<html xmlns:v="urn:schemas-microsoft-com:vml" xmlns:o="urn:schemas-microsoft-com:office:office" xmlns:w="urn:schemas-microsoft-com:office:word" xmlns:m="http://schemas.microsoft.com/office/2004/12/omml" xmlns="http://www.w3.org/TR/REC-html40">
<head>
<meta http-equiv="Content-Type" content="text/html; charset=us-ascii">
<meta name="Generator" content="Microsoft Word 15 (filtered medium)">
<style><!--
/* Font Definitions */
@font-face
{font-family:"Cambria Math";
panose-1:2 4 5 3 5 4 6 3 2 4;}
@font-face
{font-family:Calibri;
panose-1:2 15 5 2 2 2 4 3 2 4;}
/* Style Definitions */
p.MsoNormal, li.MsoNormal, div.MsoNormal
{margin:0in;
font-size:11.0pt;
font-family:"Calibri",sans-serif;}
a:link, span.MsoHyperlink
{mso-style-priority:99;
color:#0563C1;
text-decoration:underline;}
span.EmailStyle19
{mso-style-type:personal-reply;
font-family:"Calibri",sans-serif;
color:windowtext;}
.MsoChpDefault
{mso-style-type:export-only;
font-size:10.0pt;}
@page WordSection1
{size:8.5in 11.0in;
margin:1.0in 1.0in 1.0in 1.0in;}
div.WordSection1
{page:WordSection1;}
--></style><!--[if gte mso 9]><xml>
<o:shapedefaults v:ext="edit" spidmax="1026" />
</xml><![endif]--><!--[if gte mso 9]><xml>
<o:shapelayout v:ext="edit">
<o:idmap v:ext="edit" data="1" />
</o:shapelayout></xml><![endif]-->
</head>
<body lang="EN-US" link="#0563C1" vlink="#954F72" style="word-wrap:break-word">
<div class="WordSection1">
<p class="MsoNormal">Good afternoon.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">ACFR contacts,<o:p></o:p></p>
<p class="MsoNormal">An agency recently asked me about how to properly record facilities taxes in a post-GASB 87 environment; specifically, the comptroller object (cobj) used and the corresponding taxability of such payments.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Historically, facilities taxes paid to a lessor for leased facilities were charged to the same cobj as the lease payment. In a post-GASB 87 environment, the coding for lease payments varies based on whether the amount relates to principal,
interest, variable costs, and other lease components, to name a few. [Refer to the proposed
<a href="https://www.oregon.gov/das/Financial/Acctng/Documents/GASB%2087%20Chart%20of%20Account%20Changes.03-12-2021.pdf">
GASB 87 profile changes</a> on the SARS training and resources webpage.]<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">When determining which cobj to use to record the payment of facilities taxes for leased property, agencies should evaluate: (1) the specific contract language and (2) who the payment is being made to.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Facilities taxes paid directly to a government tax assessor are not 1099-reportable; therefore, these payments may be recorded using cobj 4801.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Facilities taxes paid directly to the lessor are 1099-reportable; therefore, these payments should be recorded using an appropriate 1099-reportable cobj. Again, the cobj may vary based on the specific contract language. For example, if
the facilities taxes are paid directly to the lessor and qualify as a lease component, cobj 4804,
<i>Other Lease Payments</i>, may be used. <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">To ensure the accurate usage of cobj 4801 in a post-GASB 87 environment, the title has been updated in R*STARS as follows:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Cobj 4801 - <i>FACILITIES TAXES-PAID DIRECTLY TO GOVT<o:p></o:p></i></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Please verify all payments of facilities taxes, as described above, are reported correctly.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Thank you.<o:p></o:p></p>
<p class="MsoNormal">s <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><b><span style="font-family:"Arial",sans-serif">Stacey A. Chase<o:p></o:p></span></b></p>
<p class="MsoNormal">Senior Financial Reporting & Policy Analyst<o:p></o:p></p>
<p class="MsoNormal">Chief Financial Office<o:p></o:p></p>
<p class="MsoNormal">Department of Administrative Services<o:p></o:p></p>
<p class="MsoNormal">Call via Teams or (971) 900-9993<o:p></o:p></p>
<p class="MsoNormal"><a href="https://www.oregon.gov/das/financial/acctng/pages/index.aspx"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:blue">https://www.oregon.gov/das/financial/acctng/pages/index.aspx</span></a><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#1F497D"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif;color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial",sans-serif">Data Classification: Level 1 - Published</span><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
</div>
</body>
</html>