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City officials seek to fix bill exempting RVs from property tax

LACONIA — City officials and state lawmakers are scrambling to fix a bill that threatens to shrink the city's total assessed valuation by $10 million, trim its property tax revenues by $200,000 and add 10 cents to its property tax rate.

Senate Bill 333, sponsored by Sen. Jeanie Forrester (R-Meredith), would exempt from property taxation recreational vehicles remaining in any one city, town or unincorporated place for fewer than 45 days as well as recreational vehicles stored or placed rented on a rented campsite at a recreational campground or camping park no matter for how long.

The bill carried the Senate by a unanimous vote of 24-0 in January and is scheduled to be heard by the House Municipal and County Government Committee of Tuesday, April 1, at 10:30 a.m.

The statutory definition of a recreational vehicle includes motor homes, vans, pickup campers and tent trailers as well as recreational trailers of 400 square feet or less. The definition includes so-called "park models," which may be 12-feet and 36-feet long with pitched roofs and gabled windows that resemble miniature cottages with room to sleep as many as 10 people.

Jon Duhamel, the city assessor, has counted 423 recreational vehicles parked at a dozen campgrounds year around with an aggregate assessed value of $9,994,500. They have been taxed for years, but would become exempt from property tax if the bill were enacted. He estimates that the city would forgo more than $220,000 in revenue.

Meanwhile, at Bristol Shores on Newfound Lakes in Bristol, Christina Goodwin, the assessing assistant, said there are 183 "park models" with a total value of nearly $8 million that would become exempt from property tax, representing almost $160,000 in foregone revenue to the town. In Alton, Tom Sargent, the assessor, said that currently there are 147 units with a value of $900,000, but a campground with space for another 147 is in the offing. "Because our tax rate is so low the revenue impact is only about $12,000," Sargent said," but that pays for a part-time secretary."

Laconia City Manager Scott Myers contends that recreational vehicles permanently parked in campgrounds do not comply with the intended definition of a recreational vehicle, but are more akin to seasonal camps and cabins of fewer than 400 square feet on private lots, which are liable to property taxation. He points out that these recreational vehicles are not registered as either motor vehicles or trailers, a sign that their owners, most of whom reside in another state, do not intend to move them. Likewise, he notes that manufactured housing is defined as a unit of 320 square feet or more, while units that qualify as recreational vehicles, which are in campgrounds throughout the year, measure between 369 square feet and 408 square feet. He questions if the distinction is sufficient to tax one but not the other.

Apart from the loss of revenue, Myers claims that those living in these units avail themselves of municipal services, if only on a seasonal basis, and should contribute an equitable share to their cost.

Forrester introduced the legislation at the request of the New Hampshire Campground Owners Association, whose lobbyist Henry Veilleux this week proposed an amendment intended to mitigate the fiscal impact on municipalities. The amendment would exempt only those recreational vehicles less than eight-feet, six inches in width, leaving all wider units liable to property taxation.

Veilleux said that this provision would entitle municipalities to tax the "park models," which represent the bulk of the assessed valuation of recreational vehicles. He estimated that the amendment would enable Laconia to recapture at $6,568,000, or 66 percent, of the assessed valuation. The amendment would leave all the units at Bristol Shores taxable.

Myers expressed reservations, explaining that the issue was not confined to the "park models." He said that other units meeting the statutory definition of a recreational vehicle were effectively permanent, if seasonally occupied, structures, many with porches, decks and other extensions. "They are not intended to be moved," he said.

The issue arose in the wake of two court decisions. In 1999, the New Hampshire Supreme Court ruled that a truck trailer could be assessed and taxed as a building "if by its use it:  (1) is intended to be more or less permanent, not a temporary structure;  (2) is more or less completely enclosed;  (3) is used as a dwelling, storehouse, or shelter;  and (4) is intended to remain stationary." Two years later the Belknap County Superior Court applied this standard to eight trailers at the Hack-Ma-Tack Campground at The Weirs, when the City of Laconia taxed eight trailers on the property as buildings.

On the strength of the court decisions, the New Hampshire Department of Revenue Administration (DRA) urged municipalities to apply the criteria strictly. Some did, but others found the cost of assessing the units and billing their owners, many of whom reside outside the state, outweighed the revenue collected.

Forrester said that she received calls from campground owners and municipal officials in different communities troubled by the inconsistent application of the law. In particular, she found that recreational vehicles parked at the 117 campgrounds in the state were treated differently by different municipal assessors. Some are taxed as real property while others are not. Some municipalities bill the owners of the recreational vehicles while others, unable to identify the owners, bill the owners of the campgrounds. Her bill, she said, is intended to bring order to what she called "a crazy quilt."

 
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