Utah 2023 Regular Session

Utah House Bill HB0557 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	H.B. 557
2	2	LEGISLATIVE GENERAL COUNSEL
3	3	6 Approved for Filing: G.N. Gunn 6
4	4	6 02-23-23 11:59 AM 6
5	5	H.B. 557
6	6	1 TAX INCREMENT FINANCING REVISIONS
7	7	2 2023 GENERAL SESSION
8	8	3 STATE OF UTAH
9	9	4 Chief Sponsor: James A. Dunnigan
10	10	5 Senate Sponsor: ____________
11	11	6
12	12	7LONG TITLE
13	13	8General Description:
14	14	9 This bill modifies provisions regarding redevelopment agencies and economic
15	15	10development tax increment financing.
16	16	11Highlighted Provisions:
17	17	12 This bill:
18	18	13 <requires agencies to report certain information to the Governor's Office of
19	19	14Economic Opportunity;
20	20	15 <provides penalties for failing to comply with reporting requirements;
21	21	16 <provides for the allocation of project area funds that are unspent five years after the
22	22	17project area collection period ends; and
23	23	18 <requires project area plans to include the rationale for using tax increment financing,
24	24	19including an analysis of whether the goals for a project area could reasonably be
25	25	20expected to be accomplished through private development.
26	26	21Money Appropriated in this Bill:
27	27	22 None
28	28	23Other Special Clauses:
29	29	24 None
30	30	25Utah Code Sections Affected:
31	31	26AMENDS:
32	32	27 17C-1-102, as last amended by Laws of Utah 2021, Chapter 214
33	33	HB0557 H.B. 557 02-23-23 11:59 AM
34	34	- 2 -
35	35	28 17C-1-603, as last amended by Laws of Utah 2021, Chapter 282
36	36	29 17C-1-702, as enacted by Laws of Utah 2016, Chapter 350
37	37	30 17C-5-105, as last amended by Laws of Utah 2019, Chapter 376
38	38	31 63N-2-104.2, as enacted by Laws of Utah 2022, Chapter 200
39	39	32
40	40	33Be it enacted by the Legislature of the state of Utah:
41	41	34 Section 1. Section 17C-1-102 is amended to read:
42	42	35 17C-1-102. Definitions.
43	43	36 As used in this title:
44	44	37 (1) "Active project area" means a project area that has not been dissolved in accordance
45	45	38with Section 17C-1-702.
46	46	39 (2) "Adjusted tax increment" means the percentage of tax increment, if less than
47	47	40100%, that an agency is authorized to receive:
48	48	41 (a) for a pre-July 1, 1993, project area plan, under Section 17C-1-403, excluding tax
49	49	42increment under Subsection 17C-1-403(3);
50	50	43 (b) for a post-June 30, 1993, project area plan, under Section 17C-1-404, excluding tax
51	51	44increment under Section 17C-1-406;
52	52	45 (c) under a project area budget approved by a taxing entity committee; or
53	53	46 (d) under an interlocal agreement that authorizes the agency to receive a taxing entity's
54	54	47tax increment.
55	55	48 (3) "Affordable housing" means housing owned or occupied by a low or moderate
56	56	49income family, as determined by resolution of the agency.
57	57	50 (4) "Agency" or "community reinvestment agency" means a separate body corporate
58	58	51and politic, created under Section 17C-1-201.5 or as a redevelopment agency or community
59	59	52development and renewal agency under previous law:
60	60	53 (a) that is a political subdivision of the state;
61	61	54 (b) that is created to undertake or promote project area development as provided in this
62	62	55title; and
63	63	56 (c) whose geographic boundaries are coterminous with:
64	64	57 (i) for an agency created by a county, the unincorporated area of the county; and
65	65	58 (ii) for an agency created by a municipality, the boundaries of the municipality. 02-23-23 11:59 AM H.B. 557
66	66	- 3 -
67	67	59 (5) "Agency funds" means money that an agency collects or receives for agency
68	68	60operations, implementing a project area plan or an implementation plan as defined in Section
69	69	6117C-1-1001, or other agency purposes, including:
70	70	62 (a) project area funds;
71	71	63 (b) income, proceeds, revenue, or property derived from or held in connection with the
72	72	64agency's undertaking and implementation of project area development or agency-wide project
73	73	65development as defined in Section 17C-1-1001;
74	74	66 (c) a contribution, loan, grant, or other financial assistance from any public or private
75	75	67source;
76	76	68 (d) project area incremental revenue as defined in Section 17C-1-1001; or
77	77	69 (e) property tax revenue as defined in Section 17C-1-1001.
78	78	70 (6) "Annual income" means the same as that term is defined in regulations of the
79	79	71United States Department of Housing and Urban Development, 24 C.F.R. Sec. 5.609, as
80	80	72amended or as superseded by replacement regulations.
81	81	73 (7) "Assessment roll" means the same as that term is defined in Section 59-2-102.
