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2023-05-16 VI. C. Tax Abatement Presentation • • MI5-icy � NUTE FI!_ 16/2023 (t)7.m V 1. G II IP it 41 _ IMIIMPRIPPRION 1$11 State Designated Developer Tax Incentives 1 Three Statutes/Programs: Economic Development Ad Valorem Tax Exemption F.S. 196.1995 Tax Exemptions for Affordable Housing F.S. 196.1978 Live Local Act 2023 F.S.166.04151 and others. Also note -Tax Refunds for Job Creation F.S. 288.106- Repeal eff. 7/1/23 2 1 • • 5/16/2023 �.115 URPLE KART CO nor Economic Development Ad Valorem Tax Exemption Source: Florida Statutes 196.1995 Incentive: 100% ad valorem tax exemption Conditions: Exemption applies only to taxes levied by the City. 3 � �i 1, i t i ,, .,.. .: _ _ . ,, 11IL -1 I Requirements: (a) A Referendum initiated by (i) Council resolution or (ii) Petition of 10% of registered electors (20% required by Charter) (b) Stating that Council has authority to grant property tax exemptions to new businesses and expansions of existing businesses that are expected to create new, full-time jobs in the City. After passage of the Referendum: Council may grant the exemption by ordinance 4 2 • • 5/16/2023 fit Requirements,cont'd: (c) Application by business to the Council requesting ordinance and listing (among other relevant data): (i) Proof that applicant is new business or expansion of an existing business; (ii) Number of jobs applicant expects to create along with average wage of jobs and whether the jobs are full-time or part-time; (iii) Expected time schedule for job creation (d) Referral by Council to Property Appraiser, who reports back on: (i) Total revenue available to the county or municipality for current fiscal year from ad valorem tax sources, or estimate of revenue if actual total revenue available cannot be determined; 5 q y Requirements,cont'd: (ii) Any revenue lost to the county or municipality for the current fiscal year by virtue of exemptions previously granted under this section, or an estimate of such revenue if the actual revenue lost cannot be determined; (iii) A determination as to whether the property for which an exemption is requested is to be incorporated into a new business or the expansion of an existing business. (e) [Council's option] Tax Exemption Agreement which may include performance criteria and must require the applicant to report at a specific time before the expiration of the exemption the actual number of new,full- time jobs created and their actual average wage. May include authority to revoke, in whole or in part, the exemption if the applicant fails to meet the expectations and representations. 6 3 • • 5/16/2023 1- - -~i]' 1 i i r lift . ..—., I 'U AFFORDABLE HOUSING DEFINED Source: Florida Statutes 420.0004 "Low-income persons"total annual adjusted gross household income does not exceed 80 percent of the median annual adjusted gross income for households within the state, or. . .within the county in which the person or family resides, whichever is greater. "Very-low-income persons"the total annual adjusted gross household income does not exceed 50 percent of the median annual adjusted gross income for households within the state, or. . . within the county in which the person or family resides, whichever is greater. Low=80%,Very Low=50% 7 ti, 0 .,, ,.,____ ~a •ar �f 11 IL 1- 1[LL . . ' r O i1 F AFFORDABLE HOUSING DEFINED Source: Florida Statutes 420.0004 "Extremely-low-income persons" below 30 percent of the median annual adjusted 1 gross income for households within the state. I "Affordable" means monthly rents or monthly mortgage payments including taxes, insurance, and utilities do not exceed 30 percent of that amount which represents percentage of median adjusted gross annual income for the household[.] Extremely Low=30% Affordable=30%of the 80,50,or 30%incomes depending on the program. . . 8 4 • • .....4. ,....,„..., +41 0;.., 5. 