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The Oregon Administrative Rules contain OARs filed through September 15, 2014
 
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DEPARTMENT OF REVENUE

 

DIVISION 308A

LAND SPECIAL ASSESSMENTS

150-308A.056

Farm Use Definitions, Inactivity Due to Illness, and Description of Lands in Farm Use

(1) This rule applies to land in both exclusive farm use zones and non-exclusive farm use zones that may qualify for special assessment under ORS 308A.062 or 308A.068.

(2) Definitions:

(a) “Farm unit” means a farming enterprise which includes all parcels being farmed by a single operator, whether the operator owns or leases the farmland.

(b) "Farm use" is defined in ORS 308A.056 and applies to land both inside and outside exclusive farm use zones.

(c) "Illness" means sickness, disease, injury, or disorder of body or mind which prevent the farmer or immediate family member from performing necessary farm operations.

(d) For purposes of subsection (2)(c): "Immediate family member" means the farmer's spouse, children, or any person for whom the farmer has a legal responsibility including, but not limited to, guardianship of a dependent parent or child.

(e) "Land" means land in its natural state, including any site developments (see ORS 307.010).

(A) “Land” includes all mines, minerals, quarries, dikes, banks, drainage tile, water rights, and the like. Since ORS 308A.056 relates only to land used for farming, any mineral reserves under the land continue to be assessed at real market value as defined by ORS 308.205. Minerals include oil and gas. Severed mineral interests, even though underlying zoned farmland, are assessed to the owner in accordance with ORS 308.115.

(B) For the purpose of assessment of land in farm use, "land" does not include buildings, structures, improvements (unless their contribution is an integral part of the income attributable to the land), machinery, equipment, land improvements for homesites, fixtures erected upon or affixed to the land itself, or land used for a non-farm residence or other non-farm purpose.

(f) "Wasteland" includes but is not limited to swamps, rock outcroppings, gullies, unusable overflow lands, and drainage ways.

(A) Wasteland does not include tillable lands left idle or uncultivated and non-tillable grazing lands left unused when the accepted farming practice is to utilize the land.

(B) Wasteland does include land described in paragraph (1)(f)(A), if the owner can show that it is uneconomical to utilize the land as part of the farm unit. Utilizing the land is uneconomical if the cost to raise crops or animals exceeds the value of the crops or animals. Examples in which it would not be economical to utilize the land include:

(i) An unfenced area of grazing land where the annualized cost of fencing would exceed the income derived from the land.

(ii) An area of a farm that was only profitable through irrigation that is now unused because the cost of electricity to operate the irrigation pumps increases expenses beyond the income that can be derived from that area of land.

(C) Wasteland caused by the taxpayer, owner, or person in control of the property is not entitled to special farm use assessment. Examples of taxpayer-created wasteland include "mined out" land where gravel, soil, or other minerals have been extracted, and mine tailing refuse areas.

(3)(a) The law seeks to give the benefits of ORS 308A.062 and 308A.068 to that farmland which is operated primarily for the purpose of obtaining a profit in money.

(b) The assessor must consider all requirements of ORS 308A.056 and be convinced that the land is used in a manner that is reasonably designed and intended to obtain a profit in money by accepted farming practices. If the primary purpose of the current use of the land is not to obtain a profit in money, the land is not farm use land. This primary purpose of the land must be ascertained from overt acts. All pertinent facts will be considered to determine if property qualifies as farm use land. Pertinent information may include:

(A) Present and past use of the land.

(B) If the farming operation is conducted by another for the owner, the provisions of the oral or written agreement including the term, area let, consideration, and provisions for termination.

(C) Participation in governmental or private agricultural programs or activities.

(D) Productivity of the land.

(E) Number of livestock or poultry (by type).

(F) Amount of last harvest of each crop.

(G) Gross income from crops, livestock, and livestock products.

(H) Uses of the land for other than farming operation.

(I) Ratio of farm or agricultural use as against other uses of the land.

(4)(a) Farm inactivity for one year or less due to illness of the farmer or an immediate family member does not disqualify the property from farm use special assessment or continuation of abatement.

(A) Proof of illness must be provided to the assessor by a written statement from a licensed medical practitioner. The statement must identify the nature of the illness, the onset of the illness, and the extent of its debilitating nature.

(B) The timing of the illness must prevent farming practices.

(b) For meeting the farm income requirements of ORS 308A.071 and 308A.119, the year of farm inactivity due to illness is not counted as one of the five years for income or abatement determination.

(5) Notwithstanding section (3), any part of a farm unit that is employed in or supports a non-farm use does not qualify for special assessment. Examples of non-farm use include, but are not limited to:

(a) Land under retail stores, except for farm stands offering agricultural products for sale as described in ORS 215.213 and 215.283.

(b) Land under processing facilities, except as allowed by ORS 215.213 and 215.283.

(c) Land under areas used to encourage the use or enjoyment of agricultural products such as tasting rooms, banquet halls, public gathering areas, or public entertainment.

