As Reported by House Ways and Means Committee 1
123rd General Assembly 4
Regular Session Am. H. B. No. 194 5
1999-2000 6
REPRESENTATIVES JONES-THOMAS-WOMER BENJAMIN-HOOD-JERSE- 8
BEATTY-METELSKY-BENDER-OGG-STAPLETON-HARTLEY-TAYLOR-SUTTON- 9
O'BRIEN-SCHULER-SYKES-OPFER-FORD-HEALY-CALLENDER- 10
PADGETT-HARTNETT-D.MILLER-JOLIVETTE-OLMAN-SCHULER- 11
ALLEN-VESPER-JAMES-WILLAMOWSKI-SMITH-PRINGLE-DePIERO- 12
HOLLISTER-MOTTLEY-AMSTUTZ-FLANNERY-CORBIN-JERSE-BRITTON- 13
AUSTRIA-HOOD-HAINES-JOLIVETTE-DISTEL-BARNES-GRENDELL- 14
HARTNETT-PERRY-PETERSON 15
_________________________________________________________________ 16
A B I L L
To amend section 5709.12 of the Revised Code to 18
exempt from taxation residential real property 19
constructed or rehabilitated and held by a
nonprofit charitable organization for the purpose 20
of transferring the property to qualified 21
low-income families.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 23
Section 1. That section 5709.12 of the Revised Code be 25
amended to read as follows: 26
Sec. 5709.12. (A) As used in this section, "independent 35
living facilities" means any residential housing facilities and 36
related property that are not a nursing home, residential care 38
facility, or adult care facility as defined in division (A) of 39
section 5701.13 of the Revised Code. 40
(B) Lands, houses, and other buildings belonging to a 42
county, township, or municipal corporation and used exclusively 43
for the accommodation or support of the poor, or leased to the 44
state or any political subdivision for public purposes shall be 45
exempt from taxation. Real and tangible personal property 46
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belonging to institutions that is used exclusively for charitable 47
purposes shall be exempt from taxation. All property owned and 48
used by a nonprofit organization exclusively for a home for the 49
aged, as defined in section 5701.13 of the Revised Code, also 50
shall be exempt from taxation. 51
(C) If a home for the aged is operated in conjunction with 53
or at the same site as independent living facilities, the 54
exemption granted in division (B) of this section shall include 55
kitchen, dining room, clinic, entry ways, maintenance and storage 56
areas, and land necessary for access commonly used by both 57
residents of the home for the aged and residents of the 58
independent living facilities. Other facilities commonly used by 59
both residents of the home for the aged and residents of 60
independent living units shall be exempt from taxation only if 61
the other facilities are used primarily by the residents of the 62
home for the aged. Vacant land currently unused by the home, and 63
independent living facilities and the lands connected with them 64
are not exempt from taxation. Except as provided in division (A) 65
of section 5709.121 of the Revised Code, property of a home 66
leased for nonresidential purposes is not exempt from taxation. 67
(D) A private corporation established under federal law, 69
as defined in 36 U.S.C. 1101, Pub. L. 102-199, 105 Stat. 1629, as 70
amended, the objects of which include encouraging the advancement 71
of science generally, or of a particular branch of science, the 72
promotion of scientific research, the improvement of the 73
