SB 1048

Current law provides an exemption from property taxes for real property held by a nonprofit organization if the property is held for rehabilitating an existing structure or constructing a new structure and for subsequent sale at no interest to low-income persons who participate in the property’s rehabilitation or construction. This bill modifies this property tax exemption as follows:

1. The bill eliminates the requirement that such nonprofit organizations require prospective low-income buyers to participate in the rehabilitation or construction of the real property for it to be exempt.

2. The bill provides that property is exempt if the nonprofit organization offers no-interest loans to lower income households to purchase the property or, if the nonprofit organization charges interest when selling the property, the nonprofit organization is restricted to transferring property to persons having an income that is less than 120 percent of the area median income as determined by the U.S. Department of Housing and Urban Development.

3. The bill specifies that property held for redevelopment qualifies for the property tax exemption.

4. The bill specifies that the nonprofit organization holding the property must be a 501 (c) (3) organization under the Internal Revenue Code.

Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill.