[Adopted 4-1-2020]
Commercial and Industrial Construction Exemption, RSA 72:80-83;
State Economic Growth, Resource Protection and Planning Policy, RSA
9-B; Appraisal of Taxed Property, RSA 75:1; Collection of Taxes, RSA
80:1 through 80:42-a; and Administrative Procedure Act, RSA 541-A.
Pursuant to the authority granted by RSA 72:81, the Town of
Derry adopts the Derry Commercial/Industrial Property Tax Exemption
Program for application within the geographical limits of the Town.
Derry Commercial/Industrial Property Tax Exemption Program.
New Hampshire Statutes, RSA Title V, Taxation, Chapter 72, Commercial
and Industrial Construction Exemption Program Statewide
A.
It is declared to be a public benefit to enhance the Town of Derry's
commercial/industrial property tax base with respect to economic activity,
cultural and historic character, and sense of community that contribute
to economic and social vitality.
B.
It is further declared to be a public benefit to encourage the rehabilitation
of any underutilized commercial/industrial structures in our Town
as a means of encouraging growth of economic, residential, and municipal
uses in accordance with RSA 9-B.
C.
Short-term property assessment tax relief and a related covenant
to protect the public benefit as provided under this article are considered
to provide a demonstrated public benefit if it encourages new construction,
substantial rehabilitation and use of qualifying structures, or the
replacement of a qualifying structure.
A.
The Town of Derry hereby adopts RSA 72:80-83 in the manner specified
under RSA 72:82. In addition, the Town may modify the incentive program
to best suit the needs of the Town and its constituents.
B.
The governing body shall herein refer to the Derry Town Council.
(The Council may designate an agent as permitted per Town Charter.)
In the interpretation and enforcement of this article, all words
other than those defined specifically below shall have the meanings
implied by their context in the article or the ordinarily accepted
meanings. For the purpose of this article, the following definitions
shall apply unless the context clearly indicates or requires a different
meaning.
The assessed valuation of the improvements/structures as
of April 1 within the tax year the application is made, pursuant to
RSA 72:83.
All retail, wholesale, service, and similar uses such as:
automobile and similar vehicle sales; automobile repair facility/garage;
automobile service station; bank; brewery; brew pub; commercial performing
and fine arts schools and studios; commercial service establishment;
conference center; contractor; contractor's yard; funeral establishment;
golf course/country club; grocery/convenience store; hospital; hotel;
commercial service establishment; inn (motel); medical office; movie
and recording studio; multiunit commercial establishment; nursery;
office, pharmacy, printing; professional office; radio broadcasting
facility; repairman; restaurant, drive-in restaurant; retail sales
establishment; riding school; television broadcasting; transportation
center; travel agent; tourist home, and wholesale business.
A formal and legally binding agreement or contract, such
as a lease, or one of the clauses in an agreement of this kind.
Shall include all manufacturing, production, assembling,
warehousing, or processing of goods or materials for sale or distribution,
research and development activities, or processing of waste materials,
such as: bottling facility; building material storage yard; crematorium;
equipment upfit (repair); industrial establishment; light industrial
establishment; industrial repair garage; industrial supply; laboratory
(medical/dental); laboratory: research, experimental, testing; light
industry; light manufacturing; microbrewery; product assembly; publishing;
research and development facility; research lab; sand/gravel pit;
self-storage; truck terminal; warehouse, and wood/metal craft.
A structure located in the Town of Derry built, rebuilt,
modernized, or enlarged to be used for commercial or industrial uses
as defined in RSA 72:80.
The demolition or removal of a qualifying structure and the
subsequent construction of a new structure on the same lot.
Any district established in accordance with the provisions
of RSA 162-K. (The Town of Derry, through action of the Derry Town
Council, adopted the provisions of RSA 162-K on May 7, 2002.)
For a qualifying structure, that for a period of time determined
by the Town Council in accordance with this article, the property
tax exemption on a qualifying structure shall be granted as a result
of the construction, reconstruction, modernization or enlargement.
For a qualifying structure, the percentage amount of the property
tax exemption as determined by the Town Council in accordance with
this article.
The finite period of time during which the tax relief will
be effective, and the percentage amount of new assessed value to be
exempted, as determined by the Town Council body pursuant to RSA 72:81.
