[S. 888, 84th Cong., 1st sess.] 4

A BILL To make temporary provision for the payment of taxes, or the making of payments in lieu of taxes, with respect to certain real estate held by Government corporations, or transferred by them to other Government agencies, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Government Corporation Real Property Tax Adjustment Act of 1955."

DECLARATION OF POLICY

SEC. 2. The Congress recognizes that the transfer of real property having a taxable status from a Government corporation to another Government agency often operates to remove such property from the tax rolls of local taxing authorities, thereby creating an undue and unexpected burden upon such local taxing authorities and causing disruption of their operations. It is the purpose of this Act to furnish temporary measures for the relief of such local taxing authorities by providing for (1) the taxation of real property transferred on or after June 22, 1948, by Government corporations to other agencies of the Federal Government while such property is held under lease from such agencies by nongovernmental individuals and organizations, (2) the taxation of real property held by Government corporations created after the effective date of this Act, and (3) the making of payments in lieu of taxes with respect to certain real property transferred on or after June 22, 1948, by Government corporations to other departments and agencies of the Federal Government while such property is in the custody of those departments and agencies.

SEC. 3. AS used in this Act

DEFINITIONS

(a) The term "State" means each of the several States of the United States and the Territories of Alaska and Hawaii.

(b) The term "real property" means (1) any interest in land and (2) any improvement made thereon prior to transfer thereof by any Government corporation to any Government department, if such improvement for the purpose of taxation is characterized as real property by the law of the State in which such land is situated.

(c) The term "local taxing authority" means any State, county, or municipality, and any subdivision of any State, county, or municipality, which is authorized by the law of such State to levy and collect taxes upon real property.

(d) The term "real property tax" shall not include any special assessment levied upon real property after the date of its transfer by any Government corporation to any Government department.

(e) The term "Government corporation" means any wholly owned or mixedownership Government corporation named in the Government Corporation Control Act, as amended (31 U. S. C. 846, 856), and any other corporation owned or controlled by the United States or any Government department if such corporation is incorporated, after the effective date of this Act, by or pursuant to any Act of Congress.

(f) The term "Government department" means any department, agency, or instrumentality of the United States, including any Government corporation.

(g) The term "person" means any individual, partnership, private corporation, or other entity, but does not include any Government departinent or any entity exempted by law from the payment of real property tax.

(h) The term "transfer" means the transfer of (1) legal title to any real property, or (2) custody and control, or accountability for the care and handling, of any real property.

PROPERTY HELD BY GOVERNMENT CORPORATIONS

SEC. 4. Unless otherwise specifically provided by law, all real propety owned by any Government corporation incorporated on or after the effective date of this Act shall be subject to real property taxes levied by local taxing authorities to the same extent according to its value as other real property situated within the territorial jurisdiction of such authorities.

See supra, note 1.

PROPERTY TRANSFERRED BY GOVERNMENT CORPORATIONS

SEC. 5. (a) When real property of any Government corporation subject to real property tax levied by any local taxing authority has been transferred on or after June 22, 1948, to any Government department, and such department (or any other department to which such property subsequently has been transferred) has executed a lease under which custody or control of such property has passed to any other person, such property for the duration of such lease shall be subject to real property taxes levied by such local taxing authority to the same extent according to its value as other real property situated within the terriorial jurisdiction of such authority.

(b) When real property of any Government corporation subject to real property tax levied by any local taxing authority has been transferred on or after June 22, 1948, to any Government department, such department (and any other department to which such property subsequently has been transferred) shall, for the period of its custody and control thereof, or its accountability therefor, for which no payment is authorized under subsection (a), pay annually to such local taxing authority a sum equal to (1) the amount of the real property tax which would be payable to such authority on account of such property if during such period legal title thereto had been held by any other person, reduced by (2) the aggregate amount determined by the head of such department to be a fair and just deduction (A) for benefits to such local taxing authority arising out of operations of any Government corporation or department with respect to such real property (including payment of any portion of the revenue derived from the use or products of such real property), and (B) for the cost to any Government corporation or department of furnishing services with respect to such real property which normally are furnished by local taxing authorities.

