Farm & Forest Special Assessment Programs Overview
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This is intended to be a quick overview of some of the Special Assessment programs. For details on these programs please refer to our FAQ’s for Special Assessment or you may contact the Assessor’s Office.
Special Note to Owner, Buyers or Sellers of Specially Assessed Property, Real Estate Professionals, or other interested parties:
Specially assessed properties carry a Potential Additional Tax Liability that remains on the land regardless of ownership changes. This means that the special assessment and the Potential Additional Tax Liability remain on the property until the Assessor discovers, or it is otherwise determined that such special assessment no longer applies. If a property is disqualified from a special assessment program, regardless of whom the current owner is or for how long they have owned the property, a potential additional tax liability amount of up to 5 years or 10 years, depending on the program, could be assessed against the property.
Please note that all applications must be filed on or before April 1 with the Assessor’s office unless it is a request to change designation type due to a notice of disqualification from another special assessment program. If such a notice is received between January 1 and August 14, the owner has until August 1st or 30 days from the date of notice, whichever is later, to submit an application. If such notice is received between August 14 and December 31, the owner has between January 1 and April 1 of the next year to file for another special assessment program.
Farm Deferral
Many rural properties are eligible for farm use special assessment or deferral of some or all of their property if it is "used for a qualifying farm use." The purpose of this program is to provide a financial incentive to property owners, in the form of reduced property values, for keeping their land in agricultural production. These programs have a potential tax payback if the requirements discontinue to be met.
Farmland Within an Exclusive Farm Use Zone
EFU (Zoning of EFU, UT, SA, FT, TC) is land that has been zoned farm use by the planning department and must be used to grow something for sale with the intent to make a profit in money, to qualify for farm use special assessment. No minimum acreage requirement. No minimum income requirements.
Disqualification: 10 years outside Urban Growth Boundary; 5 years inside Urban Growth Boundary
Farmland
Not Within an Exclusive Farm Use Zone
Any zoning other than exclusive farm use. The statute states that a gross income requirement must be met for three out of five years before filing for the deferral and every five-year interval thereafter. There are, however, certain limitations that should be discussed with the Assessment office. The income must be supported by a Schedule F or other farm income tax form. There is no minimum acreage requirement. This designation DOES require a minimum income to be produced and reported on a yearly gross income questionnaire. The special assessment is by application only and will transfer with ownership as long as acceptable farm activities continue.
Yearly Income requirement
0 – 6.5 acres: $650
6.5 – 30 acres: multiply acreage by $100
30+ acres: $3,000
Disqualification: 5 years
Forestland Deferral
Many rural properties are eligible for designation of forestland special assessment or deferral if the property is "used for the predominant purpose of growing and harvesting trees of a marketable species." The purpose of this program is to provide a financial incentive to property owners, in the form of reduced property values, for keeping their land in timber production. This program has a potential tax payback if the requirements discontinue to be met. An application for Designation of Land as Forestland and an application for Small Tract Forestland Option may be filed at the same time.
All Forest Special Assessment Programs are subject to stocking requirements and Assessor approval. If you have further questions please contact our office.
Designated Forestland
Any zoning. There must be at least two contiguous acres of trees in the same ownership which meet minimum forest management and stocking standards or an acceptable plan to meet the standards must be in place. Severance tax will not be charged upon harvest and sale of the timber. This special assessment is by application and can transfer with ownership. The Assessor’s Office will process your application to determine if your land qualifies.
Note: Contiguous is defined as land that has a common boundary that is greater than a single point. Includes parcels separated by public or county roads, state highways, non-navigable streams or non-navigable rivers.
Disqualification: 5 years
Small Tract Forestland Option
Any zoning. There must be a minimum of 10 but less than 5,000 acres of forestland in the state of Oregon in the same ownership under either the Designated Forestlands or highest and best use forestlands program . All contiguous parcels of forestland use in the same ownership (one or more of the owners) must be included. Severance tax will be charged upon harvest and sale of the timber. When ownership changes, the assessor has 15 months to notify the new owner to reapply or face disqualification. Once disqualified, the property must remain out of the program for five years.
Note: Highest & Best Use Forestland (a.k.a. forestlands) is generally zoned TC and are lands for which the most probable, reasonable and legal use of the land is predominately for the growth and harvesting of timber. This precludes alternative uses such as residential, farm or commercial, which may support a higher value. This is not a deferral program; the value shown is considered its worth until highest and best use changes. Most often the status changes because a home site has been established. At that point, the landowner is notified to apply for deferral in order to keep the lower taxable value. Severance tax will not be charged upon harvest and sale of the timber.
Disqualification: 10 years from STFO to Designated Forestland
Wildlife Habitat Conservation and Management Plan
Land must be located in an area zoned for exclusive farm use, mixed farm and forest use, or forest use under a land use planning goal protecting agricultural land or forestland. Property owners should contact the Oregon Department of Fish and Wildlife (ODFW) to ascertain the requirements and develop a plan. After approval from the ODFW, an application must be made to the Assessor.
Disqualification: 10 years in EFU outside Urban Growth Boundary; 5 years inside Urban Growth Boundary
Open Space
Land that is being used as a golf course, open to the general public or for conservation and preservation purposes.