3 tD • (J, w a. + . t T Im o m '4 r-0 y / C 0 q N a r-�r t 4 I— -< (p 003 ,. 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Does not pertain to CDBG-DR.HHRP.HOME.NHTF or SHIP Percentage Income Limit by Number of Persons in Household Rent Limit by Number of Bedrooms in Unit County(Metro) Category 1 2 3 4 5 6 7 8 9 10 0 1 2 3 4 5 Okeechobee County 20% 8,500 9.720 10,940 12.140 13.120 14.100 15.060 16,040 16496 17,967 212 227 273 315 352 388 25% 13.625 12.153 13.575 15.175 16420 17.625 18.825 29350 21.245 22.459 265 284 341 394 44C 485 ExtremelyLow 28% 11.900 13.608 15.316 16.996 18.368 19,740 21.084 22,456 23,794 25.154 297 318 382 442 493 544 301 12 753 14 580 16 413 18211,19 680 21 150 22 590 24 060 _25 494 -26 951 318 341 410 473 528 5933 33% 14,025 16,038 18,051 20.031 21.648 23265 24.849 26,466 28.043 29.646 350 375 451 520 581 641 35% 14.875 17.010 19.145 21 245 22 960 24.675 26 355 28.070 29.743 31.443 371 398 478 552 616 680 40% 17,000 19,440 21.880 24.280 26.240 28.200 30.120 32,080 33,992 35.934 425 455 547 631 705 777 45% 19.125 21,870 24.615 27.315 29.520 31.725 33.885 36.090 38.241 40.42E 478 512 615 713 793 874 Very Low S0% 21.250 24.300 27.350 30.350 32.800 35250 37.650 40,100 42,490 44.918 531 569 663 789 881 971 60% 25.500 29.160 32.820 36.423 39300 42.300 45.180 48,120 50.988 53.902 637 683 820 947 1.057 1.166 70% 29.750 34020 38,290 42490 45.920 49.350 52.710 56,140 59,486 62,885 743 797 957 1,105 1,233 1,360 Lleciar.53.900 Low 80% 34000 38880 43.760 48.560 52.480 56400 60240 64.160 67.984 71.869 850 911 1.094 1.263 1.410 1.555 120% 51,000 58.320 65,640 72.840 78.720 84.600 90.360 96.240 101,976 107,803 1.275 1.366 1,641 1.894 2.115 2.332 '401, 59.500 68.040 76.580 84.980 9'840 98.700 105,420 112.280 118.972 125.77C '.497 1.594 1.914 2.210 2467 2.721 9 • Yr kx• A PURPLE MEAeT,� : � y - Tax Exemptions for Affordable Housing Source: Florida Statutes 196.1978 Incentive: 50%Ad valorem discount. Conditions: 1) Starts on the 15th year after placing property in-service. 2)Tax discount applies to that portion of an overall property that houses qualified tenants. 10 5 • • 5/16/2023 Requirements: (a) Entire property must be owned by a 501(c)(3) nonprofit entity. (b) Offers affordable housing to "extremely low," "very low," or "low- income" individuals or families, (c) Must be a multifamily project in which at least 70 units are set aside to individuals referenced in clause (b) above, (d) Must have entered into an agreement with the Florida Housing Finance Corporation ("FHFC") to provide affordable housing to the individuals above. 11 • 1 i New Legislation: Live Local Act 2023 Senate Bill 2012 (Florida Statutes 166.04151) No resolution or ordinance required for City to approve affordable housing, including mixed-use residential development, as long as 10%of units are for affordable housing. Conditions: For mixed-use residential projects, at least 65%of total square footage must be used for residential purposes. 12 6 • • 5/16/2023 2.11, Requirements: (a) City MUST authorize, as a permitted use, any mixed-use multifamily and residential project in areas zoned for commercial, industrial, and mixed-use IF 40% of units committed to affordable housing for at least 30 years. (b) City CANNOT require proposed multifamily development to obtain a zoning or land use change, special exception, conditional use approval, variance, or comprehensive plan amendment for the building height, zoning, and densities. 13 ' � 1•nY•�KFE`y�t ,1) `-i• A PURPIF NEA.11 iys• _. Re-Cap: - Economic Dev. Ad Valorem Tax Exemption—Local + State (100%exemption) -Tax Exemptions for Affordable Housing—State (50%exemption) - Live Local Act 2023—State mandated (N/A) None of these incentivizes residential development. There must be either a job creation element or an affordable housing element. 14 7 • • 5/16/2023 •7 Questions ? 15 8