qualifications and usefulness of scientists, or the increase and 74
diffusion of scientific knowledge is conclusively presumed to be 75
a charitable or educational institution. A private corporation 76
established as a nonprofit corporation under the laws of a state, 77
that is exempt from federal income taxation under section 78
501(c)(3) of the Internal Revenue Code of 1986, 100 Stat. 2085, 79
26 U.S.C.A. 1, as amended, and has as its principal purpose one 80
or more of the foregoing objects, also is conclusively presumed 81
to be a charitable or educational institution. 82
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The fact that an organization described in this division 84
operates in a manner that results in an excess of revenues over 85
expenses shall not be used to deny the exemption granted by this 86
section, provided such excess is used, or is held for use, for 87
exempt purposes or to establish a reserve against future 88
contingencies; and, provided further, that such excess may not be 89
distributed to individual persons or to entities that would not 90
be entitled to the tax exemptions provided by this chapter. Nor 91
shall the fact that any scientific information diffused by the 92
organization is of particular interest or benefit to any of its 93
individual members be used to deny the exemption granted by this 94
section, provided that such scientific information is available 95
to the public for purchase or otherwise. 96
When a private corporation as described in this division 98
sells all or any portion of a tract, lot, or parcel of real 99
estate that has been exempt from taxation under this section and 100
section 5709.121 of the Revised Code, the portion sold shall be 101
restored to the tax list for the year following the year of the 102
sale and a charge shall be levied against the sold property in an 103
amount equal to the tax savings on such property during the four 104
tax years preceding the year the property is placed on the tax 105
list. The tax savings equals the amount of the additional taxes 106
that would have been levied if such property had not been exempt 107
from taxation. 108
The charge constitutes a lien of the state upon such 110
property as of the first day of January of the tax year in which 111
the charge is levied and continues until discharged as provided 112
by law. The charge may also be remitted for all or any portion 113
of such property that the tax commissioner determines is entitled 114
to exemption from real property taxation for the year such 115
property is restored to the tax list under any provision of the 116
Revised Code, other than sections 725.02, 1728.10, 3735.67, 117
5709.40, 5709.41, 5709.62, 5709.63, 5709.71, 5709.73, 5709.78, 118
and 5709.84, upon an application for exemption covering the year 119
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such property is restored to the tax list filed under section 120
5715.27 of the Revised Code. 121
(E) REAL PROPERTY HELD BY AN ORGANIZATION ORGANIZED AND 124
OPERATED EXCLUSIVELY FOR CHARITABLE PURPOSES AS DESCRIBED UNDER 125
SECTION 501(c)(3) OF THE INTERNAL REVENUE CODE AND EXEMPT FROM 126
FEDERAL TAXATION UNDER SECTION 501(a) OF THE INTERNAL REVENUE 128
CODE, 26 U.S.C.A. 501(a) AND (c)(3), AS AMENDED, FOR THE PURPOSE 130
