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HomeMy WebLinkAbout9720-06 Amend various sections in Chapter 2, Article 6 - Tax AbatementORDINANCE No. Passed by the Common Council of the Ciry ofSoutlr Bend, Indiana November 27, Attest: r` JOHN Attest: 20 06 Presented by me to the Mayor of the Ciry of South Bend, Indiana November 28, 06 20 Ciry Clerk President of Common Council Ciry Clerk Approved and signed by me November 29 2006 ~1~~~-` ~ - M~~ Ordinance No. ~ ~ 20 ~'~~ Substitute Bill No. 79-06 AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AMENDING VARIOUS SECTIONS OF CHAPTER 2, ARTICLE 6, OF THE SOUTHBEND MUNICIPAL CODE ADDRESSING TAX ABATEMENT PROCEDURES STATEMENT OF PURPOSE AND INTENT The Common Council of the City of South Bend, Indiana, passed Ordinance No. 9394-03 on February 10, 2003. This comprehensive 48-page ordinance resulted from a series of Community and Economic Development meetings over an extended period of time where members of the public and the City Administration provided input on improving our local tax abatement procedures. " The Common Council believes that tax abatements should continue to be granted in a manner which provides incentives for private sector entities to invest in property and to also execute certain other actions which the Council and the Administration jointly believe would provide public benefits which would be in the best interests of citizens and the City of South Bend, Indiana. The following ordinance incorporates many improvements to the current regulations which are basically of anon-substantive nature. Section I. Chapter 2, Article 6, Division 1, Section 2-76.1 addressing "Definitions And Interpretation" of the South Bend Municipal Code is amended in part to read as follows: Sec. 2-76.1 Definitions ~ Interpretation and Area Maps. (A)(1) "Airport Economic Development Area" and "AEDA" mean the area located within the City's corporate boundaries designated by the South Bend Redevelopment Commission and the Common Council, as amended from time to time, and filed with the City Clerk's Office with notice to the President of the South Bend Common Council and the Chair of the South Bend Common Council's Community And Economic Development Committee. Delete current boundary legal description contained in (A)(1)(a and b). (A)(3) "Central Business District" and "CBD" mean the area located within the City's corporate boundaries designated by the South Bend Redevelopment Commission and the Common Council, as amended from time to time, and filed with the City Clerk's Office with notice to the President of the South Bend Common Council and the Chair of the South Bend Common Council's Community And Economic Development Committee. Delete current boundary legal description at the end of (A)(3). Ordinance Regulating Tax Abatement Regulations Page 2 (A)(11) "East Bank Development Area" and "EBDA" mean the area located within the City 's corporate boundaries designated by the South Bend Redevelopment Commission and the Common Council, as amended from time to time, and filed with the City Clerk's Office with notice to the President of the South Bend Common Council and the Chair of the South Bend Common Council's Community And Economic Development Committee. (A)(12) "Economic Development Target Area" and "EDTA" mean the area located within the City's corporate boundaries designated by the Economic Development Commission as amended from time to time, and filed with the City Clerk's Office with notice to the President of the South Bend Common Council and the Chair of the South Bend Common Council's Community And Economic Development Committee. A maximum of fifteen percent (15%) of the total geographic territory of the City may be designated as Economic Development Tazget Areas. Delete current boundary legal description contained in (A)(12)(a thru g). (A)~21) "New Information Technolog~Equipment" has the meaning set forth in Indiana Code § 6-1.1-12.1-1 et seA. ~A)(22) "New Logistical Distribution Equipment" has the meaning set forth in Indiana Code § 6-1.1-12.1-1 et sea. (A)(~1-}(23) "New Manufacturing Equipment" has the meaning set forth in Indiana Code § 6- 1.1-12.1-1 et sea. (A)(24) "New Personal Property" includes New Manufacturing Equipment, New Research and Development Equipment, New Logistical Distribution Equipment