Code of Massachusetts Regulations
760 CMR - HOUSING AND LIVABLE COMMUNITIES, EXECUTIVE OFFICE OF
Title 760 CMR 66.00 - Housing Development Incentive Program - Chapter 40v
Section 66.06 - HD Tax Increment Exemptions
Universal Citation: 760 MA Code of Regs 760.66
Current through Register 1531, September 27, 2024
In addition to the standards and requirements of M.G.L. c. 59, § 5M, HD Tax Increment Exemptions shall meet the following requirements.
(1) Calculation of Exemption. The amount of the HD Tax Increment Exemption to be given to a Sponsor of a HD Project shall be determined by applying the Exemption Percentage to the property tax on the Increment.
(a)
The Exemption Percentage. The Exemption Percentage shall be
not less than 10% and not more than 100%, negotiated by the Municipality and each
Sponsor and shall be specified in each HD Tax Increment Exemption Agreement. The
Exemption Percentage need not be the same for all Sponsors and may change from year
to year during the term of the HD Tax Increment Exemption pursuant to a schedule set
forth in the Tax Increment Exemption Agreement.
(b)
The Increment.
1. With respect to a HD Project in which the
residential portion is rental housing, the Increment is the assessed value of the
residential portion of the HD Project after construction or Substantial
Rehabilitation less the Base Value, the sum of which is multiplied by the percentage
of useable square footage comprising the Market Rate Residential Units to the total
useable square footage of the residential portion of the HD Project.
2. With respect to a HD Project in which the
residential portion is for-sale housing units, the Increment for a given Market Rate
Residential Unit is the assessed value of the residential portion of the HD Project
after construction or Substantial Rehabilitation less the Base Value, the sum of
which is multiplied by the percentage of useable square footage comprising all of
the Market Rate Residential Units to the total useable square footage of the
residential portion of the HD Project, the product of which is multiplied by the
percentage of useable square footage comprising the given Market Rate Residential
Unit to the total useable square footage of all Market Rate Residential
Units.
3. With respect to a HD Project
in which the residential portion is a mix of rental and for-sale housing, the
Increment is determined as follows:
a. For the
rental portion, the assessed value attributed to the rental housing less the Base
Value for the rental portion, the sum of which is multiplied by the percentage of
useable square footage comprising the rental Market Rate Residential Units to the
total useable square footage of the rental residential portion of the HD
Project.
b. For a given unit in the
for-sale portion, the assessed value attributed to the for-sale portion less the
Base Value for the for-sale portion, the sum of which is multiplied by the
percentage of useable square footage comprising all of the for-sale Market Rate
Residential Units to the total useable square footage of the for-sale portion of the
HD Project, the product of which is multiplied by the percentage of useable square
footage comprising the given for-sale Market Rate Residential Unit to the total
useable square footage of all for-sale Market Rate Residential Units.
(c)
Base
Value. The Base Value is the assessed value of the parcel of the
property as of the fiscal year in which a HD Tax Increment Exemption Agreement is
executed by the Sponsor and the Municipality with respect to that parcel, and prior
to the start of any new construction or Substantial Rehabilitation activities,
including demolition minus the assessed value attributable to any portion of the
property that was assessed as other than residential in the applicable fiscal year
and remains non residential after completion of new construction or Substantial
Rehabilitation. In the case of HD Projects in which the residential housing is a mix
of rental and for sale units, the Base Value shall be apportioned between the rental
and for sale units based upon their respective proportion of the usable square
footage upon the completion of new construction or Substantial
Rehabilitation.
(2) HD Tax Increment Exemption Agreements. The terms of a HD Tax Increment Exemption shall be set forth in a HD Tax Increment Exemption Agreement executed by the Sponsor and the Municipality.
(a)
Effective Date of the Agreement. HD Tax Increment Exemption
Agreements shall provide that they shall not go into effect unless and until:
1. The Department approves the Tax Increment
Exemption Agreement; and
2. The
Department has issued a Final Certificate for the HD Project. Upon approval by the
Department, HD Tax Increment Exemption Agreements shall be made part of the
appropriate HD Zone Plan.
(b)
Effective Date of Exemption. HD Tax Increment Exemption
Agreements shall provide that the Tax Increment Exemption shall be effective as of
the first fiscal year subsequent to the completion of new construction or
Substantial Rehabilitation.
(c)
Increment and Base Value Calculations. HD Tax Increment
Agreement shall contain an explanation in support of any assumptions or calculations
related to the Increment and Base Value.
(d)
Department Approval.
Provided that the Tax Increment Exemption meets the standards and requirements of
760 CMR 66.06 and the Department's approval of the applicable HD Agreement has not
been suspended or revoked, the Department shall approve a Tax Increment Exemption
Agreement.
Disclaimer: These regulations may not be the most recent version. Massachusetts may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
