132.020 State ad valorem taxes

132.020 State ad valorem taxes.

(1) The owner or person assessed shall pay an annual ad valorem tax for state purposes

at the rate of:

(a) Thirty-one and one-half cents ($0.315) upon each one hundred dollars ($100)

of value of all real property directed to be assessed for taxation;

(b) Twenty-five cents ($0.25) upon each one hundred dollars ($100) of value of

all motor vehicles qualifying for permanent registration as historic motor

vehicles under KRS 186.043;

(c) Fifteen cents ($0.15) upon each one hundred dollars ($100) of value of all:

1. Machinery actually engaged in manufacturing;

2. Commercial radio and television equipment used to receive, capture,

produce, edit, enhance, modify, process, store, convey, or transmit audio

or video content or electronic signals which are broadcast over the air to

an antenna, including radio and television towers used to transmit or

facilitate the transmission of the signal broadcast and equipment used to

gather or transmit weather information, but excluding telephone and

cellular communication towers; and

3. Tangible personal property which has been certified as a pollution

control facility as defined in KRS 224.1-300. In the case of tangible

personal property certified as a pollution control facility which is

incorporated into a landfill facility, the tangible personal property shall

be presumed to remain tangible personal property for purposes of this

paragraph if the tangible personal property is being used for its intended

purposes;

(d) Ten cents ($0.10) upon each one hundred dollars ($100) of value on the

operating property of railroads or railway companies that operate solely

within the Commonwealth;

(e) Five cents ($0.05) upon each one hundred dollars ($100) of value of goods

held for sale in the regular course of business, which includes:

1. Machinery and equipment held in a retailer's inventory for sale or lease

originating under a floor plan financing arrangement;

2. Motor vehicles:

a. Held for sale in the inventory of a licensed motor vehicle dealer,

including licensed motor vehicle auction dealers, which are not

currently titled and registered in Kentucky and are held on an

assignment pursuant to KRS 186A.230; or

b. That are in the possession of a licensed motor vehicle dealer,

including licensed motor vehicle auction dealers, for sale, although

ownership has not been transferred to the dealer;

3. Raw materials, which includes distilled spirits and distilled spirits

inventory;

4. In-process materials, which includes distilled spirits and distilled spirits

inventory, held for incorporation in finished goods held for sale in the

regular course of business; and

5. Qualified heavy equipment;

(f) One and one-half cents ($0.015) upon each one hundred dollars ($100) of

value of all:

1. Privately owned leasehold interests in industrial buildings, as defined

under KRS 103.200, owned and financed by a tax-exempt governmental

unit, or tax-exempt statutory authority under the provisions of KRS

Chapter 103, upon the prior approval of the Kentucky Economic

Development Finance Authority, except that the rate shall not apply to

the proportion of value of the leasehold interest created through any

private financing;

2. Qualifying voluntary environmental remediation property, provided the

property owner has corrected the effect of all known releases of

hazardous substances, pollutants, contaminants, petroleum, or petroleum

products located on the property consistent with a corrective action plan

approved by the Energy and Environment Cabinet pursuant to KRS

224.1-400, 224.1-405, or 224.60-135, and provided the cleanup was not

financed through a public grant or the petroleum storage tank

environmental assurance fund. This rate shall apply for a period of three

s, pollutants, contaminants, petroleum, or petroleum

products located on the property consistent with a corrective action plan

approved by the Energy and Environment Cabinet pursuant to KRS

224.1-400, 224.1-405, or 224.60-135, and provided the cleanup was not

financed through a public grant or the petroleum storage tank

environmental assurance fund. This rate shall apply for a period of three

(3) years following the Energy and Environment Cabinet's issuance of a

No Further Action Letter or its equivalent, after which the regular tax

rate shall apply;

3. Tobacco directed to be assessed for taxation;

4. Unmanufactured agricultural products;

5. Aircraft not used in the business of transporting persons or property for

compensation or hire;

6. Federally documented vessels not used in the business of transporting

persons or property for compensation or hire, or for other commercial

purposes; and

7. Privately owned leasehold interests in residential property described in

KRS 132.195(2)(g); and

(g) Forty-five cents ($0.45) upon each one hundred dollars ($100) of value of all

other property directed to be assessed for taxation shall be paid by the owner

or person assessed, except as provided in KRS 132.030, 132.200, 136.300,

and 136.320, providing a different tax rate for particular property.

(2) Notwithstanding subsection (1)(a) of this section, the state tax rate on real property

shall be reduced to compensate for any increase in the aggregate assessed value of

real property to the extent that the increase exceeds the preceding year's assessment

by more than four percent (4%), excluding:

(a) The assessment of new property as defined in KRS 132.010(8);

(b) The assessment from property which is subject to tax increment financing

pursuant to KRS Chapter 65; and

(c) The assessment from leasehold property which is owned and financed by a

tax-exempt governmental unit, or tax-exempt statutory authority under the

provisions of KRS Chapter 103 and entitled to the reduced rate of one and

one-half cents ($0.015) pursuant to subsection (1)(f) of this section. In any

year in which the aggregate assessed value of real property is less than the

preceding year, the state rate shall be increased to the extent necessary to

produce the approximate amount of revenue that was produced in the

preceding year from real property.

(3) By July 1 each year, the department shall compute the state tax rate applicable to

real property for the current year in accordance with the provisions of subsection

(2) of this section and certify the rate to the county clerks for their use in preparing

the tax bills. If the assessments for all counties have not been certified by July 1, the

department shall, when either real property assessments of at least seventy-five

percent (75%) of the total number of counties of the Commonwealth have been

determined to be acceptable by the department, or when the number of counties

having at least seventy-five percent (75%) of the total real property assessment for

the previous year have been determined to be acceptable by the department, make

an estimate of the real property assessments of the uncertified counties and compute

the state tax rate.

(4) If the tax rate set by the department as provided in subsection (2) of this section

produces more than a four percent (4%) increase in real property tax revenues,

excluding:

(a) The revenue resulting from new property as defined in KRS 132.010(8);

(b) The revenue from property which is subject to tax increment financing

pursuant to KRS Chapter 65; and

ies and compute

the state tax rate.

(4) If the tax rate set by the department as provided in subsection (2) of this section

produces more than a four percent (4%) increase in real property tax revenues,

excluding:

(a) The revenue resulting from new property as defined in KRS 132.010(8);

(b) The revenue from property which is subject to tax increment financing

pursuant to KRS Chapter 65; and

(c) The revenue from leasehold property which is owned and financed by a tax-

exempt governmental unit, or tax-exempt statutory authority under the

provisions of KRS Chapter 103 and entitled to the reduced rate of one and

one-half cents ($0.015) pursuant to subsection (1) of this section;

the rate shall be adjusted in the succeeding year so that the cumulative total of each

year's property tax revenue increase shall not exceed four percent (4%) per year.

(5) The provisions of subsection (2) of this section notwithstanding, the assessed value

of unmined coal certified by the department after July 1, 1994, shall not be included

with the assessed value of other real property in determining the state real property

tax rate. All omitted unmined coal assessments made after July 1, 1994, shall also

be excluded from the provisions of subsection (2) of this section. The calculated

rate shall, however, be applied to unmined coal property, and the state revenue shall

be devoted to the program described in KRS 146.550 to 146.570, except that four

hundred thousand dollars ($400,000) of the state revenue shall be paid annually to

the State Treasury and credited to the Office of Energy Policy for the purpose of

public education of coal-related issues.