82	82	74 (8) "Base taxable value" means, unless otherwise adjusted in accordance with
83	83	75provisions of this title, a property's taxable value as shown upon the assessment roll last
84	84	76equalized during the base year.
85	85	77 (9) "Base year" means, except as provided in Subsection 17C-1-402(4)(c), the year
86	86	78during which the assessment roll is last equalized:
87	87	79 (a) for a pre-July 1, 1993, urban renewal or economic development project area plan,
88	88	80before the project area plan's effective date;
89	89	81 (b) for a post-June 30, 1993, urban renewal or economic development project area
90	90	82plan, or a community reinvestment project area plan that is subject to a taxing entity
91	91	83committee:
92	92	84 (i) before the date on which the taxing entity committee approves the project area
93	93	85budget; or
94	94	86 (ii) if taxing entity committee approval is not required for the project area budget,
95	95	87before the date on which the community legislative body adopts the project area plan;
96	96	88 (c) for a project on an inactive airport site, after the later of:
97	97	89 (i) the date on which the inactive airport site is sold for remediation and development; H.B. 557 02-23-23 11:59 AM
98	98	- 4 -
99	99	90or
100	100	91 (ii) the date on which the airport that operated on the inactive airport site ceased
101	101	92operations; or
102	102	93 (d) for a community development project area plan or a community reinvestment
103	103	94project area plan that is subject to an interlocal agreement, as described in the interlocal
104	104	95agreement.
105	105	96 (10) "Basic levy" means the portion of a school district's tax levy constituting the
106	106	97minimum basic levy under Section 59-2-902.
107	107	98 (11) "Board" means the governing body of an agency, as described in Section
108	108	9917C-1-203.
109	109	100 (12) "Budget hearing" means the public hearing on a proposed project area budget
110	110	101required under Subsection 17C-2-201(2)(d) for an urban renewal project area budget,
111	111	102Subsection 17C-3-201(2)(d) for an economic development project area budget, or Subsection
112	112	10317C-5-302(2)(e) for a community reinvestment project area budget.
113	113	104 (13) "Closed military base" means land within a former military base that the Defense
114	114	105Base Closure and Realignment Commission has voted to close or realign when that action has
115	115	106been sustained by the president of the United States and Congress.
116	116	107 (14) "Combined incremental value" means the combined total of all incremental values
117	117	108from all project areas, except project areas that contain some or all of a military installation or
118	118	109inactive industrial site, within the agency's boundaries under project area plans and project area
119	119	110budgets at the time that a project area budget for a new project area is being considered.
120	120	111 (15) "Community" means a county or municipality.
121	121	112 (16) "Community development project area plan" means a project area plan adopted
122	122	113under Chapter 4, Part 1, Community Development Project Area Plan.
123	123	114 (17) "Community legislative body" means the legislative body of the community that
124	124	115created the agency.
125	125	116 (18) "Community reinvestment project area plan" means a project area plan adopted
126	126	117under Chapter 5, Part 1, Community Reinvestment Project Area Plan.
127	127	118 (19) "Contest" means to file a written complaint in the district court of the county in
128	128	119which the agency is located.
129	129	120 (20) "Development impediment" means a condition of an area that meets the 02-23-23 11:59 AM H.B. 557
130	130	- 5 -
131	131	121requirements described in Section 17C-2-303 for an urban renewal project area or Section
132	132	12217C-5-405 for a community reinvestment project area.
133	133	123 (21) "Development impediment hearing" means a public hearing regarding whether a
134	134	124development impediment exists within a proposed:
135	135	125 (a) urban renewal project area under Subsection 17C-2-102(1)(a)(i)(C) and Section
136	136	12617C-2-302; or
137	137	127 (b) community reinvestment project area under Section 17C-5-404.
138	138	128 (22) "Development impediment study" means a study to determine whether a
139	139	129development impediment exists within a survey area as described in Section 17C-2-301 for an
140	140	130urban renewal project area or Section 17C-5-403 for a community reinvestment project area.
141	141	131 (23) "Economic development project area plan" means a project area plan adopted
142	142	132under Chapter 3, Part 1, Economic Development Project Area Plan.
143	143	133 (24) "Fair share ratio" means the ratio derived by:
144	144	134 (a) for a municipality, comparing the percentage of all housing units within the
145	145	135municipality that are publicly subsidized income targeted housing units to the percentage of all
146	146	136housing units within the county in which the municipality is located that are publicly
147	147	137subsidized income targeted housing units; or
148	148	138 (b) for the unincorporated part of a county, comparing the percentage of all housing
149	149	139units within the unincorporated county that are publicly subsidized income targeted housing
150	150	140units to the percentage of all housing units within the whole county that are publicly subsidized
151	151	141income targeted housing units.
152	152	142 (25) "Family" means the same as that term is defined in regulations of the United
153	153	143States Department of Housing and Urban Development, 24 C.F.R. Section 5.403, as amended
154	154	144or as superseded by replacement regulations.
