SB 783 - This act modifies provisions of the Distressed Areas Land Assemblage Tax Credit. Currently, an applicant for this tax credit is entitled to a tax credit in an amount equal to fifty percent of the applicant's acquisition costs, which includes among other things the cost of demolishing vacant buildings, and for a five-year period, one hundred percent of the applicant's interest costs. These acquisition costs include the reasonable costs of maintaining an eligible parcel of land for a five-year period after acquiring the parcel. This act eliminates the five-year time limitation on receiving a tax credit for maintenance costs and interest costs, and allows the applicant to receive a tax credit equal to one hundred percent of the reasonable costs of demolition, rather than a tax credit equal to fifty percent of the demolition costs.
Currently, for a developer to be eligible for a tax credit under this program the redevelopment agreement between the developer and the municipal authority must prohibit the developer from redeveloping more than 75 percent of the area identified in the redevelopment plan. This act eliminates this restriction for projects in a specific type of redevelopment area.
Currently, the average number of parcels per acre in an area that is eligible for the developer to receive tax credits under this program must be four or more. This act eliminates this requirement for projects in a specific type of redevelopment area.
This act also allows a developer applying for the tax credit to file for the credit on a quarterly basis, rather than annually.
This act increases the cap on the amount of tax credits that can be issued under this program each year from 20 to 30 million dollars. The act also divides the amount of tax credits that can be issued each year into two pools. If there is more than one applicant entitled to tax credits in that year, then half of the annual amount of money will go to projects in a specific type of redevelopment area and half for areas located in other project areas. If the Department of Economic Development does not issue tax credits equal to all of each pool of money by December 15th, the other kind of projects can get the remaining money in the other pool.
Currently, the Department of Economic Development is prohibited from authorizing tax credits under this program after August 28, 2013. This act extends the amount of time the department can authorize tax credits under this program until August 28, 2016.
If projects in the specific type of redevelopment area created by this act do not promote, grow, or retain significant employment, then after January 1, 2016, the Department of Economic Development can reduce or modify state assistance or tax credits to the applicant for the Distressed Areas Land Assemblage tax credit program, except the department cannot reduce the credits granted under this tax credit program, and the department cannot modify other state assistance in an amount that is more than the tax credits granted to the applicant under this tax credit program.
EMILY KALMER