CHEYENNE -- The purpose of property owned by charitable organizations must be directly beneficial to the people of the state to qualify for a property tax exemption, according to a bill endorsed Monday by the Wyoming Legislature's Joint Revenue Committee.
The draft legislation is intended to tighten property tax exemptions for benevolent, secret or charitable organizations, including charitable trusts.
The bill will be considered during the Legislature's budget session in February.
Lawmakers say some people have found loopholes in the current law to save money on property taxes.
Rep. Keith Gingery, R-Jackson, worked on the bill with the committee to address a charitable trust in Teton County that claims property tax exempt status to the benefit of the University of Lima in Peru.
There have been other abuses as well, legislators say, which represent loss of tax revenue to county governments.
The bill specifies that only properties used by the organizations for charitable purposes are exempt, not properties used for commercial or private profit.
The legislation would thwart charitable organizations that buy property and claim the exemption, then use some of the property for commercial purposes.
The bill also requires the Wyoming Department of Revenue to report annually to the committee for years 2015 through 2019 on the value of the exemptions granted by the bill. This will enable legislators to find out how much the exemptions are costing county governments.
Sen. Cale Case, R-Lander, a committee member, said there seem to be few claims for new exemptions. The problem apparently is with the existing or older exemptions.
Meanwhile, two bills aimed at allowing counties to capture or share in taxes on construction projects, such as pipelines, died for lack of a motion.
The Wyoming County Commissioners Association supported the bills the past two years because a number of pipelines were constructed in Wyoming with materials purchased out of state.
In one case the state received no revenue from the materials brought into the state because they were legally taxed in another state and received credit for those taxes that were already paid, according to a report from Department of Revenue Director Dan Noble.
One of the bills would have required the Industrial Siting Council to become involved in every multi-state project costing $5 million or more.
The other bill required companies planning multi-county projects to consult with the Department of Revenue on sales taxes before construction begins.
Industry representatives opposed the bills.
"You're making this too complicated," said Bob Tarantola, who represents Black Hills Corporation and other companies.
The intent, he said, is for counties to share revenues for multi-county construction projects.
The Department of Revenue can develop rules to handle those situations, he said.