The Senate Finance & Revenue Committee on May 17th moved a gutted and stuffed Senate Bill (SB) 596A to the floor with a do pass recommendation. Committee members concluded that the bill would provide a bright line to county assessors, who are giving varied treatment to certain farm personal property equipment.

In its current incarnation, SB 596A by expanding ORS 307.397 exempts from property taxation machinery and equipment used to compress and bale harvested straw, hay, grass or other plants, for the purpose of storage or shipment. The bill specifies that such equipment is tangible personal property, and unlike a previous amendment, does not apply retroactively. The equipment is still taxable if it is functioning to process the plants.

The committee responded positively to suggestions by Polk County Assessor Doug Schmidt to his suggested improvements to the initial set of amendments. Assessor Schmidt, representing the Oregon State Association of County Assessors, estimated the administrative cost to counties statewide to implement this bill at $8,640. Revenue impact to counties statewide is estimated at less than $100,000 per year.

Meanwhile, on May 17th the House Committee on Revenue amended and sent to the floor a bill with two distinct components, again improving the amendments at the request of Doug Schmidt and incorporating amendments presented by Washington County.

One part of House Bill (HB) 2573A attempts to make the process of reporting business personal property clearer and simpler, but the original bill would have required additional mailings, documents, and processing that may not be necessary for some assessor’s offices. Assessor Schmidt explained that because of budget and staffing constraints, some assessors are not mailing a personal property return to every business every year. For those assessors who do not mail to every business every year, the statute should make the mailing of the letter optional to the assessor. This lets the assessor determine, based on knowledge of their taxpayers, if the letter is necessary. This also cuts down on time and costs to the assessor’s office that also may not be needed. The committee agreed and incorporated the suggestion.

The other part of HB 2573A relates to increasing the personal property tax exemption from $12,500 to  $25,000 on manufactured housing in counties where population exceeds 570,000. This change in value increases the exemption from a current level of $16,500 to $33,000. The effect of the change is confined to Multnomah and Washington counties. Both county commissions support this change and there is no opposition. Clackamas and Lane counties declined to be included, and will retain an exemption level of $16,500.

Contributed by: Gil Riddell | AOC Policy Director