2020-001 - Authorizing Tax Abatement Agreement and Approving Guidelines and Criteria for Granting Tax Abatements

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(Readopted 01-13-2020) POLICY STATEMENT CRITERIA AND GUIDELINES FOR TAX ABATEMENT taxation a portion of the value of the real property, or of personal property located on the real property, or both. The period of the abatement granted under the agreement shall not exceed the term authorized by law. Such agreement will be based on the condition that the owner or lessee of the property makes specific improvements or repairs to the property. An agreement may provide for the exemption of the real property in each year covered by the agreement only to the extent its value for that year exceeds the base year value. An agreement may provide for the exemption of personal property located on the real property in each year covered by the agreement other than personal property that was located on the real property at any time before the period covered by the agreement. Inventory or supplies cannot be abated as personal property. Tax abatements may only be granted for additional value of eligible property improvements made subsequent to and specified in an abatement agreement between the Taxing Jurisdictions and the property owner or lessee subject to such limitation as the Taxing Jurisdictions may require. The additional value must exceed any reduction in the fair market value of other property of the owner already on the tax roll within the area served by the Taxing Jurisdictions. Change in appraised value does not qualify for abatement except in an instance where a previously vacant authorized facility is utilized. Value added to the tax rolls must come from actual capital expenditures. The negotiation of tax abatement agreements will be conducted by the Paris Economic Development Corporation's ("PEDC") executive director, in close consultation with the city manager. In determining where and how tax abatements will be utilized, the executive director will examine the potential return on the public's investment. Return on public investment will be measured in terms of (i) jobs created, (ii) jobs retained in cases of existing employers within the Taxing Jurisdictions, and (iii) broadening of the tax base and expansion of the economic base (e.g. capital investment, payroll, local spending, etc.). V. Eligibility Criteria for Tax Abatement for Real and Personal Property A property owner and/or lessee shall be eligible for tax abatement only upon the following criteria. _ Eli_gibRity Criteria for Tax Abatement Authorized 1. An authorized facility is used for manufacturing, research, regional distribution, regional services, regional Facility tourist entertainment, other basic industry, or any primary jobs creating industry. (See Appendix A for definitions.) 2. A new authorized facility must be created, or an existing authorized facility must be improved, modernized or expanded. 3. If a leased authorized facility is granted abatement, the agreement may be executed with the lessor and/or lessee, depending upon the particular circumstances of the proposed project. If the agreement is with the lessor, lessor shall demonstrate binding contracts with the lessee to guarantee compliance with the terms of the agreement. Eiibi� ...............ee.,.. L............................................................................ , _ .m m.....e �m. �eeeeeeeeee._........................ ................... .................................��.............. igible 1. The property involved must be a newly created, or improvements to an existing, authorized facility. Property 2. Eligible property for which abatement may be granted includes nonresidential real property and/or tangible personal property not located on the real property at any time before the abatement agreement becomes effective. 3. Abatement may be extended to the value of buildings, structures, fixed machinery and equipment, site improvements, tangible personal property, and that office space and related fixed improvements necessary �,.. ,..nn to the oferation and administration of the authorized facility 2