155	155	145 (26) "Greenfield" means land not developed beyond agricultural, range, or forestry use.
156	156	146 (27) "Hazardous waste" means any substance defined, regulated, or listed as a
157	157	147hazardous substance, hazardous material, hazardous waste, toxic waste, pollutant, contaminant,
158	158	148or toxic substance, or identified as hazardous to human health or the environment, under state
159	159	149or federal law or regulation.
160	160	150 (28) "Housing allocation" means project area funds allocated for housing under Section
161	161	15117C-2-203, 17C-3-202, or 17C-5-307 for the purposes described in Section 17C-1-412. H.B. 557 02-23-23 11:59 AM
162	162	- 6 -
163	163	152 (29) "Housing fund" means a fund created by an agency for purposes described in
164	164	153Section 17C-1-411 or 17C-1-412 that is comprised of:
165	165	154 (a) project area funds, project area incremental revenue as defined in Section
166	166	15517C-1-1001, or property tax revenue as defined in Section 17C-1-1001 allocated for the
167	167	156purposes described in Section 17C-1-411; or
168	168	157 (b) an agency's housing allocation.
169	169	158 (30) (a) "Inactive airport site" means land that:
170	170	159 (i) consists of at least 100 acres;
171	171	160 (ii) is occupied by an airport:
172	172	161 (A) (I) that is no longer in operation as an airport; or
173	173	162 (II) (Aa) that is scheduled to be decommissioned; and
174	174	163 (Bb) for which a replacement commercial service airport is under construction; and
175	175	164 (B) that is owned or was formerly owned and operated by a public entity; and
176	176	165 (iii) requires remediation because:
177	177	166 (A) of the presence of hazardous waste or solid waste; or
178	178	167 (B) the site lacks sufficient public infrastructure and facilities, including public roads,
179	179	168electric service, water system, and sewer system, needed to support development of the site.
180	180	169 (b) "Inactive airport site" includes a perimeter of up to 2,500 feet around the land
181	181	170described in Subsection (30)(a).
182	182	171 (31) (a) "Inactive industrial site" means land that:
183	183	172 (i) consists of at least 1,000 acres;
184	184	173 (ii) is occupied by an inactive or abandoned factory, smelter, or other heavy industrial
185	185	174facility; and
186	186	175 (iii) requires remediation because of the presence of hazardous waste or solid waste.
187	187	176 (b) "Inactive industrial site" includes a perimeter of up to 1,500 feet around the land
188	188	177described in Subsection (31)(a).
189	189	178 (32) "Income targeted housing" means housing that is owned or occupied by a family
190	190	179whose annual income is at or below 80% of the median annual income for a family within the
191	191	180county in which the housing is located.
192	192	181 (33) "Incremental value" means a figure derived by multiplying the marginal value of
193	193	182the property located within a project area on which tax increment is collected by a number that 02-23-23 11:59 AM H.B. 557
194	194	- 7 -
195	195	183represents the adjusted tax increment from that project area that is paid to the agency.
196	196	184 (34) "Loan fund board" means the Olene Walker Housing Loan Fund Board,
197	197	185established under Title 35A, Chapter 8, Part 5, Olene Walker Housing Loan Fund.
198	198	186 (35) (a) " Local government building" means a building owned and operated by a
199	199	187community for the primary purpose of providing one or more primary community functions,
200	200	188including:
201	201	189 (i) a fire station;
202	202	190 (ii) a police station;
203	203	191 (iii) a city hall; or
204	204	192 (iv) a court or other judicial building.
205	205	193 (b) " Local government building" does not include a building the primary purpose of
206	206	194which is cultural or recreational in nature.
207	207	195 (36) "Major transit investment corridor" means the same as that term is defined in
208	208	196Section 10-9a-103.
209	209	197 (37) "Marginal value" means the difference between actual taxable value and base
210	210	198taxable value.
211	211	199 (38) "Military installation project area" means a project area or a portion of a project
212	212	200area located within a federal military installation ordered closed by the federal Defense Base
213	213	201Realignment and Closure Commission.
214	214	202 (39) "Municipality" means a city, town, or metro township as defined in Section
215	215	20310-2a-403.
216	216	204 (40) "Participant" means one or more persons that enter into a participation agreement
217	217	205with an agency.
218	218	206 (41) "Participation agreement" means a written agreement between a person and an
219	219	207agency that:
220	220	208 (a) includes a description of:
221	221	209 (i) the project area development that the person will undertake;
222	222	210 (ii) the amount of project area funds the person may receive; [and]
223	223	211 (iii) the terms and conditions under which the person may receive project area funds;
224	224	212and
225	225	213 (iv) how the project area development contributes to achieving the goals, policies, and H.B. 557 02-23-23 11:59 AM
226	226	- 8 -
227	227	214purposes in the project area plan; and
228	228	215 (b) is approved by resolution of the board.
