68th OREGON LEGISLATIVE ASSEMBLY--1995 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 3324
House Bill 3133
Sponsored by Representative BEYER
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Expands application of property tax exemption granted for
multiple-unit rental housing in core area to housing in transit
corridors, stories added over commercial buildings, conversion of
single-story commercial property to housing units and housing
units constructed on surface parking lots. Applies to
construction, addition or conversion completed in calendar years
beginning on or after 1996 and to tax years beginning on or after
July 1, 1997.
A BILL FOR AN ACT
Relating to property tax exemptions for multiple-unit rental
housing; creating new provisions; and amending ORS 307.600,
307.605, 307.610, 307.620, 307.630, 307.650, 307.660, 307.670,
307.675 and 307.690.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 307.600 is amended to read:
307.600. { + (1) + } The legislature finds that it is in the
public interest to stimulate the construction of rental housing
in the core areas of Oregon's urban centers to improve the
balance between the residential and commercial nature of those
areas, and thus, to insure full-time use of these areas as places
where citizens of the community have an option to live as well as
work. { +
(2) + } The legislature further finds that cities of this state
should be enabled to establish and design programs to attract new
development of rental housing in their core areas based on the
incentive of a local property tax exemption, which is authorized
under ORS 307.600 to 307.690. { + The + } { - Such - }
programs shall emphasize { + the following:
(a) + } The development of vacant or underutilized sites in the
core areas, rather than sites where sound or rehabilitable
multiple-unit rental housing exists { + . + } { - , and - }
{ + (b) The development of multiple-unit rental housing, with
or without parking, above structures in which the ground floor is
used for commercial purposes or on sites with existing
single-story commercial structures.
(c) The development of multi-unit rental housing, with or
without parking, on existing surface parking lots.
(3) The programs + } shall result in the construction { + ,
addition or conversion + } of units at rental rates accessible to
a broad range of the general public.
SECTION 2. ORS 307.605 is amended to read:
307.605. As used in ORS 307.600 to 307.690 { + , + }
'multiple-unit housing' means newly constructed structures { + ,
stories or other additions to existing structures and structures
converted in whole or in part from other use to multiple family
use which meet the following criteria:
(1) The structure must have + } { - having as - } a minimum
{ - a - } number of rental dwelling units { + , the number + }
specified by the city pursuant to ORS 307.610 (4) { + .
(2) The structure must + } { - and - } not { + be + }
designed or used as transient accommodations { + , including but
not limited to + } { - and not including - } hotels and motels
{ - , but including such - } { + .
(3) The structure must have those + } design elements
benefiting the general public as specified by the city pursuant
to ORS 307.650. { - Included in the definition are newly
constructed structures and structures converted in whole or in
part from other use to multiple family use. - } { +
+ } { + SECTION 3. + } ORS 307.610 is amended to read:
307.610. (1) ORS 307.600 to 307.690 apply to multiple-unit
rental housing constructed { + , added to or converted + }
{ - after July 1, 1975, and completed on or before July 1,
1998, - } in cities which adopt { + or amend + }, after a
public hearing and determination pursuant to subsection (3) of
this section, by resolution or ordinance, the provisions of ORS
307.600 to 307.690. The tax exemption provided by ORS 307.600 to
307.690 only applies to the tax levy of a city which adopts the
provisions of ORS 307.600 to 307.690, except that the tax
exemption shall apply to the ad valorem tax levy of all taxing
districts when upon request of the city which has adopted the
provisions of ORS 307.600 to 307.690, the rates of ad valorem
taxation of taxing districts whose governing boards agree by
resolution to the policy of providing tax exemptions for
multiple-unit rental housing as provided in ORS 307.600 to
307.690, when combined with the rate of taxation of the city
which adopts the provisions of ORS 307.600 to 307.690, equal 51
percent or more of the total combined rate of taxation levied on
the property which is tax exempt under ORS 307.600 to 307.690.
(2) The city shall designate an area in proximity to the
central business district, within which it proposes to allow
exemptions provided for under the provisions of ORS 307.600 to
307.690. { + The city from time to time may extend or withdraw
territory from the area originally designated and include in the
area designated transit corridors or areas within proximity of
public transportation. + }
(3) The city shall, prior to passage of a resolution or
ordinance { + or an amendment to an existing resolution or
ordinance that elects + } { - electing - } to utilize the
provisions of ORS 307.600 to 307.690, hold a public hearing in
order to determine whether multiple-unit housing meeting the
qualifications of subsection (4) of this section would not
otherwise be built in the designated area without the benefits
provided by ORS 307.600 to 307.690.
