Chapter 17.20
PROPERTY TAX
Sections:
17.20.011 Low income housing property.
17.20.030 Application for exemption.
17.20.040 Property declarations.
17.20.060 Board of equalization.
17.20.080 Payment dates, penalties and interest.
17.20.100 Personal property tax demand for payment.
17.20.110 Warrant of distraint and distraint.
17.20.120 Notice of sale of distrained property.
17.20.140 Return on distraint and sale.
17.20.010 Property taxation.
Unless otherwise provided in this chapter, the city shall assess for, levy and collect real property tax and personal property tax and enforce personal property tax in accordance with Alaska statutes. The city shall enforce delinquent real property tax liens through foreclosure proceedings conducted once every two years. (Ord. O-93-6-6 § 1 (part), 1994)
17.20.011 Low income housing property.
(a) When used in this chapter the phrase “low income housing property” means property that first qualifies for a low income housing credit under 26 U.S.C. 42 on and after January 1, 2001.
(b) When used in this chapter the phrase “alternate assessment method” means an assessment of the value of low income housing property based on the actual income derived from the property without adjustment based on the amount of any federal income tax credit given for the property.
(c) The full and true value of all low income housing property shall be exempt from the alternate assessment method requirement of AS 29.45.110(d)(1) or any successor or amendment thereto.
(d) The council may determine by parcel of low income housing property whether to assess such parcel of low income housing property using the alternate assessment method.
(e) The owner of any parcel of low income housing property who wants the council to determine whether to assess such parcel of low income housing property using the alternate assessment method shall submit an application for use of such alternate assessment method on or before May 15 of the year in which such an assessment is first desired. The application shall be submitted to the city clerk on forms provided by the assessor and shall include information that may reasonably be required to determine whether the property for which the assessment is requested is low income housing property.
(f) No later than the date set for the meeting of the board of equalization the assessor shall submit all such requests for use of the alternate assessment method for low income housing property to the city council together with an estimate of the difference in valuation that would result from granting the request.
(g) The council shall consider all requests for assessment of low income housing property submitted to the council by the assessor and shall by motion or resolution determine whether the property shall be assessed using the alternate assessment method.
(h) The council may not change the manner of assessment of any parcel of low income housing property for which an application for assessment using the alternate assessment method has been decided if debt relating to the property incurred in conjunction with the property’s qualifying for the low income housing tax credit remains outstanding. (Ord. O-02-5-5 § 2, 2002)
17.20.020 Exemptions.
(a) The following property is exempt from general taxation:
(1) All property required to be exempted by state and federal law, including, but not limited to, property identified in AS 29.45.030;
(2) Household furniture and personal effects of members of a household;
(3) Improvements to real property if an increase in assessed value is directly attributable to new maintenance, repair, or renovation of an existing structure and if the maintenance, repair, or renovation, when completed, enhances the exterior appearance or aesthetic quality of the land or structure. No exemption may be allowed under this subsection for the construction of any improvement to a structure if the principal purpose of the improvement is to increase the amount of space for occupancy for nonresidential use within the structure or for the alteration of land as a consequence of construction activity. An exemption provided in this subsection shall continue for four years from the date the improvement is completed or from the date of approval for the exemption by the assessor, whichever is later; provided, however, that the same exemption shall extend to one hundred percent of the initial increased assessed value of the improvement during the first year, only seventy-five percent of the initial increased assessed value of the improvement during the second year, only fifty percent of the initial increased assessed value of the improvement during the third year, and only twenty-five percent of the initial increased assessed value of the improvement during the fourth year;
(4) Real property actually and exclusively used for a public park, provided that this use has been approved and accepted by the city council;
(5) All aircraft;
(6) The residence of a celebrant of the formularies of public worship of a recognized religious organization that does not ordain bishops, pastors, priests, rabbis or ministers as a part of its liturgy, provided that such residence is owned by the religious organization and used exclusively for nonprofit religious purposes;
(7) On the first one hundred fifty thousand dollars of assessed value, real property owned by a disabled veteran (as defined below) and as otherwise provided by AS 29.40.030(e);
(8) On the first one hundred fifty thousand dollars of assessed value, real property owned and occupied as a permanent place of abode and primary residence by a resident sixty-five years of age or older or a resident at least sixty years of age or older who is a widow or widower of a resident sixty-five years of age or older who qualified for an exemption and as otherwise provided by AS 29.45.030(e);
(9) Business inventories held for resale in the normal course of business of a seller as defined by NCO Section 17.10.180 and who is issued a city sales tax certificate; and
(10) Snow machines, ATVs, boats/motors and associated trailers held primarily for personal and/or subsistence use.