229	229	216 (42) "Plan hearing" means the public hearing on a proposed project area plan required
230	230	217under Subsection 17C-2-102(1)(a)(vi) for an urban renewal project area plan, Subsection
231	231	21817C-3-102(1)(d) for an economic development project area plan, Subsection 17C-4-102(1)(d)
232	232	219for a community development project area plan, or Subsection 17C-5-104(3)(e) for a
233	233	220community reinvestment project area plan.
234	234	221 (43) "Post-June 30, 1993, project area plan" means a project area plan adopted on or
235	235	222after July 1, 1993, and before May 10, 2016, whether or not amended subsequent to the project
236	236	223area plan's adoption.
237	237	224 (44) "Pre-July 1, 1993, project area plan" means a project area plan adopted before July
238	238	2251, 1993, whether or not amended subsequent to the project area plan's adoption.
239	239	226 (45) "Private," with respect to real property, means property not owned by a public
240	240	227entity or any other governmental entity.
241	241	228 (46) "Project area" means the geographic area described in a project area plan within
242	242	229which the project area development described in the project area plan takes place or is
243	243	230proposed to take place.
244	244	231 (47) "Project area budget" means a multiyear projection of annual or cumulative
245	245	232revenues and expenses and other fiscal matters pertaining to a project area prepared in
246	246	233accordance with:
247	247	234 (a) for an urban renewal project area, Section 17C-2-201;
248	248	235 (b) for an economic development project area, Section 17C-3-201;
249	249	236 (c) for a community development project area, Section 17C-4-204; or
250	250	237 (d) for a community reinvestment project area, Section 17C-5-302.
251	251	238 (48) "Project area development" means activity within a project area that, as
252	252	239determined by the board, encourages, promotes, or provides development or redevelopment for
253	253	240the purpose of implementing a project area plan, including:
254	254	241 (a) promoting, creating, or retaining public or private jobs within the state or a
255	255	242community;
256	256	243 (b) providing office, manufacturing, warehousing, distribution, parking, or other
257	257	244facilities or improvements; 02-23-23 11:59 AM H.B. 557
258	258	- 9 -
259	259	245 (c) planning, designing, demolishing, clearing, constructing, rehabilitating, or
260	260	246remediating environmental issues;
261	261	247 (d) providing residential, commercial, industrial, public, or other structures or spaces,
262	262	248including recreational and other facilities incidental or appurtenant to the structures or spaces;
263	263	249 (e) altering, improving, modernizing, demolishing, reconstructing, or rehabilitating
264	264	250existing structures;
265	265	251 (f) providing open space, including streets or other public grounds or space around
266	266	252buildings;
267	267	253 (g) providing public or private buildings, infrastructure, structures, or improvements;
268	268	254 (h) relocating a business;
269	269	255 (i) improving public or private recreation areas or other public grounds;
270	270	256 (j) eliminating a development impediment or the causes of a development impediment;
271	271	257 (k) redevelopment as defined under the law in effect before May 1, 2006; or
272	272	258 (l) any activity described in this Subsection (48) outside of a project area that the board
273	273	259determines to be a benefit to the project area.
274	274	260 (49) "Project area funds" means tax increment or sales and use tax revenue that an
275	275	261agency receives under a project area budget adopted by a taxing entity committee or an
276	276	262interlocal agreement.
277	277	263 (50) "Project area funds collection period" means the period of time that:
278	278	264 (a) begins the day on which the first payment of project area funds is distributed to an
279	279	265agency under a project area budget approved by a taxing entity committee or an interlocal
280	280	266agreement; and
281	281	267 (b) ends the day on which the last payment of project area funds is distributed to an
282	282	268agency under a project area budget approved by a taxing entity committee or an interlocal
283	283	269agreement.
284	284	270 (51) "Project area plan" means an urban renewal project area plan, an economic
285	285	271development project area plan, a community development project area plan, or a community
286	286	272reinvestment project area plan that, after the project area plan's effective date, guides and
287	287	273controls the project area development.
288	288	274 (52) (a) "Property tax" means each levy on an ad valorem basis on tangible or
289	289	275intangible personal or real property. H.B. 557 02-23-23 11:59 AM
290	290	- 10 -
291	291	276 (b) "Property tax" includes a privilege tax imposed under Title 59, Chapter 4, Privilege
292	292	277Tax.
293	293	278 (53) "Public entity" means:
294	294	279 (a) the United States, including an agency of the United States;
295	295	280 (b) the state, including any of the state's departments or agencies; or
296	296	281 (c) a political subdivision of the state, including a county, municipality, school district,
297	297	282local district, special service district, community reinvestment agency, or interlocal cooperation
298	298	283entity.
