H.B. 445 County Government Land Purchasing: transcript

Madam Chair or Vice chair and committee. Um, I've talked to a number of you about this bill. Um, and I've, I've brought, uh, well, so the impetus of the bill is that we had, uh, a county that was purchasing property in another county and there was no notification. And when it finally came to, uh, the, um, when, when the county, Morgan County became aware of this, they were concerned. And, uh, in the end, uh, everything worked out. But the, uh, what we're trying to accomplish here is that if a county is gonna purchase property in another county, they need to notify and they need to have a vote from the, the legislative body. So, um, I mean, the crux of the bill really is in lines 1 43 to 1 53, um, that before a county may acquire real property that is located within geographical boundaries of another county by exchange, purchase, or lease, the acquiring county shall obtain the express permission of the legislative body of the county. Um, and this requires formal legislative action. So that's the crux of the bill. But I have with me, uh, Mike Newton, he's one of the county commissioners in Morgan County, and he can, uh, he can explain a couple things that, uh, uh, from his perspective to help.

Name for the record. Thank you. My name's Mike Newton. I'm Morgan County Commissioner. Appreciate the opportunity to address you today. Um, Representative Strong did a, a great job of introducing the bill and, and kind of what it's about. And I wanted to speak to that and, and also talk about, um, some what ifs. And I know as, as representatives, we get a lot of what ifs from constituents and some of those may be, um, legitimate and some of those we, we maybe aren't quite as legitimate. But I'd like to to talk about some scenarios here a little bit. And, um, I think the, the big question is, um, before this committee is what happens if this bill passes? Right? But I think the o other question is what happens if it doesn't and what are some scenarios that could occur under the current code? Um, so very briefly to kind of talk a little bit about the, I guess the impetus to this whole thing, which was, uh, Summit County's acquisition of the nine 10 Cattle Ranch. Um, and I wanna be very clear that we're not against that acquisition. Uh, we never have been against that acquisition. It's now closed. This bill will not affect that project at all. Um, it's in the past and, and we'd like to leave it there. Summit County will likely testify later that, um, this bill will, would have jeopardized that project. I disagree with that. Um, they will likely tell you that, um, having that purchase discussed in an open meeting would've jeopardized the purchase. It's in and of itself, and I would say that that's incorrect and that the purchase and disposition of real properties covered under the, the Open Meetings Act and can be handled in a closed session. So it would not have needed to be discussed publicly and would not have been jeopardized. Um, they will also likely tell you that, um, counties are not generally invited in involved, excuse me, in private property acquisitions. And that's very true. However, when one public entity is purchasing property in another public entity, that is by default public property, it's, it's not a private property. They may be purchasing it from a private landowner, but it is public property. So the nine 10 Ranch is approximately 8,500 acres, uh, about 1700 acres of that project, or that property is located within Morgan County. It, it does straddle the Morgan Summit County line. And I will say, initially, uh, we found out about it the night before. They announced it publicly, um, which was a little bit disappointing. We would've liked to have known about the project sooner. Uh, we would've loved to have partnered with Summit County, frankly, on it, but they didn't give us that opportunity. Um, and although that didn't raise a whole lot of alarm, what really raised alarm for us is that in, in the last few months, um, Summit County closed on another piece of property in Morgan County. It's much smaller, about 30 acres. It is adjacent to the nine 10 Cattle Ranch. But, um, that particular property was purchased from a completely separate owner. It's a completely separate deal, had nothing to do with the nine 10 Ranch. And we found out about that when it was recorded in Morgan County. So our concern, um, is, is really that we feel like any property that one public entity county specifically, this doesn't affect cities. It doesn't affect, um, special service districts. It only affects counties. There needs to be some cooperation between the two entities, and there needs to be some, some communication. Um, and I'd like to illustrate that through through three what if scenarios. Okay. And these, what if scenarios are assuming that the code stays exactly the way it is. So these are what could potentially happen if a county is not required to at least work with a county in which they're purchasing property. So here's scenario number one. Uh, Weber County does not have a landfill that they own. They currently have a, a transfer station. They transfer all of their, their garbage to a private landfill. It's, it's owned by a, a corporation. Okay? Let's assume for a moment that Weber County decides they want their own landfill and they find the perfect piece of property. And that piece of property happens to be located in Salt Lake County, and it happens to be a former open pit mine, right? So they purchase the property, presumably because counties are not, uh, required to follow Klu Ma, the county land use ordinances. Perhaps Weaver County could do whatever they wanted with that property, right? Which may include a landfill. Who knows? Right? So let's assume they, they buy the property, they create a landfill. They took property that once was valued at a certain value, including personal property and, and real property, and was taxed by the county. And because counties are tax exempt, that property now becomes tax exempt under the current code. Right? So now they own a piece of property in another county that is tax exempt, and they begin hauling trash into this, into this landfill, right? Well, down the road, after hundreds of vehicle trips, a day of big semi-truck hauling trash from Weber County into Salt Lake County, the road leading to the landfill that's owned by Salt Lake County, deteriorates well, who's, who's responsible to repair that road. The, the taxpayers of Salt Lake County are, that's who's, because Weaver County has, they're tax exempt. They're not paying taxes on it. They have no reason to, to deal with it. Right? Scenario number two, Iron County, a few years ago, um, they found it necessary to relocate their, their jail, their county jail. The old jail was located right in the heart of Cedar City. It was too small, it was old. They needed to relocate it. Every time they held a public hearing to discuss the location of a new jail, residents came in screaming, not in my backyard. Right? We all, we've all been there. So let's assume that they decided, you know what we gotta fix for that. Instead of locating the jail in Iron County where our constituents are, we'll just go by land in another county and locate our jail there. So they go up to Beaver County and they find an old, uh, cattle farm there, dairy farm. They buy it, they convert it into a jail. And six months later, one of the inmates there has a heart attack. Warden calls 9 1 1. Who shows up to, to deal with that? Beaver County does. Who's on the hook to pay for it? Beaver County is 'cause there's nothing requiring, um, Iron County to, to work with Beaver County, right? There's nothing in the current law. All right? Scenario number three, Washington County, beautiful county, some of the best outdoor recreation in the state. My daughter lives down there for school. She loves it, right? But in July, there's not enough swig in St. George to quench your thirst. If you're out hiking the Red Rocks in St. George, it's too hot, right? So let's assume that the Summit, or excuse me, the, the Washington County Commission says, you know what? We're gonna fix this. We're gonna go up north, or it's nice and cool in the Wasatch Mountains, and we're gonna buy a piece of property that our residents can recreate on. So they find the perfect, perfect piece of property, 500 acres. It's located on the upper Weber River. It's just outside of Oakley and Summit County. And they buy that property. It's great. They put a picnic area there, they have trails. And that summer, Mrs. Smith comes up from Hurricane and she has a picnic along the river. And as she's dishing up her famous chili, she accidentally knocks over her camp stove and starts Ophir. Well, she calls dispatch. And who are they gonna send? I can tell you they're not gonna send Washington Counties fire and rescue 'cause they're five hours away. They're gonna send South Summit Fire District over to take care of the fire. And who's gonna cover the cost of that fire? Well, because Washington County bought the property, and now they're tax exempt. They're not contributing to the tax base there. So who's gonna cover it? Summit County is the taxpayers there. These are just a few illustrations of why this is a concern. And and you'll hear people say, well, you know, counties should be tax exempt, and what's the difference in a state entity or a federal entity owning property in a county? And I'll tell you the difference. For those counties that have state or or federally owned property, they do not collect tax. That's correct. But what they do collect is a pilt payment, a payment in lieu of taxes. And this bill essentially does that. It says, look, you don't have to pay taxes. But what you do have to, or excuse me, you do have to pay taxes on the property if you're a county owning in another property. But what you have to pay is based on what the value was when you purchased the property. And nothing more, so much like a pilt payment. It requires you to have some skin in the game, right? And to contribute. And more than that, it requires you to at least sit down with the county in which you're purchasing property and say, this is what we intend to do. Let's talk this through. Let's work it out. It does not prohibit you from purchasing property in another county, but it does require that you at least talk about it. Questions? Well,

