Oklahoma 2025 Regular Session

Oklahoma Senate Bill SB1098 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2	2
3		-	SENATE FLOOR VERSION - SB1098 SFLR Page 1
4		-	(Bold face denotes Committee Amendments) 1
	3	+
	4	+	Req. No. 387 Page 1 1
	5	+	2
	6	+	3
	7	+	4
	8	+	5
	9	+	6
	10	+	7
	11	+	8
	12	+	9
	13	+	10
	14	+	11
	15	+	12
	16	+	13
	17	+	14
	18	+	15
	19	+	16
	20	+	17
	21	+	18
	22	+	19
	23	+	20
	24	+	21
	25	+	22
	26	+	23
	27	+	24
	28	+	1
5	29		2
6	30		3
7	31		4
8	32		5
9	33		6
10	34		7
11	35		8
12	36		9
13	37		10
14	38		11
15	39		12
16	40		13
17	41		14
18	42		15
19	43		16
20	44		17
21	45		18
22	46		19
23	47		20
24	48		21
25	49		22
26	50		23
27	51		24
28	52
29		-	SENATE FLOOR VERSION
30		-	March 3, 2025
31		-	AS AMENDED
	53	+	STATE OF OKLAHOMA
32	54
33		-	~~SENATE BILL NO. 1098 By: Thompson~~ of the ~~Senate~~
	55	+	1st Session of the 60th Legislature (2025)
34	56
35		-	and
36		-
37		-	Kannady of the House
	57	+	SENATE BILL 1098 By: Thompson
38	58
39	59
40	60
41	61
42	62
43		-	[ taxation - Ad Valorem Tax Code - classifications of
44		-	property - valuation procedure - effective date ]
	63	+	AS INTRODUCED
	64	+
	65	+	An Act relating to taxation; amending 68 O.S. 2021,
	66	+	Sections 2802, 2803, and 2817, as amended by Section
	67	+	1, Chapter 374, O.S.L. 2022 ( 68 O.S. Supp. 2024,
	68	+	Section 2817), which relate to the Ad Valorem Tax
	69	+	Code; defining terms; expanding classifications of
	70	+	property for purposes of ad valorem taxation;
	71	+	modifying the valuation procedure of certain real
	72	+	property for assessment; updating statutory
	73	+	references; updating statutory language; and
	74	+	providing an effective date .
45	75
46	76
47	77
48	78
49	79		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
50	80		SECTION 1. AMENDATORY 68 O.S. 2021, Section 2802, is
51	81		amended to read as follows:
52	82		Section 2802. As used in Section 2801 et seq. of this title:
53	83		1. “Accepted standards for mass appraisal practice ” means those
54	84		standards for the collection and analysis of information about
55	85		taxable properties within a taxing jurisdiction permitting the
56	86		accurate estimate of fair cash value for similar properties in the
57	87		jurisdiction either without direct observation of such similar
58	88		properties or without direct sales price information for such
59		-	similar properties using a reliable statistical or other method to
60		-	estimate the values of such properties;
61		-	2. “Additional homestead exemption ” means the exemption
62		-	provided by Section 2890 of this title;
63	89
64		-	SENATE FLOOR VERSION - SB1098 SFLR Page 2
65		-	(Bold face denotes Committee Amendments) 1
	90	+
	91	+	Req. No. 387 Page 2 1
	92	+	2
	93	+	3
	94	+	4
	95	+	5
	96	+	6
	97	+	7
	98	+	8
	99	+	9
	100	+	10
	101	+	11
	102	+	12
	103	+	13
	104	+	14
	105	+	15
	106	+	16
	107	+	17
	108	+	18
	109	+	19
	110	+	20
	111	+	21
	112	+	22
	113	+	23
	114	+	24
	115	+	1
66	116		2
67	117		3
68	118		4
69	119		5
70	120		6
71	121		7
72	122		8
73	123		9
74	124		10
75	125		11
76	126		12
77	127		13
78	128		14
79	129		15
80	130		16
81	131		17
82	132		18
83	133		19
84	134		20
85	135		21
86	136		22
87	137		23
88	138		24
89	139
	140	+	similar properties using a reliable statistical or other method to
	141	+	estimate the values of such properties;
	142	+	2. “Additional homestead exemption ” means the exemption
	143	+	provided by Section 2890 of this title;
90	144		3. “Assessor” means the county assessor and, unless the context
91	145		clearly requires otherwise, deputy assessors and persons e mployed by
92	146		the county assessor in performance of duties imposed by law;
93	147		4. “Assess and value” means to establish the fair cash value
94	148		and taxable fair cash value of taxable real and personal property
95	149		pursuant to requirements of law;
96	150		5. “Assessed valuation” or “assessed value” means the
97	151		percentage of the fair cash value of personal property, or the
98	152		percentage of the taxable fair cash value of real property, pursuant
99	153		to the provisions of Sections 8 and 8B of Article X of the Oklahoma
100	154		Constitution, either of individual items of personal property,
101	155		parcels of real property or the aggregat e total of such individual
102	156		taxable items or parcels within a jurisdiction;
103	157		6. “Assessment percentage ” means the percentage applied to
104	158		personal property and real property pursua nt to Section 8 of Article
105	159		X of the Oklahoma Constitution;
106	160		7. “Assessment ratio” means the relationship between assessed
107	161		value and taxable fair cash value for a county or for use categories
108	162		within a county expressed as a percentage determined in the annua l
109	163		equalization ratio study;
110		-	8. “Assessment roll” means a computerized or noncomputeri zed
111		-	record required by law to be kept by the county assessor and
112		-	containing information about property within a taxing jurisdiction;
113	164
114		-	SENATE FLOOR VERSION - SB1098 SFLR Page 3
115		-	(Bold face denotes Committee Amendments) 1
	165	+
	166	+	Req. No. 387 Page 3 1
	167	+	2
	168	+	3
	169	+	4
	170	+	5
	171	+	6
	172	+	7
	173	+	8
	174	+	9
	175	+	10
	176	+	11
	177	+	12
	178	+	13
	179	+	14
	180	+	15
	181	+	16
	182	+	17
	183	+	18
	184	+	19
	185	+	20
	186	+	21
	187	+	22
	188	+	23
	189	+	24
	190	+	1
116	191		2
117	192		3
118	193		4
119	194		5
120	195		6
121	196		7
122	197		8
123	198		9
124	199		10
125	200		11
126	201		12
127	202		13
128	203		14
129	204		15
130	205		16
131	206		17
132	207		18
133	208		19
134	209		20
135	210		21
136	211		22
137	212		23
138	213		24
139	214
	215	+	8. “Assessment roll” means a computerized or nonco mputerized
	216	+	record required by law to be kept by the county assessor and
	217	+	containing information about property within a taxing jurisdiction;
140	218		9. “Assessment year” means the year beginning January 1 of each
141	219		calendar year and ending on December 31 preceding the following
142	220		January 1 assessment date;
143	221		10. “Circuit breaker” means the form of property tax relief
144	222		provided by Sections 2904 through 2911 of this title;
145	223		11. “Class of subjects” means a category of property
146	224		specifically designated pursuant to provisions of the Oklahoma
147	225		Constitution for purposes of ad valorem taxation;
148	226		12. “Code” means the Ad Valorem Tax Code, Section 2801 et seq.
