Senate Bill No. 741
(By Senators McCabe)
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[Introduced February 18, 2008; referred to the Committee on
Economic Development; and then to the Committee on Finance.]
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A BILL to amend and reenact §7-11B-2, §7-11B-3, §7-11B-4, §7-11B-7
§7-11B-8, §7-11B-10, §7-11B-19, §7-11B-22 and §7-11B-26 of the
Code of West Virginia, 1931, as amended, all relating to the
West Virginia Tax Increment Financing Act.
Be it enacted by the Legislature of West Virginia:
That §7-11B-2, §7-11B-3, §7-11B-4, §7-11B-7 §7-11B-8,
§7-11B-10, §7-11B-19, §7-11B-22 and §7-11B-26 of the Code of West
Virginia, 1931, as amended, be amended and reenacted, all to read
as follows:
ARTICLE 11B. WEST VIRGINIA TAX INCREMENT FINANCING ACT.
§7-11B-2. Findings and legislative purpose.
(a) It is found and declared to be the policy of this state to
promote and facilitate the orderly development and economic
stability of its communities. County commissions need the ability
to raise revenue to finance capital improvements and facilities that are designed to encourage economic growth and development in
geographic areas characterized by high levels of unemployment,
stagnant employment, slow income growth, contaminated property or
inadequate infrastructure. The construction of necessary capital
improvements in accordance with local economic development plans
will encourage investing in job-producing private development and
expand the public tax base.
(b) It is also found and declared that
capital improvements or
facilities infrastructure improvements in any area that result in
the increase in the value of property located in the area or
encourage increased employment within the area will serve a public
purpose for each taxing unit possessing the authority to impose ad
valorem taxes in the area.
(c) It is the purpose of this article:
(1) To encourage local levying bodies to cooperate in the
allocation of future tax revenues that are used to finance
capital
infrastructure improvements
and facilities designed to encourage
private development in selected areas; and
(2) To assist local governments that have a competitive
disadvantage in their ability to attract business, private
investment or commercial development due to their location; to
encourage remediation of contaminated property; to prevent or
arrest the decay of selected areas due to the inability of existing
financing methods to provide capital improvements and facilities; and to encourage private investment designed to promote and
facilitate the orderly development or redevelopment of selected
areas.
§7-11B-3. Definitions.
(a)
General. -- When used in this article, words and phrases
defined in this section shall have the meanings ascribed to them in
this section.
unless a different meaning is clearly required
either by the context in which the word or phrase is used or by
specific definition in this article.
(b)
Words and phrases defined. --
(1) "Agency" includes a municipality, a county or municipal
development agency established pursuant to authority granted in
section one, article twelve of this chapter, a port authority, an
airport authority or any other entity created by this state or an
agency or instrumentality of this state that engages in economic
development activity.
(2) "Base assessed value" means the taxable assessed value of
all real and tangible personal property, excluding personal motor
vehicles, having a tax situs within a development or redevelopment
district as shown upon the landbooks and personal property books of
the assessor on the first day of July of the calendar year
preceding the effective date of the order or ordinance creating and
establishing the development or redevelopment district.
(3) "Blighted area" means an area within the boundaries of a development or redevelopment district located within the
territorial limits of a municipality or county in which the
structures, buildings or improvements, by reason of dilapidation,
deterioration, age or obsolescence, inadequate provision for
access, ventilation, light, air, sanitation, open spaces, high
density of population and overcrowding or the existence of
conditions which endanger life or property, are detrimental to the
public health, safety, morals or welfare. "Blighted area" includes
any area which, by reason of the presence of a substantial number
of substandard, slum, deteriorated or deteriorating structures,
predominance of defective or inadequate street layout, faulty lot
layout in relation to size, adequacy, accessibility or usefulness,
unsanitary or unsafe conditions, deterioration of site or other
improvements, diversity of ownership, defective or unusual
conditions of title or the existence of conditions which endanger
life or property by fire and other causes, or any combination of
such factors, substantially impairs or arrests the sound growth of
a municipality, retards the provision of housing accommodations or
constitutes an economic or social liability and is a menace to the
public health, safety, morals or welfare in its present condition
and use, or any area which is predominantly open and which because
of lack of accessibility, obsolete platting, diversity of
ownership, deterioration of structures or of site improvements, or
otherwise, substantially impairs or arrests the sound growth of the community.
(4) "Conservation area" means any improved area within the
boundaries of a development or redevelopment district located
within the territorial limits of a municipality or county in which
fifty percent or more of the structures in the area have an age of
thirty-five years or more. A conservation area is not yet a
blighted area but is detrimental to the public health, safety,
morals or welfare and may become a blighted area because of any one
or more of the following factors: Dilapidation; obsolescence;
deterioration; illegal use of individual structures; presence of
structures below minimum code standards; abandonment; excessive
vacancies; overcrowding of structures and community facilities;
lack of ventilation, light or sanitary facilities; inadequate
utilities; excessive land coverage; deleterious land use or layout;
depreciation of physical maintenance; and lack of community
planning. A conservation area shall meet at least three of the
factors provided in this subdivision.