(b) To be eligible for an exemption under subsection (a)(7) or (8) of this section (only one exemption may be granted for each parcel of real property regardless of ownership), an individual must meet at least one of the following requirements: (i) the individual shall be eligible for a permanent fund dividend under AS 43.23.005 for that same year for which the exemption is sought or for the immediately preceding year; or (ii) if the individual has not applied or does not apply for one or both of the permanent fund dividends, the individual would have been eligible for one of the permanent fund dividends identified had the individual applied. The assessor shall require proof in the form the assessor considers necessary of the right to and amount of an exemption claimed under subsections (a)(7) and (8) of this section, and shall require a disabled veteran claiming an exemption under this section to provide evidence of the disability rating.
(c) For purposes of subsection (a)(7), a “disabled veteran” is a disabled person who is a resident of the state and (i) separated from the military service of the United States under a condition that is not dishonorable, 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 fifty percent or more by the United States Department of Veterans Affairs; or (ii) served in the Alaska territorial guard and 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 fifty percent or more.
(d) Except with respect to public entities and agencies exempted under subsection (a) of this section, an exemption may not be granted under this section except upon written application for the exemption. The assessor may require proof under this section at any time.
(11) Restoration or replacement of deteriorated property. The assessed value of a real property is, subject to subsection (a)(11)(A) of this section, exempt from taxation for the duration set out in subsection (a)(11)(C) of this section, beginning in the year following approval by the assessor, or the assessor’s designee, of an application demonstrating that the eligibility criteria set out in subsection (a)(11)(A) of this section have been met.
(A) Eligibility Criteria. A property owner qualifying for the exemption set out in this subsection (a)(11) shall:
(i) Own real property at least partially comprised of an existing building that:
a. Is located in the deteriorated area of the city; and
b. Has been included on a list of deteriorated nuisance structures maintained by the city; or
c. Has been determined by the building inspector to meet written criteria to be developed by the building inspector and approved by the city council for qualification as a deteriorated structure provided the determination of the building inspector has been approved by the city manager; and
(ii) Have received all building and land use permits necessary to restore the building or to remove and replace the building with a new building to be used as rental residential housing which meets the requirements for an exception from sales tax under NCO Section 17.10.020(e), is generally available to all members of the public and which upon completion will increase the supply of property rented for continuous periods in excess of twenty-seven days; and
(iii) Submit a qualifying application to the assessor or the assessor’s designee prior to beginning work to restore or remove and replace the existing building.
(B) Exclusions. Restoration, replacement or construction of the following buildings does not create eligibility for this tax exemption:
(i) Temporary or seasonal use structures.
(ii) Owner-occupied structures.
(C) Duration of Exemption. The tax exemption granted by this subsection (a)(11) shall be for ten years.
(D) Taxes Due If Exemption Expires or Is Revoked. An exemption granted under this subsection (a)(11) shall expire and taxes previously exempted by operation of this subsection (a)(11) shall become due and payable if:
(i) By the third December 31st following application approval, a certificate of occupancy or conditional certificate of occupancy under NCO Section 5.10.060 has not been issued for a restored or new building on the real property, constructed in accordance with all applicable building and land use permits; or
(ii) A building or land use permit submitted with the application expires or is revoked and no restoration or replacement permit is obtained, and a copy submitted to the assessor or the assessor’s designee within three hundred sixty days; or
(iii) A new or renovated building for which the application was granted is not being occupied in a manner that meets the exemption criteria of this subsection (a)(11); or
(iv) The exemption is revoked.
(E) Application Procedure. Applicants for the tax exemption authorized in this subsection (a)(11) shall submit an application no later than February 1st of each assessment year for which the exemption is sought, on a form specified by the assessor or the assessor’s designee, containing:
(i) The legal description and parcel number designation of the real property for which the exemption is being sought,
(ii) The assessed value and age of all buildings on the real property, and the estimated value of each separate building when there are multiple buildings,
(iii) A copy of all building and land use permits obtained to restore or remove and replace an existing building on the real property,
(iv) An agreement and acknowledgment that taxes exempted upon approval of the application will become due and payable if, by the third December 31st following approval of the application, a certificate of occupancy or conditional certificate of occupancy has not been issued for a restored or new building on the real property, constructed in accordance with all applicable building and land use permits, and is not being used as a primary residence, and
(v) Such other information as the assessor may require.