149	227		of this title;
150	228		13. “Coefficient of dispersion ” means a statistical measure of
151	229		assessment uniformity for a category of property or for all property
152	230		within a taxing jurisdiction;
153	231		14. “Confidence level” means a statistical procedure for
154	232		determining the degree of reliability for use in reporting the
155	233		assessment ratio for a taxing jurisdiction;
156	234		15. “Cost approach” means a method used to establish the fair
157	235		cash value of property involving an estimate of current construction
158	236		cost of improvements, subtracting accrued depreciation including any
159	237		loss in value that may be caused by physical deterioration,
160		-	functional obsolescence or economic obsolescence and adding th e
161		-	value of the land.
162	238
163		-	SENATE FLOOR VERSION - SB1098 SFLR Page 4
164		-	(Bold face denotes Committee Amendments) 1
	239	+
	240	+	Req. No. 387 Page 4 1
	241	+	2
	242	+	3
	243	+	4
	244	+	5
	245	+	6
	246	+	7
	247	+	8
	248	+	9
	249	+	10
	250	+	11
	251	+	12
	252	+	13
	253	+	14
	254	+	15
	255	+	16
	256	+	17
	257	+	18
	258	+	19
	259	+	20
	260	+	21
	261	+	22
	262	+	23
	263	+	24
	264	+	1
165	265		2
166	266		3
167	267		4
168	268		5
169	269		6
170	270		7
171	271		8
172	272		9
173	273		10
174	274		11
175	275		12
176	276		13
177	277		14
178	278		15
179	279		16
180	280		17
181	281		18
182	282		19
183	283		20
184	284		21
185	285		22
186	286		23
187	287		24
188	288
	289	+	functional obsolescence or economic obsolescence and adding the
	290	+	value of the land.
189	291		a. Physical deterioration is a cause of depreciation that
190	292		is a loss in value due to ordinary wear and tear and
191	293		the forces of nature.
192	294		b. Functional or internal obsolescence is the loss in
193	295		value of a property resulting from changes in tastes,
194	296		preferences, technical innovations or market
195	297		standards.
196	298		c. Economic or external obsolescence is a cause of
197	299		depreciation that is a loss in value as a result of
198	300		impairment in utility and desirability caused by
199	301		factors outside the boundaries of the property or loss
200	302		of value in a property (relative to the cost of
201	303		replacing it with a property of equal utility) that
202	304		stems from factors external to the p roperty;
203	305		16. “County board of equalization ” means the board which, upon
204	306		hearing competent evidence, has the authority to correct and adjust
205	307		the assessment rolls in its respective county to conform to fair
206	308		cash value and such other responsibilities as pres cribed in Section
207	309		2801 et seq. of this title;
208	310		17. “Equalization” means the process for making adjustments to
209	311		taxable property values within a county by analyzing the
210	312		relationships between assessed values and fair cash values in one or
211		-	more use categories within the county or between counties by
212	313
213		-	SENATE FLOOR VERSION - SB1098 SFLR Page 5
214		-	(Bold face denotes Committee Amendments) 1
	314	+
	315	+	Req. No. 387 Page 5 1
	316	+	2
	317	+	3
	318	+	4
	319	+	5
	320	+	6
	321	+	7
	322	+	8
	323	+	9
	324	+	10
	325	+	11
	326	+	12
	327	+	13
	328	+	14
	329	+	15
	330	+	16
	331	+	17
	332	+	18
	333	+	19
	334	+	20
	335	+	21
	336	+	22
	337	+	23
	338	+	24
	339	+	1
215	340		2
216	341		3
217	342		4
218	343		5
219	344		6
220	345		7
221	346		8
222	347		9
223	348		10
224	349		11
225	350		12
226	351		13
227	352		14
228	353		15
229	354		16
230	355		17
231	356		18
232	357		19
233	358		20
234	359		21
235	360		22
236	361		23
237	362		24
238	363
	364	+	more use categories within the county or between counties by
239	365		analyzing the relationship between ass essed value and fair cash
240	366		value in each county;
241	367		18. “Equalization ratio study ” means the analysis of the
242	368		relationships between assessed values and fair cash values in the
243	369		manner provided by law;
244	370		19. “Fair cash value” or “market value” means the value or
245	371		price at which a willing buyer would purchase property and a willing
246	372		seller would sell property if both parties are knowledgeable about
247	373		the property and its uses and if neither party is under any undue
248	374		pressure to buy or sell and for real property shall me an the value
249	375		for the highest and best use for which such property was actually
250	376		used, or was previously classified for use, during the calendar year
251	377		next preceding the applicable January 1 assessment date;
252	378		20. “Homestead exemption” means the reduction in the taxable
253	379		value of a homestead as authorized by law;
254	380		21. “Income and expense approach ” means a method to estimate
255	381		fair cash value of a property by determining the present valu e of
