Real property taxes assessed against political subdivisions or state;
cancellation; compromise; distribution of receipts
Sec. 7. (a) The department of local government finance may
cancel any property taxes assessed against real property owned by a
county, township, city, or town if a petition requesting that the
department cancel the taxes is submitted by the auditor, assessor, and
treasurer of the county in which the real property is located.
(b) The department of local government finance may cancel any
property taxes assessed against real property owned by this state if
a petition requesting that the department cancel the taxes is submitted
by:
(1) the governor; or
(2) the chief administrative officer of the state agency which
supervises the real property.
However, if the petition is submitted by the chief administrative
officer of a state agency, the governor must approve the petition.
(c) The department of local government finance may compromise
the amount of property taxes, together with any interest or penalties
on those taxes, assessed against the fixed or distributable property
owned by a bankrupt railroad, which is under the jurisdiction of:
(1) a federal court under 11 U.S.C. 1163;
(2) Chapter X of the Acts of Congress Relating to Bankruptcy
(11 U.S.C. 701-799); or
(3) a comparable bankruptcy law.
(d) After making a compromise under subsection (c) and after
receiving payment of the compromised amount, the department of
local government finance shall distribute to each county treasurer an
amount equal to the product of:
(1) the compromised amount; multiplied by
(2) a fraction, the numerator of which is the total of the
particular county's property tax levies against the railroad for
the compromised years, and the denominator of which is the
total of all property tax levies against the railroad for the
compromised years.
(e) After making the distribution under subsection (d), the
department of local government finance shall direct the auditors of
each county to remove from the tax rolls the amount of all property
taxes assessed against the bankrupt railroad for the compromised
years.
(f) The county auditor of each county receiving money under
subsection (d) shall allocate that money among the county's taxing
districts. The auditor shall allocate to each taxing district an amount
equal to the product of:
(1) the amount of money received by the county under
subsection (d); multiplied by
(2) a fraction, the numerator of which is the total of the taxing
district's property tax levies against the railroad for the
compromised years, and the denominator of which is the total
of all property tax levies against the railroad in that county for
the compromised years.
(g) The money allocated to each taxing district shall be
apportioned and distributed among the taxing units of that taxing
district in the same manner and at the same time that property taxes
are apportioned and distributed.
(h) The department of local government finance may, with the
approval of the attorney general, compromise the amount of property
taxes, together with any interest or penalties on those taxes, assessed
against property owned by a person that has a case pending under
state or federal bankruptcy law. Property taxes that are compromised
under this section shall be distributed and allocated at the same time
and in the same manner as regularly collected property taxes. The
department of local government finance may compromise property
taxes under this subsection only if:
(1) a petition is filed with the department of local government
finance that requests the compromise and that is signed and
approved by the assessor, auditor, and treasurer of each county,
and the assessor of each township, that is entitled to receive any
part of the compromised taxes;
(2) the compromise significantly advances the time of payment
of the taxes; and
(3) the compromise is in the best interest of the state and the
taxing units that are entitled to receive any part of the
compromised taxes.
(i) A taxing unit that receives funds under this section is not
required to include the funds in its budget estimate for any budget
year which begins after the budget year in which it receives the
funds.
(j) A county treasurer, with the consent of the county auditor and
the county assessor, may compromise the amount of property taxes,
interest, or penalties owed in a county by an entity that has a case
pending under Title 11 of the United States Code (Bankruptcy Code)
by accepting a single payment that must be at least seventy-five
percent (75%) of the total amount owed in the county.
(Formerly: Acts 1975, P.L.47, SEC.1.) As amended by Acts 1977,
P.L.75, SEC.1; P.L.69-1983, SEC.9; P.L.5-1988, SEC.45;
P.L.30-1994, SEC.6; P.L.90-2002, SEC.260.
Last modified: May 28, 2006