SLS 10RS-975 ORIGINAL
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2010
SENATE BILL NO. 630
BY SENATOR NEVERS
TAX/AD VALOREM. Provides for the fair market value of property held for residential
development for property tax purposes. (gov sig)
AN ACT1
To amend and reenact R.S. 47:2321 and the introductory paragraph of 2323(C) and to enact2
R.S. 47:2323(C)(4), relative to ad valorem property tax; to provides for the fair3
market value of property held for residential development; and to provide for related4
matters.5
Be it enacted by the Legislature of Louisiana:6
Section 1. R.S. 47:2321 and the introductory paragraph of 2323(C) is hereby7
amended and reenacted and RS. 47:2323(C)(4) is hereby enacted to read as follows: 8
§2321. Fair market value; defined 9
Fair market value is the price for property which would be agreed upon10
between a willing and informed buyer and a willing and informed seller under usual11
and ordinary circumstances; it shall be the highest price estimated in terms of money12
which property will bring if exposed for sale on the open market with reasonable13
time allowed to find a purchaser who is buying with knowledge of all the uses and14
purposes to which the property is best adapted and for which it can be legally used15
unless the provisions of this Part provide for property whose circumstances are16
not usual and ordinary and therefore require a determination of fair market17 SB NO. 630
SLS 10RS-975 ORIGINAL
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
value not through general appraisal procedures.1
* * *2
§2323. Criteria for determining3
* * *4
C. Criteria.5
The fair market value of real and personal property shall be determined by6
the following generally recognized appraisal procedures: the market approach, the7
cost approach, and/or the income approach which are generally recognized8
appraisal procedures and by the other valuation method provided for in this9
Subsection.10
* * *11
(4)(a) The legislature hereby finds that general appraisal procedures are12
not suitable for determining the fair market value of property held for13
residential development. Therefore, notwithstanding any other law to the14
contrary, when determining the fair market value of property held for15
residential development, the assessor shall value the property at the purchase16
price of the land without any subsequent infrastructure improvements17
according to the Louisiana Tax Commission guidelines provided for in18
Subparagraph (b) of this Paragraph. The value shall remain in place until the19
last lot of the residential development is sold as a residence. When a particular20
lot is improved, sold, and occupied as a residence, that improved lot shall then21
be valued utilizing the procedures provided for in Paragraphs (1) through (3)22
of this Subsection.23
(b) The Louisiana Tax Commission shall develop guidelines for the24
appropriate valuation of property held for residential development which shall25
include but not be limited to:26
(i) Physical and economic risks.27
(ii) Prevailing interest rates.28
(iii) The inventory of residential real estate in each region of Louisiana.29 SB NO. 630
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Section 2. This Act shall become effective upon signature by the governor or, if not1
signed by the governor, upon expiration of the time for bills to become law without signature2
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If3
vetoed by the governor and subsequently approved by the legislature, this Act shall become4
effective on the day following such approval.5
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Riley Boudreaux.
DIGEST
Present constitution requires property to be taxed for ad valorem tax purposes at its assessed
valuation, which is a percentage of its fair market value to be determined in accordance with
criteria which shall be established by law.
Present law defines fair market value as the price for property which would be agreed upon
between a willing and informed buyer and a willing and informed seller under usual and
ordinary circumstances and requires the criteria for determining such value to be generally
recognized appraisal procedures: the market approach, the cost approach, and/or the income
approach.
Proposed law requires the assessor to value property held for residential development at the
purchase price of the land without any subsequent infrastructure improvements according
to La. Tax Commission guidelines set forth below. The value remains in place until the last
lot of the residential development is sold as a residence. When a particular lot is improved,
sold, and occupied as a residence, that improved lot must then be valued utilizing the
generally recognized appraisal.
Proposed law requires the tax commission to develop guidelines for the appropriate
valuation of property held for residential development which must include but not be limited
to:
1. Physical and economic risks.
2. Prevailing interest rates.
3. The inventory of residential real estate in each region of La.
Effective upon signature of the governor or lapse of time for gubernatorial action.
(Amends R.S. 47:2321 and 2323(C)(intro para); adds R.S. 47:2323(C)(4))