256	382		the projected income stream;
257	383		22. “List and assess” means the process by w hich taxable
258	384		property is discovered, its description recorded for purposes of ad
259	385		valorem taxation and its fair cash value and taxable fair cash value
260	386		are established;
261	387
262		-	SENATE FLOOR VERSION - SB1098 SFLR Page 6
263		-	(Bold face denotes Committee Amendments) 1
	388	+
	389	+	Req. No. 387 Page 6 1
	390	+	2
	391	+	3
	392	+	4
	393	+	5
	394	+	6
	395	+	7
	396	+	8
	397	+	9
	398	+	10
	399	+	11
	400	+	12
	401	+	13
	402	+	14
	403	+	15
	404	+	16
	405	+	17
	406	+	18
	407	+	19
	408	+	20
	409	+	21
	410	+	22
	411	+	23
	412	+	24
	413	+	1
264	414		2
265	415		3
266	416		4
267	417		5
268	418		6
269	419		7
270	420		8
271	421		9
272	422		10
273	423		11
274	424		12
275	425		13
276	426		14
277	427		15
278	428		16
279	429		17
280	430		18
281	431		19
282	432		20
283	433		21
284	434		22
285	435		23
286	436		24
287	437
288	438		23. “Mill” or “millage” means the rate of tax imposed upon
289	439		taxable value. One (1) mill equals One Dollar ($1.00) of tax for
290	440		each One Thousand Dollars ($1,000.00) of taxable value;
291	441		24. “Multiple regression analysis ” means a statistical
292	442		technique for estimating unk nown data on the basis of known and
293	443		available data;
294	444		25. “Parcel” means a contiguous area of land described in a
295	445		single description by a deed or other instrument or as one of a
296	446		number of lots on a plat or plan, separately owned and capable of
297	447		being separately conveyed;
298	448		26. “Residential rental housing ” means any single tax parcel
299	449		that contains a building or buildings that are constructed and used
300	450		for multifamily housing or contains two or more single family homes
301	451		that are constructed for rental purposes. For the purposes of this
302	452		paragraph, “multifamily housing” shall mean residential buildings or
303	453		complexes that contain multiple separate units or dwellings intended
304	454		for occupancy by multiple families or households;
305	455		27. “Sales comparison approach ” means the collection,
306	456		verification, and screening of sales data, stratification of sales
307	457		information for purposes of comparison and use of such information
308	458		to establish the fair cash value of taxable property;
309	459		27. 28. “State Board of Equalization ” means the Board
310	460		responsible for valuation of railroad, airline and public service
311	461
312		-	SENATE FLOOR VERSION - SB1098 SFLR Page 7
313		-	(Bold face denotes Committee Amendments) 1
	462	+
	463	+	Req. No. 387 Page 7 1
	464	+	2
	465	+	3
	466	+	4
	467	+	5
	468	+	6
	469	+	7
	470	+	8
	471	+	9
	472	+	10
	473	+	11
	474	+	12
	475	+	13
	476	+	14
	477	+	15
	478	+	16
	479	+	17
	480	+	18
	481	+	19
	482	+	20
	483	+	21
	484	+	22
	485	+	23
	486	+	24
	487	+	1
314	488		2
315	489		3
316	490		4
317	491		5
318	492		6
319	493		7
320	494		8
321	495		9
322	496		10
323	497		11
324	498		12
325	499		13
326	500		14
327	501		15
328	502		16
329	503		17
330	504		18
331	505		19
332	506		20
333	507		21
334	508		22
335	509		23
336	510		24
337	511
338	512		corporation property and the adjustment and equalization of all
339	513		property values both centrally and locally assessed;
340	514		28. 29. “Taxable value” means the percentage of the fair cash
341	515		value of personal property or the taxable fair cash value of real
342	516		property, less applicable exemptions, upon which an ad valorem tax
343	517		rate is levied pursuant to the provisions of Section 8 and Section
344	518		8B of Article X of the Oklahoma Constitution;
345	519		29. 30. “Taxable fair cash value” means the fair cash value of
346	520		locally assessed real property as cap ped pursuant to Section 8B of
347	521		Article X of the Oklahoma Constitution;
348	522		30. 31. “Use category” means a subcategory of real property ,
349	523		that is either agricultural use, residential use or
350	524		commercial/industrial use but does not and shall not constitute a
351	525		class of subjects within the meaning of the Oklahoma Constitution
352	526		for purposes of ad valorem taxation;
353	527		31. 32. “Use value” means the basis for establishing fair cash
354	528		value of real property pursuant to the requirement of Section 8 of
355	529		Article X of the Oklahoma Co nstitution; and
356	530		32. 33. “Visual inspection program ” means the program required
357	531		in order to gather data about real property from physical
358	532		examination of the property and improve ments in order to establish
359	533		the fair cash values of properties so inspected at least once each
360	534		four (4) years and the fair cash values of similar properties on an
361	535		annual basis.