OF CONSTRUCTING OR REHABILITATING RESIDENCES FOR EVENTUAL 131
TRANSFER TO QUALIFIED LOW-INCOME FAMILIES THROUGH SALE, LEASE, OR 132
LAND INSTALLMENT CONTRACT, SHALL BE EXEMPT FROM TAXATION. 133
THE EXEMPTION SHALL COMMENCE ON THE DAY TITLE TO THE 136
PROPERTY IS TRANSFERRED TO THE ORGANIZATION AND SHALL CONTINUE TO 137
THE END OF THE TAX YEAR IN WHICH THE ORGANIZATION TRANSFERS TITLE 138
TO THE PROPERTY TO A QUALIFIED LOW-INCOME FAMILY. IN NO CASE 139
SHALL THE EXEMPTION EXTEND BEYOND THE SECOND SUCCEEDING TAX YEAR 140
FOLLOWING THE YEAR IN WHICH THE TITLE WAS TRANSFERRED TO THE 141
ORGANIZATION. IF THE TITLE IS TRANSFERRED TO THE ORGANIZATION 142
AND FROM THE ORGANIZATION TO A QUALIFIED LOW-INCOME FAMILY IN THE
SAME TAX YEAR, THE EXEMPTION SHALL CONTINUE TO THE END OF THAT 143
TAX YEAR. THE PROPORTIONATE AMOUNT OF TAXES THAT ARE A LIEN BUT 145
NOT YET DETERMINED, ASSESSED, AND LEVIED FOR THE TAX YEAR IN
WHICH TITLE IS TRANSFERRED TO THE ORGANIZATION SHALL BE REMITTED 146
BY THE COUNTY AUDITOR FOR EACH DAY OF THE YEAR THAT TITLE IS HELD 147
BY THE ORGANIZATION. 148
UPON TRANSFERRING THE TITLE TO ANOTHER PERSON, THE 150
ORGANIZATION SHALL FILE WITH THE COUNTY AUDITOR AN AFFIDAVIT 151
AFFIRMING THAT THE TITLE WAS TRANSFERRED TO A QUALIFIED 152
LOW-INCOME FAMILY OR THAT THE TITLE WAS NOT TRANSFERRED TO A
QUALIFIED LOW-INCOME FAMILY, AS THE CASE MAY BE; IF THE TITLE WAS 153
TRANSFERRED TO A QUALIFIED LOW-INCOME FAMILY, THE AFFIDAVIT SHALL 154
IDENTIFY THE TRANSFEREE BY NAME. IF THE ORGANIZATION TRANSFERS 155
TITLE TO THE PROPERTY TO ANYONE OTHER THAN A QUALIFIED LOW-INCOME 157
FAMILY, THE EXEMPTION, IF IT HAS NOT PREVIOUSLY EXPIRED, SHALL 158
TERMINATE, AND THE PROPERTY SHALL BE RESTORED TO THE TAX LIST FOR
5
THE YEAR FOLLOWING THE YEAR OF THE TRANSFER AND A CHARGE SHALL BE 159
LEVIED AGAINST THE PROPERTY IN AN AMOUNT EQUAL TO THE AMOUNT OF 160
ADDITIONAL TAXES THAT WOULD HAVE BEEN LEVIED IF SUCH PROPERTY HAD 161
NOT BEEN EXEMPT FROM TAXATION. THE CHARGE CONSTITUTES A LIEN OF 162
THE STATE UPON SUCH PROPERTY AS OF THE FIRST DAY OF JANUARY OF 163
THE TAX YEAR IN WHICH THE CHARGE IS LEVIED AND CONTINUES UNTIL 164
DISCHARGED AS PROVIDED BY LAW.
THE APPLICATION FOR EXEMPTION SHALL BE FILED AS OTHERWISE 166
REQUIRED UNDER SECTION 5715.27 OF THE REVISED CODE, EXCEPT THAT 167
THE ORGANIZATION HOLDING THE PROPERTY SHALL FILE WITH ITS 168
APPLICATION DOCUMENTATION SUBSTANTIATING ITS STATUS AS AN 169
ORGANIZATION ORGANIZED AND OPERATED EXCLUSIVELY FOR CHARITABLE 170
PURPOSES UNDER SECTION 501(c)(3) OF THE INTERNAL REVENUE CODE AND 172
ITS QUALIFICATION FOR EXEMPTION FROM FEDERAL TAXATION UNDER 173
SECTION 501(a) OF THE INTERNAL REVENUE CODE, AND AFFIRMING ITS 174
INTENTION TO CONSTRUCT OR REHABILITATE THE PROPERTY FOR THE 175
EVENTUAL TRANSFER TO QUALIFIED LOW-INCOME FAMILIES. 176
AS USED IN THIS DIVISION, "QUALIFIED LOW-INCOME FAMILY" 178
MEANS A FAMILY WHOSE INCOME DOES NOT EXCEED TWO HUNDRED PER CENT 179
OF THE OFFICIAL FEDERAL POVERTY GUIDELINES AS REVISED ANNUALLY IN 181
ACCORDANCE WITH SECTION 673(2) OF THE "OMNIBUS BUDGET 182
RECONCILIATION ACT OF 1981," 95 STAT. 511, 42 U.S.C.A. 9902, AS 183
AMENDED, FOR A FAMILY SIZE EQUAL TO THE SIZE OF THE FAMILY WHOSE 184
INCOME IS BEING DETERMINED.
Section 2. That existing section 5709.12 of the Revised 186
Code is hereby repealed. 187