Chapter 307

 

ATTY. GEN. OPINIONS: Validity of ad valorem and severance taxation of logs destined for export, (1975) Vol 37, p 427; application of Article XI, section 11b of Oregon Constitution to this chapter, (1990) Vol 46, p 388

 

LAW REVIEW CITATIONS: 5 EL 516 (1975)

 

      307.010

 

NOTES OF DECISIONS

 

      Plants growing upon land did not include plants grown by taxpayer in containers. Salem Nursery, Inc. v. Dept. of Rev., 4 OTR 482 (1971), aff’d 262 Or 187, 497 P2d 371 (1972)

 

      House owned separately from land upon which it stands, and whose presence there is of permanent nature, is affixed to land and taxable as real property under this section, even though it is held in place only by its great weight and owners have right and intention to remove it eventually. Moore v. Dept. of Rev., 4 OTR 573 (1971)

 

      For purposes of determining true cash value of real property, “rights and privileges” appertaining to real property do not include goodwill, going concern, management and work force in place. Boise Cascade Corp. v. Dept. of Rev., 12 OTR 263 (1992)

 

      “Real property” includes both land held in fee simple and land held in less than fee simple. Smith v. Dept. of Revenue, 330 Or 227, 998 P2d 675 (2000)

 

ATTY. GEN. OPINIONS: Value of mineral resource as measure of ad valorem taxation, (1976) Vol 38, p 20

 

      307.020

 

NOTES OF DECISIONS

 

      Legislature intended that exemption from ad valorem taxes now codified in ORS 307.400 apply only to category of tangible personal property defined in this section. Saunders v. Department of Revenue, 300 Or 384, 711 P2d 961 (1985)

 

      Under 2003 version, nonapplicability of this section to person, company, corporation or association covered by ORS 308.505 to 308.665 did not limit tax exemption under ORS 307.400 for inventory of centrally assessed companies. Northwest Natural Gas Co. v. Dept. of Revenue, 19 OTR 367 (2007), aff’d 347 Or 536, 226 P3d 28 (2010)

 

      307.030

 

NOTES OF DECISIONS

 

      Legislative intent is that title insurance companies’ “title plants” (certain records and information concerning real property titles) are not taxable as “tangible personal property” under this section. Pioneer Nat. Title Ins. Co. v. Dept. of Rev., 7 OTR 453 (1978)

 

      Assessment in equal and ratable proportion occurs when similar properties are subject to same classification and methodology notwithstanding differences in valuation. Chart Development Corp. v. Dept. of Revenue, 16 OTR 9 (2001)

 

ATTY. GEN. OPINIONS: Exclusion of value of business license from real property for purposes of property taxation, (1978) Vol 38, p 1759

 

      307.060

 

NOTES OF DECISIONS

 

      Interest transferred by Forest Service special-use permit to build recreational residences within national forests is a possessory interest and is taxable. Ore. Summer Home Owners Assn. v. Johnson, 265 Or 544, 510 P2d 344 (1973)

 

      Whether person has possessory interest depends upon whether person has sufficient control over premises to warrant label of possession. Ore. Summer Home Owners Assn. v. Johnson, 265 Or 544, 510 P2d 344 (1973)

 

      State is authorized to tax only possessory interests. Ore. Summer Home Owners Assn. v. Johnson, 265 Or 544, 510 P2d 344 (1973)

 

      Threshold for making property interest taxable differs from threshold property interest required for exemption. Eugene Yacht Club v. Dept. of Rev., 6 OTR 35 (1975)

 

      Month-to-month tenants of dwellings owned by federal corporation were liable for real property taxes as holders of taxable leasehold interest in properties within meaning of this section. Tipton v. Dept. of Rev., 8 OTR 201 (1979)

 

      Assessment of federally owned land leased under same conditions permitting assessment exemption under ORS 307.110 for leased state land unconstitutionally violated intergovernmental immunity. Hood River County v. Dept. of Rev., 13 OTR 292 (1995)

 

      Extent of taxable possessory interest in property is determined by degree that taxpayer has exclusive control over portion of property, as indicated by limitations on taxpayer use and nature and character of property. Power Resources Cooperative v. Dept. of Revenue, 14 OTR 479 (1998), aff’d 330 Or 24, 996 P2d 969 (2000)

 

      307.080

 

NOTES OF DECISIONS

 

      Allowing tax exempt status for fraternal organizations which practice racial discrimination is a violation of the Fourteenth Amendment Equal Protection Clause. Falken-stein v. Dept. of Rev., 350 F Supp 887 (1972)

 

      307.090

 

NOTES OF DECISIONS

 

      City did not have incidents of ownership in water system which would justify exemption from tax under this section. White City Water System v. Dept. of Rev., 7 OTR 274 (1977), aff’d 285 Or 255, 590 P2d 724 (1979)

 

      Nonprofit corporation organized to provide financing for rehabilitation and expansion of water system to be operated by city was not entitled to exemption under this section, because exemption is available only for property actually owned by city. White City Water System v. Dept. of Rev., 285 Or 255, 590 P2d 724 (1979)

 

      Dry boat storage building built over 300 feet from water and leased to taxable individuals was not exempted from taxation under “berthing” of watercraft exemption in ORS 307.120. Port of Coos Bay v. Dept. of Rev., 298 Or 229, 691 P2d 100 (1984)

 

      Where plaintiff had legal ownership of subject property but district had sole equitable ownership, District’s ownership satisfied requirement of this statute and property was exempt for 1987-88 tax year. Tillamook Community Foundation v. Dept. of Rev., 11 OTR 130 (1989)

