Goodman B. Duke
General Contractor, Inc.
(434) 974-1812 info@gbduke.com

Special Topics: Solar Energy Tax Exemptions


 

AN ORDINANCE AMENDING AND PREORDAINING ARTICLE V OF CHAPTER 30 OF THE CHARLOTTESVILLE CITY CODE, 1990, AS AMENDED BY ADDING A NEW DIVISION TO ARTICLE V, TO BE NUMBERED SECTIONS 30-155 THROUGH 30-160 RELATING TO TAX EXEMPTIONS FOR REHABILITATED RESIDENTIAL STRUCTURES

BE IT ORDAINED by the Council of the City of Charlottesville, Virginia, that a new division is hereby added to Article V of Chapter 30 of the Code of the City of Charlottesville, 1990 , as amended, to be numbered Sections 30-155 through 30-160, to read as follows:

ARTICLE V. Tax Exemption for Solar Energy and Recycling Equipment, Facilities and Devices; Certain Rehabilitated Residential Structures

Division 3. Partial Property Tax Exemption for Certain Rehabilitated Residential Structures.

Section 30-155. Granted

This division authorizes a partial exemption for improved real estate from general real estate tax, for real estate containing a structure or other improvement that has been rehabilitated, renovated or replaced for residential use in accordance with Va. Code 58.1-3220 and the provisions of this division. The exemption provided by this division shall not be available for any improvements made to unimproved real property.

Section 30-156. Requirements for qualification.

(a) For the purposes of this division the term "residential real property" shall mean a building or structure which has itself undergone, or will undergo, substantial rehabilitation, renovation or replacement for residential use. The term "residential use" shall mean occupied, or designed to be occupied, by not more than one (1) family.

(b) In order to qualify for the exemption from real property taxation provided by this division, residential real property shall meet all the following criteria:

(i) The building or structure must be no less than 25 years of age at the time application is filed pursuant to this division.

(ii) The building or structure itself must have been substantially rehabilitated, renovated or replaced for residential use. For the purposes of this division, the phrase "substantially rehabilitated, renovated or replaced" with respect to residential real estate, shall mean a building of structure which has been so improved that its assessed value has been increased by no less than twenty percent (20%).

(a) For the purposes of this division, additions to a residential structure shall be considered rehabilitation, renovation, or replacement of that structure.

(b) the following improvements, and other similar improvements not attached to the primary residential structure, even if they improve the value of real estate, shall not serve as the basis for an exemption under this division: swimming pools, detached garages, detached offices or workshops.

(iii) The building or structure must be designed for and suitable for residential use and must be the primary residential structure on the site following its substantial rehabilitation, renovation or replacement.

(iv) Following completion of substantial rehabilitation, renovation, or replacement, the building or structure must be owned and occupied by the taxpayer who applies for the exemption. Thereafter, any exemption granted shall run with the real estate, accruing to the benefit of the owner, subject to the provision of 30-157(b) herein.

(v) All improvements made to the building or structure must have been made under and in accordance with all applicable building and zoning regulations and permits, and upon completion of substantial rehabilitation, renovation or replacement the building or structure must conform to all applicable zoning regulations.

(vi) Residential real property that has been improved by the demolition and razing of an existing building or structure and construction of a replacement structure, may qualify for an exemption under this division; however, the exemption shall not apply when any structure which has been razed or demolished is a registered Virginia landmark or is determined by the Virginia Department of Historic Resources to contribute to the significance of a registered historic district.

(c) No building or structure shall be eligible for the exemption if the City Assessor has been denied access to the entire premises (for the purpose of determining a Base Value and whether there has been substantial rehabilitation, renovation or replacement of a building or structure) either before the commencement of any work for which exemption is sought or after completion of such work.

(d) At any time prior to November 1 of any calendar year in which rehabilitation, renovation, or replacement of a building or structure is complete, an owner may submit a written request to the City Assessor for an inspection to determine if it has been substantially rehabilitated, renovated or replaced and if the building or structure qualifies in all other aspects for an exemption under this division. After the City Assessor has determined that the building or structure qualifies them the exemption shall become effective on January 1 of the next calendar year.

(e) Except with respect to the determination of the substantiality of rehabilitation, renovation or replacement, which shall be determined by the City Assessor, the burden of proof shall be on the applicant to show that the residential real estate for which exemption is sought complies with all the eligibility criteria established by this division. The City Assessor may require documentary proof of eligibility and, in such cases, documentation satisfactory to the City Assessor shall be presented.

Section 30-157. Amount of exemption, effective date and duration.

(a) The amount of the exemption from real property taxation provided for by this division shall be an amount equal to the difference in the Base Value of the qualifying building or structure and the assessed value of the building or structure upon completion of substantial rehabilitation, renovation, or replacement, as determined by the City Assessor. This amount only, on a fixed basis, shall constitute the exemption, notwithstanding subsequent assessment or reassessment.