(d) Land under structures such as communication towers, and improvements that support the structures.

(e) Land under structures used for power generation or transmission such as wind turbines, substations, crane pads, and improvements that support the structures.

(f) Private roads not used primarily to support the farming operation such as those used to access structures listed in subsections (d) and (e).

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.380 & 308A.056
Hist.: RD 8-1992, f. 12-29-92, cert. ef. 12-31-92; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.380-(C); REV 17-2008, f. 12-26-08, cert. ef. 1-1-09

150-308A.056(1)(g)

Disposal by donation to a local food bank or school

(1) Definitions for this rule

(a) “Local food bank” means any organization located in the state of Oregon, that is a charitable or not-for-profit organization that collects food and distributes it, without charge, to the needy, including children and families, homeless, unemployed, elderly or low income people. For the purposes of ORS 308A.056(1)(g) and this rule, “local food bank” includes regional food banks as defined under OAR 813-220-0005(6).

(b) “School” means a public or private educational institution, or a publicly or privately funded early childhood education program located in the state of Oregon.

(2) For the donation to a local food bank or school of products or by-products raised for human or animal use to constitute a “farm use” under ORS 308A.056, the owner, renter or operator of the land to be qualified for farm use special assessment shall document the donation in writing and shall submit that documentation to the county assessor, if requested.

(a) The documentation required by this subsection shall contain, at a minimum:

(A) The name, address, and phone number of the owner, renter or operator applying for or maintaining the land in special assessment.

(B) The description, date, and quantity of the donation.

(C) The description of the land upon which the product or by product was raised including either the county assessor’s tax lot number or tax account number.

(D) The signature of the director, supervisor, or other appropriate official, whether paid or volunteer, of the local food bank or school receiving the donation.

(E) The name and address of the local food bank or school receiving the donation.

(F) A signed statement by the owner, renter or operator of the land for which special assessment is requested or maintained verifying that the information provided is accurate.

(b) The owner, renter or operator may satisfy the documentation requirements of section (2) by submitting a completed Form 150-101-240 to the county assessor.

(c) If the owner, renter or operator does not produce the documentation described in this subsection in response to a request from the county assessor, then the land may be disqualified from special assessment.

(3) Nothing in ORS 308A.056(1)(g) or this rule shall constitute an exception to the income requirements for nonexclusive farm use zone farmland, as set forth in ORS 308A.071, and the value of donated products or by-products shall not be included in the calculation of either “gross income” under ORS 308A.071(7)(b), or “income from consumed products” under OAR 150-308A.071(1). Publications: Contact the Oregon Department of Revenue for information about how to obtain a copy of the publication referred to or incorporated by reference in this rule pursuant to ORS 183.360(2) and 183.355(1)(b).

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.056
Hist.: REV 3-2014, f. & cert. ef. 7-31-14

150-308A.062

Assessment of Farmlands Within Exclusive Farm Use (EFU) Zones

(1)(a) Zoned farm use land means land that is zoned as farm use land pursuant to ORS 215.010 to 215.190.

(b) Real market value is the basis for the assessment of farmland not qualified to be assessed at farm use value. Real market value is defined in ORS 308.205.

(2) Qualification and Disqualification Dates:

(a) To be entitled to farm use assessment, land must be qualified as of January 1 each year. Often, qualifying farm use land is not farmed during the winter months which include the qualifying date of January 1. If land is not employed in farm use on January 1, the assessor may look at the prior year's usage of the land to determine qualification for January 1.

(b) Farm use disqualifications take effect July 1 following the disqualification.

(3) Appeal on the question of qualification for special assessment as farm use land: An appeal from a decision of the assessor concerning qualification for special assessment as farmland under ORS Ch. 308A is made directly to the Magistrate Division of the Tax Court under ORS 305.275(1) (also see 305.280). It is not made through an appeal to the county Board of Property Tax Appeals.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.370 & 308A.062
Hist.: 12-63; 1-66; 2-68; 3-70; 9-71; 11-73; 12-75; 12-31-77; TC 17-1979, f. 12-20-79, cert. ef. 12-31-79; RD 9-1983, f. 12-20-83, cert. ef. 12-31-83; RD 9-1984, f. 12-5-84, cert. ef. 12-31-84; RD 16-1987, f. 12-10-87, cert. ef. 12-31-87; RD 8-1988, f. 12-19-88, cert. ef. 12-31-88; RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; RD 11-1990, f. 12-20-90, cert. ef. 12-31-90; RD 8-1991, f. 12-30-91, cert. ef. 12-31-91; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.370

150-308A.068

Assessment of Farmlands Outside of Exclusive Farm Use (EFU) Zones

(1)(a) To qualify for assessment at its farm use value, land not within an exclusive farm use zone:

(A) Must be currently employed in a qualifying farm use;

(B) Must have been used for farm use for the two years preceding the current assessment year;

(C) Must have met the income requirement for three out of the last five years and;

(D) Must have an application filed with the assessor meeting the requirements of ORS 308A.077.

