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H. B. No. 293 As Introduced
As Introduced
126th General Assembly | Regular Session | 2005-2006 |
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Representatives Kilbane, Miller, Trakas, McGregor, Wolpert, C. Evans, Reidelbach, Gilb, Faber, Cassell, Kearns, Hartnett, Carano, Boccieri, Healy, Buehrer
A BILL
To amend section 135.353 and to enact sections 135.804, 135.805, 135.806, and 135.807 of the Revised Code to authorize boards of county commissioners to establish property tax payment linked deposit programs to assist senior citizens and permanently and totally disabled citizens in paying property taxes on their homesteads.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That section 135.353 be amended and sections 135.804, 135.805, 135.806, and 135.807 of the Revised Code be enacted to read as follows:
Sec. 135.353. In addition to the investments specified in section 135.35 of
the Revised Code, the investing authority of a county may invest inactive or
public moneys in linked both of the following: (A) Linked deposits as authorized by resolution adopted pursuant
to section 135.80 or 135.801 of the Revised Code; (B) Linked deposits as authorized by resolution adopted pursuant to section 135.805 of the Revised Code for a term considered appropriate by the investing authority, but not exceeding fifteen years, which investment may be renewed for up to two additional terms with each additional term not exceeding fifteen years.
Sec. 135.804. As used in sections 135.804 to 135.807 of the Revised Code:
(A) "Current taxes" has the same meaning as in section 323.01 of the Revised Code.
(B) "Eligible borrower" means a person meeting all of the following:
(1) The person is the owner of a homestead that is not charged with any delinquent taxes.
(2) The person is, at the time of applying for a reduced rate loan under a property tax payment linked deposit program, either sixty-five years of age or older or permanently and totally disabled.
(3) The person had total income in the year prior to submitting an application for a reduced rate loan under a property tax payment linked deposit program the lesser of fifty thousand dollars or the total income limit established pursuant to section 135.805 of the Revised Code by the board of county commissioners as an eligibility requirement for participation in a property tax payment linked deposit program.
(4) The person meets all other eligibility requirements established pursuant to section 135.805 of the Revised Code by the board of county commissioners for participation in a property tax payment linked deposit program.
(C) "Eligible lending institution" means a financial institution that meets all of the following:
(1) The financial institution is eligible to make loans to individuals that are secured by mortgages, including mortgages commonly known as reverse mortgages.
(2) The financial institution has an office located within the territorial limits of the county.
(3) The financial institution is an eligible public depository described in section 135.32 of the Revised Code into which the county's investing authority may deposit the public moneys of the county.
(4) The financial institution has entered into an agreement described in division (B)(4) of section 135.805 of the Revised Code with the investing authority of the county to participate in the property tax payment linked deposit program.
(D) "Homestead" means either of the following: (1) A dwelling, including a unit in
a multiple-unit dwelling
and a manufactured home or
mobile home taxed as real property
pursuant to division (B) of
section 4503.06 of the Revised Code,
owned and
occupied as a
home by an individual whose domicile is in
this state and who has
not acquired ownership from a person, other
than the
individual's spouse,
related by consanguinity or affinity
for the purpose of
qualifying for a property tax payment linked deposit program. (2) A unit in a housing cooperative that is occupied as a
home,
but not owned, by an individual whose domicile is in this
state. The homestead shall include
so much of the land surrounding
it, not exceeding one acre, that is
reasonably necessary for the use
of the dwelling or unit as a
home. An owner includes a holder of
one of the several
estates in fee, a vendee in possession under a
purchase
agreement or a land contract, a mortgagor, a life tenant,
one or more tenants
with a right of survivorship, tenants in
common, and a settlor of
a revocable inter vivos trust holding the
title to a homestead
occupied by the settlor as of right under the
trust. The tax
commissioner shall adopt rules for the uniform
classification and
valuation of real property or portions of real
property as
homesteads.
(E) "Housing cooperative" means a housing complex of at
least two
hundred fifty units that is owned and operated by a
nonprofit
corporation that issues a share of the corporation's
stock to an
individual, entitling the individual to live in a unit
of the complex, and
collects a monthly maintenance fee from the
individual to
maintain, operate, and pay the taxes of the complex.
(F) "Investing authority" and "public moneys" have the same meanings as in section 135.31 of the Revised Code.
(G) "Lien certificate" means the certificate described in section 135.807 of the Revised Code.