 

      Where port was obligated under purchase contract to protect and store equipment without charge to buyer, buyer had not paid full purchase price and equipment was not in immediately useable condition, ownership had not passed to buyer. Kaiser International Corp. v. Dept. of Rev., 12 OTR 513 (1993)

 

      “Corporate purposes” of municipality includes any action consistent with municipal charter and not contrary to express or implied law. City of Eugene v. Dept. of Revenue, 15 OTR 1 (1998)

 

      Property belonging to intergovernmental unit partially comprised of people’s utility district is not immune from taxation. Western Generation Agency v. Dept. of Revenue, 327 Or 327, 959 P2d 80 (1998)

 

      Property owned by partnership in which public body is general partner does not qualify for exemption as public property. Linn-Benton Housing Authority v. Linn County Assessor, 17 OTR 1 (2003)

 

      Exemption from taxation for various governmental entities “in” this state is limited to governmental entities formed under laws of this state. P.U.D. No. 1 of Snohomish County v. Dept. of Revenue, 17 OTR 290 (2004)

 

      Central assessment statutes (ORS 308.505 to 308.665) create exception to public property tax exemption. Pacificorp Power Marketing v. Dept. of Revenue, 340 Or 204, 131 P3d 725 (2006)

 

      For public corporation to be “in this state”, corporation must serve geographic areas located primarily within state. Pacific States Marine Fisheries Commission v. Dept. of Revenue, 346 Or 117, 206 P3d 1037 (2009)

 

      Phrase “in this state” modifies types of entities listed, not reference to public or corporate property. Pacific States Marine Fisheries Commission v. Dept. of Revenue, 346 Or 117, 206 P3d 1037 (2009)

 

      To be considered “public corporation,” entity must meet following four requirements: be formed for public’s benefit or public purpose; be subject to public management or control; be created or authorized by statute; and possess some governmental power or authority. Oregon School Boards Assn. v. Dept. of Revenue, 22 OTR 281 (2016)

 

ATTY. GEN. OPINIONS: Exemption of real property held by Department of General Services under lease-purchase transaction, (1978) Vol 39, p 335

 

      307.092

(formerly 456.225)

 

NOTES OF DECISIONS

 

      Vacant property held for future use by partnership of which housing authority is general partner is not property “leased or rented” for housing purposes. Linn-Benton Housing Authority v. Linn County Assessor, 17 OTR 1 (2003)

 

      307.110

 

NOTES OF DECISIONS

 

      Restrictions may be imposed without destroying possessory interest denoting a lease. Canteen Co. v. Dept. of Revenue, 8 OTR 450 (1980)

 

      Legislative decision, expressed by this section, to subject state-owned land leased to private individuals to ad valorem property tax does not violate Article VIII, section 5 of the Oregon Constitution. Johnson v. Dept. of Revenue, 292 Or 373, 639 P2d 128 (1982)

 

      Dry boat storage building built over 300 feet from water and leased to taxable individuals was not exempted from taxation under “berthing” of watercraft exemption in ORS 307.120. Port of Coos Bay v. Dept. of Rev., 298 Or 229, 691 P2d 100 (1984)

 

      Property belonging to tax exempt, special district port was occupied by plaintiff’s employee as personal residence but was used as incident to employment pursuant to this provision and, therefore, was tax exempt. Port of Bandon v. Dept. of Rev., 12 OTR 40 (1991)

 

      Franchise allowing nonexclusive use of public property in undescribed areas of city does not grant taxable possessory interests in public property. Jones Intercable, Inc. v. Dept. of Rev., 12 OTR 436 (1993)

 

      Franchise to operate business does not increase assessed value of tangible business property. Jones Intercable, Inc. v. Dept. of Rev., 12 OTR 436 (1993)

 

      Assessment describing entire property was not sufficiently specific for purpose of assessing rented or leased portion of premises. Lincoln County v. Dept. of Rev., 12 OTR 548 (1993)

 

      Where non-tax exempt entity leases otherwise tax exempt property, lien for property taxes is enforceable only against leasehold interest of non-tax exempt lessee. Multnomah County v. Finance America Corp., 120 Or App 30, 852 P2d 262 (1993), Sup Ct review denied

 

      Mere possession and use of property without obtaining lawful interest does not make property taxable to user. Multnomah County v. Dept. of Rev., 13 OTR 170 (1994), aff’d 321 Or 576, 902 P2d 94 (1995)

 

      Where public property is “held under a lease,” assessment is levied on value of fee interest in property, not just value of leasehold interest. Pollin v. Dept. of Revenue, 13 OTR 478 (1996)

 

      Upon expiration of lease, lien on lessee’s interest in otherwise exempt property also expires. Urban Renewal Agency v. Dept. of Revenue, 14 OTR 77 (1996)

 

      Property value is reduced by government restrictions on use of property, but is not reduced by restrictions on lessee’s interest. Pollin v. Dept. of Revenue, 14 OTR 96 (1997), aff’d 326 Or 427, 952 P2d 537 (1998)

 

      Where interference by other uses is minimal and interest held constitutes substantial part of all practical uses of property, right of exclusive control exists. Avis Rent A Car System, Inc. v. Dept. of Revenue, 14 OTR 487 (1998), aff’d 330 Or 35, 995 P2d 1163 (2000)

 

      Property that is owned by public body and that is subject to lien for tax due and unpaid by private party lessee is not “safe” from unpaid tax liability because lien survives lease termination. Grant County Assessor v. Dayville Public Sch. Dist. 16J, 20 OTR 91 (2010)

