Senate Bill No. 99
(By Senator Blatnik)
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[Introduced January 25, 1994;
referred to the Committee on Small Business.]
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A BILL to amend chapter eight of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, by adding
thereto a new article, designated article thirteen-a,
relating to the authority of municipalities to create
business improvement districts to foster economic growth and
development and providing procedures therefor; legislative
findings and declaration of purpose; definitions; providing
authorization to municipalities to create business
improvement districts; types of services that a municipality
may provide to a business improvement district; the petition
that initiates procedures to be used to organize, develop
and designate a business improvement district; the
appointment of a planning committee which issues a report;
provision of notice and hearing; the creation of a business
improvement district; certain uses of fees to be prohibited;
the petition to appeal an ordinance creating a business
improvement district; the establishment of a district board
and its duties; the levy of service fees; the classification
of properties within a business improvement district; the
creation of a special business improvement district fund and
its funding sources; the petition to include additional
property in an existing business improvement district; and
the procedure used to abolish and dissolve a business
improvement district.
Be it enacted by the Legislature of West Virginia:
That chapter eight of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, be amended by
adding thereto a new article, designated article thirteen-a, to
read as follows:
ARTICLE 13A. BUSINESS IMPROVEMENT DISTRICTS.
§8-13A-1. Short title.
This article is known and may be cited as the "Business
Improvement District Act".
§8-13A-2. Legislative findings and declaration of purpose.
The Legislature finds that many business districts within
the municipalities of this state are economically depressed.
This adversely affects the economic and general well-being of the
citizens of those municipalities. Establishment of business
improvement districts within municipalities of the state, in
accordance with the purpose and powers set forth in this article,
will serve a public purpose, promote the health, safety,
prosperity, security and general welfare of all citizens in the
state. It will also promote the vitality of commercial businessareas within municipalities, while serving as an effective means
for restoring and promoting commercial and other business
activity within the business improvement districts created
herein. This will be of special benefit to the property within
the boundaries of any business improvement district created under
this article and will stimulate economic growth and job creation.
§8-13A-3. Definitions.
For purposes of this article, the term:
(a) "Commercial property" means the surface of any taxable
real property which is classified for ad valorem real property
tax purposes as Class IV. Excluded from the meaning of such term
is all real property owned or used exclusively for state, county,
municipal, literary, educational, scientific, religious,
benevolent or charitable purposes, or real property owned or used
by public port authorities or wayport authorities;
(b) "District board" means a district board created pursuant
to section eleven of this article;
(c) "Property owner" or "owner" means the owner of
commercial property as shown by the transfer records in the
office of the county clerk of the county in which the property is
located. If an owner owns more than one commercial property,
that owner is counted as a separate owner for each such
commercial property owned. If commercial property is owned by
more than one owner, the majority in ownership is treated as the
owner for the purpose of this article;
(d) "Services" means governmental functions, programs,activities, facility improvements and other services which a
district board is authorized to perform or provide under section
five of this article.
§8-13A-4. Authorization.
The governing body of any municipality may, in accordance
with the procedures and subject to the limitations set forth in
this article, establish one or more business improvement
districts within the municipality. The municipality may provide
for the administration and financing of additional and extended
services to businesses within the districts and for the
administration and financing of a continuing program of services
within the districts.
§8-13A-5. Services.
Any municipality which has established a business
improvement district under this article may provide or cause to
be provided such services as will restore or promote the economic
vitality of the district and the general welfare of the
municipality, including, but not limited to, the following:
(a) Beautification of the district, by means such as
landscaping and construction and erection of fountains, shelters,
benches, sculptures, signs, lighting, decorations and similar
amenities;
(b) Provision of special or additional public services, such
as sanitation, security for persons and property and the
construction and maintenance of public facilities including
sidewalks and other public areas;
(c) Making principal or interest payments on bonds issued by
the municipality for public improvements located within and
designated to improve the economic viability of the district;
(d) Providing financial support for public transportation
and vehicle parking facilities open to the general public;
(e) Constructing, operating and maintaining parking
facilities;
(f) Developing plans for the general architectural design of
public areas and developing plans and programs for the future
development of the district;
(g) Developing, promoting and supporting community events
and activities open to the general public;
(h) Providing the administrative costs for a district
management program; and
(i) Providing any other services which the municipality or
district board is authorized to perform and which the
municipality does not also perform to the same extent on a
municipality-wide basis.