(5) "County commission" means the governing body of a county
of this state and, for purposes of this article only, includes the
governing body of a Class I or II municipality in this state.
(6) "Current assessed value" means the annual taxable assessed
value of all real and tangible personal property, excluding
personal motor vehicles, having a tax situs within a development or
redevelopment district as shown upon the landbook and personal property records of the assessor.
(7) "Development office" means the West Virginia Development
Office created in section one, article two, chapter five-b of this
code.
(8) "Development project" or "redevelopment project" means a
project undertaken in a development or redevelopment district for
eliminating or preventing the development or spread of slums or
deteriorated, deteriorating or blighted areas, for discouraging the
loss of commerce, industry or employment, for increasing employment
or for any combination thereof in accordance with a tax increment
financing plan. A development or redevelopment project may include
one or more of the following:
(A) The acquisition of land and improvements, if any, within
the development or redevelopment district and clearance of the land
so acquired; or
(B) The development, redevelopment, revitalization or
conservation of the project area whenever necessary to provide land
for needed
infrastructure improvements public facilities, public
housing, or industrial or commercial development or revitalization,
to eliminate unhealthful, unsanitary or unsafe conditions, to
lessen density, mitigate or eliminate traffic congestion, reduce
traffic hazards, eliminate obsolete or other uses detrimental to
public welfare or otherwise remove or prevent the spread of blight
or deterioration;
(C) The financial or other assistance in the relocation of
persons and organizations displaced as a result of carrying out the
development or redevelopment project and other improvements
necessary for carrying out the project plan, together with those
site improvements that are necessary for the preparation of any
sites and making any land or improvements acquired in the project
area available, by sale or lease, for public housing or for
development, redevelopment or rehabilitation by private enterprise
for commercial or industrial uses in accordance with the plan;
(D) The construction of
capital infrastructure improvements
within a development or redevelopment district designed to increase
or enhance the development of commerce, industry or housing within
the development project area; or
(E) Any other projects the county commission or the agency
deems appropriate to carry out the purposes of this article.
(9) "Development or redevelopment district" means an area
proposed by one or more agencies as a development or redevelopment
district, which may include one or more counties, one or more
municipalities or any combination thereof, that has been approved
by the county commission of each county in which the project area
is located if the project is located outside the corporate limits
of a municipality, or by the governing body of a municipality if
the project area is located within a municipality, or by both the
county commission and the governing body of the municipality when the development or redevelopment district is located both within
and without a municipality.
(10) "Economic development area" means any area or portion of
an area within the boundaries of a development or redevelopment
district located within the territorial limits of a municipality or
county that does not meet the requirements of subdivisions three
and four of this subsection and for which the county commission
finds that development or redevelopment
will not be solely used for
development of commercial businesses that will unfairly compete in
the local economy and that development or redevelopment is in the
public interest because it will:
(A) Discourage commerce, industry or manufacturing from moving
their operations to another state;
(B) Result in increased employment in the municipality or
county, whichever is applicable; or
(C) Result in preservation or enhancement of the tax base of
the county or municipality.
(11) "Governing body of a municipality" means the city council
of a Class I or Class II municipality in this state.
(12) "Incremental value", for any development or redevelopment
district, means the difference between the base assessed value and
the current assessed value. The incremental value will be positive
if the current value exceeds the base value and the incremental
value will be negative if the current value is less than the base assessed value.
(13) "Includes" and "including", when used in a definition
contained in this article, shall not be deemed to exclude other
things otherwise within the meaning of the term being defined.
(14) "Infrastructure" means environmental protection devices,
main storm or sanitary sewer lines, main water lines, broadband,
public streets or the rebuilding or expansion of public streets or
the construction, alteration, rebuilding or expansion of which is
necessitated by the project plan for a development or redevelopment
district whether or not the construction alteration, rebuilding or
expansion is within the area or on land contiguous thereto.
(14) (15) "Local levying body" means the county board of
education, and the county commission, and includes the governing
body of a municipality when the development or redevelopment
district is located, in whole or in part, within the boundaries of
the municipality.
(15) (16) "Obligations" or "tax increment financing
obligations" means bonds, loans, debentures, notes, special
certificates or other evidences of indebtedness issued by a county
commission or municipality pursuant to this article to carry out a
development or redevelopment project or to refund outstanding
obligations under this article.
(16) (17) "Order" means an order of the county commission
adopted in conformity with the provisions of this article and as provided in this chapter.
(17) (18) "Ordinance" means a law adopted by the governing
body of a municipality in conformity with the provisions of this
article and as provided in chapter eight of this code.
(18) (19) "Payment in lieu of taxes" means those estimated
revenues from real property and tangible personal property having
a tax situs in the area selected for a development or redevelopment
project, which revenues according to the development or
redevelopment project or plan are to be used for a private use,
which levying bodies would have received had a county or
municipality not adopted one or more tax increment financing plans
and which would result from levies made after the date of adoption
of a tax increment financing plan during the time the current
assessed value of all taxable real and tangible personal property
in the area selected for the development or redevelopment project
exceeds the total base assessed value of all taxable real and
tangible personal property in the development or redevelopment
district until the designation is terminated as provided in this
article.
