Senate Study Bill 3167


                                          SENATE FILE       
                                          BY  (PROPOSED COMMITTEE ON
                                               WAYS AND MEANS BILL BY
                                               CHAIRPERSON BOLKCOM)


       Passed Senate, Date               Passed House,  Date             
       Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                    Approved                            

                                         A BILL FOR

     1 An Act relating to urban renewal plans and areas, by providing
     2    for expiration and dissolution of certain urban renewal plans
     3    and areas, placing a durational limitation on the use of tax
     4    increment financing in certain urban renewal areas, relating
     5    to amendments to urban renewal plans, and including effective
     6    and applicability date provisions.
     7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
     8 TLSB 5809SC 82
     9 sc/rj/14

PAG LIN



  1  1    Section 1.  Section 403.5, subsections 5 and 6, Code 2007,
  1  2 are amended to read as follows:
  1  3    5.  An urban renewal plan may be modified amended at any
  1  4 time:  Provided, that.  However, if modified the urban renewal
  1  5 plan is amended after the lease or sale by the municipality of
  1  6 real property in the urban renewal project area, such
  1  7 modification amendment may be conditioned upon such approval
  1  8 of the owner, lessee, or successor in interest as the
  1  9 municipality may deem advisable, and in any event such
  1 10 modification amendment shall be subject to such rights at law
  1 11 or in equity as a lessee or purchaser, or a lessee's or
  1 12 purchaser's successor or successors in interest, may be
  1 13 entitled to assert.  The A project may be added to an urban
  1 14 renewal plan only by an amendment to the plan.  Territory may
  1 15 be added to, or severed from, an urban renewal area only by an
  1 16 amendment to the urban renewal plan.  When amending an urban
  1 17 renewal plan, the municipality shall comply with the
  1 18 notification and consultation process provided in this section
  1 19 prior to the approval of any amendment or modification to an
  1 20 adopted urban renewal plan if such amendment or modification
  1 21 provides for refunding bonds or refinancing resulting in an
  1 22 increase in debt service or provides for the issuance of bonds
  1 23 or other indebtedness, to be funded primarily in the manner
  1 24 provided in section 403.19, or if such amendment proposes to
  1 25 add a project to an urban renewal plan or proposes to add
  1 26 territory to an urban renewal area or proposes to sever
  1 27 territory from an urban renewal area.
  1 28    6.  Upon the approval by a municipality of an urban renewal
  1 29 plan or of any modification thereof amendment to an urban
  1 30 renewal plan, such plan or modification amendment shall be
  1 31 deemed to be in full force and effect for the respective urban
  1 32 renewal area, and the municipality may then cause such plan or
  1 33 modification amendment to be carried out in accordance with
  1 34 its terms.
  1 35    Sec. 2.  NEW SECTION.  403.5A  DURATIONAL LIMITATIONS ON
  2  1 URBAN RENEWAL AREAS.
  2  2    1.  a.  Except as provided in paragraph "b", all urban
  2  3 renewal plans adopted by a municipality before January 1,
  2  4 2008, shall expire on June 30, 2013, and any urban renewal
  2  5 areas established in those plans shall be dissolved, and any
  2  6 division of revenue provided for in those plans shall
  2  7 terminate.
  2  8    b.  Paragraph "a" does not apply to an urban renewal plan
  2  9 for an urban renewal area designated as an economic
  2 10 development area, and no part of such area contains slum or
  2 11 blighted conditions, if the urban renewal plan was adopted by
  2 12 a municipality after January 1, 1995.
  2 13    2.  If an urban renewal plan for an urban renewal area is
  2 14 based upon a finding that the area is an economic development
  2 15 area and that no part of the area contains slum or blighted
  2 16 conditions, then the division of revenue provided in section
  2 17 403.19 and stated in the plan shall be limited to twenty years
  2 18 beginning with the calendar year following the calendar year
  2 19 in which the municipality first certifies to the county
  2 20 auditor the amount of any loans, advances, indebtedness, or
  2 21 bonds which qualify for payment from the division of revenue
