REPRESENTATIVES Trakas, Evans, Seitz, Sullivan, Seaver, Patton, Schmidt, Jerse, Oakar, Carano, Faber, Collier, Allen, Schneider, Schaffer, Britton, Williams, Latta, Kilbane, Gilb, Niehaus, Callender, Hartnett, Brown, Olman, Calvert, Blasdel, Grendell, Carey, Aslanides, Cates, Sulzer, Willamowski, Perry, Distel, Flannery, DePiero, Jolivette, Ogg, Hughes, Carmichael, Womer Benjamin, Webster, Reidelbach, Otterman, G. Smith, Roman, Hoops, Coates, Latell

To amend sections 5701.13 and 5709.12 of the Revised

1

Code to provide property tax exemption for

2

retirement or nursing homes belonging to tax-exempt

3

organizations and occupied by persons who have

4

retired from uncompensated service to a charitable,

5

religious, fraternal, or educational institution.

6

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 5701.13 and 5709.12 of the Revised	7
Code be amended to read as follows:	8

Sec. 5701.13.  (A) As used in this section:

9

(1) "Nursing home" means a nursing home or a home for the	10
aging, as those terms are defined in section 3721.01 of the	11
Revised Code, that is issued a license pursuant to section 3721.02	12
of the Revised Code.	13

(2) "Residential care facility" means a residential care	14
facility, as defined in section 3721.01 of the Revised Code, that	15
is issued a license pursuant to section 3721.02 of the Revised	16
Code.	17

(3) "Adult care facility" means an adult care facility as	18
defined in section 3722.01 of the Revised Code that is issued a	19
license pursuant to section 3722.04 of the Revised Code.	20

(B) As used in Title LVII of the Revised Code, and for the	21
purpose of other sections of the Revised Code that refer	22
specifically to Chapter 5701. or section 5701.13 of the Revised	23
Code, a "home for the aged" means aeither of the following:	24

(1) A place of residence for aged and infirm persons that	25
satisfies divisions (B)(1)(a) to (e) of this section:	26

(a) It is either a nursing home, residential care facility,	27
or adult care facility and that meets all of the following	28
standards:.	29

(1)(b) It is owned by a corporation, unincorporated	30
association, or trust of a charitable, religious, or fraternal	31
nature, which is organized and operated not for profit, which is	32
not formed for the pecuniary gain or profit of, and whose net	33
earnings or any part of whose net earnings is not distributable	34
to, its members, trustees, officers, or other private persons, and	35
which is exempt from federal income taxation under section 501 of	36
the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1.	37

(2)(c) It is open to the public without regard to race,	38
color, or national origin;.	39

(3)(d) It does not pay, directly or indirectly, compensation	40
for services rendered, interest on debts incurred, or purchase	41
price for land, building, equipment, supplies, or other goods or	42
chattels, which compensation, interest, or purchase price is	43
unreasonably high;.	44

(4)(e) It provides services for the life of each resident	45
without regard to histhe resident's ability to continue payment	46
for the full cost of the services.	47

(2) A place of residence that satisfies divisions (B)(1)(b),	48
(d), and (e) of this section; that satisfies the definition of	49
"nursing home," "residential care facility," or "adult care	50
facility" under section 3721.01 or 3722.01 of the Revised Code	51
regardless of whether it is licensed as such a home or facility;	52
and that is provided at no charge to individuals on account of	53
their service without compensation to a charitable, religious,	54
fraternal, or educational institution, which individuals are aged	55
or infirm and are members of the corporation, association, or	56
trust that owns the place of residence. For the purposes of	57
division (B)(2) of this section, "compensation" does not include	58
furnishing room and board, clothing, health care, or other	59
necessities, or stipends or other de minimis payments to defray	60
the cost thereof.	61

Exemption from taxation shall be accorded, on proper	62
application, only to those homes or parts of homes which meet the	63
standards and provide the services specified in this section.	64

