Senate File 2419 - Enrolled
PAG LIN
1 1 SENATE FILE 2419
1 2
1 3 AN ACT
1 4 RELATING TO THE PROPERTY TAX EXEMPTION FOR SPECULATIVE SHELL
1 5 BUILDINGS AND INCLUDING EFFECTIVE AND RETROACTIVE
1 6 APPLICABILITY DATE PROVISIONS.
1 7
1 8 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 9
1 10 Section 1. Section 427.1, subsection 27, Code Supplement
1 11 2007, is amended to read as follows:
1 12 27. a. SPECULATIVE SHELL BUILDINGS OF CERTAIN
1 13 ORGANIZATIONS. New construction of shell buildings by
1 14 community development organizations, not=for=profit
1 15 cooperative associations under chapter 499, or for=profit
1 16 entities for speculative purposes or the portion of the value
1 17 added to buildings being reconstructed or renovated by
1 18 community development organizations, not=for=profit
1 19 cooperative associations under chapter 499, or for=profit
1 20 entities in order to become speculative shell buildings as
1 21 provided in this subsection.
1 22 b. The exemption shall be for one of the following:
1 23 (1) The value added by new construction of a shell
1 24 building or addition to an existing building or structure by a
1 25 community development organization, not=for=profit cooperative
1 26 association under chapter 499, or for=profit entity.
1 27 (2) The value of an existing building being reconstructed
1 28 or renovated, and the value of the land on which the building
1 29 is located, if the reconstruction or renovation constitutes
1 30 complete replacement or refitting of the existing building or
1 31 structure, by a community development organization,
1 32 not=for=profit cooperative association under chapter 499, or
1 33 for=profit entity.
1 34 c. The exemption or partial exemption shall be allowed
1 35 only pursuant to ordinance of a city council or board of
2 1 supervisors, which ordinance shall specify if the exemption
2 2 will be available for community development organizations,
2 3 not=for=profit cooperative associations under chapter 499, or
2 4 for=profit entities and. If the exemption is for a project
2 5 described in paragraph "b", subparagraph (1), the exemption
2 6 shall be effective for the assessment year in which the
2 7 building is first assessed for property taxation or the
2 8 assessment year in which the reconstruction or renovation
2 9 addition to an existing building first adds value and. If the
2 10 exemption is for a project described in paragraph "b",
2 11 subparagraph (2), the exemption shall be effective for the
2 12 assessment year following the assessment year in which the
2 13 project commences. An exemption allowed under this subsection
2 14 shall be allowed for all subsequent years until the property
2 15 is leased or sold or for a specific time period stated in the
2 16 ordinance or until the exemption is terminated by ordinance of
2 17 the city council or board of supervisors which approved the
2 18 exemption. Eligibility for an exemption as a speculative
2 19 shell building shall be determined as of January 1 of the
2 20 assessment year. However, an exemption shall not be granted a
2 21 speculative shell building of a not=for=profit cooperative
2 22 association under chapter 499 or a for=profit entity if the
2 23 building is used by the cooperative association or for=profit
2 24 entity, or a subsidiary or majority owners thereof for other
2 25 than as a speculative shell building. If the shell building
2 26 or any portion of the shell building is leased or sold, the
2 27 portion of the shell building which is leased or sold, and a
2 28 proportionate share of the land on which it is located if
2 29 applicable, shall not be entitled to an exemption under this
2 30 subsection for subsequent years. An application shall be
2 31 filed pursuant to section 427B.4 for each project for which an
2 32 exemption is claimed. Upon the sale of the shell building,
2 33 the shell building shall be considered new construction for
2 34 purposes of section 427B.1 if used for purposes set forth in
2 35 section 427B.1.
3 1 d. (1) If the speculative shell building project is a
3 2 speculative shell building project described in paragraph "b",
3 3 subparagraph (1), an application shall be filed pursuant to
3 4 section 427B.4 for each such project for which an exemption is
3 5 claimed.
