Relating to exemption of property owned by a limited equity cooperative; and prescribing an effective date.
Summary
HB 3232 modifies Oregon’s property tax exemption rules for property owned by a limited equity cooperative. The bill keeps the existing exemption framework in ORS 307.515 to 307.523, but removes the requirement that the housing units must have been constructed or converted to limited equity cooperative ownership only after a local governing body adopted the exemption provisions. In its place, the bill focuses on whether the property is occupied by low-income persons with proprietary leases, whether occupant charges reflect the value of the tax benefit, whether the exemption was approved under the statutory process, and whether the application meets any additional local criteria.
The bill also sets a deadline for eligibility: the exemption must be approved for an application filed before July 1, 2030. The amendments apply to property tax years beginning on or after July 1, 2026, and the act takes effect 91 days after adjournment of the 2025 legislative session. In practical terms, the bill broadens access to the exemption for limited equity cooperatives by allowing more properties to qualify, while preserving local government authority to adopt nonconflicting additional criteria.
Impact
HB 3232 amends ORS 307.520, which governs property tax exemptions for limited equity cooperative housing. By eliminating the prior construction/conversion timing restriction, the bill expands the pool of cooperative housing properties that may qualify for exemption, potentially reducing property tax liability for eligible cooperatives and affecting local government tax revenue. The bill continues to require low-income occupancy and approval through the existing application process, and it preserves local discretion to add compatible eligibility criteria.
Sentiment
The available voting history shows strong and unanimous support for the bill at each stage: it passed the House committee 7-0, the House floor 54-0, the Senate committee 5-0, and the Senate floor 27-0. No committee transcripts were provided, but the unanimous votes suggest broad bipartisan agreement and little visible controversy around the measure.
Contention
No explicit opposition or major controversy is reflected in the provided materials. The main policy issue embedded in the bill is whether limited equity cooperatives should remain subject to the older restriction tying eligibility to the timing of local adoption of the exemption. Support appears to have centered on expanding affordable housing tax relief, while local governments retain some ability to impose additional nonconflicting criteria. The bill does not show any recorded dissent in committee or on the floor.