(F) Revocation of Exemption. An exemption granted under this subsection (a)(11) may be revoked if, at any time during the exemption period, the property for which the exemption was granted is no longer being used in a manner that meets the exemption criteria of this subsection (a)(11).
(G) Appeal of Revocation or Expiration. NCO Section 17.20.050 applies to determinations an exemption has expired and to determinations revoking an exemption.
(H) Definitions. For purposes of this exemption the deteriorated area of the city consists of all property within city boundaries.
(12) Economic development property. The assessed value of economic development property is, subject to subsections (a)(12)(A) through (D) of this section, partially exempt from taxation for the duration set out in subsection (a)(12)(C) of this section, beginning in the year following approval by the assessor, or the assessor’s designee, of an application demonstrating that the eligibility criteria set out in subsection (a)(12)(A) of this section have been met.
(A) Eligibility Criteria. A property owner qualifying for the exemption set out in this subsection (a)(12) shall:
(i) Have received all building and land use permits necessary to construct economic development property; and
(ii) Submit a qualifying application to the assessor or the assessor’s designee prior to beginning work to construct a new building or renovate an existing building.
(B) Exclusions.
(i) Restoration or construction of temporary or seasonal use structures does not create eligibility for this tax exemption.
(ii) Restoration or construction of long-term rental structures not available for rent to the general public does not create eligibility for this tax exemption.
(iii) Restoration or construction of long-term rental structures which will not increase the supply of rental residential housing which meets the requirements for an exception from sales tax under NCO Section 17.10.020(e) does not create eligibility for this tax exemption.
(C) Duration of Exemption. The tax exemption granted by this subsection shall be for fifteen years.
(D) Amount of Exemption. An exemption under this section only exempts:
(i) That portion of the amount of real property tax that exceeds the amount levied on other real property for the city’s required local contribution to the Nome Public School District under AS 14.17.410(b)(2);
(ii) The incremental increase in assessed value of the property as determined in the first tax year after issuance of a certificate of occupancy or conditional certificate of occupancy under NCO Section 5.10.060;
(iii) For a mixed-use building, only that portion of the incremental increase in assessed value that is attributed to the additional residential rental portion of the structure.
(E) Taxes Due If Exemption Expires or Is Revoked. An exemption granted under this subsection (a)(12) shall expire and taxes previously exempted shall become due and payable if:
(i) By the third December 31st following application approval, a certificate of occupancy or conditional certificate of occupancy under NCO Section 5.10.060 has not been issued for a restored or new building on the real property, constructed in accordance with all applicable building and land use permits and consisting of at least one residential dwelling unit; or
(ii) A building or land use permit submitted with the application expires or is revoked and no restoration or replacement permit is obtained and a copy submitted to the assessor or the assessor’s designee within three hundred sixty days; or
(iii) All units in a new or renovated building for which the application was granted are not being occupied as rental residential housing which meets the requirements for an exception from sales tax under NCO Section 17.10.020(e); or
(iv) The exemption is revoked.
(F) Application Procedure. Applicants for the tax exemption authorized in this subsection (a)(12) shall apply no later than February 1st of each assessment year for which the exemption is sought, on a form specified by the assessor, or the assessor’s designee, containing:
(i) The legal description and parcel number designation of the real property for which the exemption is being sought,
(ii) The assessed value and age of all buildings on the real property, and the estimated value of each separate building when there are multiple buildings,
(iii) A copy of all building and land use permits obtained to renovate an existing building or construct a new building on the real property,
(iv) A copy of all current leases of dwelling units on the property,
(v) An agreement and acknowledgment that taxes exempted upon approval of the application will become due and payable if, by the third December 31st following approval of the application, a certificate of occupancy or conditional certificate of occupancy has not been issued for a restored or new building on the real property, constructed in accordance with all applicable building and land use permits, containing at least one residential unit which is being used as rental residential housing which meets the requirements for an exception from sales tax under NCO Section 17.10.020(e), and
(vi) Such other information as the assessor may require.
(G) Revocation of Exemption. An exemption granted under this subsection (a)(12) may be revoked if, at any time during the exemption period, all dwelling units on the property for which the exemption was granted are no longer being used as rental residential housing which meets the requirements for an exception from sales tax under NCO Section 17.10.020(e).
(H) Appeal of Revocation or Expiration. NCO Section 17.20.050 applies to determinations an exemption has expired and to determinations revoking an exemption.