LIMITATIONS

SEC. 6. (a) The failure of Government corporation or department to make, or to make timely payment of, any payment authorized by this Act shall not subject

(1) any Government corporation or department, or any person who is a subsequent purchaser of any real property from any such corporation or department, to the payment of any penalty or penalty interest, or to any payment in lieu of any penalty or penalty interest; or

(2) any real estate or other property or property right to any lien, attachment, foreclosure, garnishment, or other legal proceeding.

(b) No payment shall be made under section 5 of this Act with respect to any real property of any of the following categories:

(1) Real property taxable by any local taxing authority under any other provision of law, or with respect to which any payment in lieu of taxes is payable under any other provision of law.

(2) Real property used or held primarily for any purpose for which property owned by any private person would be exempt from real property taxation under the constitution or laws of the State in which the property is situated.

(3) Real property used or held primarily for the rendition of service to or on behalf of the local public, including (but not limited to) the following categories of property: Defense installations; courthouses; post offices and other property used for purposes incidental to postal operations; and federally owned airports maintained and operated by the Civil Aeronautic Administration.

(4) Office buildings and facilities which are an integral part of, or are used for purposes incidental to the use made of, any properties described in paragraph (1), (2), or (3), of this subsection.

(c) Nothing contained in this Act shall establish any liability of any Government corporation or department for the payment of any tax, or for any payment in lieu of taxes, with respect to any real property for any period after December 31, 1957.

EFFECTIVE DATE

SEC. 7. This Act shall take effect as of January 1, 1955.

[S. 1566, 84th Cong., 1st sess.]

A BILL Establishing a general policy and procedures with respect to payments to State and local governments on account of Federal real property and tangible personal property, and for other purposes

Be it enacted by the Senate and House of Represenatives of the United States of America in Congress assembled, That this Act may be cited as the "Act for Payments to State and Local Governments on Federal Real Property."

Sec. 1. Short title.

Sec. 2. Declaration of policy.

TABLE OF CONTENTS

Sec. 3. Definitions.

TITLE I-PAYMENTS ON TAX-EXEMPT PROPERTIES

Sec. 101. Payments on certain properties serving national interests.

Sec. 102. Payments on housing properties.

Sec. 103. Exemptions.

Sec. 104. Transition payments.

TITLE II-CONSENT TO STATE AND LOCAL TAXATION

Sec. 201. Taxation of property acquired in connection with loans or contracts of insurance

or guaranty.

Sec. 202. Taxation of property under lease or conditional-sale contracts.

TITLE III-CONSENT TO SPECIAL ASSESSMENTS

Sec. 301. Property subject to special assessments.

TITLE IV-PAYMENTS TO LOCAL GOVERNMENTS NOT OTHERWISE COMPENSATED FOR

SUBSTANTIAL FINANCIAL BURDENS

Sec. 401. Authority to establish supplementary system of payments.

TITLE V- GENERAL PROVISIONS

Sec. 501. Commission for payments to State and local governments on Federal real property.

Sec. 502. Advisory committee.

Sec. 503. Applications for payments.

Sec. 504. Determination and method of payment.

Sec. 505. Applicability.

Sec. 506. Authorization for appropriations.

Sec. 507. Exemption from Administrative Procedure Act.

Sec. 508. Repeal and savings provisions.

Sec. 509. Separability.

Sec. 510. Effective date.

DECLARATION OF POLICY

SEC. 2. (a) Although the Federal Government is under no constitutional obligation to pay taxes or to contribute to the States or local governments any sums in lieu of taxes on account of property owned by the Federal Government, the Congress declares that it is the policy of the United States to avoid insofar as feasible the impairment of the finances of State and local governments through the acquisition of real or certain tangible personal property by the Federal Government or through requirements for State or local governmental services arising directly from Federal ownership or use of real or certain tangible personal property. Officials and employees of the Federal Government, in administering this Act, shall be guided by the general objective of avoiding, insofar as feasible, inequities between the taxpayers of particular State and local governments on the one hand and the taxpayers of the Federal Government on the other hand in the distribution of tax burdens and governmental costs associated with the ownership or use of property by the Federal Government.