(H) "Old age and survivors benefits received pursuant to
the
'Social Security Act'" or "tier I railroad retirement
benefits
received pursuant to the 'Railroad Retirement Act'"
means: (1) Old age
benefits
payable under the social security or railroad retirement
laws in
effect on the last day of the calendar year prior to the
year for
which a reduced rate loan under a property tax payment linked deposit program is applied for, or, if
no such
benefits are payable that year, old age benefits payable
the first
succeeding year in which old age benefits under the
social
security or railroad retirement laws are payable, except
in those
cases where a change in social security or railroad
retirement
benefits results in a reduction in income. (a) Survivors benefits payable under the social security
or
railroad retirement laws in effect on the last day of the
calendar
year prior to the year for which a reduced rate loan under a property tax payment linked deposit program is applied for, or, if no such benefits are payable that year,
survivors
benefits payable the first succeeding year in which
survivors
benefits are payable; or (b) Old age benefits of the deceased spouse, as determined
under division (H)(1) of this section, upon which the
surviving spouse's survivors benefits are based under the social
security or railroad retirement laws, except in those cases where
a change in benefits would cause a reduction in income. Survivors benefits are those described in division
(H)(2)(b)
of this section only if the deceased spouse received
old age
benefits in the year in which the deceased spouse died. If the
deceased spouse did not receive old age benefits in the year in
which the deceased spouse died, then survivors benefits are those
described in division (H)(2)(a) of this section. (I) "Permanently and totally disabled" means a person who
has, on the first day of January of the year that a reduced rate loan under a property tax payment linked deposit program is applied for, has some impairment in body or mind
that makes the person unable to work at any substantially
remunerative
employment that the person reasonably is able to
perform
and
that will,
with reasonable probability, continue for
an indefinite period of
at least twelve months without any present
indication of recovery
therefrom or has been certified as
permanently and totally
disabled by a state or federal agency
having the function of so
classifying persons.
(J) "Property tax payment linked deposit program" means a county-wide program authorized under section 135.805 of the Revised Code and established by the board of county commissioners of a county pursuant to that section.
(K) "Sixty-five years of age or older" means a person who
has attained age sixty-four prior to the first day of January of
the year of application for a reduced rate loan under a property tax payment linked deposit program.
(L) "Total income" means the adjusted gross income of the
owner and the owner's spouse for the year preceding the year
in
which
application for a reduced rate loan under a property tax payment linked deposit program is made, as determined
under
the "Internal Revenue Code of 1986," 100 Stat. 2085, 26
U.S.C.A.
1, as amended, adjusted as follows: (1) Subtract the amount of disability benefits included in
adjusted gross income, but not to exceed fifty-two hundred
dollars; (2) Add old age and survivors benefits received pursuant
to
the "Social Security Act" that are not included in adjusted
gross
income; (3) Add retirement, pension, annuity, or other retirement
payments or benefits not included in adjusted gross income; (4) Add tier I and tier II railroad retirement benefits
received pursuant to the "Railroad Retirement Act," 50 Stat. 307,
45 U.S.C.A. 228; (5) Add interest on federal, state, and local government
obligations; (6) For a person who received a reduced rate loan under a property tax payment linked deposit program for a
prior year on
the basis of being permanently and totally disabled
and whose current
application for a reduced rate loan is made on the
basis of age, subtract the
following amount: (a) If the person received disability benefits that were not
included in adjusted gross income in the year preceding the first
year in
which the person applied for a reduced rate loan on the basis of
age, subtract an
amount equal to the disability benefits the
person received in that preceding
year, to the extent included in
total income in the current year and not
subtracted under division
(L)(1) of this section in the current year; (b) If the person received disability benefits that were
included
in adjusted gross income in the year preceding the first
year in which the
person applied for a reduced rate loan on the basis of
age, subtract an amount equal
to the amount of disability benefits
that were subtracted pursuant to division
(L)(1) of this section
in that preceding year, to the extent included
in total income in
the current year and not subtracted under division
(L)(1) of this
section in the current year. Disability benefits that are paid by the department of
veterans affairs or
a
branch of the armed forces of the United
States on account
of an injury or disability shall not be included
in total income.
Sec. 135.805. (A) The general assembly finds that many low to moderate income senior citizens and permanently and totally disabled citizens face financial hardship and find it difficult to timely pay property taxes on their homesteads which can lead to delinquencies, penalties, declines in tax receipts, foreclosures, a loss of stable and affordable housing, a loss of neighborhoods and communities, and a decline in property values. Accordingly, it is declared to be the public policy of the state through property tax payment linked deposit programs established by counties to provide a source of low-cost funds for lending purposes to assist these citizens in timely paying property taxes on their homesteads.