3 6 (2) If the speculative shell building project is a
3 7 speculative shell building project described in paragraph "b",
3 8 subparagraph (2), an application shall be filed by the owner
3 9 of the property with the local assessor by February 1 of the
3 10 assessment year in which the project commences. Applications
3 11 for exemption shall be made on forms prescribed by the
3 12 director of revenue and shall contain information pertaining
3 13 to the nature of the improvement, its cost, and other
3 14 information deemed necessary by the director of revenue. The
3 15 city council or the board of supervisors, by ordinance, shall
3 16 give its approval of a tax exemption for the project if the
3 17 project is in conformance with the zoning plans for the city
3 18 or county. The approval shall also be subject to the hearing
3 19 requirements of section 427B.1. Approval under this
3 20 subparagraph (2) entitles the owner to exemption from taxation
3 21 beginning in the assessment year following the assessment year
3 22 in which the project commences. However, if the tax exemption
3 23 for the building and land is not approved, the person may
3 24 submit an amended proposal to the city council or board of
3 25 supervisors to approve or reject.
3 26 e. For purposes of this subsection the following
3 27 definitions apply:
3 28 a. (1) (a) "Community development organization" means an
3 29 organization, which meets the membership requirements of
3 30 subparagraph (2) subdivision (b), formed within a city or
3 31 county or multicommunity group for one or more of the
3 32 following purposes:
3 33 (a) (i) To promote, stimulate, develop, and advance the
3 34 business prosperity and economic welfare of the community,
3 35 area, or region and its citizens.
4 1 (b) (ii) To encourage and assist the location of new
4 2 business and industry.
4 3 (c) (iii) To rehabilitate and assist existing business and
4 4 industry.
4 5 (d) (iv) To stimulate and assist in the expansion of
4 6 business activity.
4 7 (2) (b) For purposes of this definition, a community
4 8 development organization must have at least fifteen members
4 9 with representation from the following:
4 10 (a) (i) A representative from government at the level or
4 11 levels corresponding to the community development
4 12 organization's area of operation.
4 13 (b) (ii) A representative from a private sector lending
4 14 institution.
4 15 (c) (iii) A representative of a community organization in
4 16 the area.
4 17 (d) (iv) A representative of business in the area.
4 18 (e) (v) A representative of private citizens in the
4 19 community, area, or region.
4 20 b. (2) "New construction" means new buildings or
4 21 structures and includes new buildings or structures which are
4 22 constructed as additions to existing buildings or structures.
4 23 "New construction" also includes reconstruction or renovation
4 24 of an existing building or structure which constitutes
4 25 complete replacement of an existing building or structure or
4 26 refitting of an existing building or structure, if the
4 27 reconstruction or renovation of the existing building or
4 28 structure is required due to economic obsolescence, if the
4 29 reconstruction or renovation is necessary to implement
4 30 recognized industry standards for the manufacturing or
4 31 processing of products, and the reconstruction or renovation
4 32 is required in order to competitively manufacture or process
4 33 products or for community development organizations,
4 34 not=for=profit cooperative associations under chapter 499, or
4 35 for=profit entities to market a building or structure as a
5 1 speculative shell building, which determination must receive
5 2 prior approval from the city council of the city or county
5 3 board of supervisors of the county.
5 4 c. (3) "Speculative shell building" means a building or
5 5 structure owned and constructed or reconstructed by a
5 6 community development organization, a not=for=profit
5 7 cooperative association under chapter 499, or a for=profit
5 8 entity without a tenant or buyer for the purpose of attracting
5 9 an employer or user which will complete the building to the
5 10 employer's or user's specification for manufacturing,
5 11 processing, or warehousing the employer's or user's product
5 12 line.
5 13 Sec. 2. EFFECTIVE AND APPLICABILITY DATES. This Act,
5 14 being deemed of immediate importance, takes effect upon
5 15 enactment and applies retroactively to January 1, 2007, for
5 16 projects approved by a city council or board of supervisors
5 17 prior to that date. Claims for exemption for the 2007 or 2008
5 18 or 2009 assessment year shall be filed with the appropriate
5 19 governing body on or before October 1, 2008.
5 20
5 21
5 22
5 23 JOHN P. KIBBIE
5 24 President of the Senate
5 25
5 26
5 27
5 28 PATRICK J. MURPHY
5 29 Speaker of the House
5 30
5 31 I hereby certify that this bill originated in the Senate and
5 32 is known as Senate File 2419, Eighty=second General Assembly.
5 33
5 34
5 35
6 1 MICHAEL E. MARSHALL
6 2 Secretary of the Senate
6 3 Approved , 2008
6 4
6 5
6 6
6 7 CHESTER J. CULVER
6 8 Governor