(b) The Congress declares further that, in consideration of the general system of payments herein provided, State and local governments will be expected, when requested, to make available public services for Federal Government properties and the residents thereon upon the same terms as are accorded to other properties or residents.

SEC. 3. AS used in this Act-

DEFINITIONS

(a) "Federal" or "Federal Government" means the United States of America and the Government thereof, including all its departments, agencies, boards, and commissions and all corporations subject now or hereafter to the provisions of title I of the Government Corporation Control Act (December 6, 1945; ch. 557, 59 Stat. 597; 31 U. S. C. 846-852).

(b) "Federal agency", "owning agency", or "Federal owning agency" means any part of the Federal Government which has jurisdiction over or administers Federal real or tangible personal property.

(c) "Federal property" or "Federal properties" means only Federal real property and Federal tangible personal property as defined herein.

(d) "Federal real property" means real property the title to which is in the Federal Government and real property held in trust for individuals or groups of individuals by the Federal Government which, by reason of such trusteeship, is not subject to taxation by States and local governments. "Federal real property", however, shall not include

(1) subsurface mineral rights if title to the surface rights of the land is not also held by the Federal Government;

(2) low-rent housing projects acquired or held under

(A) section 202 (d) of the National Industrial Recovery Act of 1933, as amended (ch. 90, title II, 48 Stat. 201 ; 40 U. S. C. 402 (d));

(B) the Emergency Relief Appropriation Act of 1935 (April 8, 1935; ch. 48, 49 Stat. 115);

(C) the United States Housing Act of 1937 (September 1, 1937; ch. 896, 50 Stat. 888), as amended and supplemented by the Housing Act of 1949 (July 15, 1949; ch. 338, 63 Stat. 413; 42 U. S. C. 1401–1433);

(D) title II of the Act of June 28, 1940 (ch. 440, 54 Stat. 681), as amended October 26, 1942 (ch. 626, 56 Stat. 988; 42 U. S. C. 1501-1504), other than any project for the period during which such project is found by the President to be needed to house persons engaged in national defense activities; nor

(3) public-domain lands. As used herein the term "public-domain lands" means lands acquired from the Thirteen Original States or another country by cession, purchase, or treaty during the period from 1781 to 1867 and which never left Federal ownership; lands which have been made subject to publicland laws by statute; lands in Federal ownership which were obtained by the Government in exchange for such lands or for timber on such lands; lands which have reverted to Federal ownership through operation of publicland laws; or lands transferred for administration under public-land laws. As used herein, “public-domain lands" do not, however, include lands withdrawn under Act of Congress or under the powers of the President from the operation of the public-land laws for use by a Federal agency to carry out an activity or responsibility of that agency other than the administration, management, and protection of the public-domain lands, or the resources on such lands.

(e) "Federal tangible personal property" means tangible personal property the title to which is in the Federal Government; but "Federal tangible personal property" shall include only that tangible personal property owned by the Federal Government which, by reason of its attachment to real property, has a fixed location.

(f) "Acquire" means to vest title in the Federal Government by purchase, exchange, condemnation, donation, devise, revestment, or bequest.

(g) "Industrial" refers to activities involving primarily, or to properties the ownership or use of which involves primarily, the processes of mining, manufacture, fabrication, repair, generation of electrical energy, transportation, storage. or any similar process of a type commonly carried on by private enterprise. (h) "Commercial" refers to activities involving primarily, or to properties the ownership or use of which involves primarily, the sale or resale, rent, or lease of commodities or the sale of services when the commodities or services are of a type commonly provided by private enterprise.

