Idaho State Tax Commission

Idaho State Tax Commission

Operating Property

The Idaho State Tax Commission is responsible for appraising all operating property in the state.

Operating property defined

Operating property, also known as centrally assessed property, generally includes all property operated in connection with any public utility, railroad, or private railcar fleet, located wholly or partially in Idaho. For a complete definition of operating property, see Idaho Code section 63-201(16).

The following industry types are classified as operating property:

  • Electricity (and cooperative electricity) generation, transmission, and distribution
  • Regulated telecommunications
  • Water transportation and distribution
  • Petroleum
  • Gas transmission and distribution
  • Railroads
  • Private railcar fleets
  • Gas transmission and distribution
  • Anaerobic digesters
  • Non-utility generators
  • Wind farms (in place of property taxes; see Idaho Code sections 63-3502, 63-602JJ)
  • Gas and oil gathering lines (beginning in 2015)

Appraisal of operating property

The unit method of valuation is preferred for valuing a railroad or public utility when the individual assets function collectively, are operated under one ownership and one management, are interdependent, and the property would be expected to trade in the marketplace as a unit. Under the unit method, the value of the tangible and intangible property is equal to the value of the going concern. The market value of the unit is referred to as the "system value." For interstate property, allocation factors are used to determine what part of the system value is in Idaho. For more information, review Property Tax Rule 405 and Idaho Code section 63-405. Certain intangibles are exempt (see Idaho Code section 63-602L and Property Tax Rule 615) while other intangibles are taxable.

Example: An owner of operating property has property and provides services in Idaho and nine other states. The total property in all 10 states is appraised as an operating unit. Part of the total value is then allocated to Idaho based on its presence within the state.

Appraisal of all operating property is done annually. Every person or company owning operating property in Idaho is required to file a report (operator’s statement) with the Tax Commission by April 30 of each year. This report may include asset listings, financial statements, reports to stockholders, and reports to regulatory agencies.

Reporting operating property

Some property may be classified as nonoperating. Nonoperating property generally includes assets owned, but not reasonably necessary for the maintenance and operation of the business. For more information see Idaho Code section 63-402.

Property is identified as either operating or nonoperating when the owner files a record of real estate ownership (Form R) with the Tax Commission. After a review by the Tax Commission, the Form R is sent to each county where the property is located. Nonoperating property is appraised at the local level by the county assessor rather than by the Tax Commission.

Operating property owners obtain an operator’s statement form and submit it to the Tax Commission. Included in the statement is a report identifying the location of the company's property by county and tax code area. For property tax purposes, each county in Idaho is divided into tax code areas that are determined by the boundaries of taxing districts. Rather than reporting individual property items by specific location, the companies generally report the location and length of their wire, pipe, or rail in a particular tax code area. For more information, see Idaho Code sections 63-404 and 63-411, and Property Tax Rules 404 and 411 - 417.

Apportionment

Apportionment is the process of assigning the value of operating property to the appropriate taxing district.

It's done by calculating the value per mile of wire, pipe, or rail in Idaho and applying this rate per mile to each tax code area in which the wire, pipe, or rail is located. Apportionment for electric companies is done on a rate per wire mile for each county.

Some items, such as leased equipment and microwave facilities, are reported separately and assessed at their actual physical location. When a property is located in only one tax code area, no apportionment is necessary. For more information on apportionment, see Idaho Code section 63-405 and Property Tax Rules 405 and 413 - 417.

Appeals

If an operating property owner disagrees with the appraised property value, the owner can meet with the appraiser to informally discuss the valuation and can also request a formal hearing before the Tax Commission. The owner must request a formal hearing before August 1. For more information on appeals, see Idaho Code sections 63-406 through 63-410 and Property Tax Rules 407 and 408.

Map orders

Every year Idaho counties submit tax code area changes to the Tax Commission’s Geographic Information Systems (GIS) section of the Property Tax Division. Digital copies of the maps for these tax code areas are available to the operating property owners, at no charge, on our website’s GIS and Property Tax page. You can also purchase CD or paper versions of these maps.

More information

Assessments for operating property (also known as centrally assessed property) are developed by the Property Tax Division's Operating Property Bureau. If you have questions, please contact that bureau or review these operating property brochures, forms, and statements.

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Last updated Aug. 21, 2014