H*2960 Session 107 (1987-1988)
H*2960(Rat #0287, Act #0200 of 1987) General Bill, By J.H. Toal
A Bill to amend Sections 31-6-40, 31-6-70, 31-6-80, 31-6-100, and 31-6-110,
Code of Laws of South Carolina, 1976, relating to tax increment financing for
redevelopment projects, so as to provide that all references in Chapter 6 of
Title 31 to "obligations" are considered to include those obligations a
municipality may issue to refund, in whole or in part, obligations it has
previously issued under the authority of the Chapter; change the base year for
calculating the increment from the year after the bonds are issued to the year
in which the plan is adopted by the municipality but not to exceed a five-year
period after the adoption of the ordinance, provide that when bonds have been
retired and redevelopment project costs are paid or budgeted all funds
remaining in the special tax allocation fund must be paid to the taxing
districts, provide that if bonds have not been issued within the five-year
period, the redevelopment project area designation is terminated; require that
the maximum estimated term of bonds be stated in a notice of a public hearing,
add a condition that a taxing district is considered to have consented to the
redevelopment plan if the actual term of obligations issued is equal to or
less than the term stated in the notice of public hearing, provide that no
consent is required of any taxing district if the term of additional refunding
bonds is not greater than the latter of fifteen years from the date of the
initial or refunding bonds or the remaining term of the bonds, add to the list
of alterations which must be approved by ordinance the maximum term of
maturity of obligations to be issued under the plan; substitute the county
auditor for the county assessor as the proper official to certify the assessed
value of the property within the redevelopment project; and authorize a
municipality to avail itself of any powers granted under provisions of law
which provide for the financing of water and sewer systems instead of
authorizing the revenues from these systems to be pledged to secure the bonds
issued under the provisions of Chapter 6 of Title 31 (Tax Increment Financing
Law).-amended title
04/14/87 House Introduced and read first time HJ-1840
04/14/87 House Referred to Committee on Ways and Means HJ-1840
05/13/87 House Committee report: Favorable with amendment Ways
and Means HJ-2643
05/20/87 House Amended HJ-3013
05/20/87 House Read second time HJ-3021
05/21/87 House Read third time and sent to Senate HJ-3069
05/26/87 Senate Introduced and read first time SJ-2304
05/26/87 Senate Referred to Committee on Finance SJ-2304
06/03/87 Senate Recalled from Committee on Finance SJ-2677
06/03/87 Senate Read second time SJ-2753
06/03/87 Senate Ordered to third reading with notice of
amendments SJ-2753
06/04/87 Senate Amended SJ-2837
06/04/87 Senate Read third time SJ-2840
06/04/87 Senate Returned SJ-2840
06/04/87 House Concurred in Senate amendment and enrolled HJ-3773
06/25/87 Ratified R 287
07/21/87 Signed By Governor
07/21/87 Effective date 07/21/87
07/21/87 Act No. 200
08/20/87 Copies available
(A200, R287, H2960)
AN ACT TO AMEND SECTIONS 31-6-40, 31-6-70, 31-6-80, 31-6-100, AND 31-6-110,
CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO TAX INCREMENT FINANCING FOR
REDEVELOPMENT PROJECTS, SO AS TO PROVIDE THAT ALL REFERENCES IN CHAPTER 6 OF
TITLE 31 TO "OBLIGATIONS" ARE CONSIDERED TO INCLUDE THOSE OBLIGATIONS
A MUNICIPALITY MAY ISSUE TO REFUND, IN WHOLE OR IN PART, OBLIGATIONS IT HAS
PREVIOUSLY ISSUED UNDER THE AUTHORITY OF THE CHAPTER; CHANGE THE BASE YEAR FOR
CALCULATING THE INCREMENT FROM THE YEAR AFTER THE BONDS ARE ISSUED TO THE YEAR
IN WHICH THE PLAN IS ADOPTED BY THE MUNICIPALITY BUT NOT TO EXCEED A FIVE-YEAR
PERIOD AFTER THE ADOPTION OF THE ORDINANCE, PROVIDE THAT WHEN BONDS HAVE BEEN
RETIRED AND REDEVELOPMENT PROJECT COSTS ARE PAID OR BUDGETED ALL FUNDS REMAINING
IN THE SPECIAL TAX ALLOCATION FUND MUST BE PAID TO THE TAXING DISTRICTS, PROVIDE
THAT IF BONDS HAVE NOT BEEN ISSUED WITHIN THE FIVE-YEAR PERIOD, THE REDEVELOPMENT
PROJECT AREA DESIGNATION IS TERMINATED; REQUIRE THAT THE MAXIMUM ESTIMATED TERM
