(a) Through an annual net operating income approach to value that uses actual income and stabilized operating expenses that are based on the actual history of the property (if available) and a capitalization rate. The income, expenses and capitalization rate used must be consistent with the Uniform Standards of Professional Appraisal Practice and may be further defined by rules adopted by the Department of Revenue. Factors to be considered in setting a capitalization rate include the risks associated with multiunit rental housing subject to a government restriction on use, including but not limited to diminished ownership control, income generating potential and liquidity. The capitalization rate that is set pursuant to this paragraph must be equal to or greater than the capitalization rate used for valuing multiunit rental housing that is not subject to a government restriction on use;

(b) By adjusting the unrestricted market value of the property being specially assessed, computed without regard to any government restriction on use applicable to the property, based on the ratio of the average annual rent of those dwelling units of the property that are subject to a government restriction on use to the average annual rent of comparable multiunit rental housing that is not subject to a government restriction on use; or

(c) Through an alternate method for determining the specially assessed value of multiunit rental housing that is subject to a government restriction on use that may be adopted by the department by rule.

(2)(a) An election under this section must be made at the time an application for special assessment is filed under ORS 308.709, and is considered to be a part of the application.

(b) A property owner may change the election the owner previously made. Except as provided in subsection (3) of this section, a new election under this section must be made on or before April 1 preceding the tax year for which the new election applies. The election shall be made in writing to the county assessor of the county in which the property is located, in the form prescribed by the department.

(c) The election form must be accompanied by a written statement of the actual income and stabilized operating expenses of the property, as described in subsection (1)(a) of this section.

(3) A change in election may be made after April 1 and on or before December 31 of the tax year, if the election form is accompanied by a late filing fee equal to the greater of $200 or one-tenth of one percent of the real market value of the property to which the election relates, as of the assessment date for that tax year. [2001 c.605 §6]