SB 5289 provides a state and local property tax exemption for real property owned by a nonprofit entity or a qualified cooperative association and used to develop affordable housing. HB 1107 is the Senate bill’s companion and had its hearing on January 29.

Here are the key changes to current law:

• It’s an expansion in two ways. First, existing law only allows the tax exemption for a nonprofit property owner. The bill expands this to include a qualified cooperative association. Second, existing law only allows the tax exemption when property is sold to a low-income household.The bill expands the list of buyers to include a qualified cooperative association and a separate nonprofit entity.
• The tax exemption will not expire if the property transfers from one nonprofit to another or to a qualified cooperative association. It will only expire when the property is conveyed to any single-family dwelling on the property.
• The bill defines qualified cooperative association as the owner of real property that develops on the property:
  • 60% or more of units owned by low-income; and
  • 80% or more of the square feet of improvements of property are used by owners of the units.

Dates to remember

SB 5289 will be heard Monday, February 4 at 1:30 pm in the Senate Housing Stability & Affordability Committee.