and New Information and Technology Equipment, all having the meaning set forth in Indiana Code § 6-1.1-12.1-1 et sect (A~25) "New Research and Development Equipment" has the meaning set forth in Indiana Code § 6-1.1-12.1-1 et secy. (A) 26 "Property" has the meaning set forth in I~ Indiana Code § 6-1.1-12.1-1 et sec, (A)(~)~"Redevelopment" has the meaning set forth in I~ Indiana Code § 6-1.1-12.1-1 et s~ (A) 28 "Redevelopment Blighted Area" and "RBA" mean real Property meeting the standards set forth in Indiana Code § 6-1.1-12.1 et seq., excluding the South Side Development Area. (A)(~)(~ "Rehabilitation" has the meaning set forth in ~ Indiana Code § 6-1.1-12.1-1 et s~ Ordinance Regulating Tax Abatement Regulations Page 3 (A)(~)(30 "Related Party" means any person who is related within the meaning of Section 267 of the Internal Revenue Code (i.e., United States Code Title 26, Subtitle A, Chapter 1, Subchapter B, Park IX, Section 267). (A)(~)(31) "Residentially Distressed Area" and "RDA" mean an area that meets any of the following findings as declared by the Council: a. The area is comprised of parcels that are either unimproved or contain only one (1) or two (2) family dwellings or multifamily dwellings designed for up to four (4) families, including accessory buildings for those dwellings; or b. Any dwellings in the area are not permanently occupied and are: (1) The subject of an order issued under I.C. 36-7-9; or (2) Evidencing significant building deficiencies; or c. Parcels of property in the area: (1) Have been sold and not redeemed under I.C. 6-1.1-24 and I.C. 6-1.1-25; or (2) Are owned by a unit of local government; or (3) A significant number of dwellings within the area are not permanently occupied or a significant number of parcels in the area are vacant land; or (4) A significant number of dwelling units within the area are: (a) The subject of an order issued under I.C. 36-7-9; or (b) Evidencing significant building deficiencies; or (5) The area has experienced a net loss in the number of dwelling units, as documented by census information, local building and demolition permits, or certificates of occupancy, or the area is owned by Indiana or the United States; or (6) The area (plus any areas previously designated under this subsection) will not exceed ten percent (10%) of the total area within the Council's jurisdiction. (A)(2-8)(32) "Retail" means and includes the economic activities described in major groups 44 through 45 of the North American Industry Classification System-United States, 2002 manual published by the United States Office of Management and Budget's Economic Classification Policy Committee, which manual is hereby incorporated by reference, with copies being maintained in the Office of the City Clerk. Ordinance Regulating Tax Abatement Regulations Page 4 (A)(33) "South Side Development Area" and "SSDA" mean the area located within the City's corporate boundaries designated by the South Bend Redevelopment Commission and the Common Council, as amended from time to time, and filed with the City Clerk's Office with notice to the President of the South Bend Common Council and the Chair of the South Bend Common Council's Community And Economic Development Committee. (A)(~3)(34) "Tax Abatement Impact Areas and "TAIA" mean the area located within the City's corporate boundaries designated by the South Bend Common Council, as amended from time to time, and on file with the City Clerk's Office. Delete boundary legal description contained in (A)(12)(a thru e). (A}08)(35) "Tax Increment Allocation Areas" and "TIAA" have the meaning set forth in I.C. 36-7-14-39(a). (A)0-1-)(36) "Urban Enterprise Zone" and "UEZ" mean the area located within the City's corporate boundaries designated by the Urban Enterprise Association and South Bend Common Council, as amended from time to time, and on file with the City Clerk's Office. Delete current boundary legal description at the end of (A)(31). (A)(~)(37) "Warehouse Development" means and includes the economic activities described in major groups 421, 422, and 493 of the North American Industry Classification System-United States, 2002 manual published by the United States Office of Management and Budget's Economic Classification Policy Committee, which manual is hereby incorporated by reference with copies being maintained in the Office of the City Clerk. (A)(~)(38) "Workforce Development Services" and "WDA" mean Workforce Development Services of St. Joseph County or its successor agency. F. Accurate and current maps of all areas defined in this section with legal descriptions are available in the Office of the City Clerk and are printed at the end of this Article. Larger versions of said maps are available for public inspection in the Office of the City Clerk and in the Community and Economic Development Department durin regular business hours. Said maps may also be accessed on the City's website at http://www.southbendin.gov. Section II. Chapter 2, Article 6, Division 11, Section 2-76.4., addressing "Add-On Abatement" of the South Bend Municipal Code is amended in part to read as follows: An Add-on Abatement ("Add-on Abatement") is available only for real property other than single-family residential construction and may be from one (1) to seven (7) years of abatement in addition to the Base Abatement. Hence, an applicant for real property tax abatement who is Ordinance Regulating Tax Abatement Regulations Page 5 granted both a Base Abatement and anAdd-on Abatement may receive in total from four (4) to ten (10) years of abatement. The Council may, in its discretion and in light of its evaluation of the public benefits produced by the applicant's proposed project, grant anAdd-on Abatement to any applicant for real property tax abatement who qualifies for a Base Abatement under the provisions of Section 2- 76.3 and whose proposed project is not single-family residential construction. The Community and Economic Development Department shall provide a summarX of each applicant's public benefit point calculations which have been awarded as part of their written report which is further addressed in Sec. 2-84.9 of this Article. As a guide to its deliberations regarding anAdd- on Abatement, the Council may consider, among other things: (i)_the number of Public Benefit Points ("Public Benefit Points") awarded for the applicant's including in the Memorandum of Agreement commitments to execute one or more of the Public Benefit Actions ("Public Benefit Actions") described in paragraph A below1 and (ii)the total number of Public Benefit Points awarded in relation to the threshold numbers of Public Benefit Points required to earn consideration for additional years of abatement set forth in paragraph B below. Section III. Chapter 2, Article 6, Division 10, addressing "Personal Property Tax Abatement" of the South Bend Municipal Code is amended in part to read as follows: Sec. 2-84.2 Tangible Personal Property Tax Abatement. A. Generally: The Council believes that the following general standards have a reasonable relationship to the development objectives of promoting the installation of New Personal Property in urban development areas within the City's corporate boundaries, and would warrant tax abatement consideration as set forth herein. C. Certification of New Manufacturing Equipment, New Research and Development Equipment, New Logistical Distribution Equipment and New Information Technology Equipment: An applicant seeking personal property tax abatement must certify that it will use the New Manufacturing Equipment, New Research and Development Equipment, New Logistical Distribution Equipment and New Information Technology Equipment in one or more of the uses listed within the definition of New Manufacturing Equipment, New Research and Development Equipment, New Logistical Distribution Equipment and New Information Technolog_~Equipment set forth in I.C. 6-1.1-12.1 et seq. Section IV. Chapter 2, Article 6, Division 11, Section 2-84.7, addressing "Designation Application+Required" of the South Bend Municipal Code is amended in part to read as follows: C. 3. The legal description and commonly known address of the real property for which real property tax abatement is being petitioned; or the legal description and commonly known address of the facility at which the New Ordinance Regulating Tax Abatement Regulations Page 6 pf~t-Personal Property for which tangible personal property tax abatement is being petitioned will be located. 