362	536
363		-	SENATE FLOOR VERSION - SB1098 SFLR Page 8
364		-	(Bold face denotes Committee Amendments) 1
	537	+
	538	+	Req. No. 387 Page 8 1
	539	+	2
	540	+	3
	541	+	4
	542	+	5
	543	+	6
	544	+	7
	545	+	8
	546	+	9
	547	+	10
	548	+	11
	549	+	12
	550	+	13
	551	+	14
	552	+	15
	553	+	16
	554	+	17
	555	+	18
	556	+	19
	557	+	20
	558	+	21
	559	+	22
	560	+	23
	561	+	24
	562	+	1
365	563		2
366	564		3
367	565		4
368	566		5
369	567		6
370	568		7
371	569		8
372	570		9
373	571		10
374	572		11
375	573		12
376	574		13
377	575		14
378	576		15
379	577		16
380	578		17
381	579		18
382	580		19
383	581		20
384	582		21
385	583		22
386	584		23
387	585		24
388	586
389	587		SECTION 2. AMENDATORY 68 O.S. 2021, Section 2803, is
390	588		amended to read as follows:
391	589		Section 2803. A. The Legislature, pursuant to aut hority of
392	590		Article X, Section 22 of Article X of the Oklahoma Constitution,
393	591		hereby classifies the following types of property for purposes of ad
394	592		valorem taxation:
395	593		1. Real property, except as provided by paragraph 6 of this
396	594		subsection;
397	595		2. Personal property, except as provided in paragraph 3 of this
398	596		subsection;
399	597		3. Personal property which is household goods of the head of
400	598		families and livestock employed in support of the family in those
401	599		counties which have exempted such property pursuant to subsection
402	600		(b) B of Section 6 of Article X of the Oklahoma Constitution;
403	601		4. Public service corporation property; and
404	602		5. Railroad and air carrier property ; and
405	603		6. Real property containing impr ovements constructed for the
406	604		purposes of providing residential rental housing .
407	605		B. Valuation of each class of subjects shall be made by a
408	606		method appropriate for each class or any subclass thereof, as
409	607		established by the Ad Valorem Division of the Oklahoma T ax
410	608		Commission.
411	609		C. Classification as provided by this section shall require
412	610		uniform treatment of each item within a class or any subclass as
413	611
414		-	SENATE FLOOR VERSION - SB1098 SFLR Page 9
415		-	(Bold face denotes Committee Amendments) 1
	612	+
	613	+	Req. No. 387 Page 9 1
	614	+	2
	615	+	3
	616	+	4
	617	+	5
	618	+	6
	619	+	7
	620	+	8
	621	+	9
	622	+	10
	623	+	11
	624	+	12
	625	+	13
	626	+	14
	627	+	15
	628	+	16
	629	+	17
	630	+	18
	631	+	19
	632	+	20
	633	+	21
	634	+	22
	635	+	23
	636	+	24
	637	+	1
416	638		2
417	639		3
418	640		4
419	641		5
420	642		6
421	643		7
422	644		8
423	645		9
424	646		10
425	647		11
426	648		12
427	649		13
428	650		14
429	651		15
430	652		16
431	653		17
432	654		18
433	655		19
434	656		20
435	657		21
436	658		22
437	659		23
438	660		24
439	661
440	662		provided in Article X, Section 5 of Article X of the Oklahoma
441	663		Constitution.
442	664		SECTION 3. AMENDATORY 68 O.S. 2021, Section 2817, as
443	665		amended by Section 1, Chapter 374, O.S.L. 2022 (68 O.S. Supp. 2024,
444	666		Section 2817), is amended to read as follows:
445	667		Section 2817. A. All taxable personal property, except
446	668		intangible personal property, personal proper ty exempt from ad
447	669		valorem taxation, or household personal property, shall be li sted
448	670		and assessed each year at its fair cash value, estimated at the
449	671		price it would bring at a fair voluntary sale, as of January 1.
450	672		The fair cash value of household personal pr operty shall be
451	673		valued at ten percent (10%) of the appraised value of the
452	674		improvement to the residential real property within which such
453	675		personal property is located as of January 1 each year. The
454	676		assessment of household personal property as provided by t his
455	677		section may be altered by the taxpayer listing such property at its
456	678		actual fair cash value. For purposes of establishing the value of
457	679		household personal property, pursuant to the requirement of Section
458	680		8 of Article X of the Oklahoma Constitution, the percentage of value
459	681		prescribed by this section for the household personal property shall
460	682		be presumed to constitute the fair cash value of the personal
461	683		property.
462	684		Stocks of goods, wares, and merchandise shall be assessed at the
463	685		value of the average amount on hand during the preceding year, or
464	686
465		-	SENATE FLOOR VERSION - SB1098 SFLR Page 10
466		-	(Bold face denotes Committee Amendments) 1
	687	+
	688	+	Req. No. 387 Page 10 1
	689	+	2
	690	+	3
	691	+	4
	692	+	5
	693	+	6
	694	+	7
	695	+	8
	696	+	9
	697	+	10
	698	+	11
	699	+	12
	700	+	13
	701	+	14
	702	+	15
	703	+	16
	704	+	17
	705	+	18
	706	+	19
	707	+	20
	708	+	21
	709	+	22
	710	+	23
	711	+	24
	712	+	1
467	713		2
468	714		3
469	715		4
470	716		5
471	717		6
472	718		7
473	719		8
474	720		9
475	721		10
476	722		11
477	723		12
478	724		13
479	725		14
480	726		15
481	727		16
482	728		17
483	729		18
484	730		19
485	731		20
486	732		21
487	733		22
488	734		23
489	735		24
490	736
491	737		the average amount on hand during the part of the preceding year the
492	738		stock of goods, wares, or merchandise was at its January 1 location.
