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ACT NO. 120
Downtown Development; Taxation; Transportation Capital Improvement
This act is the Historic Downtown Development Act which establishes a downtown community development program to encourage investment in and restoration of municipal downtown districts. Under the program, designated downtown districts of participating municipalities will receive priority consideration by any agency of the state administering state or federal assistance programs, planning grants, and technical assistance, and property owners in designated downtown districts will be eligible to receive tax incentives and benefits for restoration of qualifying property. A Vermont Downtown Development Board is created to administer the program to consist of the heads of six state agencies, three public members appointed by the governor, and two regional members from each region of the state to serve during consideration of applications from their respective regions. Municipalities must apply to the Board for designation as a downtown development district and must delineate the boundaries of the district and demonstrate a planning commitment and a community reinvestment agreement committing resources to the district.
The tax benefits available to owners of qualifying property in a designated downtown development district include a five percent state tax credit for substantial rehabilitation of historic buildings which qualify for the federal Rehabilitation Tax Credit, and a 25 percent state tax credit for rehabilitation of older or historic buildings not qualifying for the federal Rehabilitation Tax Credit. In any calendar year, the board may not award a total amount of both of these rehabilitation tax credits in excess of $300,000.00.
Tax benefits also include a Training Tax Credit for up to $400.00 of training expenses of a qualified employer for training certain employees who within the previous six months had been receiving ANFC or TANF benefits and hired for a job site in a downtown district.
The Act also establishes a Downtown Transportation and Capital Improvement Fund to be administered by the Vermont Downtown Development Board to aid municipalities with designated downtown districts to finance transportation capital and improvement projects, including parking facilities, in those districts. The board may make loans, loan guarantees, or grants to municipalities for eligible capital transportation projects. Grants awarded may not exceed $250,000.00 annually to any municipality, and may not exceed 25 percent of the overall cost of the project. The Act also provides an appropriation to the Downtown Transportation and Capital Improvement Fund in the amount of $400,000.00 in fiscal year 1999 from the Transportation Fund, with an expression of intent by the General Assembly that at least this amount of funding be provided for this purpose on an annual basis.
The act also amends a section of law (32 V.S.A. § 9819), relating to allocation of sales taxreceipts enacted in No. 71 of the Acts of 1998 (H.577, the Act 60 "Technical Corrections" Act). Sales tax receipts from the sale of construction materials used in projects qualified under the downtown community development program will be allocated and paid to municipalities in which the project is located according to the following scale:
1. Municipalities in which the population is 7,500 or less will receive receipts from sales in excess of $100,000.00, with a cap of $600,000.00 in total allocations to municipalities of this size.
2. Municipalities in which the population is greater than 7,500 but less than 30,000 will receive receipts from sales in excess $200,000.00, with a cap of $600,000.00 in total allocations to municipalities with a population of this size.
3. Municipalities in which the population is greater than 30,000 will receive receipts from sales in excess of $1,000,000.00, with a cap of $800,000.00 in total allocations to municipalities of this size.
Revenues allocated to municipalities under this section may be used by the municipality only for the support of the qualified project that generated the revenues.
The Act also makes amendments to other laws related to and intended to facilitate downtown development. Downtown Development districts may post speed limits of less than 25 miles per hour (23 V.S.A. § 1007(g)). The state's travel information sign laws are amended to allow alternative municipal information and guidance signs (10 V.S.A. § 494 (17) ). Provisions relating to permits for curb cuts and access right-of-way to state highways are revised to further protect state highway infrastructure investment (19 V.S.A. § 1111(b), (f) and (k)). And, penalties for violation of public highway commercial motor vehicle height, width and length limits have been increased, enforcement enhanced, and a regional commercial motor vehicle enforcement fund created and funded with an appropriation of $25,000.00 to support a regional commercial vehicle law enforcement initiative in Windsor County (Secs. 9a - 9i).
Effective Dates: The downtown community development program takes effect July 1, 1998. The rehabilitation tax credits take effect January 1, 1999. Most amendments to related laws take effect July 1, 1998; those relating to enhanced enforcement of commercial motor vehicle height, width and length limits take effect from passage, April 28, 1998.