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H0652...............................................by REVENUE AND TAXATION
PROPERTY TAX - Adds to existing law to provide that certain low-income
housing owned by nonprofit organizations is exempt from taxation.
02/13 House intro - 1st rdg - to printing
02/14 Rpt prt - to Rev/Tax
03/06 Rpt out - rec d/p - to 2nd rdg
03/07 2nd rdg - to 3rd rdg
Rls susp - PASSED - 55-8-7
AYES -- Aikele, Barraclough, Bedke, Bieter, Block, Boe, Bolz,
Bradford, Bruneel, Callister, Campbell, Clark, Collins, Crow, Cuddy,
Deal, Denney, Ellis, Ellsworth, Eskridge, Field(13), Field(20),
Gagner, Gould, Hadley, Harwood, Henbest, Higgins, Jaquet, Jones,
Kellogg(Duncan), Loertscher, Martinez, McKague, Meyer, Montgomery,
Mortensen, Pischner, Pomeroy, Raybould, Ridinger, Roberts, Robison,
Sali, Schaefer, Sellman, Shepherd, Smith(33), Smith(23), Smylie,
Stone, Tilman, Trail, Young, Mr. Speaker
NAYS -- Bell, Hammond, Kendell, Lake, Langford, Moyle, Pearce,
Stevenson
Absent and excused -- Barrett, Black, Hornbeck, Kunz, Mader, Wheeler,
Wood
Floor Sponsors - Bruneel & Kellogg(Duncan)
Title apvd - to Senate
03/08 Senate intro - 1st rdg - to Loc Gov
03/13 Rpt out - rec d/p - to 2nd rdg
03/14 2nd rdg - to 3rd rdg
03/15 3rd rdg - PASSED - 33-1-1
AYES -- Boatright, Branch Brandt, Bunderson, Burtenshaw, Cameron,
Darrington, Davis, Deide, Dunklin, Frasure, Geddes, Goedde, Hill,
Ingram, Ipsen, Keough, King-Barrutia, Little, Lodge, Marley, Noh,
Richardson, Risch, Sandy, Schroeder, Sims, Sorensen, Stegner,
Stennett, Thorne, Wheeler, Williams
NAYS -- Hawkins
Absent and excused -- Andreason
Floor Sponsor - Stegner
Title apvd - to House
To enrol - rpt enrol - Sp signed - Pres signed
03/18 To Governor
03/21 Governor signed
Session Law Chapter 162
Effective: 07/01/02
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature Second Regular Session - 2002
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 652
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO TAX EXEMPTIONS; AMENDING CHAPTER 6, TITLE 63, IDAHO CODE, BY THE
3 ADDITION OF A NEW SECTION 63-602FF, IDAHO CODE, TO PROVIDE THAT CERTAIN
4 LOW-INCOME HOUSING OWNED BY NONPROFIT ORGANIZATIONS IS EXEMPT FROM TAXA-
5 TION.
6 Be It Enacted by the Legislature of the State of Idaho:
7 SECTION 1. That Chapter 6, Title 63, Idaho Code, be, and the same is
8 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
9 ignated as Section 63-602FF, Idaho Code, and to read as follows:
10 63-602FF. PROPERTY EXEMPT FROM TAXATION -- LOW-INCOME HOUSING OWNED BY
11 NONPROFIT ORGANIZATIONS. (1) As provided in this section, low-income housing
12 owned by nonprofit organizations shall be exempt from taxation.
13 (2) In order to qualify as a nonprofit organization under this section,
14 an organization must demonstrate that:
15 (a) It is organized as a nonprofit corporation pursuant to chapter 3,
16 title 30, Idaho Code, or pursuant to equivalent laws in the applicable
17 state of incorporation; and
18 (b) It has received an exemption from taxation from the internal revenue
19 service pursuant to section 501(c)(3) of the Internal Revenue Code; and
20 (c) No proceeds or tax benefits of the organization or from the low-in-
21 come housing property owned by the organization shall inure to any indi-
22 vidual or for-profit entity other than normal employee compensation.