Uh, just a, a couple other little things. Um, in addition to what he said, we've got some scenarios. Um, there is, and I didn't mention at the beginning, on lines 4 76 to 4 87, there are some discussions about taxation on that land. And, um, I'm happy to discuss that. We've kind of heard some, some grumblings maybe about that. But that can all be addressed if the counties come together and have the discussion. And it requires an official action from the legislative body. Um, and I think that would, uh, that's fair to say, to have those discussions. Counties are concerned about their boundaries and, uh, in the case of this, uh, nine 10 Ranch, it was, uh, right next to, to Summit County. And Morgan might feel like, eh, after a while, they might say, Hey, we'll just incorporate that into our county. So, um, those discussions should be had before a purchase. And that, that ends our presentation. Yeah.

So thank you for your work on this. Let's talk about land that's currently owned by county in another county. This means they would start paying tax on that, is that correct?

Uh, I, I guess I don't know the answer to that question. I did ask Ruth Ann to come if, uh, I don't know if she can answer that question.

Thank you. Stole my line. Uh, Ruth Anki Brass from Office of Legislative Research and General Counsel. Um, I helped with this, uh, bill and drafted it for Representative Strong. Um, so if you go down to the taxation lines, um, it does say that real property owned by a county that is located outside the geographical boundaries of that county is not exempt from property tax. And, um, it was alluded to that it could be taxed at the, um, previous value. So the example is, if, if it was agricultural, it can stay agricultural, but there is the provision, um, if it changes, it could be subject to the rollback tax provisions. So, um, I, tax is not my primary area, obviously, but essentially what that means is if something's being taxed at Greenbelt and then it changes from agricultural use to like residential use, um, the county assessor will determine the value of the rollback tax. So they'll go back in time and sort of assess, um, how much value, um, would've been if it had been residential instead of greenbelt. Um, if it stays the same use, then the rollback tax issue doesn't come into play.

Does that make sense? I follow that. Go ahead. So I, I, I see on, you know, line 4 85, it's talking about the rollback tax. Mm-hmm. Is that essentially, okay, so let's say you have a green belt and you go and build a hotel on it. Okay? They lose the agriculture, agriculture, the greenbelt exemption. Does that mean going forward they'll pay the value of that hotel plus a is a rollback a retro tax?

The rollback is a bit like a, a retro tax uhhuh. So yeah, they would change the value of the hotel if it was no longer greenbelt, and if it was a hotel, it would be assessed at the value of, of a, of a commercial type property.

Okay. And then as long as you're here, I have one more question. I think Representative Strong, or maybe his witness said that if a county goes and buys property in another county mm-hmm. Are they exempt from the other county's land use requirements?

I need to look that up more specifically. If you could give me a moment and get back to you. Sure.

Okay. That's fine. Thank you, Madam Chair.

I wanna get that right. Thank you.

So I guess, I mean, just this hypothetical, so if I, not, it's not greenbelt or anything else, but if I buy, if a county buys land in another county and then builds just residential, they just build homes there, then do they, then what do they pay tax on? They pay tax on what the land was worth prior to building the homes, or they pay Juab, those homeowners just pay a regular tax, uh,

Sorry, if it was a homeowner, it would no longer be owned by the county. Does that make sense? Okay.

Um, let, if the county has their employees and lets them live there, but they build homes on it, so now there are homes of a certain value, and before it was just land, then they pay the tax on the value of the land, or they pay tax on what it would be to have that many residences built on it. I

Mean, I think it would be assessed by the, the Origin county, um, the county where the land is. And so if it was residential units that were still owned by the county, um, by the county unit, I don't know how that would be by the, by the other county Uhhuh, then I don't know how that would be assessed, but it wouldn't be assessed at Greenbelt any longer And it wouldn't be assessed.