Nothing in this section shall be construed as preventing a	65
home from requiring a resident with financial need to apply for	66
any applicable financial assistance or requiring a home to retain	67
a resident who willfully refuses to pay for services for which he	68
the resident has contracted even though hethe resident has	69
sufficient resources to do so.	70

(C)(1) If a corporation, unincorporated association, or	71
trust described in division (B)(1)(b) of this section is granted a	72
certificate of need pursuant to section 3702.52 of the Revised	73
Code to construct, add to, or otherwise modify a nursing home, or	74
is given approval pursuant to section 3791.04 of the Revised Code	75
to construct, add to, or otherwise modify a residential care	76
facility or adult care facility and if the corporation,	77
association, or trust submits an affidavit to the tax commissioner	78
stating that, commencing on the date of licensure and continuing	79
thereafter, the home or facility will be operated in accordance	80
with the requirements of divisions (B)(1), (2), (3), and (4)(a) to	81
(e) of this section, the corporation, association, or trust shall	82
be considered to be operating a "home for the aged" within the	83
meaning of division (B)(1) of this section, beginning on the first	84
day of January of the year in which such certificate is granted or	85
approval is given.	86

(2) If a corporation, association, or trust is considered to	87
be operating a "home for the aged" pursuant to division (C)(1) of	88
this section, the corporation, association, or trust shall notify	89
the tax commissioner in writing upon the occurrence of any of the	90
following events:	91

(a) The corporation, association, or trust no longer intends	92
to complete the construction of, addition to, or modification of	93
the home or facility, to obtain the appropriate license for the	94
home or facility, or to commence operation of the home or facility	95
in accordance with the requirements of divisions (B)(1), (2), (3),	96
and (4)(a) to (e) of this section;	97

(b) The certificate of approval referred to in division	98
(C)(1) of this section expires, is revoked, or is otherwise	99
terminated prior to the completion of the construction of,	100
addition to, or modification of the home or facility;	101

(c) The license to operate the home or facility is not	102
granted by the director of health within one year following	103
completion of the construction of, addition to, or modification of	104
the home or facility;	105

(d) The license to operate the home or facility is not	106
granted by the director of health within four years following the	107
date upon which the certificate or approval referred to in	108
division (C)(1) of this section was granted or given;	109

(e) The home or facility is granted a license to operate as	110
a nursing home, residential care facility, or adult care facility.	111

(3) Upon the occurrence of any of the events referred to in	112
divisions (C)(2)(a), (b), (c), (d), orand (e) of this section,	113
the corporation, association, or trust shall no longer be	114
considered to be operating a "home for the aged" pursuant to	115
division (C)(1) of this section, except that the tax commissioner,	116
for good cause shown and to the extent hethe commissioner	117
considers appropriate, may extend the time period specified in	118
division (C)(2)(c) or (d) of this section, or both. Nothing in	119
division (C)(3) of this section shall be construed to prevent a	120
nursing home, residential care facility, or adult care facility	121
from qualifying as a "home for the aged" if, upon proper	122
application made pursuant to division (B) of this section, it is	123
found to meet the requirements of divisions (A) and (B) of this	124
section.	125

Sec. 5709.12.  (A) As used in this section, "independent	126
living facilities" means any residential housing facilities and	127
related property that are not a nursing home, residential care	128
facility, or adult care facility as defined in division (A) of	129
section 5701.13 of the Revised Code.	130

(B) Lands, houses, and other buildings belonging to a	131
county, township, or municipal corporation and used exclusively	132
for the accommodation or support of the poor, or leased to the	133
state or any political subdivision for public purposes shall be	134
exempt from taxation. Real and tangible personal property	135
belonging to institutions that is used exclusively for charitable	136
purposes shall be exempt from taxation, including real property	137
belonging to an institution that is a nonprofit corporation that	138
receives a grant under the Thomas Alva Edison grant program	139
authorized by division (C) of section 122.33 of the Revised Code	140
at any time during the tax year and being held for leasing or	141
resale to others. If, at any time during a tax year for which	142
such property is exempted from taxation, the corporation ceases to	143
qualityqualify for such a grant, the director of development	144
shall notify the tax commissioner, and the tax commissioner shall	145
cause the property to be restored to the tax list beginning with	146
the following tax year. All property owned and used by a nonprofit	147
organization exclusively for a home for the aged, as defined in	148
section 5701.13 of the Revised Code, also shall be exempt from	149
taxation.	150