OF BONDS BE STATED IN A NOTICE OF A PUBLIC HEARING, ADD A CONDITION THAT A TAXING
DISTRICT IS CONSIDERED TO HAVE CONSENTED TO THE REDEVELOPMENT PLAN IF THE ACTUAL
TERM OF OBLIGATIONS ISSUED IS EQUAL TO OR LESS THAN THE TERM STATED IN THE NOTICE
OF PUBLIC HEARING, PROVIDE THAT NO CONSENT IS REQUIRED OF ANY TAXING DISTRICT IF
THE TERM OF ADDITIONAL REFUNDING BONDS IS NOT GREATER THAN THE LATTER OF FIFTEEN
YEARS FROM THE DATE OF THE INITIAL OR REFUNDING BONDS OR THE REMAINING TERM OF
THE BONDS, ADD TO THE LIST OF ALTERATIONS WHICH MUST BE APPROVED BY ORDINANCE THE
MAXIMUM TERM OF MATURITY OF OBLIGATIONS TO BE ISSUED UNDER THE PLAN; SUBSTITUTE
THE COUNTY AUDITOR FOR THE COUNTY ASSESSOR AS THE PROPER OFFICIAL TO CERTIFY THE
ASSESSED VALUE OF THE PROPERTY WITHIN THE REDEVELOPMENT PROJECT; AND AUTHORIZE
A MUNICIPALITY TO AVAIL ITSELF OF ANY POWERS GRANTED UNDER PROVISIONS OF LAW
WHICH PROVIDE FOR THE FINANCING OF WATER AND SEWER SYSTEMS INSTEAD OF AUTHORIZING
THE REVENUES FROM THESE SYSTEMS TO BE PLEDGED TO SECURE THE BONDS ISSUED UNDER
THE PROVISIONS OF CHAPTER 6 OF TITLE 31 (TAX INCREMENT FINANCING LAW).
Be it enacted by the General Assembly of the State of South Carolina:
Reference to obligations
SECTION 1. The fifth paragraph of Section 31-6-40 of the 1976 Code is amended
to read:
"A municipality also may issue its obligations to refund in whole or in
part obligations previously issued by the municipality under the authority of
this chapter, whether at or prior to maturity and all references in this chapter
to 'obligations' are considered to include these refunding obligations."
Obligations may be issued; conditions
SECTION 2. Section 31-6-70 of the 1976 Code is amended to read:
"Section 31-6-70. A municipality, within five years after the date of
adoption of an ordinance providing for approval of a redevelopment plan pursuant
to Section 31-6-80, may issue obligations under this chapter to finance the
redevelopment project upon adoption of an ordinance providing that:
(1) after the issuance of the obligations; and
(2) after the total equalized assessed valuation of the taxable real property
in a redevelopment project area exceeds the certified 'total initial equalized
assessed value' established in accordance with Section 31-6-100(B) of all taxable
real property in the project area, the ad valorem taxes, if any, arising from the
levies upon taxable real property in the project area by taxing districts and tax
rates determined in the manner provided in Section 31-6-100(B) each year after
the obligations have been issued until obligations issued under this chapter have
been retired and redevelopment project costs have been paid must be divided as
follows:
(a) That portion of taxes levied upon each taxable lot, block, tract, or
parcel of real property which is attributable to the total initial equalized
assessed value of all taxable real property in the redevelopment project area
must be allocated to and when collected must be paid by the county treasurer to
the respective affected taxing districts in the manner required by law in the
absence of the adoption of the redevelopment plan; and
(b) That portion, if any, of taxes which is attributable to the increase in
the current total equalized assessed valuation of all taxable real property in
the redevelopment project area over and above the total initial equalized
assessed value of taxable real property in the redevelopment project area must
be allocated to and when collected must be paid to the municipality which shall
deposit the taxes into a special fund called the special tax allocation fund of
the municipality for the purpose of paying redevelopment project costs and
obligations incurred in the payment of the costs and obligations. The
municipality may pledge in the ordinance the funds in and to be deposited in the
special tax allocation fund for the payment of the costs and obligations.
Any ordinance adopted based on acts of the municipality occurring before the
effective date of this chapter must incorporate by reference and adopt those
prior acts undertaken in accordance with the procedures of this chapter as if
they had been undertaken pursuant to this chapter.