Okay. I guess I'm just trying to figure out, is it, would it be paid under the kind of the normal process to the county where it was, or would it still have some different process because the land was still owned by the other county and they were a tax exempt entity?

Well, under this bill, they would, the, the property would not be tax exempt anymore. I'm just saying, I don't know how a county assessor would value land that isn't privately owned, I guess. Okay. That, um, so you're describing like if they built a bunch of housing for county employees to live in, but they retain the ownership of the

Yeah, I, I'm just trying to figure out if there's a, if going forward, if the process is just the normal process for the county where the land is, or if the tax exempt status of the county who owns the land still in some way, cha changes that process?

No, I think under the language of the bill, the, the property is not tax exempt even though it's owned by the county, if the, if the land is located in another county than the one that owns it.

I'm gonna restate to try and make sure we're, um, all on the same page. And I'd just like to know if my statement is correct. So, if a county buys land in another county, from a property tax standpoint, it is treated as though it were privately owned property for tax purposes, meaning assessed value, rollbacks, et cetera. Is that correct?

So you mean like under the current law? No,

Under this, under this, under the proposed bill. Yes. So I'm, this, it would,

It would be treated like any private acquisition, but um, if they keep it in the same use, then it would be, and it's greenbelt, it would stay in greenbelt, Which would be the same as, um, which would be the same as a private use.

So if it's in, if it stays in greenbelt is treated as greenbelt, if they develop it and they do something different, then you have to pay the rollbacks. Yes. If it becomes homes that like it, it's just treated as though it were a privately owned parcel in that other county,

Yes, For tax purposes.

And I'm sorry for, but thank you for one more question. So in the instance that there are already currently perhaps, I don't know, 20 instances already where counties have purchased land in another county right now, today, do they pay that tax as though it were privately owned or they don't pay it because they're a tax exempt and so they don't pay it? So where are we today before the bill? I guess I'm asking four instances where this thing has happened.

My understanding if a county owns property in another county, that that property is tax exempt from property tax Currently. Okay.

Yeah. Thank you. The question came up on land use, I think that's gotta be solved in there somewhere, right? Because that's important as is important as taxes.

Right? So under, uh, the county land use, um, uh, use development management act, so each county, municipality, school district, charter school, special district, special service district and political subdivision of the state shall conform to any applicable land use ordinance of any county when installing, constructing, operating, or otherwise using any area situated, uh, within, uh, the unincorporated portion of the county as applicable. So there are exemptions for schools, um, and it gets very specific into what school districts and charters are exempt from. And obviously the federal government and the state is exempt from Luma. Uh, but if a city or a county, um, or a special district for that matter, bought land in another county, I think that was perhaps a misunderstanding to say that they wouldn't be subject to, um, Luma generally.

Did you say would or would not be subject Wouldn't, did you say, would not be subject to it or would be subject to it? They

Would be subject to ma. Sorry.

Yes. Okay.

Yeah. So the, the exemption there. Yeah.

My name's Greg Miles, the Duchesne County Commissioner, and appreciate the opportunity to speak, uh, to this bill. And I, I must say I am friends with all 29 counties and, and I don't wish to have any heartburn with any of them, but I think that, uh, with, with other, other, um, government agencies, we have the opportunity to weigh in when they acquire ground in, in our counties and with, with one exception. And that is the Ute tribe. The Ute tribe can purchase property, but they are subject to pay the taxes. Um, I think that, you know, we are the first state in the nation to have all 29 counties have, um, uh, resource management plan, and that dictates how we operate our counties. And, uh, it conforms with what our cons, constituents have asked us to protect. And so I do think that there needs to be guardrails in place, and I think that the, the state of Utah would feel the same if you, if Wyoming tried acquiring ground in, in Utah, we might have some heartburn with it for some reasons. And so, um, I, I appreciate this bill being taken up just for the guardrail standpoint. Thank you.

Thank you. Appreciate the opportunity to come and speak today. My name is Tyler Vincent Boxell County. Um, I appreciate this bill as well. Um, one of the, one of the issues that we have is we should be collaborating as a, we collaborate as a state with our counties. I think each county needs to be collaborating with each county, especially if we want to, um, buy property in that county that impacts our counties. Um, just as was said, we need to protect our constituents as well. And, and I think it's disingenuine when we have another county that comes and buys property without at least having a discussion with the county that it, that property resides in. So I just appreciate this and I appreciate your time. Thank you.

Good morning, Madam Chair representatives. Thank you for your time and consideration this morning. My name is Megan McKenna, I'm a Summit County counselor. Um, and I'm, I'm coming here today, um, to respectfully, uh, express my opposition to, um, HB 4 45. Um, fundamentally this is about property rights. Um, and, and prior to purchasing land in another county, this bill would require not just notification, um, but express permission. And, and that's really where, um, where our concern is. Um, it would effectively limit our ability, um, to enter into land deals. Um, this requirement would be inconsistent as it singles out, just counties, um, and not other public entities such as city school districts, um, that, that are also, um, uh, have that ability. Um, well, I know we're, we're short on time, um, but just, just to be clear, um, we never had any intention of annexing Morgan County, um, or exerting Juab, uh, jurisdictional, jurisdictional control over them. Um, in fact, as soon as we were able to, um, we invited them in as a stakeholder. And, and as you heard, um, we've come to an agreement, we've addressed, um, the Morgan County's concerns regarding the, um, the issue. And, and this was all prior to learning about this legislation. So I just respectfully ask you to, um, oppose HB 4 45 and allow counties to resolve these matters, collaborate collaboratively and locally. Um, and, and we'd be happy to include discussion. Um, but requiring express permission is, is concerning to us.

Thank you. Would you like to share why you acquired land in an adjacent county?

Um, yes. This was actually, the property owner reached out to the county, um, and, and wanted the county to purchase. Um, after we had, um, voter approved, um, bond money to acquire, um, uh, land, um, to conserve land, um, this owner reached out to the county, um, privately and said, um, I would like to offer, um, to, to sell you my land. And, and that was, this actually would've, um, impacted that deal. Um, and, and so, uh,

Do you have concerns about paying tax?

