2017 ORS 307.110¹
Public property leased or rented by taxable owner
  • exceptions

(1) Except as provided in ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports), all real and personal property of this state or any institution or department thereof or of any county or city, town or other municipal corporation or political subdivision of this state, held under a lease or other interest or estate less than a fee simple, by any person whose real property, if any, is taxable, except employees of the state, municipality or political subdivision as an incident to such employment, shall be subject to assessment and taxation for the assessed or specially assessed value thereof uniformly with real property of nonexempt ownerships.

(2) Each leased or rented premises not exempt under ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports) and subject to assessment and taxation under this section which is located on property used as an airport and owned by and serving a municipality or port shall be separately assessed and taxed.

(3) Nothing contained in this section shall be construed as subjecting to assessment and taxation any publicly owned property described in subsection (1) of this section that is:

(a) Leased for student housing by a school or college to students attending such a school or college.

(b) Leased to or rented by persons, other than sublessees or subrenters, for agricultural or grazing purposes and for other than a cash rental or a percentage of the crop.

(c) Utilized by persons under a land use permit issued by the Department of Transportation for which the department’s use restrictions are such that only an administrative processing fee is able to be charged.

(d) County fairgrounds and the buildings thereon, in a county holding annual county fairs, managed by the county fair board under ORS 565.230 (Management of county fairs), if utilized, in addition to county fair use, for any of the purposes described in ORS 565.230 (Management of county fairs) (2), or for horse stalls or storage for recreational vehicles or farm machinery or equipment.

(e) The properties and grounds managed and operated by the State Fair Council under ORS chapter 565, if utilized, in addition to the purpose of holding the Oregon State Fair, for horse stalls or for storage for recreational vehicles or farm machinery or equipment.

(f) State property that is used by a public university listed in ORS 352.002 (Public universities) or the Oregon Health and Science University to provide parking for employees, students or visitors.

(g) Property of a housing authority created under ORS chapter 456 which is leased or rented to persons of lower income for housing pursuant to the public and governmental purposes of the housing authority. For purposes of this paragraph, “persons of lower income” has the meaning given that term in ORS 456.055 (General definitions for ORS 456.055 to 456.235).

(h) Property of any county or city, town or other municipal corporation or political subdivision of this state that is used for affordable housing or is leased or rented to persons of lower income for housing pursuant to the public and governmental purposes of the county or city, town or other municipal corporation or political subdivision of this state. For purposes of this paragraph, “affordable housing” and “persons of lower income” have the meanings given those terms in ORS 456.055 (General definitions for ORS 456.055 to 456.235). The exemption under this paragraph shall be granted upon compliance with ORS 307.162 (Claiming exemption).

(i) Property of a health district if:

(A) The property is leased or rented for the purpose of providing facilities for health care practitioners practicing within the county; and

(B) The county is a frontier rural practice county under rules adopted by the Office of Rural Health.

(j) Property of a port if:

(A) The port:

(i) Is organized under ORS chapter 777; and

(ii) Has a board of commissioners appointed by the Governor; and

(B) The property is:

(i) Located in a county with a population of less than 450,000; and

(ii) Used or held for future use by a person other than the port pursuant to an agreement that obligates the person to provide common carrier rail freight service to shippers.

(4) Property determined to be an eligible project for tax exemption under ORS 285C.600 (Definitions for ORS 285C.600 to 285C.635) to 285C.635 (Determination of personal income tax revenue) and 307.123 (Property of strategic investment program eligible projects) that was acquired with revenue bonds issued under ORS 285B.320 (Purpose of ORS 285B.320 to 285B.371) to 285B.371 (State interest in eligible projects not necessary for loans) and that is leased by this state, any institution or department thereof or any county, city, town or other municipal corporation or political subdivision of this state to an eligible applicant shall be assessed and taxed in accordance with ORS 307.123 (Property of strategic investment program eligible projects). The property’s continued eligibility for taxation and assessment under ORS 307.123 (Property of strategic investment program eligible projects) is not affected:

(a) If the eligible applicant retires the bonds prior to the original dates of maturity; or

(b) If any applicable lease or financial agreement is terminated prior to the original date of expiration.

(5) The provisions of law for liens and the payment and collection of taxes levied against real property of nonexempt ownerships shall apply to all real property subject to the provisions of this section. Taxes remaining unpaid upon the termination of a lease or other interest or estate less than a fee simple, shall remain a lien against the real or personal property.

