Property Subject to Taxation

ORS 307.112
Property held under lease, sublease or lease-purchase by institution, organization or public body other than state


(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, or a public university listed in ORS 352.002 (Public universities), granted exemption or the right to claim exemption for any of its property under ORS 307.090 (Property of the state, counties and other municipal corporations), 307.130 (Property of certain museums, volunteer fire departments and literary, benevolent, charitable and scientific institutions), 307.136 (Property of fraternal organizations), 307.140 (Property of religious organizations), 307.145 (Certain child care facilities, schools and student housing), 307.147 (Senior services centers) or 307.181 (Land acquired or owned by Indian tribe) (3), is exempt from taxation if:

(a)

The property is used by the lessee or, if the lessee is not in possession of the property, by 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 under the terms of the lease, sublease or lease-purchase agreement that any tax savings resulting from the exemption granted under this section shall inure solely to the benefit of the institution, organization or public body.

(2)

To obtain the exemption under this section, the lessee or, if the lessee is not in possession of the property, the entity in possession of the property, must 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, 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 tax savings resulting from the exemption granted under this section will inure solely to the benefit of the institution, organization or public body, before the exemption may be granted the lessor must provide documentary proof, as specified by rule of the Department of Revenue, that the tax savings resulting from the exemption will inure solely to the benefit of the institution, organization or public body.

(4)

(a) The claim must be filed on or before April 1 preceding the tax year for which the exemption is claimed, except:

(A)

If the lease, sublease or lease-purchase agreement is entered into after March 1 but not later than June 30, the claim must be filed within 30 days after the date the lease, sublease or lease-purchase agreement is entered into if exemption is claimed for that year; or

(B)

If a late filing fee is paid in the manner provided in ORS 307.162 (Claiming exemption) (2), the claim may be filed within the time specified in ORS 307.162 (Claiming exemption) (2).

(b)

The exemption first applies for the tax year beginning July 1 of the year for which the claim is filed.

(5)

(a) An exemption granted under this section continues as long as the use of the property remains unchanged and during the period of the lease, sublease or lease-purchase agreement.

(b)

If the use changes, a new claim must be filed as provided in this section.

(c)

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 must file a new claim for exemption as provided in this section.

(d)

If the lease, sublease or lease-purchase agreement expires before July 1 of any year, the exemption terminates as of January 1 of the same calendar year. [1977 c.673 §2; 1987 c.756 §20; 1991 c.459 §41; 1991 c.851 §4; 1993 c.19 §3; 1993 c.777 §4; 1995 c.513 §1; 1997 c.434 §1; 1997 c.541 §102; 1999 c.579 §18; 2003 c.117 §1; 2007 c.817 §1; 2009 c.626 §1; 2011 c.655 §1; 2012 c.42 §2; 2013 c.768 §126; 2017 c.554 §1]

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)

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)


Source

Last accessed
Jun. 26, 2021