
property actually and regularly used
24 in any farming or ranching operation. The
term ``farm machinery and
25 equipment'' shall include: (1)
Machinery and equipment comprising a
26 natural gas distribution system which is
owned and operated by a non-
27 profit public utility described by K.S.A.
66-104c, and amendments
28 thereto, and which is operated
predominantly for the purpose of provid-
29 ing fuel for the irrigation of land devoted
to agricultural use; and (2) any
30 greenhouse which is not permanently
affixed to real estate and which is
31 used for a farming or ranching
operation. The term ``farming or ranching
32 operation'' shall include the operation of
a feedlot and, the performing
33 of farm or ranch work for hire and the
planting, cultivating and harvesting
34 of nursery or greenhouse products, or
both, for sale or resale. The term
35 ``farm machinery and equipment'' shall not
include any passenger vehicle,
36 truck, truck tractor, trailer, semitrailer
or pole trailer, other than a farm
37 trailer, as the terms are defined by K.S.A.
8-126 and amendments thereto.
38 The provisions of this
subsection shall apply to all taxable years com-
39 mencing after December 31,
1998 1999.
40 (b) (1) All
aquaculture machinery and equipment. The term ``aqua-
41 culture machinery and equipment'' means
that personal property actually
42 and regularly used in any aquaculture
operation. The term ``aquaculture
43 operation'' shall include the feeding out
of aquatic plants and animals;
2
1 breeding, growing or rearing aquatic
plants and animals; and selling or
2 transporting aquatic plants and
animals. The term ``aquaculture machin-
3 ery and equipment'' shall not include
any passenger vehicle, truck, truck
4 tractor, trailer, semitrailer or pole
trailer.
5 (2) All
Christmas tree machinery and equipment. The term ``Christ-
6 mas tree machinery and equipment''
means that personal property ac-
7 tually and regularly used in any
Christmas tree operation. The term
8 ``Christmas tree operation'' shall
include the planting, cultivating and har-
9 vesting of Christmas trees; and
selling or transporting Christmas trees.
10 The term ``Christmas tree machinery and
equipment'' shall not include
11 any passenger vehicle, truck, truck
tractor, trailer, semitrailer or pole
12 trailer.
13 The provisions of this
subsection shall apply to all taxable years com-
14 mencing after December 31, 1992.
15 Sec. 2. K.S.A. 1999
Supp. 79-201 is hereby amended to read as
16 follows: 79-201. The following
described property, to the extent
17 herein specified, shall be and is
hereby exempt from all property or
18 ad valorem taxes levied under the
laws of the state of Kansas:
19
First. All buildings used exclusively as places of
public worship
20 and all buildings used exclusively by
school districts and school
21 district interlocal cooperatives
organized under the laws of this
22 state, with the furniture and books
therein contained and used ex-
23 clusively for the accommodation of
religious meetings or for school
24 district or school district
interlocal cooperative purposes, which-
25 ever is applicable, together with the
grounds owned thereby if not
26 leased or otherwise used for the
realization of profit, except that:
27 (a) (1) Any school building, or
portion thereof, together with the
28 grounds upon which the building is
located, shall be considered to
29 be used exclusively by the school
district for the purposes of this
30 section when leased by the school
district to any political or taxing
31 subdivision of the state, including a
school district interlocal co-
32 operative, or to any association,
organization or nonprofit corpo-
33 ration entitled to tax exemption with
respect to such property; and
34 (2) any school building, together
with the grounds upon which the
35 building is located, shall be
considered to be used exclusively by a
36 school district interlocal
cooperative for the purposes of this section
37 when being acquired pursuant to a
lease-purchase agreement; and
38 (b) any building, or portion thereof,
used as a place of worship,
39 together with the grounds upon which
the building is located, shall
40 be considered to be used exclusively
for the religious purposes of
41 this section when used as a
not-for-profit day care center for chil-
42 dren which is licensed pursuant to
K.S.A. 65-501 et seq., and amend-
43 ments thereto, or when used to house
an area where the congrega-
3
1 tion of a church society and
others may purchase tracts, books and
2 other items relating to the
promulgation of the church society's re-
3 ligious doctrines.
4
Second. All real property, and all tangible personal
property, ac-
5 tually and regularly used
exclusively for literary, educational, sci-
6 entific, religious, benevolent
or charitable purposes, including
7 property used exclusively for
such purposes by more than one
8 agency or organization for one
or more of such exempt purposes.