(6) If the state enters into a lease of property with, or grants an interest or other estate less than a fee simple in property to, a person whose real property, if any, is taxable, then within 30 days after the date of the lease, or within 30 days after the date the interest or estate less than a fee simple is created, the state shall file a copy of the lease or other instrument creating or evidencing the interest or estate with the county assessor. This section applies notwithstanding that the property may otherwise be entitled to an exemption under this section, ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports) or as otherwise provided by law. [Amended by 1953 c.698 §7; 1961 c.449 §1; 1969 c.675 §18; 1971 c.352 §1; 1971 c.431 §1; 1979 c.689 §4; 1981 c.381 §1; 1987 c.487 §1; 1989 c.659 §2; 1991 c.459 §40; 1991 c.851 §3; 1993 c.655 §2; 1993 c.737 §7; 1995 c.337 §1; 1995 c.376 §3; 1995 c.698 §9; 1995 c.748 §2; 1997 c.541 §101; 1997 c.819 §12; 1999 c.760 §1; 2001 c.67 §2; 2001 c.114 §8; 2003 c.662 §11a; 2005 c.777 §17; 2013 c.287 §1; 2013 c.386 §1; 2013 c.492 §31; 2013 c.768 §133]

Note: The amendments to 307.110 (Public property leased or rented by taxable owner) by section 4, chapter 287, Oregon Laws 2013, apply to property tax years beginning on or after July 1, 2023. See section 5, chapter 287, Oregon Laws 2013. The text that applies to property tax years beginning on or after July 1, 2023, is set forth for the user’s convenience.

307.110 (Public property leased or rented by taxable owner). (1) Except as provided in ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports), all real and personal property of this state or any institution or department thereof or of any county or city, town or other municipal corporation or political subdivision of this state, held under a lease or other interest or estate less than a fee simple, by any person whose real property, if any, is taxable, except employees of the state, municipality or political subdivision as an incident to such employment, shall be subject to assessment and taxation for the assessed or specially assessed value thereof uniformly with real property of nonexempt ownerships.

(2) Each leased or rented premises not exempt under ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports) and subject to assessment and taxation under this section which is located on property used as an airport and owned by and serving a municipality or port shall be separately assessed and taxed.

(3) Nothing contained in this section shall be construed as subjecting to assessment and taxation any publicly owned property described in subsection (1) of this section that is:

(a) Leased for student housing by a school or college to students attending such a school or college.

(b) Leased to or rented by persons, other than sublessees or subrenters, for agricultural or grazing purposes and for other than a cash rental or a percentage of the crop.

(c) Utilized by persons under a land use permit issued by the Department of Transportation for which the department’s use restrictions are such that only an administrative processing fee is able to be charged.

(d) County fairgrounds and the buildings thereon, in a county holding annual county fairs, managed by the county fair board under ORS 565.230 (Management of county fairs), if utilized, in addition to county fair use, for any of the purposes described in ORS 565.230 (Management of county fairs) (2), or for horse stalls or storage for recreational vehicles or farm machinery or equipment.

(e) The properties and grounds managed and operated by the State Fair Council under ORS chapter 565, if utilized, in addition to the purpose of holding the Oregon State Fair, for horse stalls or for storage for recreational vehicles or farm machinery or equipment.

(f) State property that is used by a public university listed in ORS 352.002 (Public universities) or the Oregon Health and Science University to provide parking for employees, students or visitors.

(g) Property of a housing authority created under ORS chapter 456 which is leased or rented to persons of lower income for housing pursuant to the public and governmental purposes of the housing authority. For purposes of this paragraph, “persons of lower income” has the meaning given that term in ORS 456.055 (General definitions for ORS 456.055 to 456.235).

(h) Property of any county or city, town or other municipal corporation or political subdivision of this state that is used for affordable housing or is leased or rented to persons of lower income for housing pursuant to the public and governmental purposes of the county or city, town or other municipal corporation or political subdivision of this state. For purposes of this paragraph, “affordable housing” and “persons of lower income” have the meanings given those terms in ORS 456.055 (General definitions for ORS 456.055 to 456.235). The exemption under this paragraph shall be granted upon compliance with ORS 307.162 (Claiming exemption).

(i) Property of a health district if:

(A) The property is leased or rented for the purpose of providing facilities for health care practitioners practicing within the county; and

(B) The county is a frontier rural practice county under rules adopted by the Office of Rural Health.

(4) Property determined to be an eligible project for tax exemption under ORS 285C.600 (Definitions for ORS 285C.600 to 285C.635) to 285C.635 (Determination of personal income tax revenue) and 307.123 (Property of strategic investment program eligible projects) that was acquired with revenue bonds issued under ORS 285B.320 (Purpose of ORS 285B.320 to 285B.371) to 285B.371 (State interest in eligible projects not necessary for loans) and that is leased by this state, any institution or department thereof or any county, city, town or other municipal corporation or political subdivision of this state to an eligible applicant shall be assessed and taxed in accordance with ORS 307.123 (Property of strategic investment program eligible projects). The property’s continued eligibility for taxation and assessment under ORS 307.123 (Property of strategic investment program eligible projects) is not affected:

(a) If the eligible applicant retires the bonds prior to the original dates of maturity; or

(b) If any applicable lease or financial agreement is terminated prior to the original date of expiration.

