42-6010. Retail business location municipal
tax incentives; prohibition; penalty; exceptions;
definitions
A. If at least sixty-five per cent of the land area within a city's or town's
exterior boundaries is located within the exterior boundary of a metropolitan statistical
area having a population of more than two million persons, the city or town shall not
offer or provide a tax incentive to a business entity as an inducement or in exchange for
locating or relocating a retail business facility in the city or town.
B. A city or town that violates this section is subject to a penalty equal to the
amount of the incentive realized by the taxpayer, extended over a period of sixty months.
The department of revenue shall notify the state treasurer to withhold the amount of the
penalty from monies otherwise payable to the city or town as provided by section 42-5029,
subsection J.
C. The city or town shall report to the department of revenue the value of any tax
incentive used as an inducement or in exchange for locating or relocating a retail
business facility in the city or town. For the purposes of this subsection, the value
includes all negotiated amounts, in any form and whether actual, realized or contingent,
over the term of the incentive agreement.
D. This section does not apply with respect to:
1. Municipal services and benefits generally afforded by ordinance to all new
businesses in the city or town, having no direct affect on municipal tax levies.
2. Tax incentives that are afforded to all existing retail business facilities in
the city or town.
3. Tax incentives for locating retail business facilities in an area designated as
a redevelopment project pursuant to title 36, chapter 12, article 3 where the average
household income is less than the average city household income as determined by the
United States census bureau.
4. Incentives consisting of reimbursement for public infrastructure dedicated to
and accepted and controlled upon completion of the project by the city or town, county,
state or a private utility where no other political subdivision provides such utility for
transportation, water, sewer, electrical, drainage, the fair market value of real
property necessary for the public infrastructure and other necessary public
infrastructure. This paragraph does not apply to parking lots, parking structures or
parking facilities or other structures or amenities owned or controlled by a private
entity.
5. Incentives that are offered for the purpose of preserving historical buildings
and other structures.
6. Incentives that are offered for cleanup or other remediation activities at a
brownfields site under title 49, chapter 2, article 1.1 or the comprehensive
environmental response, compensation, and liability act of 1980 (P.L. 96-510, 94 Stat.
2767; 42 United States Code sections 9601 through 9657), commonly known as "superfund".
E. To qualify as exempt from the penalty, an incentive under subsection D of this
section that is offered in exchange for expenses incurred by the business entity must be
in the form of a reimbursement of the expenses and may not exceed or otherwise be
disproportional to the actual cost incurred.
F. This section does not apply to tax incentives that were referred to a vote of
the qualified electors of the city or town before July 1, 2007 and approved by the
qualified electors of the city or town.
G. For the purposes of this section:
1. "Metropolitan statistical area" means a geographical area consisting of cities,
towns and other populated areas defined for federal statistical and census purposes by
the United States office of management and budget with technical assistance from the
United States bureau of the census.
2. "Retail business facility" means a store, warehouse or other improvement to real
estate where at least one-half of the business conducted on the premises consists of
retail sales of tangible personal property to the ultimate consumer, measured by either
the number of employees assigned to retail sales or the square footage of the facility
used for retail sales. For the purposes of this paragraph, retail sales do not include:
(a) Sales of food and beverage for consumption on the premises of the facility.
(b) The distribution without charge of promotional products that display the
company logo or trademark.
(c) Sales solely to company employees.
3. "Tax incentive" means any waiver, exemption, deduction, credit, rebate,
discount, deferral or other abatement or reduction of the normal municipal tax liability
of an individual taxpayer that otherwise applies to similar existing taxpayers and
properties in the city or town, however denominated, computed or applied, and generally
understood as an inducement for the taxpayer to locate a business facility or other
operation in the city or town.
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