ARIZONA HOUSE OF REPRESENTATIVES

SB 1300: low-income housing; tax exemption

PRIME SPONSOR: Senator Brophy McGee, LD 28

BILL STATUS: Ways & Means

Overview

Modifies qualification conditions for tax exempt low-income housing.

History

Current law exempts certain rental property and related facilities from property taxation if the property is not used for profit and is operated by a nonprofit organization. This exemption also applies to properties that are wholly-owned subsidiaries of a nonprofit organization, including those in limited partnerships where the nonprofit organization is the managing general partner. (A.R.S. § 42-11133)

Provisions

1. Exempts property from taxation if it is used exclusively for affordable rental housing pursuant to the Internal Revenue Code (IRC) or another recorded restrictive covenant imposed by financing for affordable housing. (Sec. 1)

2. Requires that the property is owned and operated by a corporation that is qualified pursuant to the IRC, a limited partnership or limited liability company, in which the general partner or the managing member, as applicable, is an eligible nonprofit corporation or a single purpose entity that is wholly owned by one or more eligible nonprofit corporations. (Sec. 1)

3. Requires that property must qualify under either of the following conditions:

a. the acquisition, rehabilitation, development or operation of the property is financed with tax exempt mortgage revenue bonds or general obligation bonds or is financed by local, state or federal loans or grants, and the amount of rent paid by or on behalf of the occupants does not exceed the amount of rent that is prescribed by deed restrictions or regulatory agreements; or

b. the owner of the property is eligible for and receives federal tax credits for low-income or moderate-income residential housing pursuant to the IRC, and the amount of rent paid by or on behalf of the occupants does not exceed the amount that is prescribed by deed restrictions or by regulatory agreements. (Sec. 1)

4. Removes the requirement that the property is used as an assisted living facility for low income elderly residents. (Sec. 1)

5. Requires that qualifying properties cannot exceed 200 units. (Sec. 1)

6. Defines eligible nonprofit corporation. (Sec. 1)

7. Makes technical and conforming changes. (Sec. 1)

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11. Fifty-fourth Legislature                       SB 1300

12. First Regular Session                            Version 1: Ways & Means

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