299	299	284 (54) "Publicly owned infrastructure and improvements" means water, sewer, storm
300	300	285drainage, electrical, natural gas, telecommunication, or other similar systems and lines, streets,
301	301	286roads, curb, gutter, sidewalk, walkways, parking facilities, public transportation facilities, or
302	302	287other facilities, infrastructure, and improvements benefitting the public and to be publicly
303	303	288owned or publicly maintained or operated.
304	304	289 (55) "Record property owner" or "record owner of property" means the owner of real
305	305	290property, as shown on the records of the county in which the property is located, to whom the
306	306	291property's tax notice is sent.
307	307	292 (56) "Sales and use tax revenue" means revenue that is:
308	308	293 (a) generated from a tax imposed under Title 59, Chapter 12, Sales and Use Tax Act;
309	309	294and
310	310	295 (b) distributed to a taxing entity in accordance with Sections 59-12-204 and 59-12-205.
311	311	296 (57) "Superfund site":
312	312	297 (a) means an area included in the National Priorities List under the Comprehensive
313	313	298Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. Sec. 9605; and
314	314	299 (b) includes an area formerly included in the National Priorities List, as described in
315	315	300Subsection (57)(a), but removed from the list following remediation that leaves on site the
316	316	301waste that caused the area to be included in the National Priorities List.
317	317	302 (58) "Survey area" means a geographic area designated for study by a survey area
318	318	303resolution to determine whether:
319	319	304 (a) one or more project areas within the survey area are feasible; or
320	320	305 (b) a development impediment exists within the survey area.
321	321	306 (59) "Survey area resolution" means a resolution adopted by a board that designates a 02-23-23 11:59 AM H.B. 557
322	322	- 11 -
323	323	307survey area.
324	324	308 (60) "Taxable value" means:
325	325	309 (a) the taxable value of all real property a county assessor assesses in accordance with
326	326	310Title 59, Chapter 2, Part 3, County Assessment, for the current year;
327	327	311 (b) the taxable value of all real and personal property the commission assesses in
328	328	312accordance with Title 59, Chapter 2, Part 2, Assessment of Property, for the current year; and
329	329	313 (c) the year end taxable value of all personal property a county assessor assesses in
330	330	314accordance with Title 59, Chapter 2, Part 3, County Assessment, contained on the prior year's
331	331	315tax rolls of the taxing entity.
332	332	316 (61) (a) "Tax increment" means the difference between:
333	333	317 (i) the amount of property tax revenue generated each tax year by a taxing entity from
334	334	318the area within a project area designated in the project area plan as the area from which tax
335	335	319increment is to be collected, using the current assessed value of the property and each taxing
336	336	320entity's current certified tax rate as defined in Section 59-2-924; and
337	337	321 (ii) the amount of property tax revenue that would be generated from that same area
338	338	322using the base taxable value of the property and each taxing entity's current certified tax rate as
339	339	323defined in Section 59-2-924.
340	340	324 (b) "Tax increment" does not include taxes levied and collected under Section
341	341	32559-2-1602 on or after January 1, 1994, upon the taxable property in the project area unless:
342	342	326 (i) the project area plan was adopted before May 4, 1993, whether or not the project
343	343	327area plan was subsequently amended; and
344	344	328 (ii) the taxes were pledged to support bond indebtedness or other contractual
345	345	329obligations of the agency.
346	346	330 (62) "Taxing entity" means a public entity that:
347	347	331 (a) levies a tax on property located within a project area; or
348	348	332 (b) imposes a sales and use tax under Title 59, Chapter 12, Sales and Use Tax Act.
349	349	333 (63) "Taxing entity committee" means a committee representing the interests of taxing
350	350	334entities, created in accordance with Section 17C-1-402.
351	351	335 (64) "Unincorporated" means not within a municipality.
352	352	336 (65) "Urban renewal project area plan" means a project area plan adopted under
353	353	337Chapter 2, Part 1, Urban Renewal Project Area Plan. H.B. 557 02-23-23 11:59 AM
354	354	- 12 -
355	355	338 Section 2. Section 17C-1-603 is amended to read:
356	356	339 17C-1-603. Reporting requirements -- Governor's Office of Economic
357	357	340Opportunity to maintain a database -- Penalties for failure to provide the required
358	358	341reports.
359	359	342 (1) On or before June 1, 2022, the Governor's Office of Economic Opportunity shall:
360	360	343 (a) create a database to track information for each agency located within the state; and
361	361	344 (b) make the database publicly accessible from the office's website.
362	362	345 (2) (a) The Governor's Office of Economic Opportunity may:
363	363	346 (i) contract with a third party to create and maintain the database described in
364	364	347Subsection (1); and
365	365	348 (ii) charge a fee for a county, city, or agency to provide information to the database
366	366	349described in Subsection (1).
367	367	350 (b) The Governor's Office of Economic Opportunity shall make rules, in accordance
368	368	351with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, to establish a fee schedule for
369	369	352the fee described in Subsection (2)(a)(ii).