(i) "State" and "States" means the several States and Territories of the United States of America.

(j) "Local government" means any county, city, municipality, or other political subdivision or public entity of any State having authority under State laws to levy and collect taxes upon real or tangible personal property or to levy and collect special assessments upon real property.

(k) "Person" means an individual, partnership, corporation, association, or public or private organization of any character other than a Federal agency.

(1) Except in title IV, "tax" means a levy according to value upon real property or tangible personal property. For purposes of title IV, "tax" shall not be limited to a levy on real property or tangible personal property.

(m) "Tax year" means the year beginning with the tax assessment date or tax lien date, whichever establishes tax liability in the jurisdiction concerned.

69937-56-pt. 1--2

In the event an assessment period is used by the taxing jurisdiction and no single assessment date or lien date fixing tax liability is determinable with respect to the property, then the first day of the assessment period shall be the beginning of the tax year. (.

(n) "Average effective tax rate" means the average nominal tax rate adjusted to reflect the current average relationship of assessed value to fair value property.

(o) "Commission" means the Commission established by subsection 501 (a) of this Act.

TITLE I-PAYMENTS ON TAX-EXEMPT PROPERTIES

PAYMENTS ON CERTAIN PROPERTIES SERVING NATIONAL INTERESTS

SEC. 101. (a) Payments to State or local governments under this section are hereby authorized on account of Federal property used or held for activities which serve primarily national or broad regional interests and which activities do not serve primarily the local public. The provisions of this section shall not apply to

(1) any property subject to the provisions of section 102, section 103, or title II of this Act except as provided in subsection 101 (c) herein;

(2) any property acquired or constructed by the Federal Government prior to January 1, 19-, unless the Federal Government, on or after January 1, 19-, has made payments to the applicant State or local government of taxes or in lieu of taxes on such property or of any portion of the revenue derived from such property or from its use or products; and

(3) any real property (other than improvements constructed by the Federal Government on or after January 1, 19–) which has never been subject to taxes imposed by the applicant State or local government, unless the Federal Government, on or after January 1, 19-, has made payments to the applicant State or local government in lieu of taxes on such property or of any portion of the revenue derived from such property or from its use or products, or unless the applicant government came into existence, through incorporation or otherwise, after the effective date of this Act.

Nothing in this section, except as provided in subsection (e), shall be construed as altering the provisions of Federal statutes listed in subsection 508 (a) (2) of this Act which require or authorize the Federal Government to make payments to State or local governments. As long as any Federal property continues to be devoted to the use or uses for which payments are required or authorized under any such Federal statute, the property shall not be subject to the provisions of this section other than as provided in subsection (e).

(b) State or local governments shall be eligible for annual payments on property subject to the provisions of this section, but no payment shall be made to a State or local government which does not provide its services to Federal properties or to residents thereon upon the same terms as are accorded to other properties or residents, unless the provision of such services is deemed by the Federal owning agency not to be necessary or desirable. The amount of any such payment to a State or local government under the provisions of this section shall be determined by each Federal owning agency in accordance with rules and regulations promulgated under section 501 of this Act. Any rules and regulations promulgated by the Commission shall require consideration of the following factors to the extent that each is pertinent and shall specify or recommend the relative weights to be given them:

(1) The average amount of taxes, if any, charged annually against the property for the last two years in which is was in taxable ownership and also the tax delinquency, if any, of such property for the same two years, but consideration of these facts may be omitted in the case of property owned by the Federal Government for more than five years immediately preceding the tax year to which the application for payment relates.

(2) The average amount of the last two annual payments, if any, under the provisions of any statute or agreement authorized by any statute, previously applicable, which authorized the United States or any agency or instrumentality thereof to make payments in lieu of taxes thereon or to pay any portion of the revenue derived therefrom or from its use or products, but this factor may be omitted in the case of Federal property which has not been subject to the provisions of any such statute within five years immediately preceding the tax year to which the application for payment relates.