2015 ORS 307.455¹
Definitions
  • application for exemption
  • exemption
  • limitations

Caution-flag-2-25x25
This section is amended
Effective June 2, 2016
Relating to the minimum cost requirement for the exemption of certain food processing property; creating new provisions; amending ORS 307.455; and prescribing an effective date.

(1) As used in this section and ORS 307.457 (Certification of eligibility of machinery and equipment):

(a) "Assessor" means the county assessor, or the Department of Revenue if under ORS 306.126 (Appraisal of industrial property by department) the department is responsible for appraisal of the facility at which the qualified machinery and equipment is located.

(b) "Bakery product" has the meaning given that term in ORS 625.010 (Definitions for ORS 625.010 to 625.270).

(c) "Dairy products" has the meaning given that term in ORS 621.003 (Definitions).

(d) "Food processor":

(A) Means a person engaged in the business of freezing, canning, dehydrating, concentrating, preserving, processing or repacking for human consumption raw or fresh fruit, vegetables, nuts, legumes, grains, bakery products, dairy products, eggs or seafood in any procedure that occurs prior to the point of first sale by the processor.

(B) Does not include:

(i) Persons engaged in the business of producing alcoholic beverages, marijuana or any product that contains marijuana or a marijuana extract.

(ii) A person engaged in the business of producing bakery products unless the person has been issued a wholesale license by the State Department of Agriculture.

(e) "Integrated processing line" does not include forklifts, trucks or other rolling stock used to transport material to or from a point of manufacture or assembly.

(f) "Qualified machinery and equipment" means property, whether new or used, that is newly acquired by a food processor and placed into service prior to January 1 preceding the first tax year for which an exemption under this section is sought, and that consists of:

(A) Real property machinery and equipment that is used by a food processor in the primary processing of raw or fresh fruit, vegetables, nuts, legumes, grains, bakery products, dairy products, eggs or seafood; or

(B) Personal property machinery and equipment that is used in an integrated processing line for the primary processing of raw or fresh fruit, vegetables, nuts, legumes, grains, bakery products, dairy products, eggs or seafood.

(2)(a) On or before March 1 preceding the first tax year for which property is to be exempt from taxation under this section, a food processor seeking an exemption under this section shall apply to the assessor for exemption. The application shall be on a form prescribed by the Department of Revenue and shall include any information required by the department, including a schedule of the qualified machinery and equipment for which certification is sought.

(b) Notwithstanding paragraph (a) of this subsection, the assessor may approve an application that is filed after March 1, and on or before December 31 of the assessment year, if the statement is accompanied by a late filing fee of the greater of $200 or one-tenth of one percent of the real market value of the property that is the subject of the application.

(c) The assessor shall review the application and, if the machinery and equipment that is the subject of the application constitutes qualified machinery and equipment certified by the State Department of Agriculture under ORS 307.457 (Certification of eligibility of machinery and equipment), shall approve the application and exempt the qualified machinery and equipment.

(d) If any of the machinery and equipment that is the subject of the application does not constitute qualified machinery and equipment certified by the State Department of Agriculture under ORS 307.457 (Certification of eligibility of machinery and equipment), the assessor shall exclude the nonqualified machinery and equipment from the application.

(3) Qualified machinery and equipment for which an application has been approved under subsection (2) of this section shall be exempt for the tax year for which the application was approved and for the next four succeeding tax years, if as of the assessment date for each year the property constitutes qualified machinery and equipment.

(4) The duration of the exemption under subsection (3) of this section may not be extended as the result of the value of changes to qualified machinery and equipment that are attributable to rehabilitation, reconditioning or ongoing maintenance or repair.

(5) Notwithstanding subsection (3) of this section, qualified machinery and equipment that is used to process grains or bakery products may not be granted exemption under this section unless the qualified machinery and equipment has a real market value of at least $100,000 when placed in service by the food processor.

(6) Notwithstanding subsection (3) of this section, qualified machinery and equipment that is used to process bakery products may not be granted exemption under this section if proceeds from retail sales made at the processing site constitute more than 10 percent of all proceeds from sales made at the processing site. [2005 c.637 §3; 2015 c.827 §1]

Note: Section 7, chapter 637, Oregon Laws 2005, provides:

Sec. 7. Property may not qualify for a first year of exemption under ORS 307.455 (Definitions) for a tax year beginning on or after July 1, 2020. [2005 c.637 §7; 2011 c.656 §1; 2013 c.210 §1]

Note: Section 6, chapter 827, Oregon Laws 2015, provides:

Sec. 6. (1) The amendments to ORS 307.455 (Definitions) (1)(d)(B)(i) and 307.457 (Certification of eligibility of machinery and equipment) by sections 1 and 2 of this 2015 Act apply to property tax years beginning on or after July 1, 2015.

(2) The amendments to ORS 307.455 (Definitions) by section 1 of this 2015 Act relating to grains, bakery products, dairy products and eggs apply to property tax years beginning on or after July 1, 2016. [2015 c.827 §6]

Note: Section 5, chapter 827, Oregon Laws 2015, provides:

Sec. 5. The State Department of Agriculture shall submit, in the manner provided by ORS 192.245 (Form of report to legislature), a report on the impact that the amendments to ORS 307.455 (Definitions) by section 1 of this 2015 Act have had on the use of the exemption for qualified food processing machinery and equipment to the interim committees of the Legislative Assembly related to revenue not later than September 15, 2018. [2015 c.827 §5]

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 (2015) (last ac­cessed Jul. 16, 2016).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2015, Chapter 307, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano307.­html (2015) (last ac­cessed Jul. 16, 2016).
 
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.