HOUSE BILL 22-1006
BY REPRESENTATIVE(S) Roberts and Van Winkle, Bacon, Bernett,
Bird, Cutter, Esgar, Exum, Herod, Hooton, Jodeh, Kennedy, Kipp, Lindsay,
McCluskie, McCormick, Michaelson Jenet, Mullica, Pico, Ricks,
Sandridge, Titone, Valdez A., Valdez D., Van Beber, Williams, Young,
Froelich, Lontine, Sirota;
also SENATOR(S) Donovan and Smallwood, Buckner, Danielson, Fields,
Ginal, Gonzales, Hinrichsen, Hisey, Jaquez Lewis, Lee, Moreno, Pettersen,
Priola, Simpson, Sonnenberg, Story, Winter, Zenzinger, Fenberg.
C
ONCERNING THE PROPERTY TAX EXEMPTION FOR PROPERTY USED AS AN
INTEGRAL PART OF A CHILD CARE CENTER
.
Be it enacted by the General Assembly of the State of Colorado:
SECTION 1. Legislative declaration. (1) The general assembly
hereby finds and declares that:
(a) Section 5 of article X of the state constitution provides that
property that is used solely and exclusively for strictly charitable purposes
is exempt from property tax, unless otherwise provided by law;
(b) Under its constitutional authority to limit or modify this
NOTE: This bill has been prepared for the signatures of the appropriate legislative
officers and the Governor. To determine whether the Governor has signed the bill
or taken other action on it, please consult the legislative status sheet, the legislative
history, or the Session Laws.
________
Capital letters or bold & italic numbers indicate new material added to existing law; dashes
through words or numbers indicate deletions from existing law and such material is not part of
the act. exemption, the general assembly originally established a property tax
exemption that is more stringent than the constitutional requirement by
mandating ownership and irrevocable dedication of property in order for a
child care center's property to qualify for the statutory exemption;
(c) The state constitution requires only use for a strictly charitable
purpose and not ownership or irrevocable dedication of property to qualify
for the exemption;
(d) The act modifies the child care center exemption by repealing
the statutory ownership and irrevocable dedication requirements, which are
not expressly required by the state constitution;
(e) As such, whether property qualifies for the child care center
exemption will depend on whether it is used solely and exclusively for the
charitable purpose of operating a qualified child care facility;
(f) These changes allow property that is used by a tenant or
subtenant to operate a qualified child care center for strictly charitable
purposes to be eligible for the exemption;
(g) This policy change recognizes the critical link between child
care, economic development, and security for Colorado's families; and
(h) Providing this property tax exemption for landlords may
incentivize new spaces or reduced rents for tenants operating these types of
child care centers and could help reverse the loss of child care spots in
communities around the state and help workers, especially women, return
to work.
SECTION 2. In Colorado Revised Statutes, 39-3-110, amend (1)
introductory portion, (1)(f), (1)(g), and (1.5); and repeal (1)(h) as follows:
39-3-110. Property - integral part of child care center -
charitable purposes - exemption - limitations. (1) Property, real and
personal, which
THAT is owned and used solely and exclusively for strictly
charitable purposes and not for private gain or corporate profit shall be IS
exempt from the levy and collection of property tax if such property is used as an integral part of a child care center:
PAGE 2-HOUSE BILL 22-1006 (f) The operation of which does not materially enhance, directly or
indirectly, the private gain of any individual except as reasonable
compensation for services rendered or goods furnished;
AND
(g) The property of which is claimed for exemption does not exceed
the amount of property reasonably necessary for the accomplishment of the
exempt purpose. and
(h) The property of which is irrevocably dedicated to a charitable
purpose.
(1.5) (a) No requirement shall be imposed that use of property,
which is otherwise exempt pursuant to the provisions of this section, shall
benefit the people of Colorado in order to qualify for said exemption.
(b) I
F A CHILD CARE CENTER IS OPERATED BY A PERSON OTHER THAN
THE OWNER OF THE PROPERTY
, THEN THE OTHER PERSON 'S USE OF THE
PROPERTY IS THE SOLE BASIS FOR DETERMINING WHETHER THE PROPERTY
MEETS THE REQUIREMENTS FOR THE EXEMPTION SET FORTH IN SUBSECTION
(1) OF THIS SECTION.
(c) T
O THE EXTENT THAT REAL PROPERTY TAXES ARE SHARED AND
PAYABLE BY ONE OR MORE TENANTS UNDER THE LEASE OF PROPERTY THAT
ARE NOT THE CHILD CARE CENTER
, REAL PROPERTY TAXES OTHERWISE DUE
BUT FOR THE APPLICATION OF THIS SECTION ARE DEEMED TAXES PAID BY THE
PROPERTY OWNER OR THE LANDLORD OF A PROPERTY LEASED IN PART TO
THE CHILD CARE CENTER
.