(5) The provisions of law for liens and the payment and collection of taxes levied against real property of nonexempt ownerships shall apply to all real property subject to the provisions of this section. Taxes remaining unpaid upon the termination of a lease or other interest or estate less than a fee simple, shall remain a lien against the real or personal property.

(6) If the state enters into a lease of property with, or grants an interest or other estate less than a fee simple in property to, a person whose real property, if any, is taxable, then within 30 days after the date of the lease, or within 30 days after the date the interest or estate less than a fee simple is created, the state shall file a copy of the lease or other instrument creating or evidencing the interest or estate with the county assessor. This section applies notwithstanding that the property may otherwise be entitled to an exemption under this section, ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports) or as otherwise provided by law.

Notes of Decisions

Restric­tions may be imposed without destroying possessory interest denoting a lease. Canteen Co. v. Dept. of Revenue, 8 OTR 450 (1980)

Legislative decision, expressed by this sec­tion, to subject state-owned land leased to private individuals to ad valorem prop­erty tax does not violate Article VIII, sec­tion 5 of the Oregon Constitu­tion. Johnson v. Dept. of Revenue, 292 Or 373, 639 P2d 128 (1982)

Dry boat storage building built over 300 feet from wa­ter and leased to taxable individuals was not exempted from taxa­tion under “berthing” of wa­tercraft exemp­tion in ORS 307.120 (Property owned or leased by municipalities, dock commissions, airport districts or ports). Port of Coos Bay v. Dept. of Rev., 298 Or 229, 691 P2d 100 (1984)

Property belonging to tax exempt, special district port was occupied by plaintiff’s employee as per­sonal residence but was used as incident to employ­ment pursuant to this pro­vi­sion and, therefore, was tax exempt. Port of Bandon v. Dept. of Rev., 12 OTR 40 (1991)

Franchise allowing nonexclusive use of public prop­erty in unde­scribed areas of city does not grant taxable possessory interests in public prop­erty. Jones Intercable, Inc. v. Dept. of Rev., 12 OTR 436 (1993)

Franchise to operate business does not increase assessed value of tangible business prop­erty. Jones Intercable, Inc. v. Dept. of Rev., 12 OTR 436 (1993)

Assess­ment describing entire prop­erty was not sufficiently specific for purpose of assessing rented or leased por­tion of premises. Lincoln County v. Dept. of Rev., 12 OTR 548 (1993)

Where non-tax exempt entity leases otherwise tax exempt prop­erty, lien for prop­erty taxes is enforceable only against leasehold interest of non-tax exempt lessee. Multnomah County v. Finance America Corp., 120 Or App 30, 852 P2d 262 (1993), Sup Ct review denied

Mere pos­ses­sion and use of prop­erty without obtaining lawful interest does not make prop­erty taxable to user. Multnomah County v. Dept. of Rev., 13 OTR 170 (1994), aff’d 321 Or 576, 902 P2d 94 (1995)

Where public prop­erty is “held under a lease,” assess­ment is levied on value of fee interest in prop­erty, not just value of leasehold interest. Pollin v. Dept. of Revenue, 13 OTR 478 (1996)

Upon expira­tion of lease, lien on lessee’s interest in otherwise exempt prop­erty also expires. Urban Renewal Agency v. Dept. of Revenue, 14 OTR 77 (1996)

Property value is reduced by govern­ment restric­tions on use of prop­erty, but is not reduced by restric­tions on lessee’s interest. Pollin v. Dept. of Revenue, 14 OTR 96 (1997), aff’d 326 Or 427, 952 P2d 537 (1998)

Where in­ter­fer­ence by other uses is minimal and interest held constitutes substantial part of all practical uses of prop­erty, right of exclusive control exists. Avis Rent A Car System, Inc. v. Dept. of Revenue, 14 OTR 487 (1998), aff’d 330 Or 35, 995 P2d 1163 (2000)

Property that is owned by public body and that is subject to lien for tax due and unpaid by private party lessee is not “safe” from unpaid tax liability because lien survives lease termina­tion. Grant County Assessor v. Dayville Public Sch. Dist. 16J, 20 OTR 91 (2010)

Atty. Gen. Opinions

Subjec­tion of “oil and gas lease” lands to ad valorem taxa­tion, (1976) Vol 38, p 20; require­ments to maintain exempt status of leased publicly owned land, (1979) Vol 40, p 68

Chapter 307

Atty. Gen. Opinions

Validity of ad valorem and severance taxa­tion of logs destined for export, (1975) Vol 37, p 427; applica­tion of Article XI, sec­tion 11b of Oregon Constitu­tion to this chapter, (1990) Vol 46, p 388

Law Review Cita­tions

5 EL 516 (1975)

1 Legislative Counsel Committee, CHAPTER 307—Property Subject to Taxation; Exemptions, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors307.­html (2017) (last ac­cessed Mar. 30, 2018).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2017, Chapter 307, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano307.­html (2017) (last ac­cessed Mar. 30, 2018).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.