H. B. 3049
(By Delegates Wysong, Tabb, Doyle,
Miley, Cann, M. Poling, Fragale, Iaquinta,
Proudfoot, Argento and Barker)
[Introduced January 9, 2008; referred to the
Committee on Finance.]
A BILL to amend and reenact §7-11B-3 and §7-11B-4 of the Code of
West Virginia, 1931, as amended, all relating to the tax
increment financing act; and authorizing Class III and Class
IV municipalities to participate on a limited basis.
Be it enacted by the Legislature of West Virginia:
That §7-11B-3 and §7-11B-4 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-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 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 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 (3) and
(4) 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,
Class III, or Class IV 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) "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) "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) "Order" means an order of the county commission adopted
in conformity with the provisions of this article and as provided
in this chapter.
(17) "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) "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) "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) "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) "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) "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) "Project costs" 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, capital
improvements and facilities, new buildings, structures and
fixtures, the demolition, alteration, remodeling, repair or
reconstruction of existing 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
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.
(24) "Project developer" means any person who engages in the
development of projects in the state.
(25) "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) "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) "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) "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) "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) "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) "This code" means the code of West Virginia, one thousand
nine hundred thirty-one, as amended by the Legislature.
(32) "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.
(a) In addition to any other powers conferred by law, a county
commission or governing body of a Class I,
or Class II,
Class III,
or Class IV municipality may exercise any powers necessary and
convenient to carry out the purpose of this article,
except that
a Class III and a Class IV municipality may only implement the
provisions of this article relating to infrastructure improvements
for water, sewer, roads and the amelioration of waste and blight.
The powers necessary and convenient to carry out the purpose of
this article including include 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 on it or contract for the construction, development,
redevelopment, rehabilitation, remodeling, alteration or repair of
the property;
(11) Cause 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) Cause capital improvements owned by one or more private
entities to be constructed within the development or redevelopment
district;
(17) 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) 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) Expend project revenues as provided in this article; and
(22) Do all things necessary or convenient to carry out the
powers granted in this article.
(b) Class III and Class IV municipalities may implement the
provisions of this article only as they relate to infrastructure
improvements for water, sewer, roads and the amelioration of waste
and blight.
NOTE: The purpose of this bill is to authorize Class III and
Class IV municipalities to participate on a limited basis in the
West Virginia Tax Increment Financing Act.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.