§8-13A-6. Petition to initiate the procedure for organization,
development and designation.
(a) The organization, development and designation of a
business improvement district shall be initiated by a petition
filed in the office of the clerk of the governing body of the
municipality. The petition shall be signed by not less than four
owners who own commercial property in the proposed business
improvement district having an assessed value as reflected on thecounty assessor's land books of not less than fifty-one percent
of the value of all commercial property in the proposed business
improvement district.
(b) The petition shall set forth:
(1) The name of the proposed district, including a
descriptive name thereof and the words "business improvement
district";
(2) A general description of the boundaries and service area
of the proposed district;
(3) A general description of the additional or extended
services needed within the district; and
(4) A request for the organization of a business improvement
district.
§8-13A-7. Appointment of planning committee, issuance of
report.
(a) Upon receipt of a petition for the initiation of a
business improvement district, the governing body of the
municipality shall, within ninety days, appoint a district
planning committee consisting of seven members. A majority of
the members shall be owners of commercial property situated
within the proposed district of the municipality. The committee
shall study and develop preliminary plans for the establishment
and operation of the proposed district and shall consult with the
appropriate officials and agencies of the municipality prior to
completing such preliminary plans. Upon completion of the study
and development of preliminary plans and, in no event, later thantwo hundred seventy-five days after its establishment, the
committee shall submit to the governing body a written report
which:
(1) Describes the boundaries of the proposed district with
sufficient specificity to enable the owner of any commercial
property in the municipality to determine whether his or her
property is located therein. The area proposed for any district
must be contiguous with and situated fully within the boundaries
of the municipality;
(2) A description of any additional or extended services
needed within the district;
(3) A description of the proposed method of financing any
planned improvements, including the maximum rate of annual fees
that may be imposed upon properties within the proposed district
and the manner in which the rate will be imposed. The amount of
annual fees may be based upon gross leasable square footage,
street front-footage, total gross building or land square
footage, or any combination thereof, or on such basis as can
reasonably be determined based upon the value of the improvements
to the commercial property situated in the district and upon
whatever benefits exist relative to the various owners of
property situated therein. For the purpose of levying fees, the
committee shall make a reasonable classification of all
properties within the proposed district;
(4) A recommendation concerning the feasibility and
desirability of the proposed business improvement district andany alternative proposal, in the event the committee's
recommendation is not in accordance with the original petition:
Provided,
That, in the event the boundaries of the proposed
business improvement district recommended by the committee
differs from the boundaries contained in the original petition,
the report must also contain an additional petition signed by
persons who own commercial property in the proposed business
improvement district recommended by the committee. Such
commercial property must have an assessed value as reflected on
the county assessor's land books of not less than fifty-one
percent of the value of all commercial property in the proposed
business improvement district;
(5) Such other information as may be requested by the
governing body. The municipality may provide staff and technical
assistance to the committee.
8-13A-8. Notice; hearing.
Upon receipt of the planning committee's report, the
governing body of the municipality shall set a time and place for
a public hearing regarding the creation of any business
improvement district. The notice of the public hearing shall be
published as a Class I-O legal advertisement in compliance with
article three, chapter fifty-nine of this code at least twenty
days prior to the scheduled hearing. A copy of the notice shall
be sent by certified mail, return receipt requested, not less
than twenty days before the hearing, to all owners of commercial
property within the proposed district. If any property is shownto be in the name of more than one owner at the same mailing
address, a single notice may be mailed, addressed to all owners
at that address. In addition to the time and place of the
hearing, the notice must also state:
(a) The purpose of the hearing;
(b) The name of the proposed district;
(c) The purpose of the proposed district;
(d) The property proposed to be included in the district;
and
(e) The proposed method of financing any costs involved,
including the maximum rate of annual fees that may be imposed
upon any properties situated within the proposed district.