(19) (20) "Person" means any natural person, and any
corporation, association, partnership, limited partnership, limited
liability company or other entity, regardless of its form,
structure or nature, other than a government agency or
instrumentality.
(20) (21) "Private project" means any project that is subject
to ad valorem property taxation in this state or to a payment in
lieu of tax agreement that is undertaken by a project developer in
accordance with a tax increment financing plan in a development or
redevelopment district.
(21) (22) "Project" means any capital improvement, facility or
both, as specifically set forth and defined in the project plan,
requiring an investment of capital, including, but not limited to,
extensions, additions or improvements to existing facilities,
including water or wastewater facilities, and the remediation of
contaminated property as provided for in article twenty-two,
chapter twenty-two of this code, but does not include performance
of any governmental service by a county or municipal government.
(22) (23) "Project area" means an area within the boundaries
of a development or redevelopment district in which a development
or redevelopment project is undertaken, as specifically set forth
and defined in the project plan.
(23) (24) "Project costs
for an economic development area"
means expenditures made in preparation of the development or
redevelopment project plan and made, or estimated to be made, or
monetary obligations incurred, or estimated to be incurred, by the
county commission which are listed in the project plan as capital
improvements within a development or redevelopment district, plus
any costs incidental thereto. "Project costs" include, but are not limited to:
(A)
Capital Infrastructure costs, including, but not limited
to, the actual costs of the construction of
public works or
improvements, infrastructure, capital improvements and facilities,
new buildings, structures and fixtures, the demolition, alteration,
remodeling, repair or reconstruction of existing
infrastructure
buildings, structures and fixtures, environmental remediation,
parking and landscaping, the acquisition of equipment and site
clearing, grading and preparation;
(B) Financing costs, including, but not limited to, an
interest paid to holders of evidences of indebtedness issued to pay
for project costs, all costs of issuance and any redemption
premiums, credit enhancement or other related costs;
(C) Real property assembly costs, meaning any deficit incurred
resulting from the sale or lease as lessor by the county commission
of real or personal property having a tax situs within a
development or redevelopment district for consideration that is
less than its cost to the county commission;
(D) Professional service costs, including, but not limited to,
those costs incurred for architectural planning, engineering and
legal advice and services;
(E) Imputed administrative costs, including, but not limited
to, reasonable charges for time spent by county employees or
municipal employees in connection with the implementation of a project plan;
(F) Relocation costs, including, but not limited to, those
relocation payments made following condemnation and job training
and retraining;
(G) Organizational costs, including, but not limited to, the
costs of conducting environmental impact and other studies, and the
costs of informing the public with respect to the creation of a
development or redevelopment district and the implementation of
project plans;
(H) Payments made, in the discretion of the county commission
or the governing body of a municipality, which are found to be
necessary or convenient to creation of development or redevelopment
districts or the implementation of project plans;
and
(I) That portion of costs related to the construction of
infrastructure;
(J) Project costs shall not include reimbursement for funds
expended on the project prior to its approval by the Development
Office, except for costs for professional services incurred in
preparing the project plan; and
(K) Project costs shall not include costs for infrastructure
improvements that are not solely for the benefit of the public.
environmental protection devices, storm or sanitary sewer lines,
water lines, amenities or streets or the rebuilding or expansion of
streets, or the construction, alteration, rebuilding or expansion of which is necessitated by the project plan for a development or
redevelopment district, whether or not the construction,
alteration, rebuilding or expansion is within the area or on land
contiguous thereto.
(25) "Project costs" for projects not in an economic
development area means expenditures made in preparation of the
development or redevelopment project plan and made, or estimated to
be made, or monetary obligations incurred or estimated to be
incurred by the county commission which are listed in the project
plan as capital improvements within a development or redevelopment
district plus any costs incidental thereto. "Project costs"
include, but are not limited to:
(A) Capital costs, including, but not limited to the actual
costs of the construction of public works or improvements, the
demolition, alteration, remodeling, repair or reconstruction of
existing building, structures and fixtures, environmental
remediation, the acquisition of equipment and site clearing grading
and preparation;
(B) Financing costs, meaning, but not limited to, an interest
paid to holders of evidences of indebtedness issued to pay for
project costs, all costs of issuance and any redemption premiums,
credit enhancement or other related costs;
(C) Real property assembly costs, meaning any deficit incurred
resulting from the sale or lease as lessor by the county commission of real or personal property having a tax situs within a
development or redevelopment district for consideration that it
less than its cost to the county commission;
(D) Professional service costs, including, but not limited to,
those costs incurred for architectural planning, engineering and
legal advice and services;
(E) Imputed administrative costs, including, but not limited
to reasonable charges for time spent by county employees or
municipal employees in connection with the implementation of a
project plan;
(F) Relocation costs, including, but not limited to those
relocation payments made following condemnation and job training
and retraining;
(G) Organizational costs including, but not limited to the
costs of conducting environmental impact and other studies, and the
costs of informing the public with respect to the creation of a
development or redevelopment district and the implementation of
project plans;
(H) Payments made, in the discretion of the county commission
to the governing body of a municipality, which are found to be
necessary or convenience to creation of development or
redevelopment districts or the implementation of project plans;
(I) That portion of costs related to infrastructure;
(J) Project costs shall not include reimbursement for funds expended on the project prior to its approval by the Development
Office, except for costs for professional services incurred in
preparing the project plan; and
(K) Project costs shall not include costs for infrastructure
improvements that are not solely for the benefit of the public.