9 Except with regard to real
property which is owned by a religious
10 organization, is to be used
exclusively for religious purposes and is
11 not used for a nonexempt purpose
prior to its exclusive use for re-
12 ligious purposes which property shall
be deemed to be actually and
13 regularly used exclusively for
religious purposes for the purposes
14 of this paragraph, this exemption
shall not apply to such property,
15 not actually used or occupied for the
purposes set forth herein, nor
16 to such property held or used as an
investment even though the
17 income or rentals received therefrom
is used wholly for such liter-
18 ary, educational, scientific,
religious, benevolent or charitable pur-
19 poses. In the event any such property
which has been exempted
20 pursuant to the preceding sentence is
not used for religious purposes
21 prior to its conveyance which results
in its use for nonreligious pur-
22 poses, there shall be a recoupment of
property taxes in an amount
23 equal to the tax which would have
been levied upon such property
24 except for such exemption for all
taxable years for which such ex-
25 emption was in effect. Such
recoupment tax shall become due and
26 payable in such year as provided by
K.S.A. 79-2004, and amend-
27 ments thereto. A lien for such taxes
shall attach to the real property
28 subject to the same on November 1 in
the year such taxes become
29 due and all such taxes remaining due
and unpaid after the date
30 prescribed for the payment thereof
shall be collected in the manner
31 provided by law for the collection of
delinquent taxes. Moneys col-
32 lected from the recoupment tax
hereunder shall be credited by the
33 county treasurer to the several
taxing subdivisions within which
34 such real property is located in the
proportion that the total tan-
35 gible property tax levies made in the
preceding year for each such
36 taxing subdivision bear to the total
of all such levies made in that
37 year by all such taxing subdivisions.
Such moneys shall be credited
38 to the general fund of the taxing
subdivision or if such taxing sub-
39 division is making no property tax
levy for the support of a general
40 fund such moneys may be credited to
any other tangible property
41 tax fund of general application of
such subdivision. This exemption
42 shall not be deemed inapplicable to
property which would other-
43 wise be exempt pursuant to this
paragraph because an agency or
4
1 organization: (a) Is reimbursed
for the provision of services accom-
2 plishing the purposes
enumerated in this paragraph based upon the
3 ability to pay by the recipient
of such services; or (b) is reimbursed
4 for the actual expense of using
such property for purposes enumer-
5 ated in this paragraph; or (c)
uses such property for a nonexempt
6 purpose which is minimal in
scope and insubstantial in nature if
7 such use is incidental to the
exempt purposes of this paragraph; or
8 (d) charges a reasonable fee
for admission to cultural or educational
9 activities or permits the use
of its property for such activities by a
10 related agency or organization, if
any such activity is in furtherance
11 of the purposes of this
paragraph.
12
Third. All moneys and credits belonging exclusively to
universi-
13 ties, colleges, academies or other
public schools of any kind, or to
14 religious, literary, scientific or
benevolent and charitable institu-
15 tions or associations, appropriated
solely to sustain such institu-
16 tions or associations, not exceeding
in amount or in income arising
17 therefrom the limit prescribed by the
charter of such institution or
18 association.
19
Fourth. The reserve or emergency funds of fraternal
benefit so-
20 cieties authorized to do business
under the laws of the state of
21 Kansas.
22
Fifth. All buildings of private nonprofit universities
or colleges
23 which are owned and operated by such
universities and colleges as
24 student union buildings, presidents'
homes and student dormitories.
25
Sixth. All real and tangible personal property
actually and regu-
26 larly used exclusively by the alumni
association associated by its
27 articles of incorporation with any
public or nonprofit Kansas col-
28 lege or university approved by the
Kansas board of regents to confer
29 academic degrees or with any
community college approved by its
30 board of trustees to grant
certificates of completion of courses or
31 curriculum, to provide accommodations
and services to such college
32 or university or to the alumni, staff
or faculty thereof.
33
Seventh. All parsonages owned by a church society and
actually
34 and regularly occupied and used
predominantly as a residence by
35 a minister or other clergyman of such
church society who is actually
36 and regularly engaged in conducting
the services and religious min-
37 istrations of such society, and the
land upon which such parsonage
38 is located to the extent necessary
for the accommodation of such
39 parsonage.
40
Eighth. All real property, all buildings located on
such property
41 and all personal property contained
therein, actually and regularly
42 used exclusively by any individually
chartered organization of hon-
43 orably discharged military veterans
of the United States armed
5
1 forces or auxiliary of any such
organization, which is exempt from
2 federal income taxation
pursuant to section 501(c)(19) of the fed-
3 eral internal revenue code of
1986, for clubhouse, place of meeting
4 or memorial hall purposes, and
real property to the extent of not
5 more than two acres, and all
buildings located on such property,
6 actually and regularly used
exclusively by any such veterans' or-
7 ganization or its auxiliary as
a memorial park.