(b) Real market value is the basis for the assessment of farmland not qualified to be specially assessed at farm use value. Real market value is defined in ORS 308.205.

(2) Qualification and Disqualification Dates:

(a) To be entitled to farm use assessment, land must be qualified as of January 1 each year. Most land is not farmed during the winter months including January 1. If land is not employed in farm use on January 1, the assessor may look at the prior year's usage of the land to determine qualification for January 1.

(b) All farm use disqualification takes effect July 1 following the disqualification.

(3) Effect of lease or option to buy surface rights. If any owner of land outside an EFU zone grants and has outstanding a lease or option to buy surface rights of such land that permits other than farm use of all or a portion of the land, that land subject to such other use is not qualified for special farm use assessment under ORS Ch. 308A. Leases for hunting, fishing, camping or other recreational use or the exploration of geothermal, mineral or other subsurface resources will not disqualify the land if the exploration, use, or possession does not interfere with the farm use of the farmland. The income derived from such leases will not be included for the income test.

(4) Appeal on the question of qualification for special assessment as farm use land: An appeal from a decision of the assessor concerning qualification for special farm use assessment under ORS Ch. 308A is made directly to the Magistrate Division of the Tax Court under 305.275(1) (also see 305.280). It is not made through an appeal to the county Board of Property Tax Appeals.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.380 & 308A.068
Hist.: 12-63; 1-66; 2-68; 3-70; 9-71; 11-73; 3-76; 12-31-77; RD 8-1988, f. 12-19-88, cert. ef. 12-31-88; RD 8-1992, f. 12-29-92, cert. ef. 12-31-92; RD 2-1997(Temp), f. & cert. ef. 9-15-97 thru 3-9-98; RD 9-1997, f. & cert. ef. 12-31-97; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.380-(B)

150-308A.071

Gross Income Requirement

(1) Income From Consumed Products. For purposes of the income requirement for farmland or a farm parcel outside an exclusive farm use zone, gross income includes the value of any crop or livestock used by the owner personally or in the farming operation. The owner must keep records accurately reflecting both the value and the use of the crop or livestock in a manner consistent with generally accepted accounting practices. The value of any crop or livestock used by the owner personally or in the farming operation is the amount of money the product would have been sold for in the normal marketing of the crop or livestock by the taxpayer. However, the value of products consumed, by the owner personally or in the farming operation, must constitute no more than 49 percent of gross income as required under ORS 308A.071.

(2) Adjusted Gross Income From Livestock. In determining gross income from livestock, the purchase cost must be deducted from the gross sales price.

(3) Burden of Proving Income. The burden of proving that property that is not within an exclusive farm use zone meets the gross income requirements of ORS 308A.071 is upon the owner or person claiming special assessment. This burden l is met if information establishing sufficient gross income is supplied to the county assessor as provided below. A failure to provide the required income information to the county assessor constitutes grounds for disqualification under 308A.116(1)(c).

(4) Income Information. The following procedures apply if the assessor lacks sufficient information on March 1 to support a determination that land not in an EFU zone qualifies for special farm use assessment.

(a) On or before March 1, the assessor must send notice to the owner or person claiming special assessment of the need to provide income information for property subject to special assessment. The assessor must include an income information questionnaire with the notice. The property owner must use the questionnaire to provide income information to the county assessor. The property owner must provide the income information to the county assessor no later than April 15.

(b) The assessor must send the notice and the questionnaire to the last known address of record of the owner or person claiming special assessment for the subject property. The notice and questionnaire must be in a form approved by the Department of Revenue.

(c) If the information provided to the county assessor is sufficient to determine whether or not the subject property is qualified for special assessment, the assessor must take the appropriate action.

(d) If the information provided to the county assessor is insufficient to make a determination as to the qualification of the subject property for special assessment, or if no information is provided, the assessor must send a notice to the last known address of record for the owner or person claiming special assessment. The notice must be in a form approved by the Department of Revenue and must include:

(A) A statement of the assessor's intent to disqualify the subject property; and

(B) A statement that within 30 days after the date of the mailing of the notice, the owner or person claiming special assessment may appear and show cause why the property should not be disqualified.

(e) In determining whether the subject property qualifies for special assessment, the assessor must take into consideration information obtained through the income information questionnaire, the show cause hearing and the county assessor's records.

(f) If property is disqualified from special assessment solely because no income information was provided by April 15, or within the 30 days of assessor's notice of intent to disqualify, the property owner may file an appeal with the Magistrate Division of the Tax Court.

(A) "Good and sufficient cause" has the meaning given in OAR 150-307.475. The failure of the county assessor to provide the notice required in subsection (a) of this rule on or before March 1 constitutes good and sufficient cause for the owner's failure to provide timely income information.

(B) The procedural requirements contained in this rule are in addition to the requirements of ORS 308A.718.

