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83rd OREGON LEGISLATIVE ASSEMBLY--2025 Regular Session
House Bill 2124
Sponsored by Representative NOSSE (Presession filed.)
SUMMARY
The following summary is not prepared by the sponsors of the measure and is not a part of the body thereof subject
to consideration by the Legislative Assembly. It is an editor’s brief statement of the essential features of the
measure as introduced.The statement includes a measure digest written in compliance with applicable readability
standards.
Digest: The Act would require a study of land value taxation.The Act would define “land value
taxation” to mean a tax imposed at a higher rate on land than on improvements on the land. The
Act would require a report to be turned in next year. (Flesch Readability Score: 77.2).
Directs the Legislative Revenue Officer to study land value taxation and submit a report to the
interim committees of the Legislative Assembly related to revenue. Defines “land value taxation”
to mean a property tax system that imposes a higher uniform rate of tax on land assessments than
on improvement assessments.
Takes effect on the 91st day following adjournment sine die.
A BILL FOR AN ACT
Relating to land value taxation; and prescribing an effective date.
Whereas the cumulative effects of limiting the growth of property assessments under Ballot
Measure 50 (1997) are continuous revenue shortfalls, an increasing disparity between true market
values and taxable assessments, and unequal tax treatment of taxpayers with similarly valued
property;and
Whereas economic analysts have spoken out clearly against both the use of limited assessments
as a tax restraint and the perverse manner in which the taxation of improvement values discourages
capital investment and the efficient use of land; and
Whereas present limitations on revenue authority, including Ballot Measure 50 limits and stat-
utory automatic property tax exemptions, erode local control and undermine the ability of cities to
maintain a healthy mix of revenues; and
Whereas under a split-rate land value property tax system, the tax rate on the assessed land
values of all parcels in a taxing jurisdiction is higher than the rate on building assessments, thereby
taxing mainly the site value created by the community at large; and
Whereas under the revised land value tax system, all properties within a local jurisdiction would
be taxed at the same split rate, consistent with the constitutional intent to tax all classes of land
users uniformly; and
Whereas in the aggregate, a land value tax is presumed to encourage local investment, dampen
land price inflation, help protect at-risk rural resource lands from development pressures and stim-
ulate infill development; and
Whereas by capitalizing marginal land tax liability into lower resale prices and lowering the
expectation of speculative returns, the land value tax helps housing prices become more widely af-
fordable and still leaves a substantial amount of cumulative equity in the hands of homeowners; and
Whereas a land value tax is expected to restore fairness and efficiency to the tax system, is a
reliable source of revenue and is relatively easy to administer; now, therefore,
Be It Enacted by the People of the State of Oregon:
NOTE:Matter in boldfaced type in an amended section is new; matter [italic and bracketed] is existing law to be omitted.
New sections are in boldfaced type.
LC 3782 HB2124
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SECTION 1. (1) As used in this section, “land value taxation” means, for all taxable real
property, a property tax system that imposes a higher uniform rate of tax on land assess-
ments than on improvement assessments.
(2) The Legislative Revenue Officer shall conduct a study of land value taxation. The
study must include:
(a) An examination of the tax burden effects of a change from the current system of
property taxation under Ballot Measure 5 (1990) and Ballot Measure 50 (1997) to land value
taxation.
(b) Simulation model comparisons of tax applications using true market assessments and
a revenue-neutral framework.
(c) An examination of comparative economic incentive effects on classes of land use in
selected local urban and rural jurisdictions.
(d) An examination of comparative economic incentive effects on property in selected
jurisdictions currently utilizing rural enterprise zone tax incentives.
(e) An evaluation of tax burden relief measures that might accompany land value taxa-
tion, including a homestead exemption and property tax deferral for homeowners who are
financiallyoverburdened.
(3) The Legislative Revenue Officer shall submit a report on the study, in the manner
provided by ORS 192.245, to the interim committees of the Legislative Assembly related to
revenue no later than September 15, 2026.
SECTION 2. Section 1 of this 2025 Act is repealed on the date of the convening of the 2027
regular session of the Legislative Assembly as specified in ORS 171.010.
SECTION 3.This 2025 Act takes effect on the 91st day after the date on which the 2025
regular session of the Eighty-third Legislative Assembly adjourns sine die.
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