In order to qualify for tax relief under this article, the proposed
new construction or rehabilitation must provide one or more of the
following public benefits, and the proposed replacement must provide
one or more of the same public benefits to a greater degree than would
a rehabilitation of the same qualifying structure, as follows:
A.
It enhances the economic vitality of the Town; or
B.
It promotes development of municipal centers, providing for efficiency,
safety, and a greater sense of community, consistent with RSA 9-B;
or
C.
The proposed development is consistent with the vision espoused in
the Master Plan; or
D.
It increases commercial/industrial activity in the Town, including
job creation.
A.
Tax relief for the construction, rehabilitation or replacement of
a qualifying structure shall only be effective after a property owner
grants to the municipality a covenant ensuring that the structure(s)
shall be maintained and used in a manner that furthers the public
benefit for which the tax relief was granted and as otherwise provided
in this article.
B.
This covenant shall be coextensive with the tax relief period. The
covenant may, if required by the Town Council, be effective for a
period of time up to twice the duration of the tax relief period.
C.
The covenant shall include provisions requiring the property owner
to obtain casualty insurance, and flood insurance, if appropriate.
The covenant may include, at the governing body's sole discretion,
a lien against proceeds from casualty and flood insurance claims for
the purpose of ensuring proper restoration or demolition of damaged
structures and property. If the property owner has not begun the process
of restoration, rebuilding, or demolition of such structure within
one year following damage or destruction, the property owner shall
be subject to the termination of provisions by the Town Council in
a manner similar to approval of the property tax exemption.
D.
The Town shall provide for the recording of the covenant to protect
public benefit with the registry of deeds. It shall be a burden upon
the property and shall bind all transferees and assignees of such
property.
A.
An owner (or agent) of a qualifying structure that is located in
the Town, who intends to construct, rehabilitate or replace such structure,
may apply to the Planning Department for this tax relief prior to
construction, but not after December 31 before the beginning of the
tax year for which the exemption is sought. In such cases, the Town
Council may anticipatorily grant the exemption, subject to adjustment
when the actual increase in assessed value becomes known. The applicant
shall include the address of the property, a full description of the
intended construction, rehabilitation or replacement, any changes
in use of the property resulting from the rehabilitation or replacement,
and an application fee. The application shall be on a preapproved
application form provided by the Town Planning Department.
B.
The application for property tax exemption shall not be deemed to
be complete and the governing body shall not schedule the public hearing
on the application as required under RSA 72:83 until all required
information has been submitted.
A.
An application fee of $150, or the amount subsequently adopted by
the Town Council, shall be paid at the time of application submission
to the Planning Department, made out to the "Town of Derry."
B.
The applicant shall also be responsible for the reasonable expenses
incurred by the municipality in the drafting, review, and/or execution
of the covenant. If the application is approved, the applicant shall
be responsible for the cost of recording the covenant.
A.
Upon receipt of an application, the Council shall hold a duly noticed
public hearing and notify the applicant of its decision no later than
February 28 before the beginning of the tax year for which the exemption
is sought:
B.
The Council may seek assistance from Town officials, legal counsel,
boards or commissions in making its determinations.
C.
No later than 45 days after the public hearing, the governing body
shall render a decision granting or denying the requested tax relief
and, if so granting, establish the tax relief period.
D.
After following the procedures established herein, the governing
body may grant the tax relief, provided:
(3)
The governing body finds that the proposed use is consistent with
the municipality's master plan or development regulations; and/or
F.
The Town Council or its agents may request such additional or updated
information as is necessary to determine eligibility. If they are
satisfied that the applicant has willfully made any false statement,
or has refused to provide information after such a request, the Town
Council may refuse to grant the exemption.
G.
If the Town Council, in its sole discretion, denies the application
for tax relief, such denial shall be accompanied by a written explanation.
The governing body's decision may be appealed either to the Board
of Tax and Land Appeals or the Superior Court in the same manner as
provided for appeals of current use classification pursuant to RSA
72:83; provided, however, that such denial shall be deemed discretionary
and shall not be set aside by the Board of Tax and Land Appeals or
the Superior Court except for bad faith or discrimination.
[1]
Editor's Note: See also the Implementation Guidelines included as an attachment to this chapter.
A.