(C) Nothing contained in this rule alters the right of a person claiming special assessment to deferral and abatement of additional tax, pursuant to ORS 308A.119.

(D) Nothing contained in this rule precludes the assessor from continuing special assessment on farmland if the assessor determines that the property meets the qualifications.

(5) The assessor may send a copy of the income information received by the assessor under subsection (3) of this rule to the Department of Revenue.

(6) Examples: Satisfying income requirements:

(a) A ten acre parcel in an area not zoned EFU has never been used for farm purposes. For this parcel to qualify for special farm use assessment, the owner must develop an income history from farm uses of the parcel. The parcel will meet the income requirements of ORS 308A.071(2)(a) if it produces at least $1,000 gross income in each of the last three consecutive years or in any three of the last five consecutive years.

(b) A ten acre parcel was segregated from a larger farm one year ago. The land was not farmed during the year following segregation. In order to qualify for farm use assessment, the parcel must be farmed for two successive years (ORS 308A.068(1)) and meet the income requirement of at least $1,000 in one of the two years (assuming the large farm met the income requirement before the ten acre parcel was segregated).

(c) A four acre parcel in an area not zoned EFU has been farmed continually. The income has never exceeded $300. In order to qualify for special farm use assessment, the parcel must produce at least $650 in gross income per year for any three years during any consecutive five year period.

(d) A twenty two acre parcel in an area not zoned EFU includes a ten acre farm woodlot, four and one-half acres of three year old cherry trees, five acres of pasture, two acres of wasteland and a one-half acre non-farm homesite. The five acres of pasture must have produced at least $650 gross income in one of the last three years (assuming the property met the income requirement in the two years preceding the planting of the cherry trees) to remain qualified for special assessment. The one-half acre non-farm homesite (at market), the immature cherry orchard (see ORS 308A.056(3)(c)), the farm woodlot (see 308A.056(3)(h), and the wasteland (see 308A.074)) are not counted in determining the number of acres to be considered under 308A.071(2)(a). The wasteland in a non-EFU zone does not qualify because it is not currently employed under 308A.056(3), and should not be in the calculation for the income test.

NOTE: In order for the two acres of wasteland to be assessed at its farm use value under ORS 308A.074, and the homesite to be valued under ORS 308A.256, the owners must meet an adjusted gross income test and file an annual application.

(7) The farmland owner or the operator of the farm unit must file the required excise or income tax returns including a Schedule F or a schedule showing rental income or expenses of each farmland owner or the operator of the farm unit.

(a) The assessor may require the farmland owner or farm unit operator provide a copy of the income tax returns and schedules showing farm income. Failure to provide required income information including copies of the required tax returns and schedules is grounds for disqualification.

(b) Copies of income tax returns and schedules of farm income are confidential and must be safeguarded in accordance with OAR 150-192.501.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.372 & 308A.071
Hist.: RD 9-1984, f. 12-5-84, cert. ef. 12-31-84; RD 16-1987, f. 12-10-87, cert. ef. 12-31-87; RD 8-1988, f. 12-19-88, cert. ef. 12-31-88; RD 8-1991, f. 12-30-91, cert. ef. 12-31-91; RD 8-1992, f. 12-29-92, cert. ef. 12-31-92; RD 2-1997(Temp), f. & cert. ef. 9-15-97 thru 3-9-98; RD 9-1997, f. & cert. ef. 12-31-97; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.372

150-308A.074

Wasteland

"Wasteland" has the same meaning as defined in OAR 150-308A.056(1)(b).

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.074
Hist.: REV 11-2000, f. 12-29-00, cert. ef. 12-31-00

150-308A.080

Acquired Land as Part of Farming Unit

Land not in an exclusive farm use zone (non-EFU) that is acquired by an owner of a qualifying farm unit may be added to the farm unit if:

(1) Newly acquired land is put to a farm use in a timely manner consistent with accepted farming practices. There is no requirement that a previous owner used the land for farming.

(2) The owner, described in ORS 308A.077(2)(b), files an application with the county assessor on or before April 1 preceding the first tax year for which special farm use assessment is requested.

(a) The first year the acquired property may be eligible for special assessment is the calendar year following acquisition.

Example: Non-EFU property acquired February 10, 1999. Calendar year 2000 is the first year after acquisition. Therefore, the first year that this property could receive special assessment is tax year 2000-01 and applications for tax year 2000-01 special farm use assessment are due April 1, 2000.

(b) There is no requirement that the taxpayer seek or receive special farm use assessment for the property for its first eligible tax year.

Example: Non-EFU property acquired February 10, 1999. Although the acquired property was put into farm use immediately after purchase, the owner decided to wait three years before applying for special assessment. For this property to be placed under special assessment for tax year 2003-04, the taxpayer must apply by April 1, 2003.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.374 & 308A.080
Hist.: RD 8-1991, f. 12-30-91, cert. ef. 12-31-91; RD 8-1992, f. 12-29-92, cert. ef. 12-31-92; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.374

150-308A.092

Valuation of Certain Agricultural Land to Reflect Value for Farm Use Only

(1) Certain farm properties are set aside under a government payment program such as the federally administered Conservation Reserve Program (CRP). The payments received for farmlands placed in these conservation programs must not be used as income for computing farm use values. Income data from similar lands that are not included in the conservation programs should be used instead to compute farm use values. New farm use values must be computed each year as though the land in the conservation programs was being used for a farm use.