 

ATTY. GEN. OPINIONS: Subjection of “oil and gas lease” lands to ad valorem taxation, (1976) Vol 38, p 20; requirements to maintain exempt status of leased publicly owned land, (1979) Vol 40, p 68

 

      307.112

 

NOTES OF DECISIONS

 

      Where plaintiff claimed exemption from property tax for leased property under ORS 307.166 and this statute, court refused to limit operation of one statute in order to give effect to other and plaintiff’s motion for summary judgment was granted. Mercy Health Promotion v. Dept. of Rev., 11 OTR 207 (1989), aff’d 310 Or 123, 795 P2d 1082 (1990)

 

      Incorporation of leased property into real property of charitable organization did not make exemption applied for under 307.130 applicable to leased property. Garten Foundation v. Dept. of Rev., 12 OTR 554 (1993)

 

      For purpose of determining when lease was entered into, where lease specifically recites date on which it was entered into, that date controls over date of execution, date of signing, date lessee took possession, effective date and date first rent was due. Multnomah County v. Dept. of Revenue, 13 OTR 384 (1995)

 

      Exemption of property is lost where sublease occurs and no application for exemption is filed by sublessee. Erickson v. Dept. of Revenue, 17 OTR 324 (2004)

 

      307.120

 

NOTES OF DECISIONS

 

      Dry boat storage building built over 300 feet from water and leased to taxable individuals was not exempted from taxation under “berthing” of watercraft exemption in this section. Port of Coos Bay v. Dept. of Rev., 298 Or 229, 691 P2d 100 (1984)

 

      Exemption for property leased, subleased, rented or preferentially assigned for berthing watercraft applies to property used for berthing pleasure craft. South Beach Marina, Inc. v. Dept. of Rev., 301 Or 524, 724 P2d 788 (1986)

 

      307.123

 

ATTY. GEN. OPINIONS: Effect of expiration of key industry exemption under Article XI, sections 11 and 11a of Oregon Constitution, (1997) Vol 49, p 6

 

      307.130 to 307.162

 

NOTES OF DECISIONS

 

      Assessor must notify owner of property which would otherwise be exempt under these sections of intent to assess taxes against such property only when: (1) property was treated as exempt in immediately preceding year and, (2) assessor contemplates assessment of property in current year because of change of ownership or use for which no application for exemption has been made. Worrell v. Dept. of Rev., 7 OTR 128 (1977)

 

      307.130

 

NOTES OF DECISIONS

 

Real property occupied or used

 

      Actually occupied or used

 

      A farm owned by a church, from which the profits flowed to the benefit of the church’s charity, was not exempt from property taxation. Corporation of Presiding Bishop v. Dept. of Rev., 6 OTR 268 (1975), aff’d 276 Or 775, 556 P2d 685 (1976)

 

      This section grants tax exemption only to such real or personal property as is actually used in charitable work carried on. Golden Writ of God v. Dept. of Rev., 9 OTR 475 (1984), aff’d300 Or 479, 713 P2d 605 (1986)

 

      In determining whether property is tax exempt pursuant to this section, test is use to which property is put. State ex rel. NW Medical Lab. v. Wilcox, 10 OTR 181 (1985)

 

      Charitable organization’s de minimis use of property does not qualify property for exemption where use is not reasonably necessary for carrying out charitable purposes. Multnomah County v. Dept. of Rev., 13 OTR 339 (1995)

 

      Storage of material to ensure availability in case of future charitable need is actual use of storage facility for charitable purpose, notwithstanding lack of distribution from facility. Corporation of the Presiding Bishop, LDS v. Dept. of Revenue, 14 OTR 244 (1997)

 

      Actually and exclusively occupied and used

 

      Where the plaintiff had a completed building and initiated its occupancy thereof prior to July 1, the property was actually and exclusively occupied within the meaning of this section. Soc. St. Vincent DePaul v. Dept. of Rev., 272 Or 360, 537 P2d 69 (1975)

 

      Where evidence did not demonstrate which portion of entire parcel was devoted to exempt activities, no partial exemption could be allowed. Golden Writ of God v. Dept. of Rev., 300 Or 479, 713 P2d 605 (1986)

 

      Phrase “exclusively used” refers to primary, as opposed to incidental, use of property. Mercy Medical Center, Inc. v. Dept. of Rev., 12 OTR 305 (1992)

 

      Where charitable organization acquired vacant lot but had not yet started to build home on it, lot was “actually and exclusively occupied or used” by organization in carrying out its charitable work of acquiring vacant lots and building affordable houses on those lots; thus, charitable organization was entitled to receive tax exemption from property taxes assessed on lot. Habitat for Humanity v. Dept. of Rev., 360 Or 257, 381 P3d 809 (2016)

 

Property owned or being purchased

 

      Property held under a lease agreement with the United States Government did not qualify for an exemption under this section. Eugene Yacht Club v. Dept. of Rev., 6 OTR 35 (1975)

 

      Incorporation of leased property into real property of charitable organization did not alter requirement that application for exemption of leased property be made separately under ORS 307.112. Garten Foundation v. Dept. of Rev., 12 OTR 554 (1993)

 

Benevolent or charitable institutions

 

      In general

 

      Statutes exempting property are strictly construed against the one claiming the exemption. Emanuel Lutheran Charity Bd. v. Dept. of Rev., 4 OTR 410 (1971), aff’d 263 Or 287, 502 P2d 251 (1972)

 

      Property, both real and personal, was held, occupied and actually used for charitable, benevolent purposes of the organization, and was exempt. Parkhurst v. Dept. of Rev., 4 OTR 586 (1971)

