Chapter 817
AN ACT
SB 653
Relating to tax exemption for property
subleased by tax-exempt entities; creating new provisions; amending ORS
307.112; and prescribing an effective date.
Be It Enacted by the People of
the State of
SECTION 1. ORS 307.112 is amended to read:
307.112. (1) Real or
personal property of a taxable owner held under lease, sublease or
lease-purchase agreement by an institution, organization or public body, other
than the State of Oregon, granted exemption or the right to claim exemption for
any of its property under ORS 307.090, 307.130, 307.136, 307.140, 307.145 or
307.147, is exempt from taxation if:
(a) The property is used
by the lessee or, if the lessee is not in possession of the property, the
entity in possession of the property in the manner, if any, required by law
for the exemption of property owned, leased, subleased or being
purchased by it; and
(b) It is expressly
agreed within the lease, sublease or lease-purchase agreement that the
rent payable by the institution, organization or public body has been
established to reflect the savings below market rent resulting from the
exemption from taxation.
(2) The lessee or, if
the lessee is not in possession of the property, the entity in possession of
the property shall file a claim for exemption with the county assessor,
verified by the oath or affirmation of the president or other proper officer of
the institution or organization, or head official of the public body or legally
authorized delegate, showing:
(a) A complete
description of the property for which exemption is claimed.
(b) If applicable, all
facts relating to the use of the property by the lessee or, if the lessee is
not in possession of the property, all facts relating to the use of the property
by the entity in possession of the property.
(c) A true copy of the
lease, sublease or lease-purchase agreement covering the property for
which exemption is claimed.
(d) Any other
information required by the claim form.
(3) If the assessor is not
satisfied that the rent stated in the lease, sublease or lease-purchase
agreement has been established to reflect the savings below market rent
resulting from the tax exemption, before the exemption may be granted the
lessor shall provide documentary proof, as specified by rule of the Department
of Revenue, that the rent has been established to reflect the savings below
market rent resulting from the tax exemption.
(4)(a) The claim shall
be filed on or before April 1, except as follows:
(A) If the lease,
sublease or lease-purchase agreement is entered into after March 1 but not
later than June 30, the claim shall be filed within 30 days after the date the
lease, subleaseor lease-purchase agreement is entered into if exemption
is claimed for that year; or
(B) Notwithstanding that
no hardship grounds exist, if a late filing fee is determined, paid and
distributed in the manner provided in ORS 307.162 (2), the claim shall be filed
on or before December 31 of the tax year for which exemption is first claimed.
(b) The exemption first
shall apply for the tax year beginning July 1 of the year for which the claim
is filed. The exemption shall continue so long as the use of the property
remains unchanged and during the period of the lease, sublease or
lease-purchase agreement. If the use changes, a new [application] claim shall be filed
as provided in this section. If the use changes due to sublease of
the property or any portion of the property from the tax exempt entity
described in subsection (1) of this section to another tax exempt entity, the
entity in possession of the property shall file a new claim for exemption as
provided in this section. If the lease, sublease or lease-purchase
agreement expires before July 1 of any year, the exemption shall terminate as
of January 1 of the same calendar year.
SECTION 2. The amendments to ORS 307.112 by section 1
of this 2007 Act apply to tax years beginning on or
after July 1, 2007.
SECTION 3. (1) Notwithstanding the time periods set
forth in ORS 307.112, for the tax year beginning July 1, 2007, a sublessee
qualifying for exemption from property taxation under ORS 307.112 may file a
claim in writing with the county assessor, on forms supplied by the assessor,
by December 31 next following the effective date of this 2007 Act.
(2) If taxes on the
exempt value have been paid, the taxes shall be refunded in the manner
prescribed in subsection (3) of this section. If taxes on the exempt value have
not been paid, the taxes and any interest thereon shall be abated.
(3) The tax collector
shall notify the governing body of the county of any refund required under this
section. Upon receipt of notice from the tax collector, the governing body
shall cause a refund of the taxes and any interest paid to be made from the
unsegregated tax collections account described in ORS 311.385. The refund under
this subsection shall be made without interest. The county assessor and tax
collector shall make the necessary corrections in the records of their offices.
SECTION 4. This 2007 Act takes effect on the 91st day
after the date on which the regular session of the Seventy-fourth Legislative
Assembly adjourns sine die.
Approved by the Governor July 17, 2007
Filed in the office of Secretary of State July 19, 2007
Effective date September 27, 2007
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