NOTE: Acreage that is not in an exclusive farm use zone, and is under a farm-related government conservation program, is not subject to the gross income requirements.

(2) Values for farm use are to be determined on the basis of highest and best agriculture use, regardless of how the land is currently used and employed in agriculture.

Example 1: The land is capable of raising wheat, but the owner elects to pasture the property. The highest and best agricultural use of the property is as wheat land, so the farm use value would be based on wheat land.

Example 2: The land is capable of raising wheat, but the owner adds site improvements to enable the planting of an orchard. The highest and best agricultural use is now as orchard land, so the farm use value would be based on orchard land.

(3) If the owner of land assessed as farm use land contends the assessor's farm use value is not correct, the value may be appealed to the county Board of Property Tax Appeals as provided by ORS 309.100. An appeal from an adverse decision of the board may be filed with the Magistrate Division of the Tax Court as provided by 305.275(2) (also see 305.280).

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.345 & 308A.092
Hist.: RD 11-1990, f. 12-20-90, cert. ef. 12-31-90; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.345; REV 3-2014, f. & cert. ef. 7-31-14

150-308A.107

Calculation of MSAV When SAV Soil Classification is Changed

(1) Definitions:

(a) "MSAV" means maximum assessed value for property subject to special assessment (maximum specially assessed value).

(b) "SAV" means specially assessed value.

(c) "MSAV tables" are the tables that provide a maximum assessed value per acre equal to 103% of the maximum assessed value per acre from the previous assessment year. The county assessor is required to develop these tables for each assessment year under ORS 308A.107(3)(b).

(2) When an SAV soil classification as provided by the assessor in each county is changed, the MSAV must use corresponding soil classification values from the MSAV Table if:

(a) There is a physical change such as, but not limited to:

(A) Irrigation is added.

(B) Irrigation is removed.

(C) Soil movement caused by slides, erosion, flooding, wind, etc.

(D) Soil is depleted indefinitely due to extended over use of crop.

(E) Soil is enhanced due to extensive additives to the soil.

(F) Trees are removed so that cultivation can take place and previous classification was based in part on the inability to cultivate.

(G) Rocks and other debris are removed to enhance cultivation.

(H) Site improvements are added including but not limited to drainage system, fill, contouring, leveling, and diking.

(b) There are specific non-physical changes such as:

(A) Comprehensive soil reclassification due to a new published government agency soil survey.

(B) Land class acreage adjustments to implement a GIS mapping system.

(C) The assessor reasonably determines that a property's land is no longer in the same land class that it was in during the prior assessment year. The assessor's determination that the land is no longer in the same land class cannot be arbitrary, but must be based on preexisting criteria for the respective land classes. The preexisting criteria for the respective land classes must be clear, objective, consistently applied and uniform within the county. Land classification changes must be the result of the reasonable application of the preexisting criteria to the actual condition of the land.

(3) The assessor must calculate the corresponding MSAV for new SAV soil classes using the following procedure:

(a) Divide the average MSAV for all soil types by the average SAV for all soil types to derive a changed property ratio.

(b) Multiply the SAV value of the new soil type by the changed property ratio to obtain the MSAV for the new soil class.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.370 & 308A.107
Hist.: REV 13-1999, f. 12-30-99, cert. ef. 12-31-99; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.370(5)

150-308A.113

Disqualification of Exclusive Farm Use Farmland; Site Inspection and Notation

(1)(a) Before Exclusive Farm Use (EFU) land is disqualified from farm use assessment due to discovery by the assessor that the land is no longer being devoted to a farm use, the assessor must:

(A) Make a reasonable effort to contact the owner, owner's agent or person using the land;

(B) Make a site inspection of the property; and

(C) Request the recent history of the property's use.

(b) The assessor must make a record of the inspection that includes when the inspection was made, who made the inspection, copy of contact letter(s) or record of other means of contact, information from the person contacted, and notations of the conditions found. Notations about the conditions found may include the farm uses being made of the property, areas having no apparent farm use, vegetation on the property and its condition, whether the property is fenced and the fence's condition, and other conditions of the property that indicate a farm use or lack of farm use. The record of inspection must be retained in the assessor's office for at least three years.

(2) If property disqualification is effective after June 30, the EFU property will remain valued for farm use on the assessment and tax roll until the following July 1.

(a) Disqualification for non-farm use occurs as of the January 1 assessment date and is effective as of June 30 if the disqualification notice is mailed on or before August 14.

