7 Or. Tax 350 | Or. T.C. | 1978
Submitted on briefs and oral argument. Two cases consolidated.
Decision for defendant rendered February 13, 1978.
Evelyn J. Winningham died on December 15, 1973. At the time of her death, she was owner of a one-half interest in real property which had been determined by the defendant to have a true cash value for Oregon inheritance tax purposes as of the date of death of $90,000. For a number of years preceding the date of death and in the year of death, this land had been "assessed at its true cash value for farm use" as unzoned farmland, pursuant to ORS
Raymond R. Reter died on May 27, 1974. At the date of death, the decedent was owner of real property which was held by defendant to have a true cash value *352
of $1,691,650. For a number of years prior to the decedent's death, according to the personal representative, this land had been exclusively in farm use and was accorded a farm use assessment as unzoned farmland under the provisions of ORS
Oregon Laws 1973 ch 503, § 13, effective October 5, 1973, subsequently codified as ORS
"Interests in real property passing by reason of death that had received special assessment as farm use land under subsection (1) of ORS
308.370 for the tax year immediately preceding the date of death of the decedent shall be valued for the purposes of ORS118.005 to118.840 at its value for farm use determined by the assessor under subsection (1) of ORS308.370 for the tax year immediately preceding the date of the death of the decedent." (Emphasis supplied.)1
Jackson County enacted a county farm zoning ordinance, effective September 1, 1973. Prior to that time, and specifically on January 1, 1972, and January 1, 1973 (the assessment dates2 for the Winningham property and the Reter property, respectively), there was no county zoning and all farm use property in Jackson County which obtained special assessment came within the provisions of unzoned farmland, *353
pursuant to ORS
Plaintiffs first urged that if defendant's conclusions are followed, the operation of the pertinent statutes would be unconstitutional because of a failure of uniformity of taxation under Art I, § 32, and Art IX, § 1, of the Oregon Constitution, alleging discrimination and an improper delegation of legislative power to county governments.
No applicable citations of authority were presented to sustain these contentions. The reasoning appears to be that since Or Const, Art I, § 32, requires that all taxation shall be uniform on the same class of subjects within the territorial limits of the authority levying the tax, and Art IX, § 1, requires that all taxes shall be levied and collected under general laws operating uniformly throughout the state, it follows that subsection (1) of ORS
Although not argued in so many words, it appears to be plaintiffs' next step that, since the court should *354
construe all laws to find them constitutional if possible, and because the court has the primary duty of carrying out the legislative intent, special attention must be paid to the statement of legislative intent set out in Or Laws 1973, ch 503, § 1 (codified as ORS
[1, 2.] The defendant pointed out that Or Const, Art I, § 32, refers to the requirement of uniformity "on the same class of subjects within the territorial limits of the authority levying the tax." The defendant follows this requirement, differentiating between the classes created by the provisions of ORS
Defendant also pointed out that the legislative intent to preserve open land for agricultural use is implemented substantially by ORS
[3.] The court finds that the constitutionality of the cited statutes, read together, must be sustained. The legislative policy was to stimulate the preservation of farmland, and, during the time here involved, it sought to stimulate the adoption of permanent, specific farm zones by making it rewarding for taxpayers to press county commissioners to create such zones or for taxpayers to move into them. The rules do not differ from one part of the state to another. They do not single out any fixed group or class of persons; anyone might buy into or sell out of a farm zone, altering his estate's potential inheritance tax from day to day. The rules apply to all estates and all heirs of estates that are similarly situated under the law. Cf Tharalson v. State ex rel Dept. ofRev.,
[4.] The double references to "subsection (1) of ORS
"Exclusive farm use zoning as provided by law, substantially limits alternatives to the use of rural land and, with the importance of rural lands to the public, justifies incentives and privileges offered to encourage owners of rural lands to hold such lands in exclusive farm use zones." (Emphasis supplied.)
The application of this policy with respect to ORS
[5.] As stated by defendant (in No. 1136, Def Ans Br, 2):
"It is well established that the state legislature has wide discretion in classifying subjects. Smith et al v. Columbia Co. et al,
216 Or. 662 ,341 P.2d 540 (1959). The legislature may also make any classifications or sub-classifications that it sees fit, and the court will not interfere provided that the required equality and the uniformity between the persons in the separate classes is not unreasonable or arbitrary and has some sanction in reason and logic. Maxwell v. Bugbee,250 U.S. 525 ,40 S. Ct. 2 [63 L. Ed. 1124 ] (1919)."
The power of the legislature to impose estate and inheritance taxes upon the right to give or receive property is well established. In re Estate of Heck,
[6.] In Est. of McGee v. Dept. of Rev.,
Defendant's Orders No. IH 77-1 and No. IH 77-4 are affirmed. Costs are awarded to the defendant.