370	370	353 (3) Beginning in 2022, on or before June 30 of each calendar year, an agency shall, for
371	371	354each active project area for which the project area funds collection period has not expired,
372	372	355[provide] submit to the database described in Subsection (1) the following information:
373	373	356 (a) an assessment of the change in marginal value, including:
374	374	357 (i) the base year;
375	375	358 (ii) the base taxable value;
376	376	359 (iii) the prior year's assessed value;
377	377	360 (iv) the estimated current assessed value;
378	378	361 (v) the percentage change in marginal value; and
379	379	362 (vi) a narrative description of the relative growth in assessed value;
380	380	363 (b) the amount of project area funds the agency received for each year of the project
381	381	364area funds collection period, including:
382	382	365 (i) a comparison of the actual project area funds received for each year to the amount of
383	383	366project area funds forecasted for each year when the project area was created, if available;
384	384	367 (ii) (A) the agency's historical receipts of project area funds, including the tax year for
385	385	368which the agency first received project area funds from the project area; or 02-23-23 11:59 AM H.B. 557
386	386	- 13 -
387	387	369 (B) if the agency has not yet received project area funds from the project area, the year
388	388	370in which the agency expects each project area funds collection period to begin;
389	389	371 (iii) a list of each taxing entity that levies or imposes a tax within the project area and a
390	390	372description of the benefits that each taxing entity receives from the project area; and
391	391	373 (iv) the amount paid to other taxing entities under Section 17C-1-410, if applicable;
392	392	374 (c) a description of current and anticipated project area development, including:
393	393	375 (i) a narrative of any significant project area development, including infrastructure
394	394	376development, site development, participation agreements, or vertical construction; and
395	395	377 (ii) other details of development within the project area, including:
396	396	378 (A) the total developed acreage;
397	397	379 (B) the total undeveloped acreage;
398	398	380 (C) the percentage of residential development; and
399	399	381 (D) the total number of housing units authorized, if applicable;
400	400	382 (d) the project area budget, if applicable, or other project area funds analyses,
401	401	383including:
402	402	384 (i) each project area funds collection period, including:
403	403	385 (A) the start and end date of the project area funds collection period; and
404	404	386 (B) the number of years remaining in each project area funds collection period;
405	405	387 (ii) the amount of project area funds the agency is authorized to receive from the
406	406	388project area cumulatively and from each taxing entity, including:
407	407	389 (A) the total dollar amount; and
408	408	390 (B) the percentage of the total amount of project area funds generated within the
409	409	391project area;
410	410	392 (iii) the remaining amount of project area funds the agency is authorized to receive
411	411	393from the project area cumulatively and from each taxing entity; [and]
412	412	394 (iv) the amount of project area funds the agency is authorized to use to pay for the
413	413	395agency's administrative costs, as described in Subsection 17C-1-409(1), including:
414	414	396 (A) the total dollar amount; and
415	415	397 (B) the percentage of the total amount of all project area funds;
416	416	398 (v) the categories for budgetary expenditures; and
417	417	399 (vi) prior year actual expenditures, itemized by category; H.B. 557 02-23-23 11:59 AM
418	418	- 14 -
419	419	400 (e) the estimated amount of project area funds that the agency is authorized to receive
420	420	401from the project area for the current calendar year;
421	421	402 (f) the estimated amount of project area funds to be paid to the agency for the next
422	422	403calendar year;
423	423	404 (g) a map of the project area; and
424	424	405 (h) any other relevant information the agency elects to provide.
425	425	406 (4) (a) Until the Governor's Office of Economic Opportunity creates a database as
426	426	407required in Subsection (1), an agency shall, on or before November 1 of each calendar year,
427	427	408electronically submit a report to:
428	428	409 (i) the community in which the agency operates;
429	429	410 (ii) the county auditor;
430	430	411 (iii) the State Tax Commission;
431	431	412 (iv) the State Board of Education; and
432	432	413 (v) each taxing entity from which the agency receives project area funds.
433	433	414 (b) An agency shall ensure that the report described in Subsection (4)(a):
434	434	415 (i) contains the same information described in Subsection (3); and
435	435	416 (ii) is posted on the website of the community in which the agency operates.
436	436	417 (5) If an agency has no active project areas, the agency shall, on or before June 30 of
437	437	418each calendar year until the agency is dissolved under Section 17C-1-701.5, submit a report to
438	438	419the Governor's Office of Economic Opportunity stating that there are no active project areas.
439	439	420 [(5)] (6) Any information an agency submits in accordance with this section:
440	440	421 (a) is for informational purposes only; and
441	441	422 (b) does not alter the amount of project area funds that an agency is authorized to
442	442	423receive from a project area.