Tax incremental financing district (TIF). The Town shall have no
obligation to grant an application for tax relief for properties located
within tax increment finance (TIF) districts when the governing body
determines, in its sole discretion, that the granting of tax relief
will impede, reduce, or negatively affect:
(1)
The development program or financing plans for such tax increment
finance districts; or
(2)
The ability to satisfy or expedite repayment of debt service obligations
incurred for a tax increment financing district; or
(3)
The ability to satisfy program administration, operating, or maintenance
expenses within a tax increment financing district.
B.
RSA 79-E. The Town shall have no obligation to grant an application
for a property tax exemption under this program for properties which
have applied for and received tax relief under RSA 79-E, Downtown
Derry Revitalization Tax Relief Program.
The provisions of this article shall not apply to properties
whose rehabilitation or construction is subsidized by state or federal
grants or funds that do not need to be repaid totaling more than 50%
of construction costs from state or federal programs.
A.
In no instance shall the amount of the property tax exemption exceed
50% of the increase in assessed value attributable to construction
of new structures, and additions, renovations, or improvements to
existing structures.
B.
In no instance shall the exemption run for a period exceeding 10
years following the new construction.
C.
Pursuant to RSA 72:81, the exemption shall apply only for municipal
and local school property taxes assessed by the municipality which
shall exclude state education property taxes under RSA 76:3 and county
taxes assessed against the municipality under RSA 29:11
D.
If the municipality completes a revaluation during the period for
which an exemption has been granted, the amount of the exemption shall
be adjusted by the difference in equalization ratios applicable in
the municipality before and after the revaluation.
E.
The amount and length of the property tax exemption shall be determined
by the Town Council on a per-case basis.
Upon expiration of the tax relief period, the property shall
be taxed at its market value in accordance with RSA 75:1 at the date
of April 1 of said year.
The real estate of every person shall be held for the taxes
levied pursuant to RSA 79-E:9.
A.
Tax relief granted under this article shall be calculated on the
value in excess of the original assessed value. "Original assessed
value" shall mean the value of the qualifying structure assessed at
the time that the governing body approves the application for tax
relief and the owner grants to the municipality the covenant to protect
public benefit as required in this article.
B.
Tax relief granted under this article shall pertain only to assessment
increases attributable to the construction, rehabilitation or replacement
performed under the conditions approved by the governing body and
not to those increases attributable to other factors, including but
not limited to market forces, such as revaluation and/or periodic
assessment updates.
Once the application is received and deemed complete, the Town
will notify the applicant of the date of the public hearing.
A.
Termination of covenant; reduction of tax relief; penalty. If the owner fails to maintain or utilize the building according to the terms of the covenant, or fails to restore, rebuild, or demolish the structure following damage or destruction as provided in § 138-39, the Town Council shall, after a duly noticed public hearing, determine whether and to what extent the public benefit of the rehabilitation or replacement has been diminished and shall determine whether to terminate or reduce the property tax exemption amount and period in accordance with such determination. If the covenant is terminated, the governing body shall assess all past taxes to the owner as though no tax relief was granted, with interest.
B.
Any tax payment required under Subsection A shall be payable according to the following procedure:
(1)
The Commissioner of the Department of Revenue Administration shall
prescribe and issue forms to the local assessing officials for the
payment due, which shall provide a description of the property, the
market value assessment according to RSA 75:1, and the amount payable.
(2)
The prescribed form shall be prepared in quadruplicate. The original,
duplicate, and triplicate copy of the form shall be given to the collector
of taxes for collection of the payment along with a special tax warrant
authorizing the collector to collect the payment under the warrant.
The quadruplicate copy of the form shall be retained by the local
assessing officials for their records.
(3)
Upon receipt of the special tax warrant and prescribed forms, the
tax collector shall mail the (duplicate) copy of the tax bill to the
owner responsible for the tax as the notice of payment.
(4)
Payment shall be due not later than 30 days after the mailing of
the bill. Interest at the rate of 18% per annum shall be due thereafter
on any amount not paid within the thirty-day period. Interest at 12%
per annum shall be charged upon all taxes that would have been due
and payable on or before December 1 of each tax year as if no tax
relief had been granted.
All taxes levied pursuant to RSA 72:81 which are not paid when
due shall be collected in the same manner as provided in RSA 80.