(B) The board of county commissioners, by resolution, may establish a property tax payment linked deposit program authorizing the investing authority of the county, in accordance with division (B) of section 135.353 of the Revised Code, to place certificates of deposit at up to three per cent below market rates with an eligible lending institution, provided that the eligible lending institution agrees to lend the value of such deposit to eligible borrowers at up to three per cent below the present borrowing rate applicable to each eligible borrower. The resolution shall include requirements and provisions necessary to establish and carry out the property tax payment linked deposit program, including, but not limited to, all of the following:
(1) Eligibility requirements for borrowers who may receive reduced rate loans under the property tax payment linked deposit program, including a total income limit for a borrower to be eligible for such a loan;
(2) Application procedures for eligible borrowers and eligible lending institutions wishing to participate in the property tax payment linked deposit program;
(3) Review procedures for applications and criteria for acceptance or rejection of applications for reduced rate loans under the property tax payment linked deposit program;
(4) Necessary agreements between the eligible lending institution and the investing authority of the county to carry out the purposes of the property tax payment linked deposit program, including procedures for the payment directly to the county treasurer by the eligible lending institution of the current property taxes due on the homestead and delivery by the county treasurer to the eligible lending institution of the lien certificate as provided in section 135.807 of the Revised Code;
(5) Annual reports regarding the operation of the property tax payment linked deposit program to be made by the investing authority to the board of county commissioners.
(C) A board of county commissioners may appropriate funds from the general fund of the county or any other lawfully available funds of the county for the purpose of defraying some or all of the closing costs and expenses of reduced rate loans made by eligible lending institutions to eligible borrowers pursuant to the property tax payment linked deposit program.
(D) The county and its investing authority and board of county commissioners are not liable to any eligible lending institution in any manner for the payment of the principal or interest on any reduced rate loan made under the property tax payment linked deposit program, and any delay in payment or default on the part of any borrower does not in any manner affect the deposit agreement between the eligible lending institution and the investing authority or board of county commissioners.
Sec. 135.806. Upon placement of a property tax payment linked deposit with an eligible lending institution pursuant to an agreement described in section 135.805 of the Revised Code, the eligible lending institution shall do both of the following:
(A) Lend funds pursuant to the agreement to an eligible borrower;
(B) Comply fully with the requirements of sections 135.804 to 135.807 of the Revised Code.
Sec. 135.807. (A) A property tax payment linked deposit program shall provide for the delivery of a lien certificate to an eligible lending institution making payment to the county treasurer, pursuant to a loan agreement with an eligible borrower, of some or all of the current taxes then due on the homestead of that eligible borrower.
(B)(1) To ensure uniformity among all counties, the tax commissioner shall prescribe the form for a lien certificate delivered pursuant to division (A) of this section, which form shall include the identity of the homestead, the eligible borrower, the eligible lending institution, the amount of current taxes paid by that eligible lending institution, and the tax year for which the current taxes were paid. The tax commissioner shall distribute the forms to the county treasurers of all counties in which a property tax payment linked deposit program is established.
(2) A county treasurer shall use the form prescribed by the tax commissioner pursuant to division (B)(1) of this section, except that, prior to the time that a lien certificate form is prescribed and the forms are distributed by the tax commissioner, the form shall be prepared by the county treasurer of the county, contain the information required by division (B)(1) of this section, and include the following sentence: "This lien certificate is delivered pursuant to section 135.807 of the Revised Code and vests in the eligible lending institution the first lien held previously by the state and its taxing districts for the amount of current taxes paid by the eligible lending institution, together with any and all unpaid interest thereon."
(C)(1) The delivery of the lien certificate pursuant to division (A) of this section vests in the eligible lending institution the first lien held previously by the state and its taxing districts for the amount of current taxes paid by the eligible lending institution, together with any unpaid interest thereon from the date of delivery at the interest rate specified in the loan agreement between the eligible lending institution and the eligible borrower.
(2) Subject to division (C)(3) of this section, the lien certificate delivered pursuant to division (A) of this section is superior to all other liens and encumbrances upon the homestead described in that lien certificate, and the lien continues in full force and effect until the amount of current taxes paid by the eligible lending institution, together with any unpaid interest thereon, has been repaid to the eligible lending institution.
(3) With respect to the priority as among first liens of the state and its taxing districts, the priority is determined by the date that the first liens of the state and its taxing districts attached pursuant to section 323.11 of the Revised Code, with first priority to the earliest attached lien and each immediately subsequent priority based upon the next earliest attached lien.
(D) The eligible lending institution may record the lien certificate or memorandum thereof as a mortgage of land in the office of the county recorder of the county in which the homestead is situated. The county recorder shall record the certificate in the record of mortgages provided in division (B) of section 317.08 of the Revised Code and shall index the certificate in the indexes provided for under section 317.18 of the Revised Code. If the lien subsequently is canceled, the cancellation also shall be recorded by the county recorder.
Section 2. That existing section 135.353 of the Revised Code is hereby repealed.
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