493	739		Provided, persons primarily engaged in selling lumber and other
494	740		building materials including cement and concrete, except for home
495	741		centers classified under Industry No. 444110 of the North American
496	742		Industrial Classification Systems (NAICS) Manual, shall be assessed
497	743		at the average value of the inventory on hand as of January 1 of
498	744		each year and the value of the inventory on hand as of December 31
499	745		of the same year.
500	746		B. All taxable real property shall be assessed annually as of
501	747		January 1, at its fair cash value, estimated at the price it would
502	748		bring at a fair voluntary sale for:
503	749		1. The highest and best use for which the property was actually
504	750		used during the preceding calendar year; or
505	751		2. The highest and best use for which the property was last
506	752		classified for use if not actually used during the preceding
507	753		calendar year.
508	754		When improvements upon residential real property are divided by
509	755		a taxing jurisdiction line, those imp rovements shall be valued and
510	756		assessed in the taxing jurisdiction in which the physical majority
511	757		of those improvements are located.
512	758		The Ad Valorem Division of the Oklahoma Tax C ommission shall be
513	759		responsible for the promulgation of rules which shall be followed by
514	760		each county assessor of the state, for the purposes of providing for
515	761
516		-	SENATE FLOOR VERSION - SB1098 SFLR Page 11
517		-	(Bold face denotes Committee Amendments) 1
	762	+
	763	+	Req. No. 387 Page 11 1
	764	+	2
	765	+	3
	766	+	4
	767	+	5
	768	+	6
	769	+	7
	770	+	8
	771	+	9
	772	+	10
	773	+	11
	774	+	12
	775	+	13
	776	+	14
	777	+	15
	778	+	16
	779	+	17
	780	+	18
	781	+	19
	782	+	20
	783	+	21
	784	+	22
	785	+	23
	786	+	24
	787	+	1
518	788		2
519	789		3
520	790		4
521	791		5
522	792		6
523	793		7
524	794		8
525	795		9
526	796		10
527	797		11
528	798		12
529	799		13
530	800		14
531	801		15
532	802		16
533	803		17
534	804		18
535	805		19
536	806		20
537	807		21
538	808		22
539	809		23
540	810		24
541	811
542	812		the equitable use valuation of locally assessed real property in
543	813		this state. Agricultural land and nonresidential improvements
544	814		necessary or convenient for agricultural purposes shall be assessed
545	815		for ad valorem taxation based upon the highest and best use for
546	816		which the property was actually used, or was previously classified
547	817		for use, during the calendar year next preceding January 1 on which
548	818		the assessment is made.
549	819		C. The use value of agricultural land shall be based on the
550	820		income capitalization approach using cash rent. The rental income
551	821		shall be calculated using the direct capitalization method based
552	822		upon factors including, but not limited to:
553	823		1. Soil types, as depicted on soi l maps published by the
554	824		Natural Resources Conservation Service of the United States
555	825		Department of Agriculture;
556	826		2. Soil productivity indices approved by the Ad Valorem
557	827		Division of the Tax Commission;
558	828		3. The specific agricultural purpose of the soil based on use
559	829		categories approved by the Ad Valorem Division of the Tax
560	830		Commission; and
561	831		4. A capitalization rate to be determined annually by the Ad
562	832		Valorem Division of the Tax Commis sion based on the sum of the
563	833		average first mortgage interest rate charged by th e Federal Land
564	834		Bank for the immediately preceding five (5) years, weighted with the
565	835
566		-	SENATE FLOOR VERSION - SB1098 SFLR Page 12
567		-	(Bold face denotes Committee Amendments) 1
	836	+
	837	+	Req. No. 387 Page 12 1
	838	+	2
	839	+	3
	840	+	4
	841	+	5
	842	+	6
	843	+	7
	844	+	8
	845	+	9
	846	+	10
	847	+	11
	848	+	12
	849	+	13
	850	+	14
	851	+	15
	852	+	16
	853	+	17
	854	+	18
	855	+	19
	856	+	20
	857	+	21
	858	+	22
	859	+	23
	860	+	24
	861	+	1
568	862		2
569	863		3
570	864		4
571	865		5
572	866		6
573	867		7
574	868		8
575	869		9
576	870		10
577	871		11
578	872		12
579	873		13
580	874		14
581	875		15
582	876		16
583	877		17
584	878		18
585	879		19
586	880		20
587	881		21
588	882		22
589	883		23
590	884		24
591	885
592	886		prevailing rate or rates for additional loans or equity, and the
593	887		effective tax rate.
594	888		The final use value will be calculated using the soil
595	889		productivity indices and the agricultural use classification as
596	890		defined by rules promulgated by the State Board of Equalization.
597	891		This subsection shall not be construed in a manner which is
598	892		inconsistent with th e duties, powers, and authority of the Board as
599	893		to valuation of the counties as fixed and defined by Section 21 of
600	894		Article X of the Oklahoma Constitution.
601	895		However, in calculating the use value of buffer strips as
602	896		defined in Section 2817.2 of this title, ex clusive consideration
603	897		shall be based only on income from production agriculture from such
604	898		buffer strips, not including federal or state subsidies, when valued
605	899		as required by subsection C of Section 2817.2 of this title.
