Bill > HB4305

This bill establishes a special method for valuing certain real property for ad valorem taxation, which is a tax based on the assessed value of property. This method applies to real property owned by organizations that rent it to low or moderate-income individuals or families, was financed under the Oklahoma Affordable Housing Act, and is subject to specific agreements. For properties under active construction or lease-up, the county assessor will estimate their income potential and operating expenses based on projected first-year operations, adjusted for construction completion or occupancy rates. After construction is complete and the property stabilizes, the fair cash value will be determined normally for the first year, and then adjusted annually by the percentage change in the property's net income compared to the previous year. If such a property is sold and no longer subject to its affordability agreements, an additional tax will be imposed, calculated as the difference between the taxes paid under this special valuation and what would have been paid if the property had been appraised at its sale price in the preceding three years, adjusted for net income changes. A tax lien will attach to the property to secure this additional tax. The county assessor will notify the owner of any determination that the property is no longer eligible for this valuation method via certified mail, and the owner will have a right to protest. The additional tax will be due and payable by the following February 1st. Importantly, property owners cannot protest tax years where their property's value was determined by the net income adjustment method, and properties valued under this act cannot be used as comparable properties for others not valued this way. The county assessor will determine net income changes using generally accepted valuation standards for expenses, based on an independent auditor's report of the organization's finances, which the owner must provide annually by May 1st. This bill becomes effective on January 1, 2027.

Budget and Finance

http://www.oklegislature.gov/BillInfo.aspx?Bill=hb4305&Session=2600