Chapter 3.40
PERSONAL PROPERTY TAX

Sections:

3.40.010    Property subject to taxation.

3.40.020    Exemptions.

3.40.030    Assessment return.

3.40.040    Tax situs of personal property.

3.40.050    Liability for and collection of personal property taxes.

3.40.060    Penalties and interest.

3.40.070    Classification of aircraft.

*    For statutory provisions granting the power to assess and collect taxes, see AS 29.35.170; for provisions governing municipal assessment and taxation generally, see AS 29.45.

    Prior legislation: Code 1974 §§3.24.060, 3.24.070, 3.24.080 and 3.24.090 and Ords. 83-53-O, 84-25-O, 96-21 and 2007-16.

3.40.010 Property subject to taxation.

A. Tangible personal property with a tax situs within the borough is subject to taxation, except where otherwise exempted by borough ordinance or state statute. Tangible personal property includes all personal property including, but not limited to, furniture, furnishings, fixtures, machinery, equipment used by a business, stock animals, watercraft, aircraft, tools, dies, jigs, patterns and stock used in trade (including inventories, supplies, materials in process, and other similar items).

B. All private interests in personal property which is otherwise exempt due to ownership by the federal government, state, borough, other state municipal subdivision or other tax-exempt entity is taxable under this code to the extent of that interest. [Ord. FY2015-11 §2, 2015; Ord. FY2014-10 §11, 2014; Ord. FY2011-07 §2, 2010].

3.40.020 Exemptions.

A. Individual personal property utilized solely and exclusively for personal, nonbusiness, noncommercial, nonagricultural and nonincome producing uses or purposes is exempt from taxation under this chapter. This includes aircraft, boats and vessels used for nonbusiness, nonagricultural, noncommercial and nonincome producing purposes.

B. A taxpayer who files a timely business property return with the assessor shall be exempted the first $20,000 of assessed value of business personal property. For a taxpayer with more than one business personal property tax account, the $20,000 exemption shall be distributed pro rata among all of the taxpayer accounts, based on the proportion of the assessed value in each account to the total assessed value of that taxpayer’s business personal property.

C. Pursuant to AS 29.45.050(b)(2), the inventories of businesses possessing a valid business license from the state of Alaska are exempt from the tax imposed by this chapter. As used herein, “inventories” means personal property in the hands of a retail or wholesale merchant held for sale or personal property held in the form of raw materials or component parts for the manufacture or production of goods.

D. Pursuant to AS 29.45.050(b)(2), boats and vessels used for commercial purposes such as commercial fishing, charter boat fishing, or freight hauling, and fishing gear (i.e., nets, seines, crab pots, long lines, trawls) and any or all associated paraphernalia utilized for commercial fishing is exempt from property tax. [Ord. FY2015-11 §2, 2015; Ord. FY2014-10 §12, 2014; amended during 7/11 supplement; Ord. FY2011-07 §2, 2010].

3.40.030 Assessment return.

A. Every person with ownership in taxable personal property shall submit to the borough assessor a personal property return of any property owned by him, or in which he has an interest, and of the property held or controlled by him in a representative capacity, in the manner prescribed, which return shall be based on property values existing as of the first day of January of the year for which the return is made. The person making the return in every case shall state an address to which all notices required to be given to him under this section may be mailed or delivered. The return shall show the nature; quantity; description, including date of manufacture; amount; value; purchase price, new or used; depreciable basis; and current condition of all personal property, the place where the property is situated, and said return shall be in such form and include such additional information as the assessor may prescribe, and shall be signed and verified under oath by the person liable, or his or its authorized agent or representative.

B. Said return shall be filed on or before the fifteenth day of January of each tax year, unless the property owner requests, and the assessor approves, an extension that may not exceed 30 days. The extension must be requested prior to the January 15th due date.

C. The borough assessor may, by notice in writing to any person by whom a return has been made, require from him a further return containing additional details and more explicit particulars and, upon receipt of the notice, that person shall comply fully with its requirements within 30 days.

D. In the event of any person failing, refusing, or neglecting to make or file said personal property return of property owned by him, as required herein, the assessor shall make an assessment which shall be as fair and equitable as he is able to make from the best information in his possession concerning said property and this assessment shall be prima facie evidence for all legal purposes and any related proceedings. (AS 29.45.130(a).) [Ord. FY2015-11 §2, 2015; Ord. FY2014-10 §13, 2014; Ord. FY2011-07 §2, 2010; Ord. FY2011-05 §2, 2010; Ord. 92-25 §2, 1992; prior code Ch. 3 subch. 2 §1. Formerly §3.40.010. Code 1974 §3.24.010].

3.40.040 Tax situs of personal property.

A. The tax situs of personal property is presumed to be the Kodiak Island Borough if:

1. It is located within the borough on January 1st of the assessment year, and has been located in the borough for more than a temporary period in the year prior to January; or

2. It is normally located within the borough, even though it is outside the borough on January 1st of the assessment year, if it is located outside the borough for only a temporary period of time during the year prior to January 1st of the assessment year; or

3. It is not located in the borough on January 1st, but has been kept or used within the borough for any 60 days during the year preceding the January 1st assessment date; or

4. It normally is returned to the borough between uses elsewhere, and is not located in any one place for more than a temporary period.

B. For purposes of this code, “temporary period” is defined as 60 days. [Ord. FY2015-11 §2, 2015; Ord. FY2014-10 §14, 2014; Ord. FY2011-07 §2, 2010; Ord. 85-12-O §1, 1985. Formerly §3.40.015. Code 1974 §3.24.015].