606	900		D. The use value of nonresidential improvements on agricultural
607	901		land shall be based on the cost approach to value estimation using
608	902		currently updated cost manuals published by the Marshall and Swift
609	903		Company or similar cost manuals approved by the Ad Valorem Division
610	904		of the Tax Commission. T he use value estimates for the
611	905		nonresidential improvements shall take obsolescence and depreciation
612	906		into consideration in addition to necessary adjustments for local
613	907		variations in the cost of labor and materials. This section shall
614	908		not be construed in a m anner which is inconsistent with the duties,
615	909		powers, and authority of the Board as to equalization of valuation
616	910
617		-	SENATE FLOOR VERSION - SB1098 SFLR Page 13
618		-	(Bold face denotes Committee Amendments) 1
	911	+
	912	+	Req. No. 387 Page 13 1
	913	+	2
	914	+	3
	915	+	4
	916	+	5
	917	+	6
	918	+	7
	919	+	8
	920	+	9
	921	+	10
	922	+	11
	923	+	12
	924	+	13
	925	+	14
	926	+	15
	927	+	16
	928	+	17
	929	+	18
	930	+	19
	931	+	20
	932	+	21
	933	+	22
	934	+	23
	935	+	24
	936	+	1
619	937		2
620	938		3
621	939		4
622	940		5
623	941		6
624	942		7
625	943		8
626	944		9
627	945		10
628	946		11
629	947		12
630	948		13
631	949		14
632	950		15
633	951		16
634	952		17
635	953		18
636	954		19
637	955		20
638	956		21
639	957		22
640	958		23
641	959		24
642	960
643	961		of the counties as determined and defined by Section 21 of Article X
644	962		of the Oklahoma Constitution.
645	963		The use value of facilities used for poultry production shall be
646	964		determined according to the following procedures:
647	965		1. The Ad Valorem Division of the Tax Commission is hereby
648	966		directed to develop a standard system of valuation of both real and
649	967		personal property of such facilities, which shall be used by all
650	968		county assessors in this state, under which valuation based on the
651	969		following shall be presumed to be the fair cash value of the
652	970		property:
653	971		a. for real property, a ten -year depreciation schedule,
654	972		at the end of which the residual value is twenty
655	973		percent (20%) of the value of the facility during its
656	974		first year of operation, and
657	975		b. for personal property, a five -year depreciation
658	976		schedule, at the end of which the residual value is
659	977		zero;
660	978		2. Such facilities shall be valued only in comparison to other
661	979		facilities used exclusively for poultry production. Such a facility
662	980		which is no longer used for poultry production shall be deemed to
663	981		have no productive use;
664	982		3. During the first year such a facility is placed on the tax
665	983		rolls, its fair cash value shall be pres umed to be the lesser of the
666	984
667		-	SENATE FLOOR VERSION - SB1098 SFLR Page 14
668		-	(Bold face denotes Committee Amendments) 1
	985	+
	986	+	Req. No. 387 Page 14 1
	987	+	2
	988	+	3
	989	+	4
	990	+	5
	991	+	6
	992	+	7
	993	+	8
	994	+	9
	995	+	10
	996	+	11
	997	+	12
	998	+	13
	999	+	14
	1000	+	15
	1001	+	16
	1002	+	17
	1003	+	18
	1004	+	19
	1005	+	20
	1006	+	21
	1007	+	22
	1008	+	23
	1009	+	24
	1010	+	1
669	1011		2
670	1012		3
671	1013		4
672	1014		5
673	1015		6
674	1016		7
675	1017		8
676	1018		9
677	1019		10
678	1020		11
679	1021		12
680	1022		13
681	1023		14
682	1024		15
683	1025		16
684	1026		17
685	1027		18
686	1028		19
687	1029		20
688	1030		21
689	1031		22
690	1032		23
691	1033		24
692	1034
693	1035		actual purchase price or the actual documented cost of construction;
694	1036		and
695	1037		4. For the purpose of determining the valuation of
696	1038		nonresidential improvements used for poultry production, the
697	1039		provisions of this subsection shall be ap plicable and such
698	1040		improvements shall not be considered to be commercial propert y.
699	1041		E. The value of investment in property used exclusively by an
700	1042		oil refinery that is used wholly as a facility, device, or method
701	1043		for the desulphurization of gasoline or diese l fuel as defined in
702	1044		Section 2817.3 of this title shall not be included in the
703	1045		capitalization used in the determination of fair market value of
704	1046		such oil refinery if such property would qualify as exempt property
705	1047		pursuant to Section 2902 of this title, whet her or not an
706	1048		application for such exemption is made by an otherwise qualifying
707	1049		manufacturing concern owning the property described by Section
708	1050		2817.3 of this title.
709	1051		F. The use value of a lot in any platted addition or a
710	1052		subdivision in a city, town, or cou nty zoned for residential,
711	1053		commercial, industrial, or other use shall be deemed to be the fair
712	1054		cash value of the underlying tract of land platted, divided by the
713	1055		number of lots contained in the platted addition or subdivision
714	1056		until the lot shall have been conveyed to a bona fide purchaser or
715	1057		the lot with building or buildings located thereon shall have been
716	1058		occupied other than as a sales office by the owner thereof, or shall
717	1059
718		-	SENATE FLOOR VERSION - SB1098 SFLR Page 15
719		-	(Bold face denotes Committee Amendments) 1
	1060	+
	1061	+	Req. No. 387 Page 15 1
	1062	+	2
	1063	+	3
	1064	+	4
	1065	+	5
	1066	+	6
	1067	+	7
	1068	+	8
	1069	+	9
	1070	+	10
	1071	+	11
	1072	+	12
	1073	+	13
	1074	+	14
	1075	+	15
	1076	+	16
	1077	+	17
	1078	+	18
	1079	+	19
	1080	+	20
	1081	+	21
	1082	+	22
	1083	+	23
	1084	+	24
	1085	+	1
720	1086		2
721	1087		3
722	1088		4
723	1089		5
724	1090		6
725	1091		7
726	1092		8
727	1093		9
728	1094		10
729	1095		11
730	1096		12
731	1097		13
732	1098		14
733	1099		15
734	1100		16
735	1101		17
736	1102		18
737	1103		19
738	1104		20
739	1105		21
740	1106		22
741	1107		23
742	1108		24
743	1109
744	1110		have been leased, whichever event shall first occur. One who
745	1111		purchases a lot for t he purposes of constructing and selling a
746	1112		building on such lot shall not be deemed to be a bona fide purchaser
747	1113		for purposes of this section. However, if the lot is held for a
748	1114		period longer than two (2) years before construction, then the
749	1115		assessor may consider the lot to have been conveyed to a bona fide
750	1116		purchaser. The cost of any l and or improvements to any real
751	1117		property required to be dedicated to public use including, but not
752	1118		limited to, streets, curbs, gutters, sidewalks, storm or sanitary
753	1119		sewers, utilities, detention or retention ponds, easements, parks,
754	1120		or reserves shall not be utilized by the county assessor in the
755	1121		valuation of any real property for assessment purposes.
