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Tax Break May Help Habitat’s Houses

There’s no shortage of demand for good homes in Eugene these days, especially for those with low or little income. Now the local affiliate of Habitat for Humanity International has its fingers crossed that the nonprofit will be able to put up a few more houses every year if the Oregon Legislature passes House Bill 2690-1 this summer. 

The bill grants tax exemptions for land held by nonprofits, if that land is intended for low-income housing. The primary benefactors are organizations like Habitat for Humanity, building in Eugene and Springfield since 1990, which has strongly supported the bill.

 “In Lane County, we are only exempt from property taxes from the time of building a new house,” says Don Griffin, executive director for the Eugene and Springfield Habitat for Humanity.  “But with this we could be exempt for seven years or more.” 

In contrast, Eugene’s Multiple-Unit Property Tax Exemption (MUPTE) granted the Capstone student housing project a 10-year property tax break.

Usually Griffin’s organization buys a tract of land for later development and the process can take at least three years before building begins. During that time, in Lane County, the property taxes add up. 

“We need the exemption,” Griffin says. “The estimates are that this will save Habitat affiliates [in Oregon] $200,000 a year in property taxes.” The Eugene and Springfield Habitat for Humanity affiliate will save at least $5,000 a year.

Right now Griffin’s affiliate has one house under way in the Eugene-Springfield area, a groundbreaking due on June 13 and a third project under way later this year. For its construction projects, Habitat for Humanity relies on donated materials and thousands of volunteer hours. The nonprofit also takes on eight to 10 repair projects a year, painting older houses and building accessibility ramps.

Griffin says property tax exemptions vary by county, and the new act would “clarify” matters.

“We’re trying to get some consistency around the state,” Griffin says.

In the long run, more homes mean more taxes for the state and counties. “Once we sell it to the home owners, it goes on the tax rolls as a regular house, at many times the tax than when it’s bare ground,” Griffin says.

Though the bill will help all low-income housing developers in the state, House Rep. Phil Barnhart, chair of the House Committee on Revenue, says it’s primarily targeted at Habitat for Humanity.

“With this they can build a few more houses a year for low-income families,” Barnhart tells EW. “I’m hopeful the bill will pass.” 

HB 2690-1 has already passed the House 57-1 and is now in the Oregon Senate.