Chapter 800 Oregon Laws 1999

Session Law

AN ACT

HB 2375

Relating to taxation; creating new provisions; and amending ORS 321.372, 321.760 and 321.825 and section 36, chapter 314, Oregon Laws 1999 (Enrolled Senate Bill 248).

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 321.372 is amended to read:

321.372. (1) If and when the designation of forestland is removed pursuant to ORS 321.359 from any parcel of designated forestland, the assessor shall notify the owner of the land and there shall be added to the tax extended with respect to such property on the next tax roll an amount equal to the difference between the taxes assessed against the land and the taxes that would otherwise have been assessed against the land had the land not been in forestland designation for each of the last five years (or such lesser number of years, corresponding to the number of years of forestland designation of such property) preceding the year in which the land was disqualified for such designation.

(2) When the designation of forestland is removed as a result of a sale or transfer described in ORS 321.359 (1)(b)(B), the lien of such increased taxes described in subsection (1) of this section shall attach as of the date preceding such sale or transfer.

(3) The amount determined to be due pursuant to subsection (1) of this section may be paid to the tax collector prior to completion of the next general property tax roll, pursuant to ORS 311.370.

(4) Additional taxes collected under this section shall be deemed to have been imposed in the year to which the additional taxes relate.

(5) Additional taxes may not be collected under this section, and a lien may not attach under subsection (2) of this section, if the designation of forestland is removed as a result of the forestland being acquired by a federal, state or local governmental agency.

SECTION 1a. If Senate Bill 248 becomes law, section 1 of this 1999 Act (amending ORS 321.372) is repealed and section 36, chapter 314, Oregon Laws 1999 (Enrolled Senate Bill 248), is amended to read:

Sec. 36. Notwithstanding that land may have been disqualified from special assessment, no additional taxes may be imposed under section 34, chapter 314, Oregon Laws 1999 (Enrolled Senate Bill 248), [of this 1999 Act] if, as of the date the disqualification is taken into account on the assessment and tax roll, the land is any of the following:

(1) Acquired by a governmental agency as a result of the lawful exercise of the power of eminent domain or the threat or imminence thereof[, except that in the case of disqualified forestland, only if acquisition was for use as a park or recreation area].

(2) Acquired by purchase, agreement or donation under ORS 390.121 (relating to State Parks and Recreation Commission acquisitions).

(3) Acquired by a city, county, metropolitan service district created under ORS chapter 268 or park and recreation district organized under ORS chapter 266 for public recreational purposes or for the preservation of scenic or historic places.

(4) Acquired for wildlife management purposes under ORS 496.146.

(5) Public property that was leased or rented to a taxable owner as described in ORS 307.110 at the time of disqualification, and the reason for the disqualification was the termination of the lease under which the land was assessed.

(6) Land that ceases to be located within the boundaries of an exclusive farm use zone as the result of a change in the boundaries of the zone or removal of the zone following an action by the governing body of the county or city that:

(a) Was not requested or initiated by the owner of the land; or

(b) Was requested by:

(A) The State Parks and Recreation Department for public park purposes under ORS 390.121; or

(B) The State Fish and Wildlife Commission for wildlife management purposes under ORS 496.146.

(7) Declassified as Western Oregon Small Tract Optional Tax forestland under ORS 321.760 (1)(c) and (d) because:

(a) The State Forester has determined that the predominant use of the land is for the production of cultured Christmas trees; or

(b) Notwithstanding ORS 321.727, the land is transferred to an owner who, upon completion of the transfer, has a total ownership of forestland in western Oregon of less than 10 acres.

(8) Forestland acquired by a federal, state or local governmental agency. In the case of an acquisition described in this subsection, a lien for additional taxes and interest may not attach on the day preceding the day of transfer of the forestland to the governmental agency.

SECTION 2. ORS 321.760 is amended to read:

321.760. (1) The State Forester shall certify to the owner involved, and to the appropriate county assessor or assessors, the removal from classification of any forestland previously classified under ORS 321.705 to 321.765 when:

(a) The owner requests such declassification in writing. A request for declassification under this paragraph shall apply to all of the forestlands that are classified under ORS 321.705 to 321.765 and located within a single tax lot.

(b) The State Forester determines, after investigation, that the forestland is no longer entitled to classification under ORS 321.705 to 321.765.

(c) Pursuant to ORS 321.705, the State Forester determines that the predominant use of the land is for the production of cultured Christmas trees.

(d) Notwithstanding ORS 321.727, the land is transferred to an owner who, upon completion of the transfer, has a total ownership of forestland in western Oregon of less than 10 acres.

(e) Pursuant to ORS 92.102, the State Forester receives notification from the county assessor that a subdivision plat has been recorded under ORS chapter 92.