 

      A charitable enterprise does not lose its exemption merely because it engages in competition with taxable businesses. YMCA v. Dept. of Rev., 268 Or 633, 522 P2d 464 (1974)

 

      If the activity undertaken on the property substantially contributes to the furtherance of the charity’s goals, the property will be exempted. YMCA v. Dept. of Rev., 268 Or 633, 522 P2d 464 (1974); Mercy Medical Center, Inc. v. Dept. of Rev., 12 OTR 305 (1992)

 

      An exemption is not lost because the property is not required to carry out the goals of the charity. YMCA v. Dept. of Rev., 268 Or 633, 522 P2d 464 (1974)

 

      Owner of apartment complex used exclusively by retired persons, though nonprofit organization, is not a charity as implicitly required by this statute. Salem Non-Profit Housing, Inc., v. Dept. of Revenue, 9 OTR 265 (1983)

 

      Although purposes of organization were to promote arts and crafts, exchange of ideas and establishment of community feeling of unity and were unquestionably worthwhile and beneficial, they could not be said to be charitable as used in this section. Oregon Country Fair v. Dept. of Rev., 10 OTR 200 (1986)

 

      Activities of emergency veterinary clinic founded with private donation and formed as nonprofit organization met some requirements of charitable organization but did not meet taxpayer burden of qualifying as charitable institution under this section. Dove Lewis Mem. Emer. Vet. Clinic v. Dept. of Rev., 301 Or 423, 923 P2d 320 (1986)

 

      Property must qualify on its own merits to receive tax exemption and plaintiff failed to prove its right to charitable exemption under this section for either of two properties appealed. YMCA v. Dept. of Rev., 11 OTR 101 (1988), aff’d 308 Or 644, 784 P2d 1086 (1989)

 

      Personal property of public defender service is property of charitable organization and public defender service is involved in gift or giving, even though public defender service has contractual obligation to perform indigent defense and is compensated by state. Southwestern Oregon Public Defender Services, Inc. v. Dept. of Rev., 312 Or 82, 817 P2d 1292 (1991)

 

      Test to qualify as “charitable institution” is applied to organization overall, not to specific part or operation. Mercy Medical Center, Inc. v. Dept. of Rev., 12 OTR 305 (1992)

 

      Retail store stocked by donated goods does not meet requirements of this statute, even if income is used for charitable purposes. Kiwanis Club v. Dept. of Rev., 12 OTR 318 (1992)

 

      Directing charitable efforts toward particular ethnic group did not rob facility of charitable character. Rigas Maja, Inc. v. Dept. of Rev., 12 OTR 471 (1993)

 

      Requirement that retail store deal exclusively in donated property applies both to distributed inventory and to any inventory sold to public. Assistance Guild of Bend v. Dept. of Rev., 13 OTR 236 (1995)

 

      Scientific institution is not required to have charity as primary purpose to qualify as charitable. Math Learning Center v. Dept. of Revenue, 14 OTR 62 (1996)

 

      Educating public on particular ideology advanced by tax exempt organization as means for indirectly achieving public good does not qualify as charitable work. Native Forest Council v. Lane County Assessor, 17 OTR 30 (2003)

 

      Mutual benefit corporation cannot have sufficient charitable attributes for property of corporation to qualify for exemption. Rogue Gem and Geology Club, Inc. v. Josephine County Assessor, 17 OTR 446 (2003)

 

      Hospitals

 

      The fact that patients able to pay are required to do so does not deprive a hospital, otherwise eligible to be classed as a charitable institution, of its charitable character. Ev. Lutheran Good Samaritan Soc. v. Dept. of Rev., 5 OTR 14 (1972)

 

      The tax-exempt hospital did not qualify for property tax exemption for property it leased to the county health department. Albany Gen. Hosp. v. Dept. of Rev., 6 OTR 446 (1976), aff’d 277 Or 727, 561 P2d 1029 (1977)

 

      Religious institutions

 

      Land merely being held for future use is not being actually occupied or used for benevolent or charitable work. Emanuel Lutheran Charity Bd. v. Dept. of Rev., 263 Or 287, 502 P2d 251 (1972)

 

      Advancement of religion is a charitable purpose within the meaning of the statute. Archdiocese v. Dept. of Rev., 5 OTR 111 (1973), aff’d 266 Or 419, 513 P2d 1137 (1973); Diocese of Ore. v. Dept. of Rev., 5 OTR 126 (1973), aff’d 266 Or 419, 513 P2d 1138 (1973)

 

      Determination by church officers regarding what lands are reasonably required and what uses will further religious purposes are to be given deference absent clear indication of bad faith or fraud. Multnomah County v. Dept. of Revenue, 6 OTR 325 (1976)

 

      Building owned by incorporated religious organization housing members of organization, who lived communally by dictates of their religion, was exempt from real property taxation under this section. House of Good Shepherd v. Department of Revenue, 300 Or 340, 710 P2d 778 (1985)

 

Literary organizations

 

      Organization devoted to production of plays is literary organization. Theatre West of Lincoln City, Ltd. v. Dept. of Rev., 319 Or 114, 873 P2d 1083 (1994)

 

      Nonprofit literary organization qualifies for exemption if operating for public good, which is revealed by considering: 1) membership base; 2) property ownership and use; 3) administration; 4) activities; and 5) promotion of public welfare. Oregon Writer’s Colony v. Dept. of Revenue, 14 OTR 69 (1996)

 

ATTY. GEN. OPINIONS: Exemption of property owned by nonprofit corporation and leased to State Commission for Blind, (1977) Vol 38, p 1592