443	443	424 (7) (a) If an agency fails to comply with the reporting requirements under Subsections
444	444	425(3) through (5), and fails to cure the noncompliance:
445	445	426 (i) within three months after the day on which a report is due, the Governor's Office of
446	446	427Economic Opportunity shall refer the agency to the State Auditor for review; and
447	447	428 (ii) within six months after the day on which a report is due, the Governor's Office of
448	448	429Economic Opportunity shall publish a notice identifying the agency and describing the agency's
449	449	430noncompliance. 02-23-23 11:59 AM H.B. 557
450	450	- 15 -
451	451	431 (b) If an agency fails to comply with the reporting requirements under Subsections (3)
452	452	432through (5) for two consecutive years:
453	453	433 (i) the Governor's Office of Economic Opportunity shall notify the county auditor and
454	454	434treasurer of the noncompliance; and
455	455	435 (ii) the percent of tax increment funds to which the agency is entitled under the
456	456	436interlocal agreements with the taxing entities shall be reduced by 20 percentage points, until the
457	457	437Governor's Office of Economic Opportunity notifies the county auditor and treasurer that the
458	458	438agency has complied with the reporting requirements of this section.
459	459	439 [(6)] (8) The provisions of this section apply regardless of when the agency or project
460	460	440area is created.
461	461	441 Section 3. Section 17C-1-702 is amended to read:
462	462	442 17C-1-702. Project area dissolution -- Distribution of unexpended project area
463	463	443funds.
464	464	444 (1) Regardless of when a project area funds collection period ends, the project area
465	465	445remains in existence until:
466	466	446 (a) the agency adopts a resolution dissolving the project area; and
467	467	447 (b) the community legislative body adopts an ordinance dissolving the project area.
468	468	448 (2) The ordinance described in Subsection (1)(b) shall include:
469	469	449 (a) the name of the project area; and
470	470	450 (b) a project area map or boundary description.
471	471	451 (3) Within 30 days after the day on which the community legislative body adopts an
472	472	452ordinance described in Subsection (1)(b), the community legislative body shall:
473	473	453 (a) submit a copy of the ordinance to the county recorder of the county in which the
474	474	454dissolved project area is located; and
475	475	455 (b) mail or electronically submit a copy of the ordinance to the county auditor, the State
476	476	456Tax Commission, the State Board of Education, and each taxing entity that levies or imposes a
477	477	457tax on property within the dissolved project area.
478	478	458 (4) Project area funds that are unspent five years after the project area collection period
479	479	459ends shall be allocated in accordance with Subsection 17C-1-412(1)(b).
480	480	460 Section 4. Section 17C-5-105 is amended to read:
481	481	461 17C-5-105. Community reinvestment project area plan requirements. H.B. 557 02-23-23 11:59 AM
482	482	- 16 -
483	483	462 An agency shall ensure that each community reinvestment project area plan and
484	484	463proposed community reinvestment project area plan:
485	485	464 (1) subject to Section 17C-1-414, if applicable, includes a boundary description and a
486	486	465map of the community reinvestment project area;
487	487	466 (2) contains a general statement of the existing land uses, layout of principal streets,
488	488	467population densities, and building intensities of the community reinvestment project area and
489	489	468how each will be affected by project area development;
490	490	469 (3) states the standards that will guide project area development;
491	491	470 (4) shows how project area development will further purposes of this title;
492	492	471 (5) is consistent with the general plan of the community in which the community
493	493	472reinvestment project area is located and shows that project area development will conform to
494	494	473the community's general plan;
495	495	474 (6) if applicable, describes how project area development will eliminate or reduce a
496	496	475development impediment in the community reinvestment project area;
497	497	476 (7) describes any specific project area development that is the object of the community
498	498	477reinvestment project area plan;
499	499	478 (8) if applicable, explains how the agency plans to select a participant;
500	500	479 (9) states each reason the agency selected the community reinvestment project area;
501	501	480 (10) describes the physical, social, and economic conditions that exist in the
502	502	481community reinvestment project area;
503	503	482 (11) describes each type of financial assistance that the agency anticipates offering a
504	504	483participant;
505	505	484 (12) includes an analysis or description of the anticipated public benefit resulting from
506	506	485project area development, including benefits to the community's economic activity and tax
507	507	486base;
508	508	487 (13) includes the rationale for use of tax increment, including an analysis of whether
509	509	488the proposed project area development might reasonably be expected to occur in the
510	510	489foreseeable future solely through private investment;
511	511	490 [(13)] (14) if applicable, states that the agency shall comply with Section 9-8-404 as
512	512	491required under Section 17C-5-106;
513	513	492 [(14)] (15) for a community reinvestment project area plan that an agency adopted 02-23-23 11:59 AM H.B. 557
514	514	- 17 -
515	515	493before May 14, 2019, states whether the community reinvestment project area plan or proposed
516	516	494community reinvestment project area plan is subject to a taxing entity committee or an
517	517	495interlocal agreement; and
518	518	496 [(15)] (16) includes other information that the agency determines to be necessary or
519	519	497advisable.
520	520	498 Section 5. Section 63N-2-104.2 is amended to read:
521	521	499 63N-2-104.2. Written agreement -- Contents -- Grounds for amendment or
522	522	500termination.