The hearing shall be held not later than sixty days after
receipt of the planning committee's report.
At the time and place set forth in the notice, the governing
body shall afford the opportunity to be heard to any owner of
real property situated in the proposed district and any residents
of the municipality.
§8-13A-9. Creation of district; statement of prohibition on use
of fees.
(a) If the governing body of the municipality, following the
public hearing, determines it advisable and in the public
interest to establish an improvement district, it shall create
the district by ordinance as provided for in article eleven of
this chapter:
Provided,
That the governing body may not amend,
alter or change in any manner the boundaries of the improvementdistrict as recommended by the planning committee. In addition
to all other requirements, the ordinance shall contain the
following:
(1) The name of the district and a description of its
boundaries;
(2) A summary of any proposed services to be provided within
the district and a reasonable estimate of any attendant cost;
(3) The maximum rate of any annual fees that may be imposed
upon the commercial properties and the manner in which the rate
will be imposed; and
(4) The district boardmembers' terms, their method of
appointment and a full description of their powers and duties.
(b) The ordinance shall also state the general intention of
the municipality to increase services within the business
improvement district and that no fees collected under the
authority of the ordinance may be used to reduce, replace or
supplant existing funds or services.
§8-13A-10. Petition to repeal ordinance.
Within thirty days following passage of an ordinance
creating a business improvement district, the owners of any real
property situated in the district may file a petition with the
governing body of the municipality in opposition to the
continuation of the district. Upon a finding that the petition
was signed by owners of commercial property situated in the
proposed business improvement district having an assessed value
as reflected on the county assessor's land books of not less thanfifty-one percent of the value of all commercial property in the
business improvement district, the governing body shall repeal
the ordinance which established the district, thereby rescinding
its creation and development.
§8-13A-11. District board; duties.
(a) The governing body of any municipality that intends to
establish a business improvement district, in accordance with
this article, shall provide by ordinance for the appointment of
a district board to oversee the operations of the improvement
district. The board shall be made up of at least seven members,
the majority of which shall be owners of commercial property
situated in the improvement district.
(b) The district board, in addition to the duties prescribed
by the ordinance creating the improvement district, shall submit
an annual report to the governing body containing:
(1) An itemized statement of its receipts and disbursements
for the preceding fiscal year;
(2) A description of its activities for the preceding fiscal
year;
(3) A recommended program of services to be performed or
provided within the district for the coming fiscal year; and
(4) A proposed budget to accomplish its objectives.
(c) Nothing in this article prohibits any member of the
district board from also serving on the board of directors of a
nonprofit corporation with which the municipality may contract to
provide specified services within the district.
(d) No member of the district board may receive, either
directly or indirectly, compensation for service on the board.
§8-13A-12. Levy of service fees; classification of properties;
factors to consider.
(a) Upon receipt of a recommended program of services and a
proposed budget from the district board, the governing body of
the municipality may annually, by ordinance, levy business
improvement service fees which may only be applicable to
properties located within the improvement district and only to
the extent necessary to fund the budget proposed by the district
board. All revenue from the fees shall be placed in a special
business improvement district fund and may only be used to fund
the services provided under this article. Any surplus in the
fund in a fiscal year shall be applied to reduce the amount of
service fees required for the next fiscal year.
(b) The ordinance creating a business improvement district
may provide for the division of property within the district into
two or more zones or uses in the event significant differences
exist relative to the property and the improvements. The
ordinance may establish different rates of assessment for each
zone or use, or may provide that the rate be a certain percentage
of the assessment levied in the zone or on the use, subject to
the highest rate of assessment.
(c) The amount of the business improvement service fee shall
be in addition to any municipality-wide license fees or any other
tax, fee or charge levied for the general benefit and use of themunicipality.