(
24)
(26) "Project developer" means any person who engages in
the development of projects in the state.
(25) (27) "Project plan" means the plan for a development or
redevelopment project that is adopted by a county commission or
governing body of a municipality in conformity with the
requirements of this article and this chapter or chapter eight of
this code.
(26) (28)" Real property" means all lands, including
improvements and fixtures on them and property of any nature
appurtenant to them or used in connection with them and every
estate, interest and right, legal or equitable, in them, including
terms of years and liens by way of judgment, mortgage or otherwise,
and indebtedness secured by the liens.
(27) (29) "Redevelopment area" means an area designated by a
county commission, or the governing body of a municipality, in
respect to which the commission or governing body has made a
finding that there exist conditions which cause the area to be
classified as a blighted area, a conservation area, an economic
development area or a combination thereof, which area includes only those parcels of real property directly and substantially
benefitted by the proposed redevelopment project located within the
development or redevelopment district or land contiguous thereto.
(28) (30)" Redevelopment plan" means the comprehensive program
under this article of a county or municipality for redevelopment
intended by the payment of redevelopment costs to reduce or
eliminate those conditions, the existence of which qualified the
redevelopment area as a blighted area, conservation area, economic
development area or combination thereof, and to thereby enhance the
tax bases of the levying bodies which extend into the redevelopment
area. Each redevelopment plan shall conform to the requirements of
this article.
(29) (31) "Tax increment" means the amount of regular levy
property taxes attributable to the amount by which the current
assessed value of real and tangible personal property having a tax
situs in a development or redevelopment district exceeds the base
assessed value of the property.
(30) (32) "Tax increment financing fund" means a separate fund
for a development or redevelopment district established by the
county commission, or governing body of the municipality, into
which all tax increment revenues and other pledged revenues are
deposited and from which projected project costs, debt service and
other expenditures authorized by this article are paid.
(31) (33) "This code" means the Code of West Virginia, 1931, as amended by the Legislature.
(32) (34) "Total ad valorem property tax regular levy rate"
means the aggregate levy rate of all levying bodies on all taxable
property having a tax situs within a development or redevelopment
district in a tax year but does not include excess levies, levies
for general obligation bonded indebtedness or any other levies that
are not regular levies.
§7-11B-4. Powers generally.
In addition to any other powers conferred by law, a county
commission or governing body of a Class I or II municipality may
exercise any powers necessary and convenient to carry out the
purpose of this article, including the power to:
(1) Create development and redevelopment areas or districts
and to define the boundaries of those areas or districts;
(2) Cause project plans to be prepared, to approve the project
plans, and to implement the provisions and effectuate the purposes
of the project plans;
(3) Establish tax increment financing funds for each
development or redevelopment district;
(4) Issue tax increment financing obligations and pledge tax
increments and other revenues for repayment of the obligations;
(5) Deposit moneys into the tax increment financing fund for
any development or redevelopment district;
(6) Enter into any contracts or agreements, including, but not limited to, agreements with project developers, consultants,
professionals, financing institutions, trustees and bondholders
determined by the county commission to be necessary or convenient
to implement the provisions and effectuate the purposes of project
plans;
(7) Receive from the federal government or the state loans and
grants for, or in aid of, a development or redevelopment project
and to receive contributions from any other source to defray
project costs;
(8) Exercise the right of eminent domain to condemn property
for the purposes of implementing the project plan. The rules and
procedures set forth in chapter fifty-four of this code shall
govern all condemnation proceedings authorized in this article;
(9) Make relocation payments to those persons, businesses or
organizations that are displaced as a result of carrying out the
development or redevelopment project;
(10) Clear and improve property acquired by the county
commission pursuant to the project plan and construct
public
facilities infrastructure on it or contract for the
construction,
development, redevelopment, rehabilitation,
remodeling, alteration
or repair of the property;
(11) Cause
main parks, playgrounds or water, sewer or
drainage facilities or any other public improvements,
including,
but not limited to, fire stations, community centers and other public buildings, which the county commission is otherwise
authorized to undertake to be laid out, constructed or furnished in
connection with the development or redevelopment project. When the
public improvement of the county commission is to be located, in
whole or in part, within the corporate limits of a municipality,
the county commission shall consult with the mayor and the
governing body of the municipality regarding the public improvement
and shall pay for the cost of the public improvement from the Tax
Increment Financing Fund;
(12) Lay out and construct, alter, relocate, change the grade
of, make specific repairs upon or discontinue public ways and
construct sidewalks in, or adjacent to, the project area:
Provided, That when the public way or sidewalk is located within a
municipality, the governing body of the municipality shall consent
to the same and if the public way is a state road, the consent of
the commissioner of highways shall be necessary;
(13) Cause private ways, sidewalks, ways for vehicular travel,
playgrounds or water, sewer or drainage facilities and similar
improvements to be constructed within the project area for the
particular use of the development or redevelopment district or
those dwelling or working in it;
(14) Construct any capital improvements of a public nature;
(
15) Construct capital improvements to be leased or sold to
private entities in connection with the goals of the development or redevelopment project;
(16) (14) Cause capital improvements owned by one or more
private entities to be constructed within the development or
redevelopment district,
although these improvements are not to be
financed with the tax increment proceeds;
(
17) (15) Designate one or more official or employee of the
county commission to make decisions and handle the affairs of
development and redevelopment project areas or districts created by
the county commission pursuant to this article;
(
18) Adopt orders, ordinances or bylaws or repeal or modify
such ordinances or bylaws or establish exceptions to existing
ordinances and bylaws regulating the design, construction and use
of buildings within the development or redevelopment district
created by a county commission or governing body of a municipality
under this article;
(19) Enter orders, adopt bylaws or repeal or modify such
orders or bylaws or establish exceptions to existing orders and
bylaws regulating the design, construction and use of buildings
within the development or redevelopment district created by a
county commission or governing body of a municipality under this
article;
(20) (16) Sell, mortgage, lease, transfer or dispose of any
property or interest therein, by contract or auction, acquired by
it pursuant to the project plan for development, redevelopment or rehabilitation in accordance with the project plan;
(21) (17) Expend project revenues as provided in this article;
and
(22) (18) Do all things necessary or convenient to carry out
the powers granted in this article.
§7-11B-7. Creation of a development or redevelopment or district.
(a) County commissions and the governing bodies of Class I and
II municipalities, upon their own initiative or upon application of
an agency or a developer, may propose creation of a development or
redevelopment district and designate the boundaries of the
district:
Provided, That a district may not include noncontiguous
land.
(b) The county commission or municipality proposing creation
of a development or redevelopment district shall then hold a public
hearing at which interested parties are afforded a reasonable
opportunity to express their views on the proposed creation of a
development or redevelopment district and its proposed boundaries.
(1) Notice of the hearing shall be published as a Class II
legal advertisement in accordance with section two, article three,
chapter fifty-nine of this code.
(2) The notice shall include the time, place and purpose of
the public hearing, describe in sufficient detail the tax increment
financing plan, the proposed boundaries of the development or
redevelopment district and, when a development or redevelopment project plan is being proposed, the proposed tax increment
financing obligations to be issued to finance the development or
redevelopment project costs.
(3) Prior to the first day of publication, a copy of the
notice shall be sent by first-class mail to the Director of the
Development Office and to the chief executive officer of all other
local levying bodies having the power to levy taxes on real and
tangible personal property located within the proposed development
or redevelopment district.
(4) All parties who appear at the hearing shall be afforded an
opportunity to express their views on the proposal to create the
development or redevelopment district and, if applicable, the
development or redevelopment project plan and proposed tax
increment financing obligations.
(c) After the public hearing, the county commission, or the
governing body of the municipality, shall finalize the boundaries
of the development or redevelopment district, the development or
redevelopment project plan, or both, and submit the same to the
Director of the Development Office for his or her review and
approval. The director, within sixty days after receipt of the
application, shall approve the application as submitted, reject the
application or return the application to the county commission or
governing body of the municipality for further development or
review in accordance with instructions of the Director of the Development Office. A development or redevelopment district or
development or redevelopment project plan may not be adopted by the
county commission or the governing body of a municipality until
after it has been approved by the Executive Director of the
Development Office.
(d) Upon approval of the application by the Development
Office, the county commission may enter an order and the governing
body of the municipality proposing the district or development or
redevelopment project plan may adopt an ordinance, that:
(1) Describes the boundaries of a development or redevelopment
district sufficiently to identify with ordinary and reasonable
certainty the territory included in the district, which boundaries
shall create a contiguous district;
(2) Creates the development or redevelopment district as of a
date provided in the order or ordinance;
(3) Assigns a name to the development or redevelopment
district for identification purposes.
(A) The name may include a geographic or other designation,
shall identify the county or municipality authorizing the district
and shall be assigned a number, beginning with the number one.