What's that? Do you have concerns about paying tax? Um, actually that was part of the agreement that we've worked with Morgan County on that we agreed to, um, pay the greenbelt taxes on it. And that was all prior to this. Um, even knowing about this legislation, this was all a, a surprise to us and, and something that we would've hoped, you know, that, uh, we could have worked with, uh, the county or, or, or with the representative or through uac, um, I think is, is a really more effective way to deal with these sort of issues. Thank you. Thank You.

Good morning. My name's Garrett Smith. I am the Morgan County attorney. And, um, just, just one thing I wanted to point out that I, I believe this amendment actually supports the legislative intent that's contemplated in the bill. Um, when you look at, um, line about 1 36 down to one 40, it talks about that, um, a county may do these things if the action is in the public interest and complies with other law. I think the, generally that's true when you're acquiring property within your own, uh, county, because then you're only dealing with one public interest. But because public interest is subjective, what this bill does is it actually allows for both counties to come to the table and for the public interest of both counties to be contemplated as as they collaborate together. I appreciated some of the comments from, uh, the council person from Summit County because she talked about the collaborative effort that Morgan County and Summit County have made with the nine 10, and we appreciate Summit County's collaboration on that. But it took a few years to get to the point where we were at the table. And so what, what this bill would do is bring us to the table at the beginning. And, and the other thing that, you know, with this bill supporting collaboration, it actually cleared up a lot of the misconceptions and intentions that we were assigning to the other because there really wasn't, um, you know, some of those worries that we had once we talked about it. And so by opening the communication that is, is impactful there.

Good morning representatives. My name is Amy Winder Newton. I'm the chair of the Salt Lake County Council. Salt Lake County opposes this bill. Um, we are concerned about the property rights aspect and, uh, fair tax policy. Um, this does not apply to school districts or cities or the state or anyone else. So to single out counties seems, uh, like not a great policy call. Um, also as far as the tax goes, we have, um, the losing the ability to have exempt property if you do happen to have property that you own in another county is concerning for us, especially where the bill says that you have to start paying taxes on that this year. Um, if you, if for counties who do maybe own property, we don't have any, um, immediate intention to buy property in another county or anything like that, but we just wanna make sure all those tools are available and this just doesn't seem like the right policy call. We definitely support what Summit and Wasatch did in collaborating and getting together and talking about it. Um, we, we think that, uh, collaboration's great. This policy though is not the right call. Um, you know, I, I'm a Taylorsville resident and I look at, uh, we had an office building in Taylorsville that was, uh, an American Express building. It was sold to the state. And so now Taylorsville City is lost out on property tax revenue there. Um, we do have to still, counties have to obey land use authority when they look at other property and, and we just think that the current, uh, law is better. Thanks.

May I ask a question?

Yes. I, I don't want this question to be misunderstood, but do you, can you explain a public purpose for owning land in another county? Like why would Salt Lake County, what, what, what benefit would there be to own land or buildings or resources in another county?

Um, because this isn't a practice that we, um, actively participate in, I don't know that I, I would see a reason to do that. Um, I, I would say, you know, we sometimes see in cities where people have purchased property because, um, they don't want like prime commercial to be taken up by, for instance, a public works building or something. Um, and so maybe they'd look to another location, um, for property property tax or sales tax revenue benefits. But for a county, I mean, we're so large we're not really playing the game of where can you get sales tax and we're not developing locally commercial property. So I don't see why we would, um, necessarily be buying property outside of the county. But again, I don't think it's appropriate to close the door on that tool. Thank You. Thanks.

Hello. Thank you for the time to speak. I'm Jack Lidle, um, commissioner in Daggett County. So I'll give you the other perspective. As the smallest county in the state with about 11% private land, Two ways that I'm looking at this, that I support the bill is on the smaller county end. If we don't have some kind of guardrail in it, with only 11% private in our county, that's significant, especially for as small as a county as we are. If another county can come in and buy land, I have no problem with that, but they're buying it as a private interest in my mind, unless there's something that's collaborative between the two counties, whether it's based on utilities or different things that have a public purpose that those counties agree on together. It's difficult for me to think about another county coming in, buying property in our county and, and not having some thresholds or some guardrails where there's an opportunity for each of those entities to speak and work it out before the transaction is completed, especially on a willing seller situation. And then at 10,000 acres, obviously there's a matter of scale, but I just think that those sideboards on where it's a lateral between the counties, it's not the state coming in or the feds coming in. It's two similar entities working it out that if there's not something in the laws that's written, I think we're leaving too much room for. And, and, and I concur with each and respectfully disagree with some of the comments, but at the same time, I don't know that it's always best to be left up to you acker to be figured out or we end up back here again or in the courts. So thank you for your time.

Kate Becker, Morgan County administrative Manager. Thank you for the time to speak. Just wanted to clarify a few things in this room. Currently, there are three counties represented, represented that own land in another county, that being, um, Summit County, Salt Lake County, and Duchesne County. Um, Duchesne County is like us supportive of this bill. The land that they own in, uh, their neighboring county is I believe a rock quarry. Um, and he was, when I spoke with him about that, he did understand that when you're hauling all that rock on their roads, but not paying taxes that for 50 years, that obviously, um, would've been a different conversation should someone have come and in adverse on that. Um, the other thing that was not brought up, um, in comment that I would like to add is in the initial, um, process of the nine 10 cattle ranch, there was also, um, an attempt to request from Morgan County that we give sheriff's jurisdiction to their sheriff, um, rather than ours, which obviously upset our badges. Um, and we're against that. That was one of the first issues that was worked out. And if it was not for Representative Strong sitting next to us, um, making a phone call, um, that, that triggered the holdup of $44 million in federal funding to buy that ground, they, there was a concern that Summit might have never come to the table. So we just appreciate that all we're asking is for the stick to bring people to the table in the first place. Thank you very much for your time.