(C)(1) If a home for the aged described in division (B)(1)	151
of section 5701.13 of the Revised Code is operated in conjunction	152
with or at the same site as independent living facilities, the	153
exemption granted in division (B) of this section shall include	154
kitchen, dining room, clinic, entry ways, maintenance and storage	155
areas, and land necessary for access commonly used by both	156
residents of the home for the aged and residents of the	157
independent living facilities. Other facilities commonly used by	158
both residents of the home for the aged and residents of	159
independent living units shall be exempt from taxation only if the	160
other facilities are used primarily by the residents of the home	161
for the aged. Vacant land currently unused by the home, and	162
independent living facilities and the lands connected with them	163
are not exempt from taxation. Except as provided in division (A)	164
of section 5709.121 of the Revised Code, property of a home leased	165
for nonresidential purposes is not exempt from taxation.	166

(2) Independent living facilities are exempt from taxation	167
if they are operated in conjunction with or at the same site as a	168
home for the aged described in division (B)(2) of section 5701.13	169
of the Revised Code; operated by a corporation, association, or	170
trust described in division (B)(1)(b) of that section; operated	171
exclusively for the benefit of members of the corporation,	172
association, or trust who are retired, aged, or infirm; and	173
provided to those members without charge in consideration of their	174
service, without compensation, to a charitable, religious,	175
fraternal, or educational institution. For the purposes of	176
division (C)(2) of this section, "compensation" does not include	177
furnishing room and board, clothing, health care, or other	178
necessities, or stipends or other de minimis payments to defray	179
the cost thereof.	180

(D)(1) A private corporation established under federal law,	181
defined in 36 U.S.C. 1101, Pub. L. No. 102-199, 105 Stat. 1629, as	182
amended, the objects of which include encouraging the advancement	183
of science generally, or of a particular branch of science, the	184
promotion of scientific research, the improvement of the	185
qualifications and usefulness of scientists, or the increase and	186
diffusion of scientific knowledge is conclusively presumed to be a	187
charitable or educational institution. A private corporation	188
established as a nonprofit corporation under the laws of a state,	189
that is exempt from federal income taxation under section	190
501(c)(3) of the Internal Revenue Code of 1986, 100 Stat. 2085, 26	191
U.S.C.A. 1, as amended, and has as its principal purpose one or	192
more of the foregoing objects, also is conclusively presumed to be	193
a charitable or educational institution.	194

The fact that an organization described in this division	195
operates in a manner that results in an excess of revenues over	196
expenses shall not be used to deny the exemption granted by this	197
section, provided such excess is used, or is held for use, for	198
exempt purposes or to establish a reserve against future	199
contingencies; and, provided further, that such excess may not be	200
distributed to individual persons or to entities that would not be	201
entitled to the tax exemptions provided by this chapter. Nor	202
shall the fact that any scientific information diffused by the	203
organization is of particular interest or benefit to any of its	204
individual members be used to deny the exemption granted by this	205
section, provided that such scientific information is available to	206
the public for purchase or otherwise.	207

(2) Division (D)(2) of this section does not apply to real	208
property exempted from taxation under this section and division	209
(C) of section 5709.121 of the Revised Code and belonging to a	210
nonprofit corporation described in division (D)(1) of this section	211
that has received a grant under the Thomas Alva Edison grant	212
program authorized by division (C) of section 122.33 of the	213
Revised Code during any of the tax years the property was exempted	214
from taxation.	215

When a private corporation described in division (D)(1) of	216
this section sells all or any portion of a tract, lot, or parcel	217
of real estate that has been exempt from taxation under this	218
section and section 5709.121 of the Revised Code, the portion sold	219
shall be restored to the tax list for the year following the year	220
of the sale and a charge shall be levied against the sold property	221
in an amount equal to the tax savings on such property during the	222
four tax years preceding the year the property is placed on the	223
tax list. The tax savings equals the amount of the additional	224
taxes that would have been levied if such property had not been	225
exempt from taxation.	226