3.40.050 Liability for and collection of personal property taxes.

A. The owner of personal property assessed is personally liable for the amount of taxes assessed against the property. The tax, together with penalty and interest, may be collected in a personal action brought in the name of the borough.

B. If the tax on personal property is not paid when due, the borough may, in addition to other remedies available, enforce the tax lien by distraint and sale of the property after first making demand of the person assessed for the amount of the tax, penalty, and interest. The demand shall be in writing addressed to the person whose name appears on the last assessment roll as the owner of the property, describing the personal property assessed and the amount of the tax, penalty, and interest and demanding that the total be paid within 10 days after service of the demand personally or by registered mail.

C. If the tax has not been paid after the expiration of 10 days from service of demand, the clerk may issue a warrant directing a peace officer to seize the personal property for which the tax was levied and to sell it at public auction after at least 15 days’ notice of the sale by posting and publication. If the proceeds from the property sold are not sufficient to satisfy the tax, penalty, interest and costs of sale, the warrant may authorize the seizure of other personal property sufficient to satisfy the tax, penalty, interest, and costs of sale.

D. The borough has the right to seek payment of any unpaid portion of the tax, penalty and interest by all methods available under law. [Ord. FY2015-11 §2, 2015; Ord. FY2014-10 §15, 2014; Ord. FY2011-07 §2, 2010; Ord. 74-12-O §1, 1974; prior code Ch. 3 subch. 2 §2. Formerly §3.40.020. Code 1974 §3.24.020].

3.40.060 Penalties and interest.

A. A person or entity required by this code to file a personal property return who files a completed return after the filing deadline but before the mailing of the assessment notices shall, in addition to other penalties provided by law, be liable for a penalty of five percent of the tax assessed against said personal property for that tax year.

B. A person or entity required by this code to file a personal property return who fails to file a return as required by this code before the mailing of the assessment notices shall, in addition to other penalties provided by law, be fined a penalty in the amount of $300.00 and be liable for a penalty of 10 percent of the tax assessed against said personal property for the tax year.

C. (AS 29.45.140.) [Ord. FY2016-09 §2, 2015; Ord. FY2015-11 §2, 2015; Ord. FY2014-10 §16, 2014; Ord. FY2011-07 §2, 2010; Ord. 93-36 §4, 1993; Ord. 92-25 §2, 1992; Ord. 74-8-O §3, 1974; Ord. 69-4-O §1, 1969; Ord. 67-11-O §1, 1967; prior code Ch. 3 subch. 2 §3. Formerly §3.40.030. Code 1974 §3.24.030].

3.40.070 Classification of aircraft.

A. Pursuant to AS 29.45.050(b)(2), for purposes of taxation, commercial aircraft that have been issued an N number by the Federal Aviation Administration (“FAA”) by January 1st of the tax year and are less than 12,500 pounds takeoff weight shall be totally exempted from ad valorem taxes and shall be taxed at the rate determined annually by the assembly during the budget adoption process.

B. The owner of record of an aircraft that has been dismantled, destroyed or crashed and the FAA N number has been retained by the aircraft’s owner of record may submit to the assessor proof of condition that would allow for taxation of that aircraft, if approved by the assessor, at a rate determined by the assembly during the budget adoption process. Aircraft for which such registration or licensing has lapsed or that has not passed the annual inspection required by the FAA shall not qualify on this basis alone for ad valorem taxation unless it has been dismantled, destroyed or crashed.

C. Commercial aircraft with a gross takeoff weight of more than 12,500 pounds shall be taxed on an ad valorem basis and in accordance with the Kodiak Island Borough landing schedule formula. The KIB landing schedule formula provides for the prorated calculation of scheduled aircraft by dividing the total hours in a year into the total time aircraft operated by a scheduled carrier are in the Kodiak Island Borough, and multiplying the result by the assessed value of each aircraft.

D. Definitions. For purposes of this section:

“Aircraft” means any engine powered contrivance invented, used, or designed to navigate, or fly in, the air and that is capable of being manned and is required by the FAA to be registered and certified in order to be manned.

“Commercial aircraft” means any aircraft transporting passengers and/or cargo or is employed for fish spotting, agricultural, aquacultural or other purposes for some payment, or other consideration, including money or services rendered.

“Crashed” means aircraft for which only parts remain that, due to their condition, can no longer be assembled to create any contrivable aircraft. This shall be evidenced by an FAA accident report and/or copy of an insurance claim that determines the aircraft to be a total loss.

“Destroyed” means aircraft that have been damaged by age, weather, neglect and/or external influences outside the owner’s control, and only unusable parts remain that, due to their condition, can no longer be assembled to create any contrivable aircraft. This shall be evidenced by photographs and a physical inspection by the borough assessing staff appraiser if deemed necessary by the borough assessor.

“Dismantled” means aircraft that have been voluntarily disassembled and only parts remain that can no longer be assembled to create any contrivable aircraft. Evidence such as photographs and a physical inspection by the borough assessing staff appraiser shall be provided or allowed if deemed necessary by the borough assessor.

E. An aircraft owner may appeal the determination of the borough assessor under subsections B and C of this section using the same procedures for appeal of real and personal property assessments as set out in KIBC 3.35.040(C)(4) and 3.35.050(C). [Ord. FY2015-11 §2, 2015; Ord. FY2011-07 §2, 2010. Formerly §3.40.080].