(B) Each subsequently created district in the county or
municipality shall be assigned the next consecutive number;
(4) Contains findings that the real property within the
development or redevelopment district will be benefitted by eliminating or preventing the development or spread of slums or
blighted, deteriorated or deteriorating areas, discouraging the
loss of commerce, industry or employment, increasing employment or
any combination thereof;
(5) Approves the development or redevelopment project plan, if
applicable;
(6) Establishes a tax increment financing fund as a separate
fund into which all tax increment revenues and other revenues
designated by the county commission, or governing body of the
municipality, for the benefit of the development or redevelopment
district shall be deposited, and from which all project costs shall
be paid, which may be assigned to and held by a trustee for the
benefit of bondholders if tax increment financing obligations are
issued by the county commission or the governing body of the
municipality; and
(7) Provides that ad valorem property taxes on real and
tangible personal property having a tax situs in the development or
redevelopment district shall be assessed, collected and allocated
in the following manner, commencing upon the date of adoption of
such order or ordinance and continuing for so long as any tax
increment financing obligations are payable from the tax increment
financing fund, hereinafter authorized, are outstanding and unpaid:
(A) For each tax year, the county assessor shall record in the
land and personal property books both the base assessed value and the current assessed value of the real and tangible personal
property having a tax situs in the development or redevelopment
district;
(B) Ad valorem taxes collected from regular levies upon real
and tangible personal property having a tax situs in the district
that are attributable to the lower of the base assessed value or
the current assessed value of real and tangible personal property
located in the development project area shall be allocated to the
levying bodies in the same manner as applicable to the tax year in
which the development or redevelopment project plan is adopted by
order of the county commission or by ordinance adopted by the
governing body of the municipality;
(C) The tax increment with respect to real and tangible
personal property in the development or redevelopment district
shall be allocated and paid into the tax increment financing fund
and shall be used to pay the principal of and interest on tax
increment financing obligations issued to finance the costs of the
development or redevelopment projects in the development or
redevelopment district. Any levying body having a development or
redevelopment district within its taxing jurisdiction shall not
receive any portion of the annual tax increment except as otherwise
provided in this article; and
(D) In no event shall the tax increment include any taxes
collected from excess levies, levies for general obligation bonded indebtedness or any levies other than the regular levies provided
for in article eight, chapter eleven of this code.
(e) Proceeds from tax increment financing obligations issued
under this article may only be used to pay for costs of development
and redevelopment projects to foster economic development in the
development or redevelopment district or land contiguous thereto.
(f) Notwithstanding subsection (e) of this section, a county
commission may not enter an order approving a development or
redevelopment project plan unless the county commission expressly
finds and states in the order that the development or redevelopment
project
cannot occur "but for" is not reasonably expected to occur
without the use of tax increment financing.
This finding must
specifically identify the public infrastructure improvements
necessary to support the development or redevelopment project plan
and must specifically identify why the taxes increment financing is
necessary for the project plan to be implemented.
(g) Notwithstanding subsection (e) of this section, the
governing body of a municipality may not adopt an ordinance
approving a development or redevelopment project plan unless the
governing body expressly finds and states in the ordinance that the
development or redevelopment project is not reasonably expected to
occur without the use of tax increment financing.
(h) (g) No county commission shall establish a development or
redevelopment district any portion of which is within the boundaries of a Class I, II, III or IV municipality without the
formal consent of the governing body of such municipality.
(i) (h) A tax increment financing plan that has been approved
by a county commission or the governing body of a municipality may
be amended by following the procedures set forth in this article
for adoption of a new development or redevelopment project plan.
(j)
(i) The county commission may modify the boundaries of the
development or redevelopment district, from time to time, by entry
of an order modifying the order creating the development or
redevelopment district.
(k)
(j) The governing body of a municipality may modify the
boundaries of the development or redevelopment district, from time
to time, by amending the ordinance establishing the boundaries of
the district.
(l) (k) Before a county commission or the governing body of a
municipality may amend such an order or ordinance, the county
commission or municipality shall give the public notice, hold a
public hearing and obtain the approval of the Director of the
Development Office, following the procedures for establishing a new
development or redevelopment district. In the event any tax
increment financing obligations are outstanding with respect to the
development or redevelopment district, any change in the boundaries
shall not reduce the amount of tax increment available to secure
the outstanding tax increment financing obligations.
§7-11B-8. Project plan - approval.
(a) The county commission or municipality creating the
district shall cause the preparation of a project plan for each
development or redevelopment district and the project plan shall be
adopted by order of the county commission, or ordinance adopted by
the governing body of the municipality, after it is approved by the
Executive Director of the Development Office. This process shall
conform to the procedures set forth in this section.
(b) Each project plan shall include:
(1) A statement listing the kind, number and location of all
proposed public works or other improvements within the district and
on land outside but contiguous to the district;
(2) A detailed list of existing public infrastructures within
the boundaries of the approved development district, including the
existing capacity and projected needs based on the project plan;
(3) A detailed list of proposed public infrastructures within
the boundaries of the approved development or redevelopment
district, including an explanation of why the infrastructure is
necessary, who engineered the proposed infrastructure, the benefit
of the infrastructure to the public, and how the infrastructure
facilitates future development.