756	1122		G. The transfer of real property without a change in its use
757	1123		classification shall not require a reassessment thereof based
758	1124		exclusively upon the sale value of t he property. However, if the
759	1125		county assessor determines:
760	1126		1. That by reason of the transfer of a property there is a
761	1127		change in the actual use or classification of the property; or
762	1128		2. That by reason of the amount of the sales consideration it
763	1129		is obvious that the use classification prior to the transfer of the
764	1130		property is not commensurate with and would not justify the amount
765	1131		of the sales consideration of the property;
766	1132		then the assessor shall, in either event, reassess the property for
767	1133		the new use classific ation for which the property is being used, or ,
768	1134
769		-	SENATE FLOOR VERSION - SB1098 SFLR Page 16
770		-	(Bold face denotes Committee Amendments) 1
	1135	+
	1136	+	Req. No. 387 Page 16 1
	1137	+	2
	1138	+	3
	1139	+	4
	1140	+	5
	1141	+	6
	1142	+	7
	1143	+	8
	1144	+	9
	1145	+	10
	1146	+	11
	1147	+	12
	1148	+	13
	1149	+	14
	1150	+	15
	1151	+	16
	1152	+	17
	1153	+	18
	1154	+	19
	1155	+	20
	1156	+	21
	1157	+	22
	1158	+	23
	1159	+	24
	1160	+	1
771	1161		2
772	1162		3
773	1163		4
774	1164		5
775	1165		6
776	1166		7
777	1167		8
778	1168		9
779	1169		10
780	1170		11
781	1171		12
782	1172		13
783	1173		14
784	1174		15
785	1175		16
786	1176		17
787	1177		18
788	1178		19
789	1179		20
790	1180		21
791	1181		22
792	1182		23
793	1183		24
794	1184
795	1185		the highest and best use classification for which the property may,
796	1186		by reason of the transfer, be classified for use.
797	1187		H. When the term “fair cash value” or the language “fair cash
798	1188		value, estimated at the price it would bring at a fair voluntary
799	1189		sale” is used in the Ad Valorem Tax Code, in connection with and in
800	1190		relation to the assessment of real property, it is defined to mean
801	1191		and shall be given the meaning ascribed and assigned to it in this
802	1192		section and when the term or language is used in the Code in
803	1193		connection with the assessment of personal property , it shall be
804	1194		given its ordinary or literal meaning.
805	1195		I. Where any real property is zoned for a use by a proper
806	1196		zoning authority, and the use of the property has not been changed,
807	1197		the use and not zoning shall determine assessment. Any reassessment
808	1198		required shall be effective January 1 following the change in use.
809	1199		Taxable real propert y need not be listed annually with the county
810	1200		assessor.
811	1201		J. If any real propert y shall become taxable after January 1 of
812	1202		any year, the county assessor shall assess the same and place it
813	1203		upon the tax rolls for the next ensuing year. When any building is
814	1204		constructed upon land after January 1 of any year, the value of the
815	1205		building shall be added by the county assessor to the assessed
816	1206		valuation of the land upon which the building is constructed at the
817	1207		fair cash value thereof for the next ensuing year. However , after
818	1208		the building has been completed it shall be deemed to have a value
819	1209
820		-	SENATE FLOOR VERSION - SB1098 SFLR Page 17
821		-	(Bold face denotes Committee Amendments) 1
	1210	+
	1211	+	Req. No. 387 Page 17 1
	1212	+	2
	1213	+	3
	1214	+	4
	1215	+	5
	1216	+	6
	1217	+	7
	1218	+	8
	1219	+	9
	1220	+	10
	1221	+	11
	1222	+	12
	1223	+	13
	1224	+	14
	1225	+	15
	1226	+	16
	1227	+	17
	1228	+	18
	1229	+	19
	1230	+	20
	1231	+	21
	1232	+	22
	1233	+	23
	1234	+	24
	1235	+	1
822	1236		2
823	1237		3
824	1238		4
825	1239		5
826	1240		6
827	1241		7
828	1242		8
829	1243		9
830	1244		10
831	1245		11
832	1246		12
833	1247		13
834	1248		14
835	1249		15
836	1250		16
837	1251		17
838	1252		18
839	1253		19
840	1254		20
841	1255		21
842	1256		22
843	1257		23
844	1258		24
845	1259
846	1260		for assessment purposes of the fair cash value of the materials used
847	1261		in such building only, until the building and the land on which the
848	1262		building is located shall have been conveyed to a bona fide
849	1263		purchaser or shall have been occupied or used for any purpose other
850	1264		than as a sales office by the owner thereof, or shall have been
851	1265		leased, whichever event shall first occur. The county assessor
852	1266		shall continue to assess the building based upon the fair market
853	1267		value of the materials used therein until the building and land upon
854	1268		which the building is located shall have been conveyed to a bona
855	1269		fide purchaser or is occupied or used for any purpose other than as
856	1270		a sales office by the owner there of, or is leased, whichever event
857	1271		shall first occur. In the event a building or buildings described
858	1272		by this subsection are intended to serve primarily as residential