SECTION 3. In Colorado Revised Statutes, 39-2-117, amend
(1)(b)(I) as follows:
39-2-117. Applications for exemption - review - annual reports
- procedures - rules. (1) (b) (I) Any users of real and personal property for
which exemption from general taxation is requested pursuant to any of the
provisions of sections 39-3-107 to 39-3-113.5 may be required to provide
such information as the property tax administrator determines to be
necessary. I
F A CLAIM IS MADE FOR AN EXEMPTION UNDER SECTION
39-3-110, AND THE CHILD CARE CENTER IS OPERATED BY A PERSON OTHER
THAN THE OWNER OF THE PROPERTY
, THEN THE OTHER PERSON, OR THE
OTHER PERSON
'S AUTHORIZED AGENT, MUST:
PAGE 3-HOUSE BILL 22-1006 (A) ALSO SIGN THE OWNER'S APPLICATION FORM REQUIRED BY
SUBSECTION
(1)(a)(I) OF THIS SECTION, OR ANY OTHER FORM PRESCRIBED
AND FURNISHED BY THE ADMINISTRATOR
, UNDER THE PENALTY OF PERJURY
IN THE SECOND DEGREE
; AND
(B) PROVIDE THE ADMINISTRATOR WITH ANY REQUESTED
INFORMATION RELATED TO THE EXEMPTION
.
SECTION 4. In Colorado Revised Statutes, amend 39-3-101 as
follows:
39-3-101. Legislative declaration - presumption of charitable
purpose. The general assembly recognizes that only the judiciary may make
a final decision as to whether or not any given property is used for
charitable purposes within the meaning of the Colorado constitution;
nevertheless, in order to guide members of the public and public officials
alike in the making of their day-to-day decisions and to assist in the
avoidance of litigation, the general assembly hereby finds, declares, and
determines that the uses of property which
THAT are set forth in this part 1
as uses for charitable purposes benefit the people of Colorado and lessen the
burdens of government by performing services which
THAT government
would otherwise be required to perform. Therefore, property used for such
purposes shall be presumed to be
USED, OR owned and used, AS APPLICABLE,
solely and exclusively for strictly charitable purposes and not for private
gain or corporate profit,
IF APPLICABLE, and, consequently, property used for
such purposes is entitled to be exempt from the levy and collection of
property tax pursuant to the provisions of this part 1 and the Colorado
constitution. This legislative finding, declaration, determination, and
presumption shall not be questioned by the administrator and shall be
entitled to great weight in any and every court.
SECTION 5. In Colorado Revised Statutes, 39-3-116, amend (1)
and (2) introductory portion; and add (2.5) as follows:
39-3-116. Combination use of property - charitable, religious,
and educational purposes - exemption - limitations. (1) Except as
otherwise provided in this section, property, real and personal, which is
USED, OR owned and used, AS APPLICABLE, by the owner thereof or by any
other person or organization solely and exclusively for any combination of
the purposes specified in sections 39-3-106 to 39-3-113.5, subject to the
PAGE 4-HOUSE BILL 22-1006 limitations and requirements in said sections, including but not limited to
the requirement that property not be owned or used for private or corporate
gain or profit, shall be IS exempt from the levy and collection of property
tax. No requirement shall be imposed that use of property which THAT is
otherwise exempt pursuant to any of said sections shall benefit the people
of Colorado in order to qualify for said exemption. Property which
THAT is
otherwise exempt pursuant to the provisions of this section shall be IS
subject to the provisions of section 39-3-129 relating to the proportional
valuation of exempt property if such property is partially leased, loaned, or
otherwise made available for a portion of any calendar year to any business
conducted for profit.
(2) E
XCEPT AS SET FORTH IN SUBSECTION (2.5) OF THIS SECTION, in
the event that such property is used by any person or organization other than
the owner:
(2.5) S
UBSECTION (2) OF THIS SECTION DOES NOT APPLY TO
PROPERTY THAT IS USED AS AN INTEGRAL PART OF A CHILD CARE CENTER
OPERATED BY A PERSON OR ORGANIZATION OTHER THAN THE OWNER OF THE
PROPERTY AND THAT QUALIFIES FOR AN EXEMPTION UNDER SECTION
39-3-110.
SECTION 6. Act subject to petition - effective date -
applicability. (1) This act takes effect at 12:01 a.m. on the day following
the expiration of the ninety-day period after final adjournment of the
general assembly; except that, if a referendum petition is filed pursuant to
section 1 (3) of article V of the state constitution against this act or an item,
section, or part of this act within such period, then the act, item, section, or
part will not take effect unless approved by the people at the general
election to be held in November 2022 and, in such case, will take effect on
the date of the official declaration of the vote thereon by the governor.
PAGE 5-HOUSE BILL 22-1006 (2) This act applies to property tax years commencing after the
applicable effective date of this act.
____________________________ ____________________________
Alec Garnett Steve Fenberg
SPEAKER OF THE HOUSE PRESIDENT OF
OF REPRESENTATIVES THE SENATE
____________________________ ____________________________
Robin Jones Cindi L. Markwell
CHIEF CLERK OF THE HOUSE SECRETARY OF
OF REPRESENTATIVES THE SENATE
APPROVED________________________________________
(Date and Time)
_________________________________________
Jared S. Polis
GOVERNOR OF THE STATE OF COLORADO
PAGE 6-HOUSE BILL 22-1006