Oklahoma Administrative Code › Title 710 - Oklahoma Tax Commission › Chapter 10 - AD Valorem › Subchapter 1 - General Provisions › Section 710:10-1-3 - Procedures for implementation of the ad valorem valuation limitation

Current through Vol. 41, No. 20, July 1, 2024
(a)
Application of limitation.
Pursuant to Article X, Section 8B of
				the Oklahoma Constitution and 68 O.S. §2817.1, the fair cash value of any
				parcel of locally assessed real property which constitutes homestead property
				or agricultural land shall not increase by more than 3% in any taxable year.
				The fair cash value of all other locally assessed real property shall not
				increase by more than 5%. The limitation on valuation increases set forth in
				this subsection do not apply in any year when the title of the property is
				transferred, changed, or conveyed to another person, or if improvements are
				made to the property unless subject to provisions of subsection (j) of this
				Section. [
See:
68 O.S. § 2802.1]
(b)
Implementation of
				limitation.
The county assessor will implement the limitation by
				annually comparing the fair cash value with the constitutionally-limited value.
				County assessors should continue to determine fair cash value on an annual
				basis. The limitation does not accumulate. In the event that a final fair cash
				value of a property changes as the result of a protest with the county
				assessor, County Board of Equalization, applicable court action, or action by
				the County Board of Tax Roll Corrections, the applicable valuation limitation
				shall apply to that property's final taxable value, as determined using
				accepted appraisal methodology for subsequent years.
(c)
Rights of taxpayers.
Taxpayers shall continue to have all rights of protest with respect to the
				valuation and assessment of property as currently specified by statute. If the
				taxpayer demonstrates to the satisfaction of the county assessor or county
				board of equalization that the fair cash value is below the
				constitutionally-limited value, it is appropriate for the county assessor to
				lower the property to that value. The limitation would then be applied annually
				to that value if all other conditions of the limitation on increases of fair
				cash value in Article 10, Section 8B, Oklahoma Constitution, are met.
(d)
Review of valuation for
				error.
The county assessor should review the valuation of the property
				for clerical errors, incorrect physical characteristics, or other material
				error affecting valuation in order to protect the taxpayer. This review should
				not include a revaluation of the property because it is below fair cash
				value.
(e)
Duration of
				limitation.
The annual valuation limitation is valid on the property as
				long as title to the property is not transferred, changed, or conveyed.
				[
See:
Article 10, Section 8B, Oklahoma Constitution & 68 O.S.
				§§ 2802.1 & 2817.1]
(f)
Physical improvements on limited
				property.
In the event that physical improvements are made to the
				limited property, the improvement shall be valued in the same manner as the
				improvements are presently valued. Examples of physical improvements may
				include, but are not limited to, a room addition, additional square footage, a
				garage, out buildings, enclosed garage, or similar improvements. This
				additional valuation shall be added to the limited value of the property before
				the construction occurred. For example, if the improvements added $5,000 in
				fair cash value to the property, it would be increased by that amount. The
				property may increase up to the applicable valuation limitation in addition to
				the increased amount added by the improvement. The new total value continues to
				be limited as long as the title of the property remains the same. Physical
				additions or changes that are considered normal maintenance such as certain
				normal repairs, minor re-modeling, roof repair or installation, minor energy
				efficiency improvements, or retro fit improvements such as wheelchair ramps
				providing access to the property are not generally considered physical
				improvements affecting the limited value. [
See:
68 O.S.
				§§ 2802.1, 2817.1]
(g)
Effect of conveyance of property.
If title to the property is
				transferred or conveyed, the parcel of real property shall be assessed at fair
				cash value as set forth by Section 8 of Article X of the Oklahoma Constitution.
				This valuation is to be based upon current market value standards rather than
				simply placing the property on at its sale price, and it is the responsibility
				of the county assessor to value the property at fair cash value consistent with
				applicable statutes and ad valorem rules. Any sale occurring during the course
				of a given calendar year shall be valued at fair cash value as specified by
				statute for the following tax year. The county assessor shall continue to be
				responsible for making valuation changes to surrounding properties based on
				current sales information of comparable property within the constitutional
				limitations specified for non-sold properties. [
See:
68 O.S.
				§ 2802.1]
(h)
Omitted
				property.
While accomplishing statutorily mandated duties, the county
				assessor or a deputy will discover unassessed improvements on real property. A
				house and outbuildings, for example, could be on the assessment rolls, but a
				detached garage, second dwelling, or barn, previously unassessed, could be
				discovered. This additional property must be treated as if it was new
				construction and the county assessor should proceed to establish the fair cash
				value of the discovered property. It should be added to the assessment rolls,
				and proper notice provided. The original property will still be subject to the
				applicable valuation limitation, but the additional structure will
not
be subject to the valuation limitation, for that year only.
				This additional property was not on the assessment rolls before, and is to be
				placed on the assessment rolls at fair cash value.
(i)
Clerical errors.
When a
				property has been incorrectly entered on the assessment rolls as a result of
				clerical or data entry error, any error should be corrected. Clerical errors,
				however, are not to be used for general revaluation of the property, except
				that when the error results in a substantial impact on the value of the
				property, it should be corrected when discovered and proper notice provided to
				the taxpayer. For example, a residence that has been incorrectly entered as
				1,000 square feet, instead of 2,000 feet, because of a clerical error should be
				corrected. The clerical error must be a mistake of fact, and the change must
				reflect the actual physical characteristics of the property itself. Clerical
				errors of this nature are not subject to the applicable valuation
				limitation.
(j)
Adjustment of
				damaged properties.
In valuing property damaged by natural causes,
				flood, storms, fires, or other disasters, the county assessor shall adjust the
				value of such properties. When the damage has been repaired, or the property
				fully restored to its previous usage, the improvements made must be disregarded
				for purposes of determining the maximum amount of fair cash value subject to ad
				valorem taxation pursuant to Section 8B of Article 10 of the Oklahoma
				Constitution unless the improvements increase the square footage. The valuation
				limitation outlined in subsection (a) of this Section applies to the
				restoration of the damaged property to the extent the square footage is the
				same as the original property. However, the limitation does not apply to any
				improvements constituting increases in square footage to the original property.
				[
See:
68 O.S. §§ 2802.1, and 2817.1]
Added at 14 Ok Reg 2670,
				  eff 6-26-97; Amended at 15 Ok Reg 3451, eff 7-11-98; Amended at 18 Ok Reg 2796,
				  eff 6-25-01; Amended at 19 Ok Reg 1205, eff
				  5-11-02