523	523	501 (1) If the office determines that a business entity is eligible for a tax credit under
524	524	502Section 63N-2-104.1, the office may enter into a written agreement with the business entity
525	525	503that:
526	526	504 (a) establishes performance benchmarks for the business entity to claim a tax credit,
527	527	505including any minimum wage requirements;
528	528	506 (b) specifies the maximum amount of tax credit that the business entity may be
529	529	507authorized for a taxable year and over the life of the new commercial project, subject to the
530	530	508limitations in Section 63N-2-104.3;
531	531	509 (c) establishes the length of time the business entity may claim a tax credit;
532	532	510 (d) requires the business entity to retain records supporting a claim for a tax credit for
533	533	511at least four years after the business entity claims the tax credit;
534	534	512 (e) requires the business entity to submit to audits for verification of any tax credit
535	535	513claimed; and
536	536	514 (f) requires the business entity, in order to claim a tax credit, to meet the requirements
537	537	515of Section 63N-2-105.
538	538	516 (2) In establishing the terms of a written agreement, including the duration and amount
539	539	517of tax credit that the business entity may be authorized to receive, the office shall:
540	540	518 (a) authorize the tax credit in a manner that provides the most effective incentive for
541	541	519the new commercial project;
542	542	520 (b) consider the following factors:
543	543	521 (i) whether the new commercial project provides vital or specialized support to supply
544	544	522chains;
545	545	523 (ii) whether the new commercial project provides an innovative product, technology, or H.B. 557 02-23-23 11:59 AM
546	546	- 18 -
547	547	524service;
548	548	525 (iii) the number and wages of new incremental jobs associated with the new
549	549	526commercial project;
550	550	527 (iv) the amount of financial support provided by local government entities for the new
551	551	528commercial project;
552	552	529 (v) the amount of capital expenditures associated with the new commercial project;
553	553	530 (vi) whether the new commercial project returns jobs transferred overseas;
554	554	531 (vii) the rate of unemployment in the county in which the new commercial project is
555	555	532located;
556	556	533 (viii) whether the new commercial project creates a remote work opportunity;
557	557	534 (ix) whether the new commercial project is located in a development zone created by a
558	558	535local government entity as described in Subsection 63N-2-104(2);
559	559	536 (x) whether the business entity commits to hiring Utah workers for the new
560	560	537commercial project;
561	561	538 (xi) whether the business entity adopts a corporate citizenry plan or supports initiatives
562	562	539in the state that advance education, gender equality, diversity and inclusion, work-life balance,
563	563	540environmental or social good, or other similar causes;
564	564	541 (xii) whether the business entity's headquarters are located within the state;
565	565	542 (xiii) the likelihood of other business entities relocating to another state as a result of
566	566	543the new commercial project;
567	567	544 (xiv) the necessity of the tax credit for the business entity's expansion in the state or
568	568	545relocation from another state; [and]
569	569	546 (xv) whether the proposed new commercial project might be reasonably expected to
570	570	547occur in the foreseeable future solely through private investment; and
571	571	548 [(xv)] (xvi) the location and impact of the new commercial project on existing and
572	572	549planned transportation facilities, existing and planned housing, including affordable housing,
573	573	550and public infrastructure; and
574	574	551 (c) consult with the GO Utah board.
575	575	552 (3) (a) In determining the amount of tax credit that a business entity may be authorized
576	576	553to receive under a written agreement, the office may:
577	577	554 (i) authorize a higher or optimized amount of tax credit for a new commercial project 02-23-23 11:59 AM H.B. 557
578	578	- 19 -
579	579	555located within a development zone created by a local government entity as described in
580	580	556Subsection 63N-2-104(2); and
581	581	557 (ii) establish by rule made in accordance with Title 63G, Chapter 3, Utah
582	582	558Administrative Rulemaking Act, a process by which the office closely approximates the
583	583	559amount of taxes the business entity paid under Title 59, Chapter 12, Sales and Use Tax Act, for
584	584	560a capital project.
585	585	561 (b) The office may apply a process described in Subsection (3)(a)(ii) to a business
586	586	562entity only with respect to a new or amended written agreement that takes effect on or after
587	587	563January 1, 2022.
588	588	564 (4) If the office identifies any of the following events after entering into a written
589	589	565agreement with a business entity, the office and the business entity shall amend, or the office
590	590	566may terminate, the written agreement:
591	591	567 (a) a change in the business entity's organization resulting from a merger with or
592	592	568acquisition of another entity located in the state;
593	593	569 (b) a material increase in the business entity's retail operations that results in new state
594	594	570revenue not subject to the incentive; or
595	595	571 (c) an increase in the business entity's operations that:
596	596	572 (i) is outside the scope of the written agreement or outside the boundaries of a
597	597	573development zone; and
598	598	574 (ii) results in new state revenue not subject to the incentive.