5. The current assessed valuation of the real property improvement before Rehabilitation, Redevelopment, economic revitalization, or improvement; or the current valuation of the tangible personal property to be replaced by New Personal Property 9. An estimate of the after-rehabilitation market value of the real property or an estimate of the market value of the New Personal Property after installation. 11. A description of the proposed project (whether Rehabilitation, new construction, or installation of New Personal Property), including information about physical improvements to be made or the New Personal Property to be installed, an estimate of the cost of the project, the amount of land to be used, the proposed use of the improvements, and a general statement as to the value of the project to the business. 13. Certification that no building permit has been issued for construction on the property for the improvement proposed or verification that the New "~^~••~ ^'~~ri^rt ~'^~~~^~°^* Personal Property has not been installed. 19. For personal property tax abatement, a description of why the facility or group of facilities to be replaced are technologically, economically or energy obsolete, whereby the obsolescence may lead to a decline in employment and tax revenues; together with a verification that the New Personal Property will be used , rixiniu=Lr^cccsc~ubfiEurrvr~asJC°nror)~ °cmauC~i6ir~~~9E ", and that the New "~^~~~~ ^*~~ri^R ~^~~~^~°^* in one 1) or more of the uses listed within the definitions of New Manufacturing Equipment, New Research and Development Equipment, New Logistical Distribution Equipment and New Information and Technology Equipment, all as set forth in I.C. 6-1.1-12.1 et sep•, was never before used by its owner for any purpose in Indiana. 20. The -name, address, ~ telephone number, facsimile number, email address, and web address of the person to contact regarding notice of Council meetings and public hearings concerning the petition. 21. The name, address, telephone number, facsimile number, and email address of the person who will work with WDS for employee recruitment. Ordinance Regulating Tax Abatement Regulations Page 7 Section V. Chapter 2, Article 6, Division 11, Section 2-84.8, addressing "Statement of Benefits, Declaratory and Confirmatory Resolutions Required" of the South Bend Municipal Code is amended in part to read as follows: A. In addition to the completed petition, filing fee, and related documents required by Section 2-84.7, the owners of real property or New Personal Property must file a completed statement of benefits form at the time of filing the petition. Section VI. Chapter 2, Article 6, Division 11, Section 2-84.12, addressing "Confirmatory Resolution" of the South Bend Municipal Code is amended in part to read as follows: C. 3-: Limit the dollar amount of the deduction that will be allowed with respect to New Personal Property if a deduction had not been filed before July 1, 1987, for that equipment; ~: Impose reasonable conditions related to the purpose of state law or to the general standards adopted herein for allowing the deduction for the Redevelopment or Rehabilitation of the property or the installation of the New Personal Property- (e). Prior to the Common Council taking final action on a Confirmatory Resolution which involved Public Benefit Points being awarded for construction jobs, a list of contractors which are intended to be used must be filed by the Petitioner with the Department of Community and Economic Development for verification Qurposes by the Department.. The Department shall confirm in writing to the Office of the City Clerk receipt of such information which will trigger the Confirmatory Resolution being_placed on a Common Council a enda Section VII Chapter 2, Article 6, Division 11, Section 2-84.13 C addressing "Annual Review of Petitions By Council" of the South Bend Municipal Code is amended in part to read as follows: C. 4. The names of Local Company and/or Minority contractors used during the renovation of the real property and/or installation of New Personal Property for which tax abatement was received. Section VIII. Chapter 2, Article 6, Division 11, Section 2-84.14, addressing "Failure Of Petitioner To Comply May Result In Fines Being Imposed Or Termination Of Economic Revitalization Designation And Repayment Of Taxes Previously Abated" of the South Bend Municipal Code is amended in part to read as follows: Ordinance