(I) Definitions. For purposes of this exemption “economic development property” means real or personal property, including developed property conveyed under 43 U.S.C. 1601 et seq. (Alaska Native Claims Settlement Act), for which a building permit has been issued for construction of one or more multi-unit residential structures containing a total of at least one dwelling unit which demonstrates that the total cost to complete the project will exceed the current assessed value of the property. (Ord. O-22-05-03S § 2, 2022; Ord. O-22-05-01S § 2, 2022; Ord. O-19-03-01A § 2, 2019: Ord. O-06-12-02 § 2, 2006; Ord. O-06-10-03 § 2, 2006: Ord. O-99-8-1 § 2, 1998; Ord. O-96-8-7 § 2, 1995; Ord. O-93-6-6 § 1 (part), 1994)
17.20.030 Application for exemption.
(a) No exemption may be granted except upon written application for the exemption on a form supplied by the assessor. The claimant must file the application no later than February 1st of the assessment year for which the exemption is sought. The city council for good cause shown and as demonstrated in a sworn statement of the claimant may waive the claimant’s failure to make timely application for the exemption and authorize the assessor to accept the application as if timely filed. The claimant must file a separate application for each assessment year in which the exemption is sought. 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 Section 17.20.020 of this chapter. If a claimant whose failure to timely file for exemption has been waived by the city council as provided in this subsection, and the application for exemption is approved, the amount of tax which the claimant may have already paid for the assessment year with respect to the property exempt shall be refunded to the claimant.
(b) The assessor may at any time require proof, in the form he or she considers necessary, of the grounds for the claimed exemption and the amount of the exemption claimed. The claimant has the burden of establishing their qualifications and/or entitlement for an exemption. The exemption ordinance and statutes shall be strictly construed in favor of taxation. (Ord. O-06-10-03 § 3, 2006: Ord. O-93-6-6 § 1 (part), 1994)
17.20.040 Property declarations.
On or before February 1st of the assessment year, every person having ownership or control of or an interest in personal property within the corporate boundaries of the city shall file with the assessor a personal property declaration in the form prescribed by the assessor, based on property values existing on January 1st of the same assessment year. The person filing the declaration shall state an address at which all notices required by law may be mailed. The declaration shall state the nature, quantity, description, amount and value of all personal property situated within the corporate boundaries of the city; the place where the property is situated; and such additional information as the assessor may require. The declaration shall be signed and verified under oath or affirmation by the person submitting the return. (Ord. O-93-6-6 § 1 (part), 1994)
17.20.050 Appeals.
(a) Any alleged error in valuation not adjusted by the assessor to the taxpayer’s satisfaction may be appealed to the board of equalization in accordance with the procedures set forth in Alaska Statutes.
(b) A denial by the assessor of an application for exemption from taxation may be appealed to the board of equalization. The appellant shall, within thirty days from the date of mailing of the notice of denial, submit to the assessor a written appeal specifying all grounds for relief from the alleged error, and providing a summary of facts and an identification of documents to be presented as proof of qualification for the exemption. The right of appeal ceases if the appellant fails to comply with these time limitations and substantive written specifications, unless the board of equalization finds that the appellant was unable to comply.
(c) The assessor shall notify all appellants by mail of the time and place of their hearing. (Ord. O-93-6-6 § 1 (part), 1994)
17.20.060 Board of equalization.
The city council shall sit as a board of equalization for the purpose of hearing any appeal from determinations of the assessor. Except as otherwise provided in this chapter the board shall be governed in its proceedings by the general rules of city council business regarding quorum and voting requirements, and by the general rules of administrative law applicable in the state of Alaska. (Ord. O-93-6-6 § 1 (part), 1994)
17.20.070 Hearing.
(a) The appellant shall bear the burden of proof of an alleged error in an exemption determination. The only grounds for adjustment is proof based on facts which are stated in a valid written appeal timely filed or proved at the hearing.
(b) If an appellant fails to appear, the board of equalization may proceed with the hearing in his or her absence.
(c) The board of equalization shall certify its actions to the assessor within seven days of adjournment of the hearing. (Ord. O-93-6-6 § 1 (part), 1994)
17.20.080 Payment dates, penalties and interest.
(a) The taxpayer may pay the levied tax in two installments with the first installment due on or before July 31st of the tax year and with the second installment due on or before October 31st of the tax year. If the first installment is not paid in full by the due date, the unpaid balance of that installment becomes delinquent and penalty, interest and costs accrue. A penalty of eight percent on the unpaid balance of a tax installment which was due (plus any surcharge required to be imposed by AS 12.55.039) shall be added to the delinquent tax. Interest shall accrue at the rate of eight percent per annum on the unpaid balance of delinquent taxes from the due date until paid in full.