Thank you Madam Chair. I'd Like to reserve rights for make a motion. Um, having been in county government a long time, I appreciate what's going on here. If there is agreement, this isn't gonna be an issue we had in Wasatch County and with Summit County, Manti Park City a uh, situation where we did do it in agreement and it worked out right. I think the loft pushes that. I have a little issue with not having schools and, uh, special districts in it, although their uses and and reasons for acquisition would be somewhat different. Um, one thing we had when I was there, quite a bit of, in fact 'cause we had Wasatch County is, uh, or Jordan s and Wasatch Counties, we had land use owners of property shopping land use restrictions with different counties to see what they could get and threats of acquisitions and all that. So I think this puts that to bed. I like the bill. So my motion is to favor, excuse me, favorably approve, uh, HB 4, 4, 5.

Thank you. Uh, I would like to make a motion that we favorably recommend this bill.

I'm just gonna go with what Representative Kohler said.

Uh, just a couple, little, little clarifications. Um, well we did talk a little bit about municipalities and special districts. It becomes far more complicated and I'm happy to delve into that in a future session. Maybe it's something you may even consider as a committee in the interim. Um, this was kind of a simple starting point. Um, there's also, uh, to a large extent, uh, the counties in favor versus those that are opposed, kind of surround money as well. And there's a large tax component here. In fact, the tax portion of it that we have written in there, I'm not even positive that we have to have it in there because if the counties come together, they can make an agreement that both counties work on. So if there's a, a crux in, uh, this, this tax portion, I'm happy to pull that out because I believe that'll be addressed when the communication happens. In the case of Summit, I made a phone call to a lady by the name of Jamie Barnes. She's with the DNR and she's the one that directed this federal money. This is quite a few million dollars. I think it was said it was three or 4 million. How much? 44 million. 44 million. Yeah. And, and I asked her about this land deal and she says, well, you know, we've been told that this is, that it's good, there's no issue. And I said, there is an issue. Could you please hold that money until Summit and Morgan talk? As I understand it, that's kind of what brought them to the table. And and this all watered the bridge. It's not part of this bill. An existing land that's already been traded. It's not part of this bill. This is just going forward. Um, um, yeah, that pretty much sums up what I have. I, I, I think, and this word is, is complicated. We use the word common sense sometimes and that is in the eye of the beholder, but I think this is fair for all counties to discuss it beforehand and that's what this bill does.

So. Okay. Or unless you want me to talk some more. I don't wanna talk anymore.

You. Committee. Madam Chair.

Thank you, Mr. Chair and committee. Um, yes, we do have second substitute and, um, I don't know if you adopt that up front or on the back end. You tell me your preference. I think at this point, let's just move forward. Uh, why don't you go ahead and speak to two and then when we get the whole committee paying attention, we can, we can adopt your sub. Okay, sounds good. Thank you. Okay. So, um, HPE 4 45, uh, is, uh, it, it was born from a, an issue where one county, um, was purchasing property in another county. And, um, there wasn't a discussion going on at first. And what the bill basically does is it, it, uh, requires that when property is gonna be purchased in another county, that there must be one of two things. Either, uh, uh, a memorandum of understanding or official legislative action ex, uh, basically allowing them to purchase land in their com in their community. Um, and then that way they can discuss, uh, you know, the different uses and, uh, impacts and, and whatnot. So that's, we'll say probably the easier portion of the bill than there is, uh, a tax portion of the bill, which was why we're here at Rev and Tax. Um, there are some existing properties. So, um, there are properties that are purchased in other counties, and this bill, um, will give a three year period where those will continue to remain untaxed after that three year period. They will have to have, come to have, they will have to have come to an agreement. The two counties will, as how that property will be taxed, it will remain exempt, or if whatever the use of the property is, it would be, um, taxed properly. Um, then the other portion, similar portion is that any purchases going forward will have a tax agreement, right, uh, right away. So that's kind of the couple of dates. But, but they have to, um, the, the property, the, the county that is purchasing the property, um, can be exempt if, uh, the county that owns a property and the county where the property's located agree to maintain the exemption and the two enter into an agreement regarding the, the property and how it's taxed. So, in a nutshell, that's what it is. It's, um, we've had quite a bit of discussion, uh, with different counties and, and, uh, but that's where it's at. And I have, uh, one of our county commissioners from Morgan to add a little context here. Please Thank, sorry, go ahead.

Uh, thank you Mr. Chair. Um, Vaughn Nickerson, Morgan County Commission. Um, our county was, was one that was having an issue with another county purchasing property in our county. Um, we have since worked with that county over the last, uh, several years and have kind of worked out the issues. But our, our concern was to prevent this from happening to other counties, that to basically force other counties to come through the front door, come and have that conversation, um, share their desires, work together with those counties, be good neighbors and, and really work together for the betterment of, of both counties, their residents. Um, and really have just a, a, a formal process to where, uh, these things can happen and that the, the, the elected officials of that county, um, can do their job and represent their people.

Back concludes presentation. Thank you. Okay.

Thank you, Mr. Chair. My name is Steve Styler. I'm here as a representative on behalf of Summit County. Uh, first of all, I'd like to express our appreciation to the sponsor of this bill for spending a lot of time with us. Uh, largely I believe this bill was in result to this large transaction that was discussed. Um, I'm glad to report that the, the counties have worked together, they've solved this issue. Um, a lot of the, the process and procedure that's in this bill has essentially been followed and the parties earned a good position. Now they've all agreed to those terms. And we're, we, we do believe that there are probably some ways to improve this process. Um, we'd like to make sure there is a good process and, uh, we'd look forward to an opportunity to continue to discuss it because I think there's some ways to maybe improve this and make it work better in reality. But we appreciate the time that has been spent thus far.

Commissioner John Larson outta Ena County. I did not like this bill at all until R two came out. It met every requirement that I think we need and I appreciate that and I strongly support that.