 

LAW REVIEW CITATIONS: 2 EL 164 (1971)

 

      307.134

 

NOTES OF DECISIONS

 

      Allowing tax exempt status for fraternal organizations which practice racial discrimination is a violation of the Fourteenth Amendment Equal Protection Clause. Falken-stein v. Dept. of Rev., 350 F Supp 887 (1972)

 

      307.136

 

NOTES OF DECISIONS

 

      Allowing tax exempt status for fraternal organizations which practice racial discrimination is a violation of the Fourteenth Amendment Equal Protection Clause. Falken-stein v. Dept. of Rev., 350 F Supp 887 (1972)

 

      Where plaintiff’s operations did not require an on-site caretaker, residential property provided for the caretaker was not exempt under this section. American Legion v. Dept. of Rev., 5 OTR 706 (1975)

 

      Fraternal organization’s mere holding of property for sale does not constitute actual occupancy or use of property by organization. Perkins v. Dept. of Revenue, 15 OTR 381 (2001)

 

      Where taxpayer rented to nonfraternal person third-floor of building that was eligible for property tax exemption under this section and rent was with within limits under this section, because rental was for nonexempt commercial uses and not for entertainment or recreational uses, rental did not qualify for property tax exemption. Dept. of Revenue v. Oregon City BPOE #1189, 21 OTR 500 (2014)

 

      307.140

 

NOTES OF DECISIONS

 

      A farm owned by a church, from which the profits flowed to the benefit of the church’s charity, was not exempt from property taxation. Parkhurst v. Dept. of Rev., 4 OTR 586 (1971); Corporation of Presiding Bishop v. Dept. of Rev., 6 OTR 268 (1975), aff’d 276 Or 775, 556 P2d 685 (1976)

 

      Property used for church purposes other than conducting worship services must qualify under exemption granted for charitable use property rather than as exempt place of worship. Archdiocese of Portland v. Dept. of Rev., 5 OTR 111 (1972), aff’d266 Or 419, 513 P2d 1137 (1973)

 

      The tax-exempt hospital did not qualify for property tax exemption for property it leased to the county health department. Albany Gen. Hosp. v. Dept. of Rev., 6 OTR 446 (1976), aff’d 277 Or 727, 561 P2d 1029 (1977)

 

      Where full use of property by religious organization was prevented solely by delay of planning commission in approving conditional use permit, partial use of property, involving possession and presence of personal property and maintenance work, was sufficient to qualify for religious exemption under this section. Reorganized Church LDS v. Dept. of Rev., 6 OTR 510 (1976)

 

      Although evidence was insufficient to show that use of parsonage was such as to exempt it from property taxes, low-rent apartments provided to needy and older members of congregation were entitled to exemption to extent they were actually rented to those in need. German Apostolic Christian Church v. Dept. of Rev., 279 Or 637, 569 P2d 596 (1977)

 

      Building owned by incorporated religious organization housing members of organization, who lived communally by dictates of their religion, was exempt from real property taxation under this section. House of Good Shepherd v. Department of Revenue, 300 Or 340, 710 P2d 778 (1985)

 

      Where evidence did not demonstrate which portion of entire parcel was devoted to exempt activities, no partial exemption could be allowed. Golden Writ of God v. Dept. of Rev., 300 Or 479, 713 P2d 605 (1986)

 

      Exemption was allowable for building fulfilling functions of churches of more traditional religions and for portion of guest ranch used in organization’s religious activities and disallowed for caretaker’s residence, counselor’s residence and bulk of guest ranch already assessed for timber tax exemption. Found. of Human Understanding v. Dept. of Rev., 301 Or 254, 722 P2d 1 (1986)

 

      Where house was “primarily” used as a home for pastor, use of some parts of house for purposes connected with work of church does not make it building used primarily for benefit of church. Washington County v. Dept. of Rev., 11 OTR 251 (1989)

 

      “Owned” means only legal ownership, not equitable ownership. First Love Ministries v. Dept. of Rev., 12 OTR 97 (1991)

 

      Where property involves living quarters, initial inquiry is whether it is reasonably necessary for person occupying living quarters to be physically on site. Roman Catholic Archdiocese v. Dept. of Rev., 13 OTR 211 (1995)

 

      Where rectory or parsonage is reasonably necessary for work of church, inquiry is whether actual use of property is consistent with fulfilling religious purposes of church. Roman Catholic Archdiocese v. Dept. of Rev., 13 OTR 211 (1995)

 

      Exemption from property taxation applies only with regard to taxes assessed on ad valorem basis. Multnomah County v. Dept. of Rev., 13 OTR 281 (1995)

 

      Where description of property is sufficiently broad in original exemption application, construction of new improvement on property does not require filing of new application. Lake Baptist Church, Inc. v. Dept. of Revenue, 14 OTR 297 (1998)

 

      Where property used primarily for benefit of church is residence, property is exempt if: 1) church official is required by church doctrine or practical necessity to live in residence; and 2) proximity of residence to house of worship is necessary to further religious objectives. Washington County Assessor v. West Beaverton Congregation of Jehovah’s Witnesses, Inc., 18 OTR 409 (2006)

 

      307.145

 

NOTES OF DECISIONS

 

      Exemption must be granted once the “educational purposes” of the statute are proved under the direction and ownership of an incorporated religious organization. Christian Pre-School v. Dept. of Rev., 5 OTR 8 (1972)

 

