Committee advances bill to extend property tax exemption to older commercial and industrial machinery

The House Committee on Taxation voted to advance House Bill 24-06 as amended, a measure that would remove a June 30, 2006 cutoff and allow older commercial and industrial machinery and equipment (CIME) to qualify for an existing property tax exemption.

Reviser staff explained the bill would remove the statutory date that currently limits eligibility and described technical cross-references in KSA 79-2-23 and 79-2-24. Legislative research staff provided county-by-county estimates and said the statewide aggregate value potentially exempted if the amendment were adopted would be roughly 0.81% of present taxable value, with substantial variation across counties.

Committee members asked how the exemption would affect county, city and school district tax bases. Legislative research staff and Division of Property Valuation representative Lynn Kent said the change would shrink the tax base and that local governments could offset the revenue loss by raising mill levies proportionately. Staff also noted existing statutory language that prevents companies from using mergers, consolidations or paper sales to game the exemption; the committee adopted an amendment to clarify and align statutory references and to include telecommunications and railroad machinery in the amended text.

Representative Corbett moved to pass HB24-06 as amended; Representative Long seconded. After a division was called, the committee recorded a roll-call vote of 16 in favor and 2 opposed; the motion carried.

The committee asked legislative staff to prepare clearer county-by-county fiscal estimates for members and to work with the Department of Revenue on any outstanding technical fixes. The reviser said the bill’s effective date could be adjusted (for example to January 1, 2027) to align with local budget and assessment processes.

Action: HB24-06 (amended) was reported out of committee with a recorded committee vote of 16–2.