January 18, 2008
Taylor Introduces the LITE-House Act
MADISON – Senator Lena C. Taylor (D-Milwaukee) today introduced Senate Bill 403, the LITE-House Act (Low Income Tax Exempt House Act). The Act is a narrowly-crafted, property tax exemption for low-income housing owned by non-profit groups. Companion legislation has been introduced in the Assembly by Representative Mark Gottlieb (R-Port Washington).
Taylor authored the Act in response to Columbus Park Housing Corporation v. City of Kenosha, a 2003 Wisconsin State Supreme Court case. The holding in that case put many organizations that provide low-income housing at risk of being assessed for property taxes. Because these groups use rent proceeds for purposes other than those specifically allowed under the so-called “rent-use” requirement, the Court deemed them to be outside existing property tax exemptions.
“We need to be encouraging safe, affordable low-income housing,” said Taylor, “not putting up barriers to it. The organizations that provide low-income housing are out there doing God’s work. The Legislature should be there to lend them a hand.”
The Act works by redefining what actions meet the “rent-use” requirement. Specifically, it permits use of rent proceeds from low-income housing for a broader variety of purposes without loss of the property tax exemption.
“These are commonsense expansions of the definition,” remarked Taylor. “Spending rent proceeds on things like financing costs, project preservation, and building other low-income housing shouldn’t be treated as a bad thing. Communities rely on that sort of work to fulfill their low-income housing needs and this bill shows that we stand with them.”
The Act also changes current law with respect to the total property that a religious organization may own tax exempt. The Act allows a total of 30 acres of land owned by a non-profit organization to be exempt from property taxes in a given municipality, so long as that land is put toward low-income housing. Existing law generally limits the amount of land that non-profit organizations can own, tax exempt, to ten acres per municipality.
“The important thing with this legislation is that it’s narrowly-tailored to meet the needs of low-income families and individuals,” said Taylor. “We’re really shining the light on an area that’s vital to our communities with it. The LITE-House Act is just good public policy.”
The LITE-House Act, which has broad bipartisan support in the Legislature, has been referred to the Senate Committee on Judiciary, Corrections, and Housing. The bill will be heard by the Committee on Tuesday, January 22, 2008 in Room 411 South after the Senate Session.