      Where finding from evidence was that neither land nor house was used exclusively for educational purposes, though members of organization did use some parts of house and land for religious and charitable purposes, organization was not entitled to exemption under this section. Golden Writ of God v. Dept. of Rev., 300 Or 479, 713 P2d 605 (1986)

 

      Where property can be used in unimproved state, availability as play or exploration area during recess is sufficient school-connected use. The International School v. Dept. of Rev., 13 OTR 220 (1995)

 

      307.162

 

NOTES OF DECISIONS

 

      Duty of assessor to notify property owner of intent to assess presumes that owner has given assessor cause to know that owner may qualify for exemption. Renewal House, Inc. v. Dept. of Rev., 5 OTR 638 (1975)

 

      County assessor is required to notify only previously exempted property owners before assessing their property for failure to file for an exemption in the current year. Skyline Assembly of God v. Dept. of Rev., 274 Or 259, 545 P2d 879 (1976)

 

      Although application under this section must generally be filed before April 1, application for property acquired by exempt owner or changed from taxable to exempt use after filing date but before July 1, may be filed within 30 days after acquisition or change in use but if property is acquired or changed from taxable to exempt use on or after July 1 of tax year, there is no filing time under this section because exemption for year is not allowed under ORS 311.410. Christian Life Fellowship, Inc., v. Dept. of Rev., 12 OTR 94 (1991)

 

      Where church purchased property from another church under land sale contract and continued to use property for religious purposes, no change of ownership or use occurred and new application for exemption was not required under this section because under this section, change of “ownership” means change of “legal ownership.” First Love Ministries v. Dept. of Rev., 12 OTR 97 (1991)

 

      Where nonprofit taxpayer acquired property adjacent to property that taxpayer already owned and that was qualified as exempt from taxation, newly acquired property is not addition or improvement made to qualified property and must instead separately qualify for exemption from taxation. B’nai Brith Mens Camp Association v. Dept. of Revenue, 21 OTR 357 (2014)

 

      Under this section, time period for relief parallels with time period set forth in ORS 311.216 within which assessor can add property to tax rolls where no otherwise timely exemption has been filed. Where 2011-2012 tax year was “current tax year” and first year exemption was authorized and fell within five year retrospective period defined under ORS 311.216, taxpayer’s claim exemption for 2011-2012 tax year was authorized. Washington County Assessor v. Christ Gospel Church, 21 OTR 452 (2014)

 

COMPLETED CITATIONS: Emanuel Lutheran Charity Bd. v. Dept. of Rev., 4 OTR 410 (1971), aff’d 263 Or 287, 502 P2d 251 (1972)

 

      307.166

 

NOTES OF DECISIONS

 

      Where plaintiff claimed exemption from property tax for leased property under ORS 307.112 and this statute, court refused to limit operation of one statute in order to give effect to other and plaintiff’s motion for summary judgment was granted. Mercy Health Promotion v. Dept. of Rev., 11 OTR 207 (1989), aff’d 310 Or 123, 795 P2d 1082 (1990)

 

      307.175

 

NOTES OF DECISIONS

 

      Term “equipped” is too broad to conclude that energy produced by alternative energy system must be used on property where energy is produced. Pegar v. Dept. of Rev., 11 OTR 328 (1990)

 

ATTY. GEN. OPINIONS: Tax credit for installation of alternative energy devices, (1977) Vol 38, p 1198

 

      307.190

 

NOTES OF DECISIONS

 

      Whether personal property retains separate identity from floating home or boathouse is based on consideration of: 1) annexation; 2) adaptation; and 3) intention. Sideras v. Dept. of Rev., 13 OTR 310 (1995)

 

      Where owner is nonprofit corporation, tangible personal property is not exempt from taxation under this section because nonprofit cannot make “personal use” of property as required for exemption. WorldMark v. Dept. of Revenue, 20 OTR 149 (2010)

 

ATTY. GEN. OPINIONS: Constitutionality of bill originating in Senate eliminating tax exempt status of floating homes and houseboats, under provision requiring bills for raising revenue to originate in House, (1978) Vol 38, p 2143

 

      307.215

 

      See annotations under ORS 305.823.

 

      307.248

(formerly 310.692)

 

ATTY. GEN. OPINIONS: Subsequent revision by Rev. Dept. of property tax relief reduction, (1981), Vol 42, p 84; Property tax relief as obligation against state. (1981) Vol 42, p 84

 

      307.270

 

NOTES OF DECISIONS

 

      Agreement to sell partially exempt property was not an enforceable contract until Department of Veterans Affairs made loan commitment and where loan commitment did not occur until after July 1, partial exemption continued for that year. Mendelson v. Dept. of Revenue, 9 OTR 20 (1981)

 

      307.320

 

NOTES OF DECISIONS

 

      Comparable sales of orchards were used to determine true cash value of orchard land without trees. Hulburt v. Dept. of Rev., 4 OTR 475 (1971)

 

      The legislature intended to exempt only those trees, shrubs, plants and crops traditionally considered as part of soil in which they grow and therefore made “real property” as matter of law by ORS 307.010 as well as by custom, but did not intend to exempt plants grown entirely in movable containers. Salem Nursery, Inc. v. Dept. of Rev., 4 OTR 482 (1971), aff’d 262 Or 187, 497 P2d 371 (1972)

 

      307.330

 

NOTES OF DECISIONS

 

      Applicant is required to file proof that property meets each requirement for exemption, notwithstanding that assessor may possess same information from other sources. Urban Office & Parking v. Dept. of Rev., 4 OTR 523 (1971)

 