How, how did you know? Thank you, Mr. Chairman. I'm aware Mr. Lee, Mr. Lee Perry from, from Boxter County. And I just wanna say I, I, I'm grateful for this, that it's, it has an effect us at this point, but we've had other people do things like this and kind of talk about things like that in Boxer County. And so having that good neighbor policy that this bill brings forward, I think is a good thing. So that if a county around us wants to come purchase land, they need to come forward and talk to us directly before they go ahead and start doing something like that. So we appreciate Representative Strong in yourself for being sponsors of this and moving this action forward. Thank you very much. Appreciate it.

Senator Fillmore Brammer, Senator Fillmore, motion to favorably recommend.

Oh, sure. Make a motion To adopt the second Sub.

I've got a five page, uh, presentation I'd like to give on this second Sub. With that, we'll place that

For now for action. On the second substitute move Favorable recommendation.

I have a four page summary on this portion. Oh, Sorry. Four pages is okay. I'm just kidding. Okay.

House Bill 4 45 County Government land purchasing by Representative Strong. This bill was heard in political subdivisions with the vote of 7 2 3, Representative Strong.

Thank you Mr. Speaker. Uh, I'd like to move, substitute one of House Bill 4 45.

Um, yeah, we, we, uh, addressed a couple little tax issues that were associated with the bill and substitute one clears those up.

Thank you, Mr. Speaker. So, uh, what what we're trying to accomplish in this bill is alleviate some situations where one county is purchasing property in another county. So we had a situation with a couple of counties here, um, a while back where, um, one county had, uh, was going to purchase a ranch. The ranch was approximately 8,500 acres, but 2000 of those acres existed across the county line into another county. Well, it was gonna be purchased for purposes of conservation and a few things. And, and, uh, the county that wanted to purchase the process wa uh, the, the land was going through the purchase process, but the county where the land was being purchased had not been notified or they hadn't been involved in, in the purchase at all. Um, we were able to hold the purchase until the two counties were able to talk and they came to an agreement. And so we dealt with that situation. But going forward, it seems fair that if a county is purchasing property in another county, that the county should be notified. So what this bill does is it actually requires formal legislative action from the county where the property is being purchased, need to go to the county council and say, this is what we're doing. And, and they can have that discussion. They can have initial discussions on this in private, according to the current law. Sometimes land deals can be, uh, something you don't want made public right away. So they can have those, but eventually it has to go to the legislative body for them to, uh, to vote that this can take place. Now, because counties are tax exempt, if one county is purchasing another county, now you've got a situation where they're coming to your county and the county no longer can collect property tax on that, uh, or yeah, property tax on the land. So what we've got is a situation now where, um, the county that's trying to purchase the property, uh, can, if there's an agreement with the county where they're purchasing, they can continue to have that land tax exempt depending on what the purpose or the reason is. Sometimes there's a conservation or farmland and the amount of tax collected on it is so small that the county say is may say, that's fine, we don't need to collect taxes. Uh, or, or we don't care. Um, if they don't come to an agreement, then the property will be taxed in whatever appropriate way the land is. Um, whatever the use of the land is, whatever the normal tax on that property would be, would be the tax that they would collect. So, um, that's the bill. And with that I conclude my presentation. Thank you, Representative. Strong discussion to the bill.

Thank you. Mr. Speaker. Will the sponsor yield Representative Strong?

In the sub, how does it address property that's already owned by a county, within another county?

Yeah, that's a great question. Thank you. Um, so currently the way it's written in the sub is that the, uh, properties that are owned by other counties have a year to, um, to reconcile that with the county where they own the property, as I understand it.

Are you able to share where that's found? Oh, I'm sorry. I asked you if you could share what, where it's found Mr. Speaker

I'm, I'm sorry, could you repeat that, please? Yes, I thought I was waiting. I thought I answered Rep, representative, Representative Dunnigan. Will you ask the Question? Steal me? I was waiting for the words of wisdom for my good colleague to go. I thought I gave him, I apologize. Representative Dunning asked the question, Where is it found in the substitute, please? That a property that's already owned by another county, how it's gonna be treated with this bill. I, I'm struggling to find that one.

What happens after one year? We have some counties, the owner and you, you're aware of this representative that we have counties that own land in other counties. How is this gonna treat that? That's, that's, they already own the land.

Thank you, Mr. Speaker. Um, I, uh, I don't know the answer to that question, uh, where it is found as I was talking earlier with the drafting attorney, and that's what I was told. Um, I'd be happy to find that out though.

So I think that's important. Mr. Speaker. We have counties that own property already and I'm not able to find it in the bill. That doesn't mean it's not in there. I just don't see anything that this is prospective and after one year, the counties have to come together. I'm not finding that in the bill. I'd really prefer that that be resolved before we vote on this.

Uh, thank you Mr. Speaker. Motion to circle Representative. That motion is in order. Would you like to speak to her? I just think that would give the sponsor, uh, a a few minutes to address the important substantive question that was been asked.

Uh, I'd like to move, substitute one of House Bill 4 45.

Um, yeah, we, we, uh, addressed a couple little tax issues that were associated with the bill and substitute one clears those up.

Thank you, Mr. Speaker. So, uh, what what we're trying to accomplish in this bill is alleviate some situations where one county is purchasing property in another county. So we had a situation with a couple of counties here, um, a while back where, um, one county had, uh, was going to purchase a ranch. The ranch was approximately 8,500 acres, but 2000 of those acres existed across the county line into another county. Well, it was gonna be purchased for purposes of conservation and a few things. And, and, uh, the county that wanted to purchase the process wa uh, the, the land was going through the purchase process, but the county where the land was being purchased had not been notified or they hadn't been involved in, in the purchase at all. Um, we were able to hold the purchase until the two counties were able to talk and they came to an agreement. And so we dealt with that situation. But going forward, it seems fair that if a county is purchasing property in another county, that the county should be notified. So what this bill does is it actually requires formal legislative action from the county where the property is being purchased, need to go to the county council and say, this is what we're doing. And, and they can have that discussion. They can have initial discussions on this in private, according to the current law. Sometimes land deals can be, uh, something you don't want made public right away. So they can have those, but eventually it has to go to the legislative body for them to, uh, to vote that this can take place. Now, because counties are tax exempt, if one county is purchasing another county, now you've got a situation where they're coming to your county and the county no longer can collect property tax on that, uh, or yeah, property tax on the land. So what we've got is a situation now where, um, the county that's trying to purchase the property, uh, can, if there's an agreement with the county where they're purchasing, they can continue to have that land tax exempt depending on what the purpose or the reason is. Sometimes there's a conservation or farmland and the amount of tax collected on it is so small that the county say is may say, that's fine, we don't need to collect taxes. Uh, or, or we don't care. Um, if they don't come to an agreement, then the property will be taxed in whatever appropriate way the land is. Um, whatever the use of the land is, whatever the normal tax on that property would be, would be the tax that they would collect. So, um, that's the bill. And with that I conclude my presentation.