When obligations issued under this chapter have been retired and redevelopment
project costs incurred under this chapter have been paid or budgeted pursuant to
the redevelopment plan, as evidenced by resolution of the governing body of the
municipality, all surplus funds then remaining in the special tax allocation fund
must be paid by the municipal treasurer to the county treasurer who immediately,
after receiving the payment, shall pay the funds to the taxing districts in the
redevelopment project area in the same manner and proportion as the most recent
distribution by the treasurer to the affected districts of real property taxes
from real property in the redevelopment project area.
Upon the payment of all redevelopment project costs, retirement of all
obligations of a municipality issued under this chapter, and the distribution of
any surplus monies pursuant to this section, the municipality shall adopt an
ordinance dissolving the tax allocation fund for the project redevelopment area
and terminating the designation of the redevelopment project area as a
redevelopment project area for purposes of this chapter. Thereafter, the rates
of the taxing districts must be extended and taxes levied, collected, and
distributed in the manner applicable in the absence of the adoption of a
redevelopment plan and the issuance of obligations under this chapter.
If five years have passed from the time a redevelopment project area is
designated and the municipality has not issued obligations under this chapter to
finance the redevelopment project, upon the expiration of the five-year term, the
municipality shall adopt an ordinance terminating the designation of the
redevelopment project area."
Requirements of ordinance
SECTION 3. Section 31-6-80 of the 1976 Code is amended to read:
"Section 31-6-80. Prior to the issuance of any obligations under this
chapter, the municipality shall set forth by way of ordinance the following:
(a) a copy of the redevelopment plan containing a statement of the objectives
of a municipality with regard to the plan;
(b) a statement indicating the need for and proposed use of the proceeds of
the obligations in relationship to the redevelopment plan;
(c) a statement containing the cost estimates of the redevelopment plan and
redevelopment project and the projected sources of revenue to be used to meet the
costs including estimates of tax increments and the total amount of indebtedness
to be incurred;
(d) a list of all real property in the redevelopment project area;
(e) the duration of the redevelopment plan;
(f) a statement of the estimated impact of the redevelopment plan upon the
revenues of all taxing districts in which a redevelopment project area is
located;
(g) findings that (i) the redevelopment project area is a blighted or
conservation area and that private initiatives are unlikely to alleviate these
conditions without substantial public assistance, (ii) property values in the
area would remain static or decline without public intervention, and (iii)
redevelopment is in the interest of the health, safety, and general welfare of
the citizens of the municipality.
Before approving any redevelopment plan under this chapter, the governing body
of the municipality must hold a public hearing on the redevelopment plan after
published notice in a newspaper of general circulation in the county in which the
municipality and any taxing district affected by the redevelopment plan is
located not less than fifteen days and not more than thirty days prior to the
hearing. The notice shall include:
(1) the time and place of the public hearing;
(2) the boundaries of the proposed redevelopment project area;
(3) a notification that all interested persons will be given an opportunity to
be heard at the public hearing;
(4) a description of the redevelopment plan and redevelopment project; and
(5) the maximum estimated term of obligations to be issued under the
redevelopment plan.
Not less than forty-five days prior to the date set for the public hearing, the
municipality shall give notice to all taxing districts of which taxable property
is included in the redevelopment project area, and in addition to the other
requirements of the notice set forth in the section, the notice shall request
each taxing district to submit comments to the municipality concerning the
subject matter of the hearing prior to the date of the public hearing.
If a taxing district does not file an objection to the redevelopment plan at
or prior to the date of the public hearing, the taxing district is considered to
have consented to the redevelopment plan and the issuance of obligations under
this chapter to finance the redevelopment project, provided that the actual term
of obligations issued is equal to or less than the term stated in the notice of
public hearing. The municipality may issue obligations to finance the
redevelopment project if less than all taxing districts consent to the
redevelopment plan. The tax increment for a taxing district that does not
consent to the redevelopment plan must not be included in the special tax
allocation fund after the first fifteen years after the initial issuance of
obligations to finance such plan. No consent is required of any taxing district
if the term of the proposed initial obligations is fifteen years or less or, in
the case of any additional or refunding obligations, if the term of the
obligations is not greater than the later of (a) fifteen years from the date of
issuance of the initial or refunded obligations or (b) the remaining term of the
initial or refunded obligations.