      In using term “structure,” legislature intended that complex of buildings designed for specific use and not adaptable to any other purpose could be regarded as useless until whole complex or structure is operable and that completed buildings not be subject to taxation until whole complex of buildings is completed. Collier Carbon v. Dept. of Rev., 5 OTR 1 (1972), aff’d263 Or 414, 502 P2d 595 (1972); Multnomah County v. Dept. of Rev., 13 OTR 147 (1994)

 

      Once having selected the two consecutive years for exemption the taxpayer cannot revoke his selection and secure the exemption for different consecutive years. Georgia-Pac. Corp. v. Dept. of Rev., 264 Or 260, 504 P2d 704 (1972)

 

      The extent of the exempt construction must be limited to the basic functional and substantially necessary elements of the structure. Allen v. Dept. of Rev., 5 OTR 185 (1973)

 

      A structure under construction is eligible for property tax exemption under this section if it is used for production but fails to produce a commercially acceptable product. Multnomah County v. Dept. of Rev., 5 OTR 437 (1974)

 

      Where only two percent of facility was used for manufacturing “kits” for installation on aircraft, facility did not qualify for exemption as a manufacturing facility under construction. Aero Air, Inc. v. Dept. of Revenue, 8 OTR 461 (1980)

 

      Based on legislative intent behind this section which was to promote state’s economy, together with technological and scientific complexity of operation, salmon hatchery operation was income-producing facility other than nonmanufacturing facility and entitled to tax exemption provided by this section. Bain v. Dept. of Revenue, 293 Or 163, 646 P2d 12 (1982)

 

      Use of part of facility during construction period for purpose of facilitating further construction was not “use or occupancy” where not for purpose of income generation. Multnomah County v. Dept. of Rev., 13 OTR 147 (1994)

 

      Use or occupancy of portion of nonindustrial building or structure within one year of commencement of construction negates exemption even though building or structure is not complete. Multnomah County v. Dept. of Rev., 13 OTR 223 (1995)

 

      Building or structure cannot be divided into separate portions so that one portion qualifies for exemption but other portion does not. Multnomah County v. Dept. of Rev., 13 OTR 223 (1995)

 

      Property being constructed in furtherance of “production of income” includes building constructed for purpose of one-time gain on sale of property. North Harbour Corp. v. Dept. of Revenue, 16 OTR 91 (2002)

 

      “Building” means single, self-contained unit designed for occupancy. Trendwest Resorts, Inc. v. Dept. of Revenue, 18 OTR 187 (2005), aff’d 340 Or 413, 134 P3d 932 (2006)

 

      “Structure” means: 1) single, self-contained unit not designed for occupancy; or 2) combination of at least two interdependent units, one of which may be building. Trendwest Resorts, Inc. v. Dept. of Revenue, 18 OTR 187 (2005), aff’d 340 Or 413, 134 P3d 932 (2006)

 

      Use or occupancy need not be in furtherance of production of income. Trendwest Resorts, Inc. v. Dept. of Revenue, 340 Or 413, 134 P3d 932 (2006)

 

      307.340

 

NOTES OF DECISIONS

 

      Legislature contemplated filing of application with assessor. Urban Off. & Parking v. Dept. of Rev., 4 OTR 523 (1971)

 

      307.370

 

NOTES OF DECISIONS

 

      This section does not require the county assessor to take affirmative steps to place exemption forms in the hands of nonprofit homes for the elderly. Cascade Manor, Inc. v. Dept. of Rev., 5 OTR 482 (1974)

 

      Language stating that nonprofit home exemptions are “in aid of veterans tax exemptions” does not limit or condition personal property exemption. Coos County v. Dept. of Revenue, 14 OTR 282 (1998)

 

      307.375

 

ATTY. GEN. OPINIONS: Homestead as applied to a shareholder-tenant in a cooperative apartment, (1971) Vol 35, p 897

 

      307.394

 

NOTES OF DECISIONS

 

      Where taxpayer, who owned pumpkin patch that held pumpkins grown on and brought from land other than patch and who used trains and boats to transport customers and pumpkins from patch, did not use trains and boats to harvest pumpkins from patch. Lakeview Farms, Ltd. v. Dept. of Revenue, 21 OTR 161 (2013)

 

      307.400

 

      See also annotations under ORS 310.608 in permanent edition.

 

NOTES OF DECISIONS

 

      Inventory exemption applies only to items that will become physical part of taxpayer’s stock in trade and not to items merely used in process of producing merchandise. Ore. Portland Cement Co. v. Dept. of Rev., 4 OTR 545 (1971), aff’d 262 Or 617, 500 P2d 1044 (1972)

 

      Stores of nuclear fuel and fuel oil held for use in generating electricity were not inventory within meaning of this section. Portland Gen. Elec. Co. v. Dept. of Rev., 7 OTR 33 (1977)

 

      Property used in oyster raising operation was not “farm machinery used in the planting, cultivating, or harvesting of farm crops” eligible for partial exemption of this section. Oregon Oyster Co. v. Dept. of Rev., 7 OTR 308 (1978)

 

      Taxpayer was not eligible for inventory exemption from personal property taxation where he proved only that he was engaged in casual sales conducted sporadically for profit and not sale of equipment in ordinary course of business. Simpson v. Dept. of Rev., 299 Or 282, 702 P2d 399 (1985)

 

      Legislature intended that exemption from ad valorem taxes now codified in this section apply only to category of tangible personal property defined in ORS 307.020. Saunders v. Department of Revenue, 300 Or 384, 711 P2d 961 (1985)

 

      Tangible personal property used in plaintiff’s fish farming and ranching operations qualifies for exemption under this section. Anadromous, Inc. v. Dept of Rev., 11 OTR 272 (1989)