(b) If EFU property disqualification is effective on or before June 30 for any reason other than for non-farm use, to be valid the notice must be mailed within 30 days after the date that land is disqualified.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.397 & 308A.113
Hist.: RD 10-1985, f. 12-26-85, cert. ef. 12-31-85; RD 16-1987, f. 12-10-87, cert. ef. 12-31-87; RD 9-1997, f. & cert. ef. 12-31-97; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.397

150-308A.116

Disqualification of Non-Exclusive Farm Use (Non-EFU) Farmland; Site Inspection and Notation

(1)(a) Before non-EFU land is disqualified from farm use assessment due to discovery by the assessor that the land is no longer being devoted to a farm use, the assessor must;

(A) Make a reasonable effort to contact the owner, owner's agent or person using the land;

(B) Make a site inspection of the property; and

(C) Request the recent history of the property's use.

(b) The assessor must make a record of the inspection that includes when the inspection was made, who made the inspection, copy of contact letter(s) or record of other means of contact, information from the person contacted, and notations of the conditions found. Notations about the conditions found may include the farm uses being made of the property, areas having no apparent farm use, vegetation on the property and its condition, whether the property is fenced and the fence's condition, and other conditions of the property that indicate a farm use or lack of farm use. The record of inspection must be retained in the assessor's office for at least three years.

(c) If the inspection indicates a farm activity being conducted which may not provide sufficient income to satisfy the income test, the assessor must demand that the landowner complete an income questionnaire.

(2) If property disqualification is effective after June 30, the non-EFU property will remain valued for farm use on the assessment and tax roll until the following July 1.

(a) Disqualification for non-farm use occurs as of the January 1 assessment date and is effective as of June 30 if the disqualification notice is mailed on or before August 14.

(b) If non-EFU property disqualification is effective on or before June 30 for any reason other than for non-farm use, to be valid the notice must be mailed within 30 days after the date that land is disqualified.

Stat. Auth.: ORS 305.100

Stats. Implemented: ORS 308.390 & 308A.116

Hist.: 8/64, 1/66; 2/68; 3/70; 9/71; 11/73; 12/31/77; TC 17-1979, f. 12-20-79, cert. ef. 12-31-79; RD 9-1984, f. 12-5-84, cert. ef. 12-31-84; RD 10-1985, f. 12-26-85, cert. ef. 12-31-85; RD 16-1987, f. 12-10-87, cert. ef. 12-31-87; RD 9-1997, f. & cert. ef. 12-31-97; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.390

150-308A.250

Definition of Specially Assessed Homesites

(1) "Homesite" as defined in ORS 308A.250(3) includes site developments as defined in OAR 150-307.010(1)(2)(a)(A)and amenities associated with the raw, undeveloped land such as topography that affords the site a particular view, river frontage, property access, and utility access.

(2) A forest homesite qualified under ORS 308A.253(1) must be located on a parcel of land with greater than 10 acres of specially assessed forestland, that is zoned exclusive farm use (EFU), forest use, or farm and forest use.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.229 & 308A.250
Hist.: RD 8-1991, f. 12-30-91, cert. ef. 12-31-91; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.229

150-308A.253

Application for Specially Assessed Homesite

(1) An annual application must be filed with the assessor on or before April 15 of each year to receive the special assessment on a qualified homesite associated with a farm lot or parcel in a non-exclusive farm use (non-EFU) zone.

(2) An application is not required to receive the special assessment on a qualified homesite situated on:

(a) A farm use lot or parcel in an exclusive farm use (EFU) zone;

(b) A forestland lot or parcel in an EFU, forest use, or mixed farm and forest use zone and classified by the assessor as highest and best use forestland, designated forestland, or small tract forestland (STF); or

(c) A lot or parcel that is subject to a wildlife habitat special assessment.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.253
Hist.: REV 11-2000, f. 12-29-00, cert. ef. 12-31-00; REV 9-2006, f. 12-27-06, cert. ef. 1-1-07

150-308A.256

Qualified Specially Assessed Homesite Valuation

(1) Definitions:

(a) "Parcel" is a quantity of land that is capable of being described in a single description by a closed traverse, or as one of a number of subsections or sections in a township(s), or as lots, blocks, or tracts in a subdivision. A "parcel" may consist of one or more tax lots.

(b) "Contiguous" means having a common boundary to some extent greater than a point. Parcels are contiguous if separated by public or county roads, state highways, or non-navigable streams or rivers. Parcels are not contiguous if they are separated by interstate freeways, or navigable streams or rivers, except where there is direct connecting access, such as an underpass, for property separated by an interstate freeway.

(c) "Site Developments" has the same meaning as in OAR 150-307.010(1)(2)(a)(A).

(d) "Land Improvements" is synonymous with "site developments."

(e) "Same Ownership" -- to be considered the "same ownership," separate land accounts (tax lots) must have a common name in the property title. For example, a parcel owned by a wife just in her name is under the same ownership as a parcel she owns jointly with her husband. Properties do not have the "same ownership" if one parcel is owned by a husband and wife and the other parcel is owned by a corporation even though the corporation is owned by the husband and wife.