(2) (4) A cost-benefit analysis showing the economic impact of
the plan on each levying body that is at least partially within the
boundaries of the development or redevelopment district. This analysis shall show the impact on the economy if the project is not
built and is built pursuant to the development or redevelopment
plan under consideration. The cost-benefit analysis shall include
a fiscal impact study on every affected levying body and sufficient
information from the developer for the agency, if any proposing the
plan, the county commission be asked to approve the project and the
Development Office to evaluate whether the project as proposed is
financially feasible;
(3) (5) An economic feasibility study;
(4) (6) A detailed list of estimated project costs;
(5) (7) A description of the methods of financing all
estimated project costs, including the issuance of tax increment
obligations and the time when the costs or monetary obligations
related thereto are to be incurred;
(6) (8) A certification by the county assessor of the base
assessed value of real and tangible personal property having a tax
situs in a development or redevelopment district:
Provided, That
if such certification is made during the months of January or
February of each year, the county assessor may certify an estimated
base assessed value of real and tangible personal property having
a tax situs in a development or redevelopment district:
Provided,
however, That prior to issuance of tax increment obligations, the
county assessor shall certify a final base assessed value for the
estimated base assessed value permitted by this section;
(7) (9) The type and amount of any other revenues that are
expected to be deposited to the tax increment financing fund of the
development or redevelopment district;
(8) (10) A map showing existing uses and conditions of real
property in the development or redevelopment district;
(9) (11) A map of proposed improvements and uses in the
district;
(10) (12) Proposed changes of zoning ordinances, if any;
(11) (13) Appropriate cross-references to any master plan,
map, building codes and municipal ordinances or county commission
orders affected by the project plan;
(12) (14) A list of estimated nonproject costs;
(13) (15) A statement of the proposed method for the
relocation of any persons, businesses or organizations to be
displaced;
(14) (16) A certificate from the Executive Director of the
Workers' Compensation Commission, the Commissioner of the Bureau of
Employment Programs and the State Tax Commissioner that the project
developer is in good standing with the Workers' Compensation
Commission, the Bureau of Employment Programs and the State Tax
Division;
and
(15) (17) A certificate from the sheriff of the county or
counties in which the development or redevelopment district is
located that the project developer is not delinquent on payment of any real and personal property taxes in such county.
(18) Proposals for earliest retirement of the indebtedness
incurred by the increment financing;
(19) All other publicly or privately available sources of
funding for the planned improvements and infrastructure and whether
or not the sources are being utilized and if the sources are not
being utilized why the sources are not being utilized; and
(20) The annual projected costs to the state due to the school
aid formula in chapter eleven, article 9A, section eleven of this
code, for each year of the period during which the tax increment
financing obligations are to be funded.
(c) If the project plan is to include tax increment financing,
the tax increment financing portion of the plan shall set forth:
(1) The amount of indebtedness to be incurred pursuant to this
article;
(2) An estimate of the tax increment to be generated as a
result of the project;
(3) The method for calculating the tax increment, which shall
be in conformance with the provisions of this article, together
with any provision for adjustment of the method of calculation;
(4) Any other revenues, such as payment in lieu of tax
revenues, to be used to secure the tax increment financing;
and
(5) Provisions to retire the indebtedness as soon as possible,
including, but not limited to early pay off of the debt instruments with collected tax revenue, applying all excess revenue towards
retiring the debt early, and other options as negotiated; and
(5) (6) Any other provisions as may be deemed necessary in
order to carry out any tax increment financing to be used for the
development or redevelopment project.
(d) If less than all of the tax increment is to be used to
fund a development or redevelopment project or to pay project costs
or retire tax increment financing, the project plan shall set forth
the portion of the tax increment to be deposited in the tax
increment financing fund of the development or redevelopment
district and provide for the distribution of the remaining portion
of the tax increment to the levying bodies in whose jurisdiction
the district lies.
(e) The county commission or governing body of the
municipality that established the tax increment financing fund
shall hold a public hearing at which interested parties shall be
afforded a reasonable opportunity to express their views on the
proposed project plan being considered by the county commission or
the governing body of the municipality.
(1) Notice of the hearing shall be published as a Class II
legal advertisement in accordance with section two, article three,
chapter fifty-nine of this code.
(2) Prior to this publication, a copy of the notice shall be
sent by first-class mail to the chief executive officer of all other levying bodies having the power to levy taxes on property
located within the proposed development or redevelopment district.
(f) Approval by the county commission or the governing body of
a municipality of an initial development or redevelopment project
plan must be within one year after the date of the county
assessor's certification required by subdivision (6), subsection
(b) of this section:
Provided, That additional development or
redevelopment project plans may be approved by the county
commission or the governing body of a municipality in subsequent
years, so long as the development or redevelopment district
continues to exist. The approval shall be by order of the county
commission or ordinance of the municipality, which shall contain a
finding that the plan is economically feasible.
§7-11B-10. Termination of development or redevelopment district.
(a) No development or redevelopment district may be in
existence for a period longer than
thirty twenty years and no tax
increment financing obligations may have a final maturity date
later than the termination date of the area or district.