(d) Each assessment is a lien on the commercial property
that is assessed, second only to any state, federal or county
taxes levied on that property.
§8-13A-13. Special business improvement district fund.
Any municipality that has established a business improvement
district shall establish a special business improvement district
fund for each district created within such municipality. Revenue
derived from any special assessment fees, gifts, grants,
appropriations from the municipality or other sources shall be
paid into the fund. Moneys in another municipal fund or funds
may be advanced to the special fund only if reimbursement is made
to such other fund or funds prior to the end of the fiscal year.
§8-13A-14. Modification of included area; notice; hearing.
(a) The ordinance creating a business improvement district
may be amended to include additional property if a petition is
filed with the governing body requesting such inclusion. Such
petition must be signed by the owners of the commercial property
that is being proposed for inclusion in the improvement district.
Such property must have an assessed value, as reflected on the
assessor's land books, of not less than fifty-one percent of the
value of all the property proposed for inclusion.
(b) Upon receipt of the petition, the governing body shall
refer the petition to the appropriate district board for which
the amendment is sought. The board shall review the petition
and, within sixty days, file a report with the governing bodyrecommending either acceptance of the proposed inclusion or
rejection of the petition. Additional property may not be
included unless it is contiguous with the existing district and
situated within the boundaries of the municipality.
(c) Upon receipt of the recommendation from the district
board, the governing body shall designate a time and place for a
public hearing upon the petition to include additional property.
The notice shall meet the requirements set forth in section eight
of this article.
(d) At the time and place set forth in the notice, the
governing body shall afford the opportunity to be heard to any
owners of real property either currently included in or proposed
to be added to the existing improvement district and to any other
residents of the municipality. The hearing shall be held within
sixty days after the governing body's receipt of the district
board's recommendation.
(e) All additional property included in a district shall be
subject to all fees whether currently existing or thereafter
levied.
§8-13A-15. Abolishment and dissolution of district; notice;
hearing.
(a) A district may be abolished by the governing body of the
municipality following a public hearing upon the proposed
abolishment. Notice of such hearing must be provided by first
class mail to all property owners within the district and shall
be published as a Class I-O legal advertisement in compliancewith article three, chapter fifty-nine of this code at least
twenty days prior to the public hearing. Upon the abolishment of
any improvement district, any funds or other assets, contractual
rights or obligations, claims against holders of indebtedness or
other financial benefits, liabilities or obligations existing
after full payment has been made on all existing contracts,
bonds, notes or other obligations of the district, shall be
transferred to the municipality. Any funds or other assets so
transferred shall be used for the benefit of the area included in
the improvement district being abolished.
(b) Notwithstanding any other provision of this article, no
business improvement district may exist for a period exceeding
ten years unless reinstated pursuant to the provisions of this
article. Reinstatement requires compliance with all requirements
and procedures set forth herein for the initial development and
establishment of a district. No district may issue notes or
bonds for funding district projects or improvements that exceed
a repayment schedule of ten years. Upon the dissolution of any
business improvement district, any funds or other assets,
contractual rights or obligations, claims against holders of
indebtedness, or other financial benefits, liabilities or
obligations existing after full payment has been made on all
contracts, bonds, notes or other obligations of the district,
shall be transferred to the municipality. Any funds or other
assets so transferred shall be used for the benefit of the area
included in the improvement district being dissolved.
NOTE: The purpose of this bill is to provide authority to
municipalities to create business improvement districts in order
to foster economic development in various commercial sectors
within a municipality. This bill provides a procedural
mechanism, including petitioning by commercial property owners to
create, designate and develop a proposed district. It further
requires that a committee study any proposal and render a written
report in relation thereto, as well as providing for notice and
hearing in order to receive public comment. The bill also
includes provisions regarding the payment and collection of fees,
financing requirements and the abolishment or dissolution of
districts.
This section is new; therefore, strike-throughs and
underscoring have been omitted.