HB392: requiring the northern New Hampshire correctional facility to make a payment in lieu of taxes to the city of Berlin.

HB 392-FN-LOCAL - AS INTRODUCED

2019 SESSION

19-0381

08/10

HOUSE BILL 392-FN-LOCAL

AN ACT requiring the northern New Hampshire correctional facility to make a payment in lieu of taxes to the city of Berlin.

SPONSORS: Rep. Tucker, Coos 5; Rep. Laflamme, Coos 3; Rep. Y. Thomas, Coos 3; Rep. Noel, Coos 3

COMMITTEE: Municipal and County Government

ANALYSIS

This bill requires the northern New Hampshire correctional facility to make a payment in lieu of taxes to the city of Berlin.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

19-0381

08/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Nineteen

AN ACT requiring the northern New Hampshire correctional facility to make a payment in lieu of taxes to the city of Berlin.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Section; Payment in Lieu of Taxes; Correctional Facility in Berlin. Amend RSA 21-H by inserting after section 15 the following new section:

21-H:16 Payment in Lieu of Taxes; Northern New Hampshire Correctional Facility in Berlin. Notwithstanding any other provision of law, the property of the northern New Hampshire correctional facility in Berlin is exempt from all property taxes of the city of Berlin, provided however that in lieu of the taxes, the department shall make payments to the city of Berlin calculated as follows: Multiply 20 percent of the northern New Hampshire correctional facility's assessed valuation as recorded in the city of Berlin by the local school tax rate for the city for the tax year, commencing April 1, 2019 and as adjusted each subsequent tax year, with the amounts received to be used exclusively for funding the city of Berlin school system. The revenues received shall be in addition to any other state education funding grants or appropriations. The payment in lieu of taxes in this section shall terminate in the subsequent property tax year after the department of education determines that local equalized property valuation per pupil for the city of Berlin has reached 85 percent of the New Hampshire state average.

2 Effective Date. This act shall take effect upon its passage.

LBAO

19-0381

12/27/18

HB 392-FN-LOCAL- FISCAL NOTE

AS INTRODUCED

AN ACT requiring the northern New Hampshire correctional facility to make a payment in lieu of taxes to the city of Berlin.

FISCAL IMPACT: [ X ] State [ ] County [ X ] Local [ ] None

Estimated Increase / (Decrease)

STATE:

FY 2020

FY 2021

FY 2022

FY 2023

Appropriation

$0

$0

$0

$0

Revenue

$0

$0

$0

$0

Expenditures

$423,754

$423,754

$423,754

$423,754

Funding Source:

[ X ] General [ ] Education [ ] Highway [ ] Other

LOCAL:

Revenue

$423,754

$423,754

$423,754

$423,754

Expenditures

$423,754

$423,754

$423,754

$423,754

METHODOLOGY:

This bill requires the northern New Hampshire correctional facility to make a payment in lieu of taxes to the city of Berlin. The payment would be equal to 20 percent of the facility's assessed valuation, as recorded by the city, multiplied by the local school tax rate. The funds received by the city would be used exclusively for funding the Berlin school system. Assuming the current assessed value remains the same for FY 2020 through FY 2023, the Department of Corrections estimated the annual payment as follows:

Current assessed value of the Berlin Prison $142,103,800

20% of the assessed value $28,420,760

2017 City of Berlin school tax rate 0.01491

Payment amount $423,754

The annual payment would continue until the year after the Department of Education determines the local equalized property valuation per pupil for Berlin has reached 85% of the State average. The most recently published state average equalized property valuation per pupil is $983,646 and 85 percent of this amount is $836,099. The current equalized valuation per pupil for Berlin is $282,760.

AGENCIES CONTACTED:

Department of Corrections