Regulating Tax Abatement Regulations Page 8 Section 2-84.14 Failure Of Petitioner To Comply May Result In Fines Being Imposed Or Termination Of Economic Revitalization Designation And Repayment Of Taxes Previously Abated.l Section IX. This ordinance shall be in full force and effect from and after its passage by the Common Council, approval by the Mayor and le al publicat®ion. ~» - /` , , Council Member Roland Kelly, Chairpe son Community and Economic Development Committee Member of the Common Council ~. Vo rde, City Clerk ~/'~~t~d by me to Stephen J. Luecke, the Mayor of the City of South Bend, Indiana, on the 2Clay of ~~~ c,rr.bcr 2006, at '• w o'clock. m. Janice Ta oom, Deputy Clerk c~ffd ~x by me on the~9 day of ~ 2006, at ~ o'clock Q.m. ~ cr=~~.. Stephen J. Lue e Mayor of the City of South Bend, Indiana ' Indiana Code ~ 6-101-12.1-5-9. Version b provides in Hart that if the Common Council "determines that the property owner has not substantiallyplied with the statement of benefits and that the failure to substantially complywas not caused by factors beyond the control of the property owner" (such as declines in demand for the roe owner's roducts or services the Council shall hold a hearin after ro er notice has been iven with the Council determining whether the property owner has "made reasonable efforts to substantiall~p y with the statement of benefits and whether any failure to substantially comely was caused by factors beyond the control of the property owner". e 1 st READING (`~, 3 _ O S~~s~ "~`^"~ PUBLIC HEARING (1-L~'vb 0.S ~~'°^~ '~ 3 rd READING ~ \-Z~ -O~o ~! ~~ ~ Su,~S~~-l~'~C~ NOT APPROVED t ~ REFERRED ds ~~ ,~ S u,~s~.~~ PASSED ~ `-L'1 `~~ Filed in Clerk's Ofifiice {lOV 2 $ LLri~ ~r„1~ vnnq~~ TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: Your Committee of the Whole, to whom was referred: BILL NO. 79-06 A BILL OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AMENDING VARIOUS SECTIONS OF CHAPTER 2, ARTICLE 6, OF THE SOUTH BEND MUNICIPAL CODE ADDRESSING TAX ABATEMENT PROCEDURES Respectfully report that they have examined the matter and that in their opinion, this bill is being recommended to the full Council with a favorable recommendation as substituted. Karen L. White Chairperson ~SpUTFIB~~ ~I ~~„~'`''"~~'~'% ~ City of South fiend W ~: \e~ACE j~'% a ~ ~. „ -; a '~~ z Common Council M 1865 ; 441 County-City Building • 227 W. Jefferson Blvd South Bend, Indiana 46601-1830 Timothy A. Rouse President Roland Kelly Vice-President Karen L. White Chairperson, Committee of the Whole Derek D. Dieter First District November 6, 2006 Members of the South Bend Common Council 4a` Floor County-City Building South Bend, Indiana 46601 (574) 235-9321 Faz (574) 235-9173 TDD (574) 235-5567 http: //www.ci. south-bend. in. us Re: Ordinance Recommending Non-Substantive Changes to Taz Abatement Dear Council Members: Charlotte D. Pfeifer Since June of this year, discussions and meetings have taken place, to review our Second District local tax abatement regulations. Such review is consistent with the requirements Roland Kelly of § 2-84.16 of the South Bend Municipal Code, which requires the Community Third District and Economic Development Committee to formally review these regulations in calendar years ending with an even number. Ann Puzzello Fourth District The attached proposed ordinance would make several non-substantive changes to our current regulations, which consist of 48-pages. Many changes are proposed to David Varner clarify current wording, while other amendments would bring our local Fifth District regulations in compliance with new state laws, which were passed after 2003, the Ervin Kuspa effective date of our current regulations. Sixth District As Chairperson of the Council's Community and Economic Development Al "Buddy" Kirsits Committee, I urge the Council to move forward on this Bill. I believe that these At Large changes. are needed to improve our local procedures. I look forward to meeting with you in Committee on this measure and request your favorable Timothy A. Rouse recommendation. Thank you. At Large Sincerely, Karen L. White At Large ff f iCo~Member Roland Kell ai erson Kathleen Cekanski-Farrand Y~ IP Council Attorney Community and Economic Development Committee Attachment Fil~ci tp, ~t,~s' ~l~f~ ~~'~ ~ M CT^t Ce,E~~, wM,1:=..