859	1273		rental housing, after the building or buildings have been completed
860	1274		they shall be deemed to have an initial value for assessment
861	1275		purposes not to exceed the fair cash va lue of the land and the
862	1276		actual documented cost of any improvements made to the building or
863	1277		buildings. The county assessor shall continue to assess such
864	1278		building or buildings at a value not to exceed the fair cash value
865	1279		of the land and actual documented cost of any improvements made
866		-	until either ~~one~~ (1) ~~year has~~ passed since the date on which the
	1280	+	until either two (2) years have passed since the date on which the
867	1281		building or buildings were first reflected on the tax rolls, or the
868	1282		building or buildings and the land on which the building or
869	1283
870		-	SENATE FLOOR VERSION - SB1098 SFLR Page 18
871		-	(Bold face denotes Committee Amendments) 1
	1284	+
	1285	+	Req. No. 387 Page 18 1
	1286	+	2
	1287	+	3
	1288	+	4
	1289	+	5
	1290	+	6
	1291	+	7
	1292	+	8
	1293	+	9
	1294	+	10
	1295	+	11
	1296	+	12
	1297	+	13
	1298	+	14
	1299	+	15
	1300	+	16
	1301	+	17
	1302	+	18
	1303	+	19
	1304	+	20
	1305	+	21
	1306	+	22
	1307	+	23
	1308	+	24
	1309	+	1
872	1310		2
873	1311		3
874	1312		4
875	1313		5
876	1314		6
877	1315		7
878	1316		8
879	1317		9
880	1318		10
881	1319		11
882	1320		12
883	1321		13
884	1322		14
885	1323		15
886	1324		16
887	1325		17
888	1326		18
889	1327		19
890	1328		20
891	1329		21
892	1330		22
893	1331		23
894	1332		24
895	1333
896	1334		buildings are located shall have been conveyed to a bona fide
897	1335		purchaser, whichever event shall first occur.
898	1336		K. In the event improvements on land or personal property
899	1337		located therein or thereon are destroyed or partially destroyed, or
900	1338		the land itself is impaired or partially impaired by fire,
901	1339		lightning, storm, winds, floodwaters, overflow of streams, or other
902	1340		cause (all such destruction or impairments being referred to herein
903	1341		as “damage”) during any year, the co unty assessor shall determine
904	1342		the amount of damage and shall reassess the prope rty for that year
905	1343		at the fair cash value of the property, taking into account the
906	1344		actual loss of functional use of the property occasioned by such
907	1345		damage. The assessor shall ma ke the appropriate value adjustments
908	1346		to the property for that tax year up to the time at which the
909	1347		assessor publishes the “Assessor’s assessor’s Report to the Excise
910	1348		Board” Board as required by subsection D of Section 2867 of this
911	1349		title. After such time, adjustments can be made only by the county
912	1350		board of tax roll corrections and on ly after the assessor has
913	1351		certified the tax roll for that year. The board secretary shall
914	1352		notify property owners in advance of the time and place at which the
915	1353		value adjustment to their property will be heard by the board. The
916	1354		board of tax roll corrections is authorized only to approve or
917	1355		reject the value adjustment submitted by the county assessor.
918	1356		L. All taxable personal property used in the exploration of
919	1357		oil, natural gas, or other minerals including drilling equipment and
920	1358
921		-	SENATE FLOOR VERSION - SB1098 SFLR Page 19
922		-	(Bold face denotes Committee Amendments) 1
	1359	+
	1360	+	Req. No. 387 Page 19 1
	1361	+	2
	1362	+	3
	1363	+	4
	1364	+	5
	1365	+	6
	1366	+	7
	1367	+	8
	1368	+	9
	1369	+	10
	1370	+	11
	1371	+	12
	1372	+	13
	1373	+	14
	1374	+	15
	1375	+	16
	1376	+	17
	1377	+	18
	1378	+	19
	1379	+	20
	1380	+	21
	1381	+	22
	1382	+	23
	1383	+	24
	1384	+	1
923	1385		2
924	1386		3
925	1387		4
926	1388		5
927	1389		6
928	1390		7
929	1391		8
930	1392		9
931	1393		10
932	1394		11
933	1395		12
934	1396		13
935	1397		14
936	1398		15
937	1399		16
938	1400		17
939	1401		18
940	1402		19
941	1403		20
942	1404		21
943	1405		22
944	1406		23
945	1407		24
946	1408
947	1409		rigs, shall be assessed annua lly at the value set forth in the first
948	1410		Hadco International monthly bulletin published for the tax year,
949	1411		using the appropriate depth rating assigned to the drawworks by its
950	1412		manufacturer and the actual condition of the rig.
951	1413		M. The value of taxable tangible personal property used in
952	1414		commercial disposal systems of waste materials from the production
953	1415		of oil and gas shall not include any contract rights or leases for
954	1416		the use of such systems nor any value associated with the wellbore
955	1417		or non-recoverable down-hole material including casing.
956	1418		SECTION 4. This act shall become effective November 1, 2025.
957		-	~~COMMITTEE REPORT BY: COMMITTEE ON REVENUE AND TAXATION~~
958		-	~~March~~ 3~~, 2025 - DO PASS AS AMENDED~~
	1419	+
	1420	+	60-1-387 QD 1/16/2025 3:32:31 PM