(b) The county commission or governing body of the
municipality creating the development or redevelopment district may
set a shorter period for the existence of the district. In this
event, no tax increment financing obligations may have a final
maturity date later than the termination date of the district.
(c) Upon termination of the district, no further ad valorem tax revenues shall be distributed to the tax increment financing
fund of the district.
(d) The county commission shall adopt, upon the expiration of
the time periods set forth in this section, an order terminating
the development or redevelopment district created by the county
commission:
Provided, That no district shall be terminated so long
as bonds with respect to the district remain outstanding.
(e) The governing body of the county commission shall repeal,
upon the expiration of the time periods set forth in this section,
the ordinance establishing the development or redevelopment
district:
Provided, That no district shall be terminated so long
as bonds with respect to the district remain outstanding.
§7-11B-19. Tax increment obligations generally.
(a) Tax increment obligations may be issued by a county
commission, or the governing body of the municipality, to pay
project costs for projects included in the development or
redevelopment plan approved by the Development Office and adopted
by the county commission, or the governing body of the
municipality, that are located in a development or redevelopment
district or on land not in the district that is contiguous to the
district and which contain infrastructure or other facilities which
serve the district.
(1) Tax increment financing obligations may be issued for
project costs, as defined in section three of this article, which may include interest prior to and during the acquisition,
construction and equipping of a project and for a reasonable time
thereafter, with such reserves as may be required by any agreement
securing the obligations and all other expenses incidental to
planning, carrying out and financing the project.
(2) The proceeds of tax increment financing obligations may
also be used to reimburse the costs of any interim financing or
cash expenditures entered on behalf of projects in the development
or redevelopment district.
(b) Tax increment financing obligations issued under this
article shall be payable solely from the tax increment or other
revenues deposited to the credit of the tax increment financing
fund of the development or redevelopment district.
(c) Under no event shall tax increment financing obligations
be secured or be deemed to be secured by the full faith and credit
of the county commission or the municipality issuing the tax
increment financing obligations.
(d) Every tax increment financing bond, note or other
obligation issued under this article shall recite on its face that
it is a special obligation payable solely from the tax increment
and other revenues pledged for its repayment.
(3) (e) The proceeds of tax increment financing obligations
issued under this article shall not be used to reimburse project
costs incurred prior to the project plan approval by the Development Office: Provided, That at its discretion the county
commission or governing body of the municipality may authorize
reimbursement of project costs contained in subsections (d), (e)
and (g), section twenty-five, article eleven-b, chapter seven of
this code.
§7-11B-22. Tax increment financing obligations -- terms,
conditions.
(a) Tax increment financing obligations may not be issued in
an amount exceeding the estimated aggregate project costs,
as
stated in the approved project plan, including all costs of
issuance of the tax increment financing obligations.
(b) Tax increment financing obligations shall not be included
in the computation of the Constitutional debt limitation of the
county commission or municipality issuing the tax increment
financing obligations.
(c) Tax increment financing obligations shall mature over a
period not exceeding
thirty twenty years from the date of entry of
the county commission's order, or the effective date of the
municipal ordinance, creating the development or redevelopment
district and approving the development or redevelopment plan, or a
period terminating with the date of termination of the development
or redevelopment district, whichever period terminates earlier.
(d) Tax increment financing obligations may contain a
provision authorizing their redemption, in whole or in part, at stipulated prices, at the option of the county commission or
municipality issuing the obligations, and, if so, the obligations
shall provide the method of selecting the tax increment financing
obligations to be redeemed.
(e) The principal and interest on tax increment financing
obligations may be payable at any place set forth in the
resolution, trust indenture or other document governing the
obligations.
(f) Bonds or notes shall be issued in registered form.
(g) Bonds or notes may be issued in any denomination.
(h) Each tax increment financing obligation issued under this
article is declared to be a negotiable instrument.
(i) The tax increment financing obligations may be sold at
public or private sale.
(j) Insofar as they are consistent with subsections (a), (b)
and (c) of this section, the procedures for issuance, form,
contents, execution, negotiation and registration of county and
municipal industrial or commercial revenue bonds set forth in
article two-c, chapter thirteen of this code are incorporated by
reference herein.
(k) The bonds may be refunded or refinanced and refunding
bonds may be issued in any principal amount:
Provided, That the
last maturity of the refunding bonds shall not be later than the
last maturity of the bonds being refunded.
§7-11B-26. Excess funds.
(a) Moneys received in the tax increment financing fund of the
development or redevelopment district in excess of amounts needed
to pay project costs and debt service may be used by the county
commission or municipality that created the development or
redevelopment district
to retire the indebtedness for other
projects within the district or distributed to the levying bodies
as provided in this article.
(b) Upon termination of the district, all amounts in the tax
increment financing fund of the district shall be paid over to the
levying bodies in the same proportion that ad valorem property
taxes on the base value was paid over to those levying bodies for
the tax year in which the district is terminated.
NOTE: The purpose of this bill is to bring the West Virginia
Tax Increment Financing Act up to current regulations and provide
for financing regulations for development of infrastructure.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.