(f) "MSAV" means maximum assessed value for property subject to special assessment (maximum specially assessed value).

(2) Land comprising homesites for dwellings being used in conjunction with farm use in EFU zones, qualifying homesites outside the EFU zones, and qualified forest homesites must be valued at the special value provided by ORS 308A.256. Land comprising a non-qualifying homesite must be assessed at its real market value as defined in 308.205 pursuant to 308A.259.

(3) The method for determining the value for a qualified homesite is the same whether the homesite is located within an exclusive farm use (EFU) zone, an area not zoned for exclusive farm use (non-EFU), or for forest homesites as defined in ORS 308A.253(1).

(a) The first step in valuing a qualified homesite is to determine the total number of acres of the "parcel" and contiguous acres under the same ownership.

(b) The second step is to determine the bare land average per acre real market value (RMV) of the parcel. To do this:

(A) First, determine the total bare land RMV (including riverfront, view, etc.) for the parcel and contiguous acres under the same ownership on which the homesite is located.

(B) Second, divide the total bare land RMV of the parcel and contiguous acres under the same ownership by the total number of acres in the parcel and contiguous acres under the same ownership.

(C) The result is the average RMV for one acre of the parcel and contiguous acres under the same ownership.

(c) The third step is to determine the specially assessed value (SAV) of the "land improvements." The SAV of land improvements are to be valued at $4,000, or the depreciated replacement cost of the items that make up the land improvements, whichever is less.

(d) The average RMV of one acre of the land plus the land improvement SAV equals the total "homesite" SAV. However, the land improvement value must be carried as a separate item on the land record as specified in OAR 150-307.010(1)(2)(a)(B).

(4) Calculation of homesite MSAV.

(a) For the 1997-98 tax year, the MSAV on homesites qualified for the 1995-96 tax year and before equals the homesite's SAV for the 1995-96 tax year reduced by 10 percent.

(b) For the 1997-98 and subsequent tax years, the MSAV of any newly qualified homesite equals the product of the residential rural property class 4-X-X changed property ratio multiplied by the farm or forest homesite SAV. The MSAV for a homesite first qualified for the 1996-97 tax year is calculated under this subsection for the 1997-98 tax year.

(c) Once the MSAV of a homesite has been established by subsection (a) or (b) above, the MSAV increases 3% each year thereafter.

(5) The assessed value of a qualified farm or forest homesite equals the lesser of the homesite's SAV or the homesite's MSAV.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.377 & 308A.256
Hist.: RD 8-1988, f. 12-19-88, cert. ef. 12-31-88; RD 8-1991, f. 12-30-91, cert. ef. 12-31-91; RD 9-1997, f. & cert. ef. 12-31-97; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.377

150-308A.315(4)

Ratio Calculation for Open Space Lands

(1) An open space ratio must be applied to the open space special assessed value of newly designated open space lands to determine a maximum specially assessed value. The Department of Revenue will annually calculate a statewide ratio for open space lands.

(a) Counties with 10 or more open space accounts must develop and apply their own ratio.

(b) Counties having less than 10 open space accounts must use the statewide ratio.

(2) The ratio is calculated by dividing:

(a) The total current year maximum specially assessed value of land for all open space accounts (prior year's maximum specially assessed value multiplied by 103 percent), by

(b) The total current year specially assessed value of land for the same open space accounts.

(3) Only land that is specially assessed as open space may be used in the open space ratio calculation.

(4) Property that may not be used in developing the open space ratio calculation includes:

(a) Land that is valued under another special assessment program;

(b) Land that does not qualify for open space assessment;

(c) Any portion of an account that is assessed at market value, such as buildings;

(d) New open space accounts; and

(e) Disqualified accounts.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.315
Hist.: RD 9-1997, f. & cert. ef. 12-31-97; REV 2-2002, f. 6-26-02, cert. ef. 6-30-02, Renumbered from 150-308.765

150-308A.703

When to Impose Additional Tax

(1) Additional Tax Computation:

(a) Additional taxes computed for 1991-92 tax year and thereafter equal the difference between the taxes assessed against the land in that year and the taxes that would have been assessed against the land had the land not been in farm use.

(b) Additional taxes computed for the years of special assessment prior to the 1991-92 tax year equal the difference between the real market value and the specially assessed value for the last year of special assessment prior to the 1991-92 tax year times the tax rate for that tax year times the number of remaining years the special assessment was in effect.

(2) Under certain circumstances, farm use special assessment may be disqualified after July 1 and advance collection of additional taxes made. Disqualifications made under these circumstances are for the next tax year, therefore, the property will remain at its value for farm use on the tax roll until the following July 1. The collection of the additional tax is provided for in subsection (3). The specific circumstances for this type of disqualification are as follows:

(a) For non exclusive farm use (Non-EFU) zoned farmland:

(A) Subdivision plats under Chapter 92;

(B) At the owner's request.