Thank you. Mr. Speaker. Will the sponsor yield Representative Strong?

In the sub, how does it address property that's already owned by a county, within another county?

Yeah, that's a great question. Thank you. Um, so currently the way it's written in the sub is that the, uh, properties that are owned by other counties have a year to, um, to reconcile that with the county where they own the property, as I understand it.

Are you able to share where that's found? Oh, I'm sorry. I asked you if you could share what, where it's found Mr.

I'm, I'm sorry, could you repeat that, please? Yes, I thought I was waiting. I thought I answered Rep, representative, Representative Dunnigan. Will you ask the Question? Steal me? I was waiting for the words of wisdom for my good colleague to go. I thought I gave him, I apologize.

Representative Dunning asked the question, Where is it found in the substitute, please? That a property that's already owned by another county, how it's gonna be treated with this bill. I, I'm struggling to find that one.

What happens after one year? We have some counties, the owner and you, you're aware of this representative that we have counties that own land in other counties. How is this gonna treat that?

That's, that's, they already own the land. Thank you, Mr. Speaker. Um, I, uh, I don't know the answer to that question, uh, where it is found as I was talking earlier with the drafting attorney, and that's what I was told. Um, I'd be happy to find that out though.

So I think that's important. Mr. Speaker. We have counties that own property already and I'm not able to find it in the bill. That doesn't mean it's not in there. I just don't see anything that this is prospective and after one year, the counties have to come together. I'm not finding that in the bill. I'd really prefer that that be resolved before we vote on this.

Uh, thank you Mr. Speaker. Motion to circle

I just think that would give the sponsor, uh, a a few minutes to address the important substantive question that was been asked.

Yes. Thank you, Mr. Speaker. So, um, been working for the last little bit on some details on this bill. Um, just to clarify a few things, we had some questions about the tax portion of the bill. So just to take a step back, so everybody understands when a county is going to purchase property in another county, they need to get a vote from the legislative body in that county to, in order to approve that. Once they do that, they now own land in another county, but TA counties are tax exempt. So it creates this issue where now a county owns property in another county and they, uh, they don't have to pay taxes. So it leaves that county with the burden of losing that tax revenue, whatever the case might be. In some cases it might be small, like in a green belt or conservation. In other cases, it could be a for-profit thing. And so what the bill says is that after this year, they'll have to come to an agreement with the county where they purchased the property on how to address the taxes. They can, uh, they can either pay the associated taxes with it, they can exempt taxes depending on the purpose, or they can enter into an agreement. Now the, the thing where the, the sticky part came in before was this also applies to counties that have purchased property in other counties previous. So if they've owned that property for 10 years, according to the bill, the way it's written right now, at the end of this year, they'll need to enter into an agreement with the county where they own the property to start paying taxes on it. Um, so again, if that's a green belt or something, it might be very small, but if there's some sort of a for-profit thing going on there, the county where they're paying the taxes, excuse me, where they're not paying taxes, is providing services but not receiving anything from the land. So if you purchase outside, you're going to pay taxes, or at least you're going to work with the county to agree on how those taxes should be paid, if at all. And with that, I end my presentation.

Thank you Mr. Speaker. I move to amend The Verbal amendment, Uh, verbal amendment on first substitute K, go ahead. Representative Dunnigan Line 4 78, changing the date from 2026 to 2029 on line 4 78 changing 2026 to 2029.

Yes. So I appreciate the work the sponsor's done on this. This just gives a little more runway so people can prepare. It's gonna be a, property's gonna start to be taxed.

This is, this is a good amendment. Um, it was providing one year for them to figure this tax situation out for properties they've had in other counties for a while. We now give 'em three years if they want to sell, if they, you know, they can change the use of the property or work with the county to make this three years. Sounds fair.

Thank you, Mr. Speaker. Uh, well, the sponsor of the amendment yield to a question.

Thank you. Uh, I'm curious about the, the three years. I would think one year would be plenty of time to do that. Is is there anything about three years or we could have done two or is there a particular reason why we're at three?

Well, thank you for the question, Mr. Speaker. So this has a retroactive piece. I'm completely fine with the bill if it's prospective. The concern I have is the retroactive piece where the county went out, purchased property, uh, thinking in another county and because they owned it, they would not pay tax on it. And they made that decision. Now we're changing the laws say they're gonna start to pay tax on it. This was given as representative from Draper, Sandy, Cottonwood Heights, left tail, left tail. The rep Representative Sta stated this will give 'em a little time to decide if they want to, uh, sell the property or do something else with it, rather than putting a retroactive piece on it that they was not even in the law when they purchased the property.

I under, I understand that. Thank you. Uh, Mr. Speaker. I, I wish that were shorter. Three years seems like quite a bit of time, but I do understand the change of the law and giving him a little bit of a runway. Thank you, Mr. Speaker.

Seeing none back to your Representative Dunnigan on your motion to amend This discuss gives, um, a little more time to do some planning on the retroactive piece. Thank you, Mr. Speaker.

Representative Eli, uh, Stevie, listen, Uh, thank you Mr. Speaker. Will the sponsor yield Representative Strong?