 

      Tax exemption for inventory applies only to inventory of business that purchases, sells and replenishes its stock in ordinary course of business. Douglas County Assessor v. Dept. of Rev., 12 OTR 248 (1992)

 

      Tax exemption for inventory does not apply to business that sells its operating equipment or fixtures. Douglas County Assessor v. Dept. of Rev., 12 OTR 248 (1992)

 

      Exemption for property items “that are or will become” inventory does not apply to businesses that sell items only as incidental business activity. H-P Ventures, Inc. v. Dept. of Rev., 13 OTR 330 (1995)

 

      Machinery and equipment utilized in winery are not “farm machinery and equipment.” King Estate Winery, Inc. v. Dept. of Revenue, 14 OTR 169 (1997), aff’d 329 Or 414, 988 P2d 369 (1999)

 

      Equipment used in brooder portion of vertically integrated egg production operation is not “directly related” to production of fresh shell eggs. Willamette Egg Farms, Inc. v. Dept. of Revenue, 14 OTR 337 (1998), aff’d 331 Or 327, 14 P3d 609 (2000)

 

      “Any other agricultural or horticultural use” does not include processing of crops or sale of processed crops. King Estate Winery, Inc. v. Dept. of Revenue, 329 Or 414, 988 P2d 369 (1999)

 

      Centrally assessed property may be inventory qualifying for exemption. Northwest Natural Gas Co. v. Dept. of Revenue, 19 OTR 367 (2007), aff’d 347 Or 536, 226 P3d 28 (2010)

 

      For centrally assessed taxpayers, “tangible personal property” has plain, natural and ordinary meaning. Northwest Natural Gas Co. v. Dept. of Revenue, 347 Or 536, 226 P3d 28 (2010)

 

      307.405

 

NOTES OF DECISIONS

 

      The exemption provided in this section is only available if the procedural steps covered in ORS 307.420 are complied with. Ore. Portland Cement v. Dept. of Rev., 5 OTR 218 (1973)

 

      Pollution control equipment exemption allowed by this section is to be subtracted from true cash value not from assessed value. Reynolds Metals Co. v. Dept of Revenue, 9 OTR 417 (1983), as modified by 299 Or 592, 705 P2d 712 (1985); 300 Or 250, 709 P2d 710 (1985)

 

      307.420

 

NOTES OF DECISIONS

 

      The exemption provided in ORS 307.405 is only available if the procedural steps covered in this section are complied with. Ore. Portland Cement v. Dept. of Rev., 5 OTR 218 (1973)

 

      There is no affirmative duty on the part of the assessor to mail or transport to the taxpayer the notice and forms necessary to secure the exemption. Ore. Portland Cement v. Dept. of Rev., 5 OTR 218 (1973)

 

      307.460

 

      See annotations under ORS 307.471.

 

      307.471

 

(formerly 307.460)

 

NOTES OF DECISIONS

 

      Nonprofit corporation, a building association which owned student housing unit rented to students of local fraternity, did not qualify as “fraternity” for purpose of partial exemption under this section. Multnomah Co. v. Dept. of Rev., 7 OTR 315 (1978)

 

      307.475

 

NOTES OF DECISIONS

 

      A late filing caused by plaintiff’s employe’s ignorance of the filing requirement was not good and sufficient cause to grant a hardship exemption under this section. Pratum Co-Op Whse. v. Dept. of Rev., 6 OTR 130 (1975)

 

      The court will not conduct a de novo review of the discretionary power given to the Department of Revenue under this section. Rogue River Packing Corp. v. Dept. of Rev., 6 OTR 293 (1976)

 

      Director did not abuse discretion in denying relief under hardship provision of this section to automobile dealer who failed to timely file application for cancellation of assessment of unlicensed motor vehicles. Jim Fisher Motors, Inc. v. Dept. of Rev., 7 OTR 90 (1977)

 

      Statutory standard of “good and sufficient cause” of this section is not analogous to terms “excusable neglect” or “reasonable cause” used in statutes that do not involve exercise of discretion by administrative officer in determining whether important rule should be supervened. Nat’l Metallurgical Corp. v. Dept. of Rev., 7 OTR 142 (1977)

 

      To establish hardship under this section, taxpayer has to prove that assessed property would have been exempt if there had been timely filing of free port exemption claim and that failure to make timely application for exemption was by reason of good and sufficient cause. Liquid Air Inc. v. Dept. of Rev., 8 OTR 159 (1979)

 

      Where assessor’s affirmative acts prevented taxpayer from timely applying for hardship relief, taxpayer could not be denied opportunity to appeal for hardship relief. Liquid Air Inc. v. Dept. of Rev., 8 OTR 159 (1979); Southern Oregon Drydock, Inc. v. Dept. of Rev., 12 OTR 344 (1992)

 

      This section does not authorize Department of Revenue to override filing requirements of senior citizens’ property tax deferral. Phelps v. Dept. of Rev., 10 OTR 162 (1985)

 

      Although “good and sufficient cause” includes reasonable reliance on misinformation provided by certain assessment or taxation staff, taxpayer cannot be misinformed unless he provides tax authority with enough information to be led awry. New Testament Baptist Church v. Dept. of Rev., 10 OTR 286 (1986)

 

      Disqualification of property from special farm use assessment during pendency of bankruptcy proceeding did not violate automatic stay but was “notice” permitted by federal statute and this section could not rescue taxpayers from their untimely appeal of disqualification. Sanderson v. Dept. of Rev., 11 OTR 74 (1988)