Life Flight Network Spawned Magistrate Case

ORS 307.022 provides that a limited liability corporation (LLC) wholly owned by one or more nonprofit corporations shall qualify for a property tax exemption or special assessment if all the owners would qualify for the exemption or special assessment.

Life Flight Network is a not-for-profit medical transport service organized as an LLC. Union and Deschutes Counties denied it a property tax exemption, because of the four members of the LLC three are nonprofit corporations exempt from property taxation and the fourth is Oregon Health & Science University, a public body. OHSU is exempt from property taxes as a public body (ORS 307.090), but the basis for the exemption sought by Life Flight is ORS 307.022, which makes no mention of tax exempt public bodies.

Denial of the exemption led to Life Flight Network LLC v. Deschutes County Assessor and Department of Revenue (Magistrate Division, Oregon Tax Court) and Senate Bill (SB) 149. SB 149 simply adds a public body as a potential tax exempt owner of an LLC along with tax exempt nonprofit corporations. If not read overly literally, the policy behind ORS 307.022 is not changed by the bill. Under the bill the exemption or special assessment is granted in the least amount that would be granted if held directly by any of the LLC’s nonprofit corporations.

SB 149A passed the Senate on March 21 with a vote of 27-0. On June 1, the House Committee on Revenue sent the bill to the full House with a “do pass” recommendation, where it is expected to pass easily.

Contributed by: Gil Riddell | AOC Policy Director