(b) In the event that the due date is a Saturday, Sunday, or a city holiday, the property tax payment shall be received by the city on or before the next following business day.
(c) All payments shall be credited first to penalty, then to interest accrued through the date of payment, and then to the past-due taxes. (Ord. O-18-01-01 § 2, 2018: Ord. O-09-09-03 § 2, 2009: Ord. O-06-09-08 § 2, 2006: Ord. O-02-9-6 §§ 2—4, 2002; Ord. O-99-11-3 § 36, 1998: Ord. O-93-6-6 § 1 (part), 1994)
17.20.090 Effect at law.
(a) This chapter shall not be construed as abating any action now pending under, or by virtue of, prior existing laws, or as discontinuing, abating, modifying or altering any penalty accruing or about to accrue, or as affecting the liability of any person, or as waiving any right of the city under any section or provision existing at the time the ordinance codified in this chapter is adopted, or as vacating any right obtained by any person, firm or corporation, by lawful action of the city except as shall be expressly provided for in this chapter.
(b) If any part or provision of this chapter or application thereof to any person or circumstances is adjudged invalid by any court of competent jurisdiction, such judgment shall be confined in its operation to the part, provision or application directly involved in all controversy in which such judgment shall have been rendered and shall not affect or impair the validity of the remainder of this chapter or the application thereof to other persons or circumstances. The city council declares that it would have enacted the remainder of this chapter even without any such part, provision or application. (Ord. O-93-6-6 § 1 (part), 1994)
17.20.100 Personal property tax demand for payment.
When personal property taxes have become delinquent, the city clerk may demand immediate payment of the taxes, together with penalty and interest. This demand shall be in writing and may be made by personal delivery or by certified mail to the last known address of record for the taxpayer. This demand shall in all cases precede the institution of action to recover delinquent personal property taxes, either by personal action or distraint and sale. (Ord. O-18-09-03 § 2, 2018)
17.20.110 Warrant of distraint and distraint.
(a) Should the delinquent personal property tax, penalty and interest for which demand has been made be not paid within thirty days of the date the demand was delivered or mailed, the clerk may issue a warrant of distraint.
(b) A warrant of distraint shall identify:
(1) The name and address of the owner of record of the personal property subject to the lien for delinquent personal property taxes;
(2) A description of said property; and
(3) The total tax, penalty, and interest owed.
(c) A copy of the warrant shall be served upon the debtor or, if the debtor is not available, shall be conspicuously left at the premises from which property has been taken. The person serving the warrant shall additionally leave with the debtor a written inventory of all property seized pursuant to the warrant. (Ord. O-18-09-03 § 3, 2018)
17.20.120 Notice of sale of distrained property.
(a) Following seizure of personal property pursuant to this chapter, the chief of police shall publish in a newspaper of general circulation once a week for four consecutive weeks a notice of sale for property distrained under this chapter. At approximately the same time as the first publication, the chief of police shall send a copy of the notice by certified mail (return receipt requested) to the last known address of record for the owner of record of the property.
(b) Every notice of possession mailed or published pursuant to this section shall contain:
(1) A general description of the property;
(2) The date the property was distrained;
(3) The time, date, and place of the auction, if by public auction, or the deadline and place for submitting sealed bids if by sealed bid;
(4) Any other reasonable conditions of sale of the property; and
(5) A provision that the property may be reclaimed by the owner at any time prior to the date of the auction or for opening bids by payment of all tax, penalty, interest, and the reasonable costs incurred by the city to distrain and sell the property. (Ord. O-18-09-03 § 4, 2018)
17.20.130 Sale of property.
Unless otherwise reclaimed by the owner as provided for in this chapter, distrained property shall be sold as specified in the notice of sale. (Ord. O-18-09-03 § 5, 2018)
17.20.140 Return on distraint and sale.
(a) Upon the warrant of distraint having been served and the personal property therein described having been seized and sold, the chief of police shall endorse the reverse side of the warrant, describing the actions thereon, including a description of property seized, the proceeds and date of the sale, and the reasonable costs of distraining and selling the property, and deliver the same to the clerk together with the proceeds of the sale.
(b) Should the personal property be sold for an amount or total in excess of the amount required to satisfy the tax, penalty, interest, costs and expenses incurred, such excess shall be shall be paid the owner of the property upon written demand and receipt therefor. Any claim for such excess proceeds shall be forever waived if not made within one year of the date of sale. (Ord. O-18-09-03 § 6, 2018)