Prior to the adoption of an ordinance approving a redevelopment plan pursuant
to Section 31-6-80, changes may be made in the redevelopment plan which do not
alter the exterior boundaries or do not substantially affect the general land use
established in the plan or substantially change the nature of the redevelopment
project, without further hearing or notice, provided that notice of the changes
is given by mail to each affected taxing district and by publication in a
newspaper or newspapers of general circulation within the taxing districts not
less than ten days prior to the adoption of the changes by ordinance. Notice of
the adoption of the ordinance must be published by the municipality in a
newspaper having general circulation in the affected taxing districts. Any
interested party may, within twenty days after the date of publication of the
notice of adoption of the redevelopment plan, but not afterwards, challenge the
validity of such adoption by action de novo in the court of common pleas in the
county in which the redevelopment plan is located.
After adoption of an ordinance approving a redevelopment plan, any alteration
in the exterior boundaries, general land uses established pursuant to the
redevelopment plan, maximum term of maturity of obligations to be issued under
the plan, or nature of the redevelopment project must be approved by ordinance
of the municipality in accordance with the procedures provided in this chapter
for the initial approval of a redevelopment project and designation of a
redevelopment project area."
Auditor to ascertain value
SECTION 4. Section 31-6-100 of the 1976 Code is amended to read:
"Section 31-6-100. (A) If a municipality by ordinance approves a
redevelopment plan pursuant to Section 31-6-80, the auditor of the county in
which the municipality is situated, immediately after adoption of the ordinance
pursuant to Section 31-6-80, must, upon request of the municipality, determine
and certify:
(1) the most recently ascertained equalized assessed value of all taxable
real property within the redevelopment project area, as of the date of adoption
of the ordinance adopted pursuant to Section 31-6-80, which value is the 'initial
equalized assessed value' of the property; and
(2) the total equalized assessed value of all taxable real property within
the redevelopment project area and certifying the amount as the 'total initial
equalized assessed value' of the taxable real property within the redevelopment
project area.
(B) After the county auditor has certified the total initial equalized
assessed value of the taxable real property in the area, then in respect to every
taxing district containing a redevelopment project area, the county auditor or
any other official required by law to ascertain the amount of the equalized
assessed value of all taxable property within the district for the purpose of
computing the rate percent of tax to be extended upon taxable property within
such district, shall in every year that obligations are outstanding for
redevelopment projects in the redevelopment area ascertain the amount of value
of taxable property in a project redevelopment area by including in the amount
the certified total initial equalized assessed value of all taxable real property
in the area in lieu of the equalized assessed value of all taxable real property
in the area. The rate percent of tax determined must be extended to the current
equalized assessed value of all property in the redevelopment project area in the
same manner as the rate percent of tax is extended to all other taxable property
in the taxing district. The method of extending taxes established under this
section terminates when the municipality adopts an ordinance dissolving the
special tax allocation fund for the redevelopment project."
Revenues
SECTION 5. Section 31-6-110 of the 1976 Code is amended to read:
"Section 31-6-110. Revenues received by the municipality from any
property, building, or facility owned by the municipality or any agency or
authority established by the municipality in the redevelopment project area may
be used to pay redevelopment project costs or reduce outstanding obligations of
the municipality incurred under this chapter for redevelopment project costs.
If the obligations are used to finance the extension or expansion of a system as
defined in Section 6-21-40 in the redevelopment project area, all or a portion
of the revenues of the system, whether or not located entirely within the
redevelopment project area, including the revenues of the redevelopment project,
may be pledged to secure the obligations issued under this chapter. The
municipality is fully empowered to use any of the powers granted by either or
both of the provisions of Chapter 17 of Title 6 (The Revenue Bond Refinancing Act
of 1937) or the provisions of Chapter 21 of Title 6 (Revenue Bond Act for
Utilities). In exercising the powers conferred by the provisions, the
municipality may make any pledges and covenants authorized by any provision of
those chapters. The municipality may place the revenues in the special tax
allocation fund or a separate fund which must be held by the municipality or
financial institution designated by the municipality. Revenue received by the
municipality from the sale or other disposition of real property acquired by the
municipality with the proceeds of obligations issued under the provisions of this
chapter must be deposited by the municipality in the special tax allocation fund
or a separate fund which must be held by the municipality or financial
institution designated by the municipality. Proceeds of grants may be pledged by
the municipality and deposited in the special tax allocation fund or a separate
fund."
Time effective
SECTION 6. This act takes effect upon approval by the Governor. |