(b) The exemption allowed by this division shall commence on January 1st of the tax year following the City Assessor's determination that a building or structure qualifies for the exemption and shall run with the real estate for a period of seven (7) years ("Eligibility Period"). However, if at any time during the Eligibility Period the building or structure ceases to be occupied by the person who owns the residential real estate, then the exemption shall automatically expire at the end of the tax year in which the property ceases to be so occupied.

(c) If the assessed value of qualifying residential real estate increases after the first year of the Eligibility Period, the exemption specified by paragraph (b) of this section shall not be increased. If the assessed value of the qualifying residential real estate decreases after the first year of the Eligibility Period, the exemption specified by paragraph (b) shall be limited, in that the exemption shall not reduce the real estate tax below an amount equal to the amount of the real property tax calculated on the Base Value. If the assessed value of the qualifying residential real estate decreases below the Base Value after the first year of the Eligibility Period, then the property shall be assessed at full assessed value for that year, and no exemption shall be granted for that year.

(d) No exemption for which any property owner is eligible under this division shall be granted to the owner of any residential real estate, if the real estate tax o that real estate has not been paid on or before the date on which it is due. Failure to pay the tax on such real estate in any year, o or before the date on which the tax is due, shall result in the forfeiture of any exemption that otherwise would have been applied to the tax in that year. In such circumstances, the annual real estate tax shall be assessed on the full fair market value of the improved real estate.

Section 30-158. Treasurer to be furnished annual list of exemptions; contents of list.

Annually on or before April 30th in each tax year, the City Assessor shall furnish to the City Treasurer a list of all exemptions under this division effective as of the beginning of such tax year. Such list shall show the value of each applicable exemption, multiplied by the tax rate established for the year in question and extended to show the amount of the real estate tax on each such property to be exempted in each year.

Section 30-159. Exemption to be credited against real estate taxes.

The City Treasurer shall be entitled to credit the amounts certified by the City Assessor under section 30-158 against the total real estate taxes shown o the land book for the tax year in question and shall indicate the amount of each such exemption as a credit on the tax tickets of each qualifying property. Under no circumstances shall the exemption available under this division be applied to any property other than the qualifying residential real estate for which the exemption has been obtained, nor shall the exemption be applied in any calendar year to real estate taxes assessed in any other calendar year.

Section 30-160. Administration.

(a) The owner of residential real estate who seeks to obtain the exemption authorized by this division shall apply to qualify for the exemption at the same time he applies for a building permit to rehabilitate, renovate or replace a building or structure. The application of exemption shall be filed with the City Assessor.

(b) Upon receipt of an application to qualify for the exemption provided by this division, the City Assessor shall determine a base fair market value assessment for the building or structure prior to commencement of any improvements for which exemption is sought. The base fair market value shall be the most recent assessment of the building of structure for which the application is submitted ("Base Value").

(c) The application to qualify for the tax exemption shall be effective until December 31 of the calendar year following the year in which the application was filed. If, by such expiration date, rehabilitation, renovation or replacement has not progressed to the point that it may be determined to be substantial, compared with the Base Value, and if the applicant desires to proceed, then a new application shall be filed and the City Assessor shall establish a new Base Value.

(d) All initial and subsequent applications for the partial exemption allowed by this division shall be accompanied by payment of a non-refundable fee, in the amount of $50 for processing the application.

(e) During the period an application remains pending, the owner shall remain subject to real estate taxation upon the full assessed value of the residential real estate.

(f) The exemption provided by this division shall be administered by the City Assessor and the City Treasurer. Such officials are hereby authorized and directed to adopt and enforce such reasonable rules and regulations,not in conflict with the provisions of this division, as may be reasonably necessary to implement the exemptions authorized by this division.

(g) This division shall be applicable to assessments of qualifying residential real estate made on and after January 1, 2001; however, no new application for the exemption provided by this division shall be accepted after September 1, 2006.

(h) The exemption provided by this division shall not affect any special district taxes or levies within the City. All such taxes shall be computed on the full assessed value of the qualifying real estate.

(i) Nothing within this division shall be construed to permit the City Assessor to list upon the land book any reduced value due to the exemption provided herein.

(j) In determining the Base Value of any residential real estate, and in determining whether any building or structure has been substantially rehabilitated, renovated or replaced, the City Assessor shall employ usual and customary methods of assessing real estate and improvements thereon.

(k) No residential real estate which has been determined to qualify for an exemption under this division shall be eligible to submit any application for further tax credits based o subsequent improvements during the pendency of the initial Eligibility Period. Notwithstanding the foregoing, if residential real estate which has qualified for a tax exemption in accordance with this division is damaged by an occurrence beyond the control of the owner or occupant, and if such residential real estate otherwise is qualified under this division, then the owner may apply for a tax exemption based on the then present value of the damaged residential real estate, and the qualification for any new tax exemption shall supersede and extinguish any tax exemption that may have been available under the previous qualification. For the purpose of this subdivision, the phrase "an occurrence beyond the control of the owner or occupant" shall refer to an event such as a fire, flood or windstorm that reduces the assess value of the residential real estate by no less than twenty-five percent (25%). Approved by Council March 20, 2000