Disqualification: all years in program
Conservation Easement
Land that is held by one or more holders and is managed with the terms of the easement that are capable of meeting the requirements for being considered exclusively for conservation purposes under 170(h) of the IRS. The easement must be recorded with the county clerk in which land is located, followed by the written certification filed with the county assessor.
Disqualification: 10 years in EFU outside Urban Growth Boundary; 5 years all else.
FAQ
The break in taxes the property will receive is not based on a percentage of value. Rather, an appraiser will determine soil classes for your land and those lower values are what become taxable. This varies from property to property.
The break in taxes the property will receive is not based on a lower tax rate. Rather, an appraiser will determine soil classes for your land and those lower values are what become taxable. This varies from property to property.
This flag is placed on properties with billed liens, properties in foreclosure or bankruptcy, and properties that have received special use. When a change of use occurs, due to removal from special assessment use by owner request or from lack of use, the property is either billed for the use change or the Potential Additional Tax flag is added to the account. A property with the Potential Additional Tax flag will retain the flag until the lien is paid or the property returns to a qualifying use. Liens are calculated for up to either 5 or 10 years depending on the zoning and the length of time the property has received the benefit.
The liability goes with the land and not the owner, but Oregon law does not require it to be paid off unless the use of the land changes to something incompatible with returning it to farming, such as developing it for residential, commercial or industrial use. If the interested parties do not want the land to be encumbered, the buyer and seller may negotiate a payoff between themselves if they wish.
No, it does not accumulate interest charges and will remain the same amount indefinitely.
It is not forgiven or forgotten, but is set aside and simply ceases to be reflected on the legal description as a potential lien. The notation only exists for acreage that has been disqualified (removed) from special assessment. New liability continues to accrue for every year a property is specially assessed.
Please contact the Planning & Zoning department at (503) 588-5038.
Typically, 1 acre is disqualified (removed) from special assessment. In an EFU zone, that acre is then taxed at a reduced value as a homesite along with the onsite developments such as well, septic, landscaping, etc. as long as the home is owned and occupied by a person who is involved in the farm/forest operation (you must have at least 10 acres of trees to qualify for this in forestland special assessment.) In a Non-EFU zone, we calculate the most recent 5 years’ (maximum) worth of deferred taxes on 1 acre and extend the amount as an additional tax, due and payable on the next tax roll. That acre is then assessed and taxed on its market value.
Typically, 1 acre is disqualified (removed) from special assessment. In an EFU zone, that acre is then taxed at a reduced value as a homesite along with the onsite developments such as well, septic, landscaping, etc. as long as the home is owned and occupied by a person who is involved in the farm/forest operation (you must have at least 10 acres of trees to qualify for this in forestland special assessment.) In a Non-EFU zone, we calculate the most recent 5 years’ (maximum) worth of deferred taxes on 1 acre and extend the amount as an additional tax, due and payable on the next tax roll. That acre is then assessed and taxed on its market value.
If farming ceases, the property will be disqualified (removed) from special assessment. It will then begin to be assessed and taxed at its real market value. In addition, the last 5 or 10 years (maximum) of deferred taxes will be calculated and that amount will be applied to the property as a Potential Additional Tax Liability.
You can order an Informational report, which costs $75 per taxlot and takes about a week to prepare. If the property is then disqualified within 90 days of your request, the $75 will be applied as a credit to the deferred amount.
Contact our office. We will have an appraiser perform an onsite inspection after April 1st. They will determine qualifying farm use and assign soil classes to the farmland. We will send you a letter later in the year to notify you that we have processed your request for the upcoming tax year.
Yes, as long as they are farming with the intent of making a profit in money and you are receiving an income from them. We may request a lease agreement as proof of this income.
Please see our “Carrying Capacity” flyer.
Yes, but they only qualify for farm use if you are making an income from them.
Please see our “Christmas Tree Requirements” flyer.
After you receive your tax statement and prior to April 1 of the year in which you wish special assessment. Contact our office for an application.
Depending on what the Conditional Use decision states, we generally must permanently disqualify (remove) the entire property from special assessment, prior to you obtaining a building permit. This involves the calculation of the most recent 5 or 10 years’ (maximum) worth of deferred taxes which are then extended to the next tax roll, due and payable as an additional tax. The property becomes ineligible to receive special assessment as a farm or forest from that point forward, with minimal exceptions. It is then assessed and taxed on its market value.
The act of recording a subdivision triggers a disqualification (removal) of the property from special assessment and the calculation of the most recent 5 or 10 years’ (maximum) worth of deferred taxes. In an EFU zone, this Potential Additional Tax Liability will not be due and payable until the use of the land is changed to something incompatible with returning it to farm use, such as development for residential, commercial or industrial use. In a Non-EFU zone, the additional taxes are due and payable for the current tax year. If the zone is changed from EFU to Non-EFU, a timely application may be made to continue receiving special assessment.
Please see our “General Information on Designated Forestland” flyer.
Please see the “Special Assessment Programs for Forestland” flyer.
After you receive your tax statement and prior to April 1 of the year in which you wish special assessment. Contact our office for an application.