The charge constitutes a lien of the state upon such property	227
as of the first day of January of the tax year in which the charge	228
is levied and continues until discharged as provided by law. The	229
charge may also be remitted for all or any portion of such	230
property that the tax commissioner determines is entitled to	231
exemption from real property taxation for the year such property	232
is restored to the tax list under any provision of the Revised	233
Code, other than sections 725.02, 1728.10, 3735.67, 5709.40,	234
5709.41, 5709.62, 5709.63, 5709.71, 5709.73, 5709.78, and 5709.84,	235
upon an application for exemption covering the year such property	236
is restored to the tax list filed under section 5715.27 of the	237
Revised Code.	238

(E) Real property held by an organization organized and	239
operated exclusively for charitable purposes as described under	240
section 501(c)(3) of the Internal Revenue Code and exempt from	241
federal taxation under section 501(a) of the Internal Revenue	242
Code, 26 U.S.C.A. 501(a) and (c)(3), as amended, for the purpose	243
of constructing or rehabilitating residences for eventual transfer	244
to qualified low-income families through sale, lease, or land	245
installment contract, shall be exempt from taxation.	246

The exemption shall commence on the day title to the property	247
is transferred to the organization and shall continue to the end	248
of the tax year in which the organization transfers title to the	249
property to a qualified low-income family. In no case shall the	250
exemption extend beyond the second succeeding tax year following	251
the year in which the title was transferred to the organization.	252
If the title is transferred to the organization and from the	253
organization to a qualified low-income family in the same tax	254
year, the exemption shall continue to the end of that tax year.	255
The proportionate amount of taxes that are a lien but not yet	256
determined, assessed, and levied for the tax year in which title	257
is transferred to the organization shall be remitted by the county	258
auditor for each day of the year that title is held by the	259
organization.	260

Upon transferring the title to another person, the	261
organization shall file with the county auditor an affidavit	262
affirming that the title was transferred to a qualified low-income	263
family or that the title was not transferred to a qualified	264
low-income family, as the case may be; if the title was	265
transferred to a qualified low-income family, the affidavit shall	266
identify the transferee by name. If the organization transfers	267
title to the property to anyone other than a qualified low-income	268
family, the exemption, if it has not previously expired, shall	269
terminate, and the property shall be restored to the tax list for	270
the year following the year of the transfer and a charge shall be	271
levied against the property in an amount equal to the amount of	272
additional taxes that would have been levied if such property had	273
not been exempt from taxation. The charge constitutes a lien of	274
the state upon such property as of the first day of January of the	275
tax year in which the charge is levied and continues until	276
discharged as provided by law.	277

The application for exemption shall be filed as otherwise	278
required under section 5715.27 of the Revised Code, except that	279
the organization holding the property shall file with its	280
application documentation substantiating its status as an	281
organization organized and operated exclusively for charitable	282
purposes under section 501(c)(3) of the Internal Revenue Code and	283
its qualification for exemption from federal taxation under	284
section 501(a) of the Internal Revenue Code, and affirming its	285
intention to construct or rehabilitate the property for the	286
eventual transfer to qualified low-income families.	287

As used in this division, "qualified low-income family" means	288
a family whose income does not exceed two hundred per cent of the	289
official federal poverty guidelines as revised annually in	290
accordance with section 673(2) of the "Omnibus Budget	291
Reconciliation Act of 1981," 95 Stat. 511, 42 U.S.C.A. 9902, as	292
amended, for a family size equal to the size of the family whose	293
income is being determined.	294

Section 2. That existing sections 5701.13 and 5709.12 of the	295
Revised Code are hereby repealed.	296

Section 3. The amendment by this act of sections 5701.13 and	297
5709.12 of the Revised Code applies to tax year 2002 and	298
thereafter.	299