(4) Prior to accepting project applications under ORS 307.600
to 307.690, cities shall promulgate standards and guidelines to
be utilized in considering applications and making the
determinations required by ORS 307.650. The standards and
guidelines shall establish policy governing basic requirements
for an application, including but not limited to:
(a) Existing utilization of proposed project site, including
justification of the elimination of any existing sound or
rehabilitable housing.
(b) Design elements.
(c) Rental rates.
(d) Extensions of public benefits from the project beyond the
period of the exemption.
(e) Minimum number of units.
SECTION 4. ORS 307.620 is amended to read:
307.620. In cities with a population of over 300,000, the
exemption shall apply only to multiple-unit housing
constructed { + , added to or converted + } on land within an
area designated under ORS 307.610 (2) or within a designated
urban renewal or redevelopment area formed pursuant to ORS
chapter 457.
SECTION 5. ORS 307.630 is amended to read:
307.630. (1) Except as provided under subsection (2) of this
section, multiple-unit housing which qualifies for exemption
under ORS 307.600 to 307.690 { - , - } shall be exempt from ad
valorem taxation for no more than { + the period specified in an
agreement entered into between the city and the applicant. + }
{ - 10 successive years - } { + The first tax year of
exemption shall be the tax year + } beginning July 1
{ - of the tax year - } immediately following the calendar
year in which construction { + , addition or conversion + } is
completed, determined by that stage in the construction process
when, pursuant to ORS 307.330, the improvement would have gone on
the tax rolls in the absence of the exemption provided for in ORS
307.600 to 307.690. However:
(a) The exemption shall not include the land or any
improvements not a part of the multiple-unit housing { + but may
include parking constructed as part of the multiple-unit housing
construction, addition or conversion + }.
(b) In the case of a structure { + to which stories or other
improvements are added or a structure that is + }converted in
whole or in part from other use to multiple family use, only the
increase in value attributable to the conversion shall be exempt
from taxation.
(2) If the multiple-unit housing is subject to a low income
rental assistance contract with an agency of this state or of the
United States, the city may extend the exemption provided by ORS
307.600 to 307.690 through June 30 of the tax year during which
the termination date of the contract falls.
(3) The exemption provided by ORS 307.600 to 307.690 shall be
in addition to any other exemption provided by law.
SECTION 6. ORS 307.650 is amended to read:
307.650. The city may approve the application if it finds that:
(1) The owner has agreed to include in the construction { + ,
addition or conversion + } as a part of the multiple-unit housing
one or more design elements benefiting the general public as
specified by the city, including but not limited to open spaces,
parks and recreational facilities, common meeting rooms and day
care facilities.
(2) The proposed construction { + , addition or conversion + }
project is or will be, at the time of completion, in conformance
with all local plans and planning regulations, including special
or district-wide plans developed and adopted pursuant to ORS
chapters 195, 196, 197 and 227, which are applicable at the time
the application is approved.
(3) The owner has complied with all standards and guidelines
adopted by cities pursuant to ORS 307.610 (4).
SECTION 7. ORS 307.660 is amended to read:
307.660. (1) The city shall approve or deny an application
filed under ORS 307.650 within 180 days after receipt of the
application. An application not acted upon within 180 days shall
be deemed approved.
(2) Final action upon an application by the city shall be in
the form of an ordinance or resolution that shall contain the
owner's name and address, a description of the subject
multiple-unit housing, either the legal description of the
property or the assessor's property account number, and the
specific conditions upon which the approval of the application is
based. On or before April 1 following approval, the city shall
file with the county assessor and send to the owner at the
last-known address of the owner a copy of the ordinance or
resolution approving or disapproving the application { + and a
copy of the agreement between the city and the applicant fixing
the number of years of tax exemption and the first and last tax
year of exemption + }. In addition, the city shall file with the
county assessor on or before April 1 a document listing the same
information otherwise required to be in an ordinance or
resolution under this subsection, as to each application deemed
approved under subsection (1) of this section.
(3) If the application is denied, the city shall state in
writing the reasons for denial and send notice of denial to the
applicant at the last-known address of the applicant within 10
days after the denial.
(4) The city, after consultation with the county assessor,
shall establish an application fee in an amount sufficient to
cover the cost to be incurred by the city and the assessor in
administering ORS 307.600 to 307.690. The application fee shall
be paid to the city at the time the application for exemption is
filed. If the application is approved, the city shall pay the
application fee to the county assessor for deposit in the county
general fund, after first deducting that portion of the fee
attributable to its own administrative costs in processing the
application. If the application is denied, the city shall retain
that portion of the application fee attributable to its own
administrative costs and shall refund the balance to the
applicant.