23 (3) In order to qualify for the exemption provided in this section, the
24 low-income housing property shall meet the following qualifications:
25 (a) Both legal and equitable title to the property is solely owned by the
26 nonprofit organization seeking the exemption and is managed by the owner
27 or a related nonprofit organization qualifying for the exemption set forth
28 in section 63-602C, Idaho Code; and
29 (b) Tenants shall not be evicted based upon their inability to pay for a
30 period of three (3) months if such inability is due to a catastrophic
31 event that is not under the tenant's control. For purposes of this subsec-
32 tion, "catastrophic event" means a medical condition or injury in which
33 sudden, serious and unexpected symptoms of illness or injury are suffi-
34 ciently severe to render the tenant unable to participate in employment
35 and such illness or injury has been certified by one (1) or more licensed
36 physicians and/or psychiatrists or psychologists. The term "catastrophic
37 event" does not apply to individuals who voluntarily remove themselves
38 from the workforce; and
39 (c) Except for a manager's unit, all of the housing units in the low-in-
40 come housing property are dedicated to low-income housing in the following
41 manner: Fifty-five percent (55%) of the units shall be rented to those
42 earning sixty percent (60%) or less of the median income for the county in
43 which the housing is located; twenty percent (20%) of the units shall be
2
1 rented to those earning fifty percent (50%) or less of the median income
2 of the county in which the housing is located; and twenty-five percent
3 (25%) of the units shall be rented to those earning thirty percent (30%)
4 or less of the median income for the county in which the housing is
5 located.
6 (4) The exemption provided in this section shall not apply:
7 (a) If the project is financed after the effective date of this act and
8 applicable law permits the payment of property taxes with federal or state
9 funds, grants, loans or subsidies; or
10 (b) If the property is receiving federal project-based assistance, as
11 provided by 42 U.S.C. sections 1437f(d)(2), 1437f(f)(6) and 1437f(o)(13);
12 or
13 (c) To any property used by a taxpayer to qualify for tax credits under
14 the provisions of 26 U.S.C. chapter 42 or any successor programs until
15 such time as the property is solely owned by a nonprofit organization as
16 defined in this section and is no longer utilized to receive federal tax
17 credits.
18 (5) Notwithstanding any other provision of this section, a low-income
19 housing property shall be exempt from taxation due to undue hardship if:
20 (a) The property was financed prior to the effective date of this act;
21 and
22 (b) Such financing was dependent upon the tax-exempt status of the prop-
23 erty; and
24 (c) The law does not allow additional federal or state revenues to be
25 available for the payment of property taxes.
26 (6) Nothing in this section shall affect the qualification of properties
27 for tax-exempt status under other provisions of title 63, Idaho Code.
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STATEMENT OF PURPOSE
RS 11833
This legislation will clarify the property tax exempt status of
very low-income rental property when owned and operated by charitable
non-profit organizations that meet strict qualifications of ownership,
management, and utilization. Currently, counties throughout the
State of Idaho are treating these kinds of low-income property
inconsistently. Similar housing units are being taxed in some
counties and not in others. This inconsistent application of tax
policy creates inequality. This bill creates strict qualifications
for both the organization and the property to ensure a uniform
application of the exemption across the state.
FISCAL IMPACT
There would be no impact to the General Fund of the State of Idaho.
There would be a shift and realignment of the property taxes in
some counties of the state depending on the addition or deletion of
property to the individual counties tax roles. It is possible, in
the case where a county is already at the maximum allowable levy,
there could be a loss of income to the county. Currently, in all
Idaho counties, $107,892 is paid in property taxes by non-profit
organizations that would qualify for a tax exemption under the
guidelines of this bill.
Contact.
Name: Senator Stegner
Phone: 332-1340
Representative Bev Montgomery
Phone: 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE Bill No. 652