[Adopted 2-9-2015 by Ord. No. 369]
A.
Ensuring the development of affordable, healthy, and safe housing
for the residents is a priority for the Town of Charlestown.
B.
Development of LMIH requires complex financing and deed restrictions
that limit both the amount of rent that may be charged, and the income
levels of tenants, making predictability in operating expenses crucial
for the success and viability of LMIH projects.
C.
Deed-restricted LMIH projects require public and private investment,
and the application of the so-called "8 percent tax treatment" prescribed
in R.I.G.L. § 44-5-13.11 and application of an exemption
from the tax assessment prescribed in R.I.G.L. § 44-3-13.4
represents the Town's investment in such LMIH projects.
The following definitions shall apply to this article:
Newly constructed or rehabilitated residential rental units
that are encumbered by a covenant recorded in the land records in
favor of a governmental unit or Rhode Island housing and mortgage
finance corporation restricting either or both the rents that may
be charged to tenants of the property or the incomes of the occupants
of the property, as referenced in R.I.G.L. § 44-5-13.11
and 44-3-13.4 and have been issued a certificate of occupancy, whether
or not occupied.
Eight (8) percent of a Qualifying LMIH property's previous
year's gross scheduled rental income and/or tax payment due the Town.
A.
Owners of Qualifying LMIH properties shall make annual payments that
equal eight (8) percent of the property's previous year's gross scheduled
rental income and/or tax payment due the Town, as set forth elsewhere
herein this ordinance provision.
B.
In the case of Qualifying LMIH rental units which have been substantially
rehabilitated pursuant to the relevant provisions of R.I.G.L. 44-5-13.11,
a tax that equals eight percent (8%) of the property's previous year's
gross scheduled rental income or a lesser percentage as determined
by each municipality.
C.
In the case of Qualifying LMIH rental property which do not otherwise fall under the provisions of Subsection B, an exemption from taxation shall be applied by the tax assessor under the provisions of R.I.G.L. 44-3-13.4 that will constitute a tax that equals eight (8) percent of the property's previous year's gross scheduled rental income.
D.
Payments shall be made in a lump sum during the first quarter of
the applicable tax year.
E.
On or before March 1st the owners of Qualifying LMIH properties shall
submit to the tax assessor documentation of the previous year's gross
scheduled rental income. Documentation shall include and annual application
and gross rental income calculations.
F.
The tax assessor shall review the documentation required in Subsection E, and determine the dollar amount of the eight (8) percent payment due to be collected from the Qualifying LMIH property owner.
G.
The tax assessor shall forward to the tax collector the eight (8)
percent payment data.
H.
In the event that the eight (8) percent payment in lieu of taxes
is not received in a timely manner, the Town reserves the right to
assess taxes in the same form and manner as for other taxpayers in
the Town.
I.
During the construction/re-construction phases of these projects,
the tax assessor shall assess the development of construction similar
to all other building permit assessment practices, whereas the property
value will be established at the percentage of completed construction
on December 31 annually.
A.
Owners of Qualifying LMIH properties who do not submit the proper
documentation within thirty (30) days of the deadline shall be assessed
at the tax rate that applies to the property's standard classification.
Upon submission of proper documentation, the eight percent rate shall
be reapplied prospectively.
B.
Should the property no longer maintain the property as Qualifying
LMIH, the property shall be assessed at the tax rate that applies
to the property's standard classification.