8
Ninth. All real property and tangible personal
property actually
9 and regularly used by a
community service organization for the
10 predominant purpose of providing
humanitarian services, which is
11 owned and operated by a corporation
organized not for profit under
12 the laws of the state of Kansas or by
a corporation organized not
13 for profit under the laws of another
state and duly admitted to en-
14 gage in business in this state as a
foreign not-for-profit corporation
15 if: (a) The directors of such
corporation serve without pay for such
16 services; (b) the corporation is
operated in a manner which does
17 not result in the accrual of
distributable profits, realization of pri-
18 vate gain resulting from the payment
of compensation in excess of
19 a reasonable allowance for salary or
other compensation for serv-
20 ices rendered or the realization of
any other form of private gain;
21 (c) no officer, director or member of
such corporation has any pe-
22 cuniary interest in the property for
which exemption is claimed; (d)
23 the corporation is organized for the
purpose of providing humani-
24 tarian services; (e) the actual use
of property for which an exemp-
25 tion is claimed must be substantially
and predominantly related to
26 the purpose of providing humanitarian
services, except that, the use
27 of such property for a nonexempt
purpose which is minimal in scope
28 and insubstantial in nature shall not
result in the loss of exemption
29 if such use is incidental to the
purpose of providing humanitarian
30 services by the corporation; (f) the
corporation is exempt from fed-
31 eral income taxation pursuant to
section 501(c)(3) of the internal
32 revenue code of 1986 and; (g)
contributions to the corporation are
33 deductible under the Kansas income
tax act. As used in this clause,
34 ``humanitarian services'' means the
conduct of activities which sub-
35 stantially and predominantly meet a
demonstrated community need
36 and which improve the physical,
mental, social, cultural or spiritual
37 welfare of others or the relief,
comfort or assistance of persons in
38 distress or any combination thereof
including but not limited to
39 health and recreation services, child
care, individual and family
40 counseling, employment and training
programs for handicapped
41 persons and meals or feeding
programs. Notwithstanding any other
42 provision of this clause, motor
vehicles shall not be exempt here-
43 under unless such vehicles are
exclusively used for the purposes
6
1 described therein.
2
Tenth. For all taxable years commencing after December
31,
3 1986, any building, and the
land upon which such building is lo-
4 cated to the extent necessary
for the accommodation of such build-
5 ing, owned by a church or
nonprofit religious society or order which
6 is exempt from federal income
taxation pursuant to section
7 501(c)(3) of the federal
internal revenue code of 1986, and actually
8 and regularly occupied and used
exclusively for residential and re-
9 ligious purposes by a community
of persons who are bound by vows
10 to a religious life and who conduct
or assist in the conduct of relig-
11 ious services and actually and
regularly engage in religious, benev-
12 olent, charitable or educational
ministrations or the performance
13 of health care services.
14
Eleventh. For all taxable years commencing after
December 31,
15 1998, all
real property upon which is
located facilities which utilize
16 renewable energy resources or
technologies for the purpose and as the
17 primary means to produce and
generate electricity and which is used
18 predominantly for such purpose, to
the extent necessary to accommodate
19 such facilities, and all tangible
personal property which comprises such
20 facilities actually and
regularly used predominantly to produce and gen-
21 erate electricity utilizing renewable
energy resources or technologies. For
22 purposes of this section, ``renewable
energy resources or technolo-
23 gies'' shall include wind, solar,
thermal, photovoltaic, biomass, hy-
24 dropower, geothermal and landfill gas
resources or technologies.
25 For purposes of valuation of
property subject to valuation under K.S.A.
26 79-5a01 et
seq., and amendments thereto, the value of the
exempt prop-
27 erty set forth in this clause shall
be removed from the unit value prior to
28 apportionment under K.S.A. 79-5a25,
and amendments thereto.
29 The provisions
of this section, except as otherwise more specifi-
30 cally provided, shall apply to all
taxable years commencing after
31 December 31, 1995.
32 Sec. 2.
3. K.S.A. 1999 Supp. 79-201j
is 79-201, 79-201j and 79-
33 5a01b are hereby
repealed.
34 Sec. 3.
4. This act shall take effect and be in force
from and after its
35 publication in the statute book.