4.45.070 Required exemptions.
(a) The following property is exempt from general taxation:
(1) Municipal or State property, except that:
a. A private leasehold, contract or other interest in the property is taxable to the extent of the interest;
b. Notwithstanding any other provision of law, property acquired by an agency, corporation, or other entity of the State through foreclosure or deed in lieu of foreclosure and retained as an investment of a State entity is taxable; this subsection does not apply to federal land granted to the University of Alaska under AS 14.40.380 or 14.40.390, or the other land granted to the university by the State to replace land that had been granted under AS 14.40.380 or 14.40.390;
c. An ownership interest of a municipality in real property located outside the municipality acquired after December 31, 1990, is taxable by another municipality; however, a borough may not tax an interest in real property located in the borough and owned by a city in that borough;
(2) Household furniture and personal effects of members of a household;
(3) Property used exclusively for nonprofit religious, charitable, cemetery, hospital, or educational purposes;
(4) Property of a nonbusiness organization or its auxiliary composed entirely of persons with 90 days or more of active service in the armed forces of the United States whose conditions of service and separation were other than dishonorable;
(5) Money on deposit;
(6) The real property of certain residents of the state to the extent and subject to the conditions provided in subsection (e) of this section;
(7) Real property or an interest in real property that is exempt from taxation under 43 U.S.C. 1620(d), as amended;
(8) Property of a political subdivision, agency, corporation, or other entity of the United States to the extent required by federal law; except that a private leasehold, contract, or other interest in the property is taxable to the extent of that interest;
(9) Natural resources in place including coal, ore bodies, mineral deposits, and other proven and unproven deposits of valuable materials laid down by natural processes, unharvested aquatic plants and animals, and timber.
(b) In subsection (a) of this section, “property used exclusively for religious purposes” includes the following property owned by a religious organization:
(1) The residence of an educator in a private religious or parochial school or a bishop, pastor, priest, rabbi, minister, or religious order of a recognized religious organization; for purposes of this subsection, “minister” means an individual who is:
a. Ordained, commissioned, or licensed as a minister according to standards of the religious organization for its ministers; and
b. Employed by the religious organization to carry out a ministry of that religious organization;
(2) A structure, its furniture, and its fixtures used solely for public worship, charitable purposes, religious administrative offices, religious education, or a nonprofit hospital;
(3) Lots required by local ordinance for parking near a structure defined in subsection (b)(2) of this section.
(c) Property described in subsection (a)(3) or (a)(4) of this section from which income is derived is exempt only if that income is solely from use of the property by nonprofit, religious, charitable, hospital, or educational groups. If used by nonprofit educational groups, the property is exempt only if used exclusively for classroom space.
(d) Laws exempting certain property from execution under the Code of Civil Procedure (AS 09) do not exempt the property from taxes levied and collected by the borough.
(e) The real property owned and occupied as the primary residence and permanent place of abode by: (1) a resident sixty-five (65) years of age or older, or (2) a disabled veteran, or (3) a resident at least sixty (60) years old who is the widow or widower of a person who qualified for an exemption under subsection (e)(1) or (e)(2) of this section is exempt from taxation on the first one hundred fifty thousand dollars ($150,000) of the assessed value of the real property. In a case of hardship an exemption beyond the first one hundred fifty thousand dollars ($150,000) of assessed value may be granted in accordance with the regulations of the State of Alaska Department of Commerce, Community, and Economic Development. This exemption is limited to a claimant’s primary residence. A claimant must apply by completing State Form 21-400c and submitting the form, including necessary attachments, to the borough assessor before July 1st of the exemption year. An eligible claimant may qualify for a hardship exemption if the claimant’s gross household income is less than one hundred fifty (150) percent of the poverty guideline as established by the United States Department of Health and Human Services for a similar sized household in the state of Alaska for the year requested and the amount of the claimant’s tax bill is greater than two (2) percent of the claimant’s gross household income. An exemption will be granted only for that portion of the claimant’s taxes in excess of two (2) percent of gross household income. “Gross household income” means total annual compensation earned and unearned from all sources, of all members of the household for the most recent calendar year. Only one (1) exemption may be granted for the same property and, if two (2) or more persons are eligible for an exemption for the same property, the parties shall decide between or among themselves who is to receive the benefit of the exemption. Real property may not be exempted under this subsection if the assessor determines, after notice and hearing to the parties, that the property was conveyed to the applicant primarily for the purpose of obtaining the exemption. The determination of the assessor may be appealed under AS 44.62.560 through 44.62.570.
(f) To be eligible for an exemption under subsection (e) of this section for a year, in which the individual applying for an exemption must also meet requirements under one (1) of the following subsections:
(1) The individual shall be eligible for a permanent fund dividend under AS 43.23.005 for that same year or for the immediately preceding year; or
(2) If the individual has not applied or does not apply for one (1) or both of the permanent fund dividends, the individual would have been eligible for one (1) of the permanent fund dividends identified in subsection (f)(1) of this section had the individual applied.