Um, my question would be is at some point along the process of this bill, would the sponsor, obviously it'd have to be in the Senate probably, but, uh, be open to m making the property tax change prospective. Uh, the reason why generally, uh, in the legislative world, it's very, very rare to do something ex post facto. In the case of this particular bill, as I understand it, having, uh, communicated with officials in my county, uh, this could, uh, create an additional cost for the county. And of course, one of their major sources of revenue is property taxes. I'm, I'm not saying this would necessarily, uh, result in a property tax increase, but yet it would provide additional pressure when they purchased this. That was the rules they played. By the only time in the tax world that I'm familiar with that we do ex post facto is legislation. We're considering this session of a tax cut. Everybody's okay with the tax cut, tax cut that that's ex post facto, just not going back and changing the rules after they've engaged in a tran uh, entered into a transaction, which in the case of Salt Lake County was 12 years ago. So my question would be is if the sponsor would be willing to consider such, uh, a potential amendment going forward with the bill.

Was, uh, yeah. Yeah. Thank you Mr. Speaker. Um, yes, however, um, I do have some concerns with that and I do have concerns with the expo expos facto. The, the problem is when a county purchase property in another county where the property has been purchased, they no longer collect that tax. And if that county has purchased something with a for-profit, they're profiting on that, then the county where it exists, where the property is, is not collecting property tax and they're servicing it, they're paying for the land and all these things. And so the other thing is when the agreement was actually, there was no agreement beforehand. You could purchase property without any notification or vote of the county council. And whether they liked it or not, they were stuck with you in their county and not collecting taxes. So I'm, I'm good with the discussion, but I wanna find the right Blanding spot for it. And I think to some extent, the county where the land has been purchased is, uh, a a is kind of being treated unfairly. So, yes, and I've had a few of those discussions already, and I will commit to further discussions. Um, but I, yeah, well, not, but anything, it just, it seems a little tough to me to that, uh, they're gonna forego taxes, especially if it's a for-profit venture in their county. Thank you.

Thank you, Mr. Speaker with the sponsor yield to a question.

Representative Wilcox Or a series of questions, let me amend that series Of questions. Mm-hmm. Yes, Thank you, Mr. Speaker. Uh, just to make sure we understand, are you aware of any for-profit entities? Uh, owned by one county and another county?

Um, thank you, Mr. Speaker. Um, I can't give you a sp specific example. I was told that Salt Lake County purchased a gravel pit, I believe, part of which is in Salt Lake County, and part of which is in Utah County. And so if it is a gravel pit, there's likely some, some profit there. I would, I would assume, but I do not have a specific example for you.

Thank you, Mr. Speaker. And can you just tell us for what purpose, um, most of the time or, uh, that you might be aware of, would a county seek to control land in another county?

Uh, thank you, Mr. Speaker. It's a good question. The, the, the, the situation that prompted this was, as I had talked about previously, was a ranch that was purchased. It was 8,500 acres, 2000 of which were in another county. And it was be used, it was going to be used for conservation. So the tax collection, there would be very small. Um, you know, I'd have to look into it more, uh, to see how many of those there are. I'm not sure.

Thank you, Mr. Speaker. I think that that makes the point that I'm mostly concerned about. So we're taking, we're allowing our political subdivisions to purchase, uh, land in another political subdivision, not just for the purpose of, you know, using it to provide, actually the, the gravel pit makes more sense to me in the, in the prior exam, prior example. Um, what this one is doing is allowing one county that is flush with cash to go into another county without a vote of the people to control the land in that county. They're taking otherwise productive land and tax revenue and everything else, and then turning it into nothing for political, whatever, without a vote of the people in that county. That's what bothers me about this. So yes, I'm gonna support the bill, but I think we ought look at a prohibition on one county, even buying land in another county that shouldn't even be possible without at least a vote, um, of the people of the other county. Um, otherwise, yeah, we're just gonna have, like, why even have county boundaries? We can just have everybody around, uh, Park City and Summit County. You can just, you know, gobble up whatever you want. Now you control the land whether you get a vote or not. And that's, that's a problem for me. We ought to have people have the ability to at least weigh in if we're gonna seed control of our land in a given county to another one. Thank you.

We've had. Good, we've had a good discussion. Um, I'll waive.

Thank you very much. President. This is the bill that, that's been worked out with the counties. Um, the, uh, what ended up happening, uh, is inside of a county boundary. If a county acquires land in the other, in the other county's county boundaries, they get defacto land use control of a neighboring county's property. And so the idea here is not to extend the incorporation boundaries of a county by purchasing property in another county. Okay. And, uh, so what the bill does is it, it it prohibits a county from acquiring real property in another county through exchange, purchase or lease unless the county where the property is located provides express permission. And the county's acquisition is a joint acquisition with, with another political subdivision as part of an interlocal agreement. It also provides that real property owned by a county that is located outside the geographical boundaries is not exempt from property tax despite the fact that it is owned by a governmental entity because again, property that exists within a county is controlled by that county and they can control their exemptions. But controlling across county lines was never intended by our constitution or by our statute. And this just makes that clear.

I appreciate this bill, but let me ask you a question. I think you addressed it. I heard you say that they would a county entity that purchases in another county is still subject to taxes, correct?

That is correct. Thank you. Go ahead.

Thank you Mr. President. I move the third substitute house bill 4 45 county government land purchasing, uh, pass under suspension of the rules.

Thank you Mr. Speaker. Motion to concur with the Senate amendments.

Yes, I would. Um, so when the bill left here, we made, it's actually had a couple substitutes. Um, this is regarding counties purchasing property in other counties and, um, we added three years so that if you own a property in another county, you have a three year, say previous to this bill, you have a three year period where you can decide what you wanna do with that, that property, um, whether you wanna sell it or, or pay the tax on it or make an agreement with the county on how tax should be paid. Um, and then there was just, uh, they took out some language, uh, that about transportation, uh, that wasn't needed. Uh, transportation reinvestments that wasn't needed in there. So those were the changes, uh, that were made to the bill.