00                            HOUSE BILL NO. 370                                                                          
01 "An Act relating to municipal tax exemptions."                                                                          
02 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
03    * Section 1. AS 29.45.050(m) is amended to read:                                                                   
04            (m)  A municipality may by ordinance partially or totally exempt all or some                                 
05       types of economic development property from taxation for a designated period of                               
06       time [UP TO FIVE YEARS]. The municipality may provide for renewal of the                                      
07       exemption under conditions established in the ordinance. However, [UNDER A                                        
08       RENEWAL,] a municipality that is a school district may only exempt for more than                              
09       five years all or a portion of the amount of taxes if that amount exceeds the amount                  
10       levied on other property for the school district. A municipality may by ordinance                                 
11       permit deferral of payment of taxes on all or some types of economic development                                  
12       property for a designated period [UP TO FIVE YEARS]. The municipality may                                     
13       provide for renewal of the deferral under conditions established in the ordinance. A                              
14       municipality may adopt an ordinance under this subsection only if, before it is                                   
15       adopted, copies of the proposed ordinance made available at a public hearing on it                                

01       contain written notice that the ordinance, if adopted, may be repealed by the voters                              
02       through referendum. An ordinance adopted under this subsection must include specific                              
03       eligibility requirements and require a written application for each exemption or                                  
04       deferral. In this subsection "economic development property" means real or personal                               
05       property, including developed property conveyed under 43 U.S.C. 1601 et seq.                                      
06       (Alaska Native Claims Settlement Act) [, THAT]                                                                    
07                 (1)  that has not been used in the same trade or business in another                                
08       municipality for at least six months before the application for deferral or                                   
09       exemption is filed; this paragraph does not apply if the property was used in the                             
10       same trade or business in an area that has been annexed to the municipality                                   
11       within six months before the application for deferral or exemption is filed; this                             
12       paragraph does not apply to inventories; and                                                                  
13                 (2)  to which one or more of the following applies:                                                 
14                      (A)  the property has not previously been taxed as real or                                     
15            personal property by the municipality;                                                                       
16                      (B)  the property [(2)] is used in a trade or business in a way                                
17            that                                                                                                         
18                           (i) [(A)]  creates employment in the municipality;                                        
19                           (ii) [(B)]  generates sales outside of the municipality of                                
20                 goods or services produced in the municipality; or                                                      
21                           (iii) [(C)]  materially reduces the importation of goods or                               
22                 services from outside the municipality;                                                                 
23                      (C)  an exemption or deferral on the property enables a                                        
24            significant capital investment in physical infrastructure that                                           
25                           (i)  expands the tax base of the municipality; and                                        
26                           (ii)  will generate property tax revenue after the                                        
27                 exemption expires [AND                                                                              
28                 (3)  HAS NOT BEEN USED IN THE SAME TRADE OR BUSINESS                                                    
29       IN ANOTHER MUNICIPALITY FOR AT LEAST SIX MONTHS BEFORE THE                                                        
30       APPLICATION FOR DEFERRAL OR EXEMPTION IS FILED; THIS                                                              
31       PARAGRAPH DOES NOT APPLY IF THE PROPERTY WAS USED IN THE                                                          

01       SAME TRADE OR BUSINESS IN AN AREA THAT HAS BEEN ANNEXED TO                                                        
02       THE MUNICIPALITY WITHIN SIX MONTHS BEFORE THE APPLICATION                                                         
03       FOR DEFERRAL OR EXEMPTION IS FILED; THIS PARAGRAPH DOES NOT                                                       
04       APPLY TO INVENTORIES].