2002 Legislation
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HOUSE BILL NO. 652 – Property tax/exmptn/low-incm housng


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Daily Data Tracking History

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,
      Absent and excused -- Barrett, Black, Hornbeck, Kunz, Mader, Wheeler,
    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

Bill Text

  ||||              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
  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:
 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
  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.

Statement of Purpose / Fiscal Impact

REPRINT       REPRINT             REPRINT            REPRINT

                        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.


Name: Senator Stegner
Phone:  332-1340 
        Representative Bev Montgomery
Phone:  332-1000