SECTION 8. ORS 307.670 is amended to read:
307.670. (1) Except as provided in ORS 307.675, if, after an
application has been approved under ORS 307.600 to 307.690, the
city finds that construction { + , addition or conversion + } of
multiple-unit housing was not completed on or before July 1,
1998, or that any provision of ORS 307.600 to 307.690 is not
being complied with, or any provision required by the city
pursuant to ORS 307.600 to 307.690 is not being complied with,
the city shall give notice to the owner, mailed to the owner's
last-known address, of the proposed termination of the exemption.
The notice shall state the reasons for the proposed termination
and shall require the owner to appear at a specified time, not
less than 20 days after mailing the notice, to show cause, if
any, why the exemption should not be terminated.
(2) If the owner fails to show cause why the exemption should
not be terminated, the city shall adopt an ordinance or
resolution stating its findings terminating the exemption. A copy
of the ordinance or resolution shall be filed with the county
assessor and a copy sent to the owner at the owner's last-known
address, within 10 days after its adoption.
SECTION 9. ORS 307.675 is amended to read:
307.675. (1) If, after application has been approved under ORS
307.600 to 307.690, a declaration defined in ORS 100.005 with
respect to the property is presented to the county assessor or
tax collector for approval under ORS 100.110 or if the county
assessor discovers that the multiple-unit housing or a portion of
the multiple-unit housing is changed to a use that is other than
residential or housing:
(a) The exemption granted the multiple-unit housing or portion
under ORS 307.600 to 307.690 shall terminate immediately, without
right of notice or appeal;
(b) The property or portion shall be assessed and taxed as
other property similarly situated is assessed and taxed; and
(c) Notwithstanding ORS 311.220, there shall be added to the
general property tax roll for the tax year next following the
presentation or discovery, to be collected and distributed in the
same manner as other real property tax, an amount equal to the
difference between the amount of tax that would have been due on
the property or portion had it not been exempt under ORS 307.600
to 307.690 for each of the years, not to exceed the { + period
of years of exemption specified in the agreement entered into
under ORS 307.630 + } { - last 10 years - } , during which the
property was exempt from taxation under ORS 307.600 to 307.690.
(2) If, at the time of presentation or discovery, the property
is no longer exempt, additional taxes shall be imposed as
provided in this section, but the number of years that would
otherwise be used to compute the additional taxes shall be
reduced one year for each year that has elapsed since the year
the property was last granted exemption beginning with the oldest
year for which additional taxes are due.
(3) The assessment and tax rolls shall show 'potential
additional tax liability' for each property granted exemption
under ORS 307.600 to 307.690.
(4) Additional taxes collected under this section shall be
deemed to have been imposed in the year to which the additional
taxes relate.
SECTION 10. ORS 307.690 is amended to read:
307.690. Notwithstanding any provision of ORS 307.670, if the
city finds that construction { + , addition or conversion + } of
the multiple-unit housing was not completed by July 1, 1998, due
to circumstances beyond the control of the owner, and that the
owner had been acting and could reasonably be expected to act in
good faith and with due diligence, the city may extend the
deadline for completion of construction for a period not to
exceed 12 consecutive months.
SECTION 11. { + Section 12 of this Act is added to and made a
part of ORS 307.600 to 307.690. + }
SECTION 12. { + An exemption for multiple-unit housing shall
not be granted under ORS 307.600 to 307.690 unless the
construction, addition or conversion is completed on or before
July 1, 1998. + }
SECTION 13. { + (1) Except as provided in section 12 of this
Act, the amendments to ORS 307.600, 307.605, 307.610, 307.620,
307.630, 307.650, 307.660, 307.670, 307.675 and 307.690 by
sections 1 to 10 of this Act first apply to exemptions for those
structures which are completed in the calendar year 1996 or any
calendar year thereafter and first apply to tax years beginning
on or after July 1, 1997.
(2) Any exemption granted under ORS 307.600 to 307.690 for a
structure completed in the calendar year 1995 or a calendar year
prior to 1995 shall not be affected by the amendments to ORS
307.600, 307.605, 307.610, 307.620, 307.630, 307.650, 307.660,
307.670, 307.675 and 307.690 by sections 1 to 10 of this Act. ORS
307.600 to 307.690 (1993 Edition) shall continue to apply to the
structure and exemption as if this Act were not in effect. + }
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