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Legislative Year: 2020 Change
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Bill Detail: SB20-135

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Title Conservation Easement Working Group Proposals
Status Senate Committee on Finance Refer Amended to Appropriations (03/12/2020)
Bill Subjects
  • Fiscal Policy & Taxes
House Sponsors J. Wilson (R)
D. Roberts (D)
Senate Sponsors J. Sonnenberg (R)
K. Donovan (D)
House Committee
Senate Committee Agriculture and Natural Resources
Date Introduced 01/27/2020
Description

A working group was convened over the 2019 interim pursuant to
House Bill 19-1264 to develop proposed statutes to address certain issues
affecting the creation, valuation, tax treatment, and stewardship of

conservation easements in the state. The bill implements the
recommendations of the working group as follows:
  • Section 1 of the bill modifies the method of calculating the
amount of the state income tax credit that may be claimed
for the donation of a conservation easement. The section
also clarifies the manner in which certain business entities
claim the credit.
  • Section 2 requires the state to provide compensation for
certain taxpayers who were denied state income tax credits
for conservation easements donated between 2000 and
2013 if the federal internal revenue service allowed a
federal income tax deduction for the same donation. The
amount of the compensation is based upon the amount of
the credit that could have been claimed at the time of the
original donation based upon the value of the donation
accepted by the internal revenue service. The amount of
compensation is reduced by any amount that was allowed
to be claimed against Colorado income tax or otherwise
reinstated to the claimant of the compensation. Where a tax
credit was transferred to another taxpayer as transferee, the
bill provides a process for all parties to the transaction to
submit a mutual application for compensation or, if there is
objection, a process to resolve disputes about the
distribution of compensation. The total amount of
compensation to be paid to all claimants is limited to the
amount of unused conservation easement tax credits that
could have been claimed between 2013 and 2019 under an
existing statutory cap amount, but were not claimed. If the
unclaimed amounts are not sufficient to satisfy all claims,
then any unsatisfied claims would be paid in future years.
The cap for each future year would be reduced by the
amount of claims paid; except that the total amount of
claims paid in a year could not exceed 50% of the amount
of the cap for that year.
  • Section 3 requires the director of the division of
conservation to designated an ombudsman to assist in
resolving certain disputes related to conservation
easements.
  • Section 3 also addresses the abandonment of conservation
easements, which occurs when the holder of an easement
no longer fulfills its stewardship obligations with respect to
the easement. The division of conservation is required to
investigate potential abandoned easements, make findings
regarding each easement, and report its findings to the
conservation easement oversight commission
(commission). The commission then conducts a public
hearing on the easement and, if it determines that an
easement is abandoned, appoints a receiver to monitor the
easement. Receivership for an abandoned easement is
limited to 5 years, during which time the commission
reviews the easement and attempts to identify options to
reform the easement, have it assigned to another holder, or
extinguish the easement. A stewardship account is
established to provide for the cost of carrying out the
stewardship obligations resulting from abandoned
easements. A specified amount of money is appropriated to
the stewardship account for the 2020-21 fiscal year, with a
corresponding reduction in the amount of conservation
easement tax credits that can be claimed for one year.

Committee Reports
with Amendments
Full Text
Full Text of Bill (pdf) (most recent)
Fiscal Notes Fiscal Notes (02/11/2020) (most recent)  
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  • Past fiscal notes
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