(b) For exclusive farm use (EFU) zoned farmland, a non-farm dwelling under ORS 215.236.

(3)(a) Collection of Additional Tax: Advance collections of the additional tax made under the provisions of ORS 311.370 are entitled to the discount allowed by 311.505 if the assessor can compute the exact amount of the additional tax at the time the taxes are paid. If the assessor is unable to determine the exact amount due, the discount is allowed when final settlement is made at the time taxes are regularly due, as provided by 311.370.

(b) Any additional tax entered on the tax roll becomes part of the tax extended against the property and is collected in the same manner as other real property taxes. ORS 311.505 governs whether a discount is allowed or interest is charged.

(4) Distribution of Additional Tax: The total amount of the additional tax added to the tax roll must be apportioned between the taxing districts in which the property is located.

(a) The apportionment must be based on the ratio that the billing tax rate of each district bears to the total billing tax rates on the property, as shown on the tax roll on which the additional tax is entered.

(b) In preparing the certificate of the tax roll under ORS 311.105, the assessor must add the additional tax due to each taxing district to the total amount to be raised for each district under 311.105. The amount of additional tax due to each taxing district must be included in the percentage distribution schedule computed by the tax collector under 311.390.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.703
Hist.: REV 11-2000, f. 12-29-00, cert. ef. 12-31-00

150-308A.706

No Additional Tax; Notation Remains

(1) In any case where additional tax is deferred under ORS 308A.706, the assessor must continue to enter the notation "potential additional tax liability" on the assessment and tax roll.

(2)(a) When specially assessed farmland situated within an exclusive farm use (EFU) zone is transferred to a government ownership making it exempt, the assessor must continue to enter the notation "potential additional tax liability" on the assessment and tax roll.

(b) If the use of the land changes to a use inconsistent with a purpose to returning the land to farm use, the additional tax will not be imposed but will remain a lien since the government owner is exempt from taxation.

(3) If the disqualification results from the failure of the land to meet the gross income requirement, the additional taxes will not be imposed as long as the land continues to be used as farmland.

(4) If disqualification results solely because the land is no longer being devoted to a farm use and if the land is not being used for another use, the additional tax will not be imposed and the assessor must continue to enter the notation "potential additional tax liability" on the assessment and tax roll.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.706
Hist.: REV 11-2000, f. 12-29-00, cert. ef. 12-31-00

150-308A.712

Deferred Additional Tax (ORS 308A.706); When to Collect

(1)(a) When a non-exempt owner acquires exclusive farm use (EFU) farmland that was exempt because it was government owned, any amount designated by the county assessor as potential additional taxes must be added to the next general tax roll by the tax collector if the land is used for purposes inconsistent with returning the land to farm use.

(b) Non-EFU farmland liens are collected regardless of use when a non-exempt owner acquires farmland that was disqualified under ORS 308A.116(1)(b) and had liens attached under 308A.703(5).

(2) For additional information on collection and distribution of additional tax, see OAR 150-308A.703(3) and (4).

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308A.712
Hist.: REV 11-2000, f. 12-29-00, cert. ef. 12-31-00

150-308A.718

Disqualification Notification Procedures

(1) Notice of Disqualification:

(a) A notation must be made on the assessment and tax roll on or before June 30 to indicate that a disqualification of farmland, forestland, or a homesite as listed in ORS 308A.718 has taken place. The assessor must mail notice to the owner or person claiming special assessment within 30 days after the date that land is disqualified.

(b) If the disqualification occurs because the land is no longer in farm or forest use, as described under ORS 308A.113(3) (Exclusive Farm Use), 308A.116(6) (Non-Exclusive Farm Use), 321.366 (Western Oregon forestland), or 321.845 (Eastern Oregon forestland), the disqualification is effective only if the notice of disqualification is mailed on or before August 14.

(2) The notice to the person claiming special assessment must state:

(a) That the subject property has been disqualified from special assessment;

(b) That the property will be assessed under ORS 308.156;

(c) The amount of the additional tax liability that will be imposed or if the land is not used for another use the amount of the potential additional tax liability (ORS 308A.706(1));

(d) Provisions and timing for change of type of special assessment under ORS 308A.724; and

(e) Appeal rights.

Stat. Auth.: ORS 305.100
Stats. Implemented: ORS 308.399 & 308A.718
Hist.: RD 9-1984, f. 12-5-84, cert. ef. 12-31-84; RD 16-1987, f. 12-10-87, cert. ef. 12-31-87; RD 9-1989, f. 12-18-89, cert. ef. 12-31-89; RD 8-1992, f. 12-29-92, cert. ef. 12-31-92; RD 6-1994, f. 12-15-94, cert. ef. 12-30-94; RD 9-1997, f. & cert. ef. 12-31-97; REV 11-2000, f. 12-29-00, cert. ef. 12-31-00, Renumbered from 150-308.399; REV 12-2004, f. 12-29-04, cert. ef. 12-31-04

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