2001 Legislation
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SENATE BILL NO. 1160 – Property tax exmpt/low-income house

SENATE BILL NO. 1160

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View Statement of Purpose / Fiscal Impact



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Daily Data Tracking History



S1160......................................by LOCAL GOVERNMENT AND TAXATION
PROPERTY TAX - EXEMPTIONS - Amends existing law to provide that certain
low-income housing is exempt from property taxation.
                                                                        
02/12    Senate intro - 1st rdg - to printing
02/13    Rpt prt - to Loc Gov

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-sixth Legislature                  First Regular Session - 2001
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1160
                                                                        
                         BY LOCAL GOVERNMENT AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2     RELATING TO PROPERTY EXEMPT FROM TAXATION OF FRATERNAL, BENEVOLENT OR  CHARI-
  3        TABLE  CORPORATIONS OR SOCIETIES; AMENDING SECTION 63-602C, IDAHO CODE, TO
  4        PROVIDE THAT CERTAIN LOW-INCOME HOUSING IS EXEMPT FROM TAXATION,  TO  PRO-
  5        VIDE  THAT  THE  LEASE  OR  USE OF ANY PROPERTY BY ANY SUCH CORPORATION OR
  6        SOCIETY FOR LOW-INCOME HOUSING SHALL NOT BE DEEMED A BUSINESS  OR  COMMER-
  7        CIAL  PURPOSE,  EVEN THOUGH FEES OR CHARGES BE IMPOSED AND REVENUE DERIVED
  8        THEREFROM IF THE LOW-INCOME HOUSING SHALL BE INSURED, FINANCED OR ASSISTED
  9        IN WHOLE OR IN PART THROUGH A FEDERAL OR STATE  HOUSING  PROGRAM  ADMINIS-
 10        TERED  BY  THE  DEPARTMENT  OF  HEALTH  AND WELFARE, THE IDAHO HOUSING AND
 11        FINANCE ASSOCIATION OR THE FEDERAL DEPARTMENT OF HOUSING AND URBAN  DEVEL-
 12        OPMENT  AND THE CORPORATION OR  SOCIETY SHALL BE EXEMPT FROM TAXATION PUR-
 13        SUANT TO SECTION 501(c)(3) OF THE  INTERNAL  REVENUE  CODE;  DECLARING  AN
 14        EMERGENCY AND PROVIDING RETROACTIVE APPLICATION.
                                                                        
 15    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 16        SECTION  1.  That  Section 63-602C, Idaho Code, be, and the same is hereby
 17    amended to read as follows:
                                                                        
 18        63-602C.  PROPERTY EXEMPT FROM TAXATION -- FRATERNAL, BENEVOLENT, OR CHAR-
 19    ITABLE CORPORATIONS OR SOCIETIES. The following property is exempt from  taxa-
 20    tion:  property belonging to any fraternal, benevolent, or charitable corpora-
 21    tion or society, low-income housing as provided below, the World  War  veteran
 22    organization  buildings  and memorials of this state, used exclusively for the
 23    purposes for which such corporation or society is organized; provided, that if
 24    any building or property belonging to  any  such  corporation  or  society  is
 25    leased  by such owner or if such corporation or society uses such property for
 26    business purposes from which a revenue is derived which,  in  the  case  of  a
 27    charitable  organization,  is  not directly related to the charitable purposes
 28    for which such charitable organization exists, then the same shall be assessed
 29    and taxed as any other property, and if any such property is leased in part or
 30    used in part by such corporation or society for  such  purposes  the  assessor
 31    shall  determine  the  value  of the entire building and the value of the part
 32    used or leased for commercial purposes. If the value of the part used for com-
 33    mercial purposes is determined to be three percent (3%) or less than the value
 34    of the entirety, the whole of said property shall remain exempt. If the  value
 35    of  the  part used for commercial purposes is determined to be more than three
 36    percent (3%) of the value of the entirety, the assessor shall assess such pro-
 37    portionate part of such building including the value of the real estate as  is
 38    so leased or used for such purposes, and shall assess all merchandise kept for
 39    sale, and the trade fixtures used in connection with the sale of such merchan-
 40    dise; provided however, that the lease or use of any property by any such cor-
 41    poration  or  society for athletic or recreational facilities, residence halls
 42    or dormitories, low-income housing, meeting rooms  or  halls,  auditoriums  or
 43    club  rooms within the purposes for which such corporation or society is orga-
                                                                        
                                           2
                                                                        
  1    nized, shall not be deemed a business or commercial purpose, even though  fees
  2    or  charges  be imposed and revenue derived therefrom. To receive an exemption
  3    pursuant to this section, the low-income housing shall be insured, financed or
  4    assisted in whole or in part through a federal or state housing program admin-
  5    istered by the department of health and welfare, the Idaho housing and finance
  6    association or the federal department of housing and urban development and the
  7    corporation or society shall be  exempt  from  taxation  pursuant  to  section
  8    501(c)(3) of the Internal Revenue Code.
                                                                        
  9        SECTION  2.  An  emergency  existing  therefor,  which emergency is hereby
 10    declared to exist, this act shall be in full force and effect on and after its
 11    passage and approval, and retroactively to January 1, 2000.

Statement of Purpose / Fiscal Impact


                      STATEMENT OF PURPOSE
                            RS 11066
 This legislation would clarify the property tax exempt status of low
income rental property that is owned and operated exclusively by
non-profit charitable corporations or societies, specifically IRS
501(c)(3) qualified organizations.  Currently, the law is being
interpreted differently and inconsistently by counties throughout the
state.  Low income housing units owned and operated by non-profit
charitable organizations are being taxed by some counties and not by
other counties.  This legislation establishes qualifications for both the
property and the charitable organization to ensure uniform application
of the exemption across the state.
     FISCAL IMPACT
                                

There would be not fiscal impact on the General Fund of the State of
Idaho.  There would be a property tax shift from taxes currently being
paid by charitable organizations for this type of property to all other
property tax payers in the same jurisdiction.  Currently, $107,189 is
paid in property taxes by non-profit charitable organizations across the
state for this kind of property.



 Contact: Joe Stegner 332-1342



STATEMENT OF PURPOSE/FISCAL NOTE  S 116