(2)(a) Forestland shall be declassified upon sale or transfer to an ownership making it exempt from ad valorem property taxation. Except as provided by this paragraph, the sale or transfer to a new owner or the transfer by reason of death of a former owner to a new owner shall not operate to declassify the land so long as the land continues to meet all of the eligibility requirements under ORS 321.725 and 321.730, except that the land need not meet the requirement that the predominant size of timber on the forestland be eight inches in diameter (breast high), outside the bark or of an average age of less than 40 years. However, the county assessor shall notify the State Forester if a sale or transfer of the forestland occurs for the purpose of determining the continued eligibility of the forestland for classification under ORS 321.705 to 321.765.

(b) The lien for increased taxes and interest on land declassified shall attach on the day preceding a sale or transfer of the land making it exempt from ad valorem taxation or on the day preceding a sale or transfer that follows or is connected with a division of the land that results in its declassification.

(c) The additional taxes determined under this section shall be deemed assessed and imposed in the year to which the additional taxes relate.

(3) Upon declassification there shall be added to the tax extended against the land, on the next property assessment and tax roll, to be collected and distributed in the same manner as ad valorem taxes on real property, an amount equal to the sum of:

(a) An additional tax in the amount of the difference between the taxes assessed against the land and the taxes that would otherwise have been assessed against the land had the land not been designated as forestland for each of the last five years (or such lesser number of years, corresponding to the number of years of small tract optional tax classification applicable to the property) preceding the year in which the land was disqualified for special classification;

(b) The amount of privilege taxes which would have been payable under ORS 321.257 to 321.322, during the five years immediately preceding such extension on the tax roll; and

(c) Interest on the amounts of taxes added pursuant to paragraph (b) of this subsection at the rate of six percent a year from the date at which such increased taxes would have been payable if the forestland had been valued without regard to ORS 321.720.

(4)(a) Declassifications certified under this section shall take effect as of the date that the notice of declassification is sent by certified mail or delivered by the State Forester to the owner. If the declassification is effective before July 1, the declassification shall apply for the ensuing tax year. However, if the declassification is effective on or after July 1, classification shall continue for the current tax year and declassification shall apply for the tax year beginning the following July 1.

(b) A notice of declassification mailed or delivered under this section shall inform the owner of the land of ORS 321.960 and the opportunity, if qualified to do so, to change to classification or designation under one of the other special assessment laws listed in ORS 321.960. The notice shall be in lieu of any further notice required under ORS 321.960 (5) and shall contain the information required in a notice given under ORS 321.960 (5).

(5) The amount determined to be due under subsection (3) of this section may be paid to the tax collector prior to completion of the next general property tax roll, pursuant to ORS 311.370.

(6) No additional tax shall be imposed under subsection (3)[(a) or (b)] of this section if:

(a) The forestland or portion thereof that is declassified is designated as forestland at the election of the owner pursuant to ORS 321.347 (4) and section 45, chapter 892, Oregon Laws 1977. If the land is later removed from designation under ORS 321.257 to 321.381, however, the land shall be subject to the back taxes imposed by ORS 321.372 in the manner provided in ORS 321.347 (4) (relating to computation of the period of classification as designated forestland).

(b) The land is changed to assessment under ORS 308.370 or 321.257 to 321.381 pursuant to ORS 321.960. If the land is later removed from special assessment as farm or forest land, however, the additional tax under ORS 321.960 (4) shall apply.

(d) The forestland is declassified as a result of the forestland being acquired by a federal, state or local governmental agency. Notwithstanding subsection (2) of this section, in the case of a declassification of forestland that is described in this paragraph, a lien for increased taxes and interest may not attach on the day preceding the day of transfer of the forestland to the governmental agency.

SECTION 2a. If Senate Bill 248 becomes law, section 2 of this 1999 Act (amending ORS 321.760) is repealed.

SECTION 3. ORS 321.825 is amended to read:

321.825. (1) Whenever land designated as forestland as a result of an application being filed therefor under ORS 321.805 to 321.825 thereafter becomes disqualified, there shall be added to the tax extended against the land on the next property assessment and tax roll, to be collected and distributed in the same manner as the remainder of the real property tax, an additional tax equal to the difference between the taxes assessed against the land and the taxes that would otherwise have been assessed against the land had the land not been designated as forestland for each of the last five years (or such lesser number of years, corresponding to the number of years of forestland designation applicable to such property) preceding the year in which the land was disqualified for forestland designation.

(2) In cases where the designation of forestland is removed as a result of a sale or transfer described in ORS 321.820 (1)(b)(B), the lien for such increased taxes and interest shall attach as of the day preceding such sale or transfer.

(3) The amount determined to be due under subsection (1) of this section may be paid to the tax collector prior to the time of the next general property tax roll, pursuant to the provisions of ORS 311.370.

(4) The additional taxes shall be deemed assessed and imposed in the year to which the additional taxes relate.

SECTION 3a. If Senate Bill 248 becomes law, sections 3 (amending ORS 321.825) and 4 of this 1999 Act are repealed.

SECTION 4. The amendments to ORS 321.372, 321.760 and 321.825 by sections 1 to 3 of this 1999 Act apply to transfers of forestland occurring on or after January 1, 2000.

Approved by the Governor July 20, 1999

Filed in the office of Secretary of State July 20, 1999

Effective date October 23, 1999

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