  2 22 provided in section 403.19.  This subsection applies to urban
  2 23 renewal plans for economic development areas adopted on or
  2 24 after January 1, 1995.
  2 25    3.  If an urban renewal plan for an urban renewal area is
  2 26 based upon a finding that the area is a slum or blighted area,
  2 27 then the division of revenue provided in section 403.19 and
  2 28 stated in the plan shall be limited to twenty years beginning
  2 29 with the calendar year following the calendar year in which
  2 30 the municipality first certifies to the county auditor the
  2 31 amount of any loans, advances, indebtedness, or bonds which
  2 32 qualify for payment from the division of revenue provided in
  2 33 section 403.19.  This subsection applies to urban renewal
  2 34 plans for slum or blighted areas adopted on or after January
  2 35 1, 2008.
  3  1    Sec. 3.  Section 403.6, subsection 6, paragraph b, Code
  3  2 2007, is amended to read as follows:
  3  3    b.  Urban renewal plans adopted, or amended, pursuant to
  3  4 the requirements of section 403.5;
  3  5    Sec. 4.  Section 403.6, subsection 12, Code 2007, is
  3  6 amended to read as follows:
  3  7    12.  To approve and amend urban renewal plans, subject to
  3  8 the requirements of section 403.5.
  3  9    Sec. 5.  Section 403.17, subsection 10, Code 2007, is
  3 10 amended to read as follows:
  3 11    10.  "Economic development area" means an area of a
  3 12 municipality designated by the local governing body as
  3 13 appropriate for commercial and industrial enterprises, public
  3 14 improvements related to housing and residential development,
  3 15 or construction of housing and residential development for low
  3 16 and moderate income families, including single or multifamily
  3 17 housing.  If an urban renewal plan for an urban renewal area
  3 18 is based upon a finding that the area is an economic
  3 19 development area and that no part contains slum or blighted
  3 20 conditions, then the division of revenue provided in section
  3 21 403.19 and stated in the plan shall be limited to twenty years
  3 22 from the calendar year following the calendar year in which
  3 23 the municipality first certifies to the county auditor the
  3 24 amount of any loans, advances, indebtedness, or bonds which
  3 25 qualify for payment from the division of revenue provided in
  3 26 section 403.19.  Such designated area shall not include
  3 27 agricultural land, including land which is part of a century
  3 28 farm, unless the owner of the agricultural land or century
  3 29 farm agrees to include the agricultural land or century farm
  3 30 in the urban renewal area.  For the purposes of this
  3 31 subsection, "century farm" means a farm in which at least
  3 32 forty acres of such farm have been held in continuous
  3 33 ownership by the same family for one hundred years or more.
  3 34    Sec. 6.  EFFECTIVE AND APPLICABILITY DATE.  The section of
  3 35 this Act amending section 403.5, subsections 5 and 6, being
  4  1 deemed of immediate importance, takes effect upon enactment
  4  2 and applies to amendments to urban renewal plans, if such
  4  3 amendments are proposed by a municipality on or after the
  4  4 effective date.
  4  5                           EXPLANATION
  4  6    This bill makes changes relating to urban renewal plans and
  4  7 areas.
  4  8    The bill provides that a project may be added to an urban
  4  9 renewal plan, or territory added to or severed from an urban
  4 10 renewal area, only by an amendment to the urban renewal plan.
  4 11    The bill also provides that all urban renewal plans
  4 12 approved by a municipality before January 1, 2008, shall
  4 13 expire on June 30, 2013, and any urban renewal areas
  4 14 established in those plans shall be dissolved, and any
  4 15 division of revenue (tax increment financing) provided for in
  4 16 the plan is terminated.  However, this provision does not
  4 17 apply to economic development urban renewal plans adopted on
  4 18 or after January 1, 1995.
  4 19    The bill establishes a durational limitation of 20 years
  4 20 for dividing revenue in urban renewal areas designated as slum
  4 21 or blighted areas and established by an urban renewal plan
  4 22 adopted by a municipality on or after January 1, 2008.
  4 23 Currently, a division of revenue in urban renewal areas
  4 24 designated as economic development areas and established by an
  4 25 urban renewal plan adopted on or after January 1, 1995, is
  4 26 limited in duration to 20 years.
  4 27 LSB 5809SC 82
  4 28 sc/rj/14