An exemption may not be granted under subsection (e) of this section except upon written application for the exemption on a form designated by the borough assessor. If the claimant has not qualified for an exemption for that property for the prior year the claimant must file the application no later than March 31st of the assessment year for which the exemption is sought. A qualified senior citizen or disabled veteran need not file such application for successive tax years if there is no change of residency, ownership, permanent place of abode by the owner of record, use of the property, status of disability if the owner is a disabled veteran, or other factors affecting qualification for the exemption. For exemption applications filed after March 31st, the borough assessor is authorized to accept the application as timely filed so long as the inability to apply was based on a serious medical or other similar serious condition or event beyond the claimant’s control that resulted in the inability to timely file application. A failure to pick up or read mail, or a failure to timely provide current address to the office of the borough assessor, will not be deemed an inability to comply and the application will not be accepted for that tax year. However, a claimant’s application for late filing must be filed prior to July 1st of the year for which the exemption is sought or that year’s application will not be considered. The assessor shall accept disabled veteran applications for previous tax years only where the disabled veteran has completed application for each year that the exemption is sought and has received a qualifying retroactive disability evaluation from the Veteran’s Administration or applicable branch of service. The borough assembly, for good cause shown, may waive a disabled veteran claimant’s failure to make timely application for exemption for prior tax years and authorize the assessor to accept the application as if timely filed.
If an application is filed within the required time and is approved by the assessor, the assessor shall allow an exemption in accordance with the provisions of this section. If the application for exemption is approved after taxes have been paid, the amount of tax that the claimant has already paid for the assessment year for the property exempted shall be refunded to the claimant. The assessor shall require proof in the form the assessor considers necessary of the right to and amount of an exemption claimed under subsection (e) of this section, and shall require a disabled veteran claiming an exemption under subsection (e) of this section to provide evidence of the disability rating. A disabled veteran who has not received a permanent disability rating will be required to file annually. It shall be the claimant’s (property owner’s) responsibility to notify the borough when the requirements for exemption are no longer met. If the assessor determines that a property is not eligible for exemption, all taxes, penalty and interest due on the property from the tax lien date following the date the property should have been subject to taxation are immediately due and owing. The assessor may require proof under this section at any time.
(g) In subsections (e) and (f) of this section:
(1) “Disabled veteran” means a disabled person:
a. Separated from the military service of the United States under a condition that is not dishonorable who is a resident of the state, whose disability was incurred or aggravated in the line of duty in the military service of the United States, and whose disability has been rated as 50 percent or more by the branch of service in which that person served or by the Veterans’ Administration;
b. Who served in the Alaska Territorial Guard, who is a resident of the State, whose disability was incurred or aggravated in the line of duty while serving in the Alaska Territorial Guard, and whose disability has been rated as 50 percent or more;
(2) “Real property” includes but is not limited to mobile homes, whether classified as real or personal property for municipal tax purposes.
(h) One motor vehicle per household owned by a resident 65 years of age or older on January 1 of the assessment year is exempt either from taxation on its assessed value or from the registration tax under AS 28.10.431. An exemption may be granted under this subsection only upon written application on a form prescribed by the State of Alaska Department of Public Safety.
(i) For the purpose of determining property exempt under subsection (a)(7) of this section, the following definitions apply to terms used in 43 U.S.C. 1620(d) unless superseded by applicable federal law:
(1) “Developed” means a purposeful modification of the property from its original state that effectuates a condition of gainful and productive present use without further substantial modification; surveying, construction of roads providing utilities or other similar actions normally considered to be component parts of the development process, but that do not create the condition described in this subsection, do not constitute a developed state within the meaning of this subsection; developed property, in order to remove the exemption, must be developed for purposes other than exploration, and be limited to the smallest practicable tract of the property actually used in the developed state;
(2) “Exploration” means the examination and investigation of undeveloped land to determine the existence of subsurface nonrenewable resources;
(3) “Lease” means a grant of primary possession entered into for gainful purposes with a determinable fee remaining in the hands of the grantor; with respect to a lease that conveys rights of exploration and development, this exemption shall continue with respect to that portion of the leased tract that is used solely for the purpose of exploration.
(j) If property or an interest in property that is determined not to be exempt under subsection (a)(7) of this section reverts to an undeveloped state, or if the lease is terminated, the exemption shall be granted, subject to the provisions of subsections (a)(7) and (i) of this section. [Ord. No. 1838, §1, 9-5-17; Ord. No. 1536, §1, 9-21-09; Ord. No. 1434, §1, 5-22-07; Ord. No. 1234, §1, 10-21-02; Ord. No. 1195, §1, 10-1-01; Ord. No. 891, §1, 11-2-92; Ord. No. 591, §1, 12-1-86; Ord. No. 590, §1, 12-1-86; Ord. No. 558, §3, 2-18-86; Ord. No. 411, §1, 3-1-82; Ord. No. 272, §3, 11-17-77. Code 1974 §45.11.020.]
State Law Reference – Similar provisions, AS 29.45.030.