1. Preliminary Eligibility & Preparation
a. Confirm Taxing Unit Eligibility
- The municipality or county must:
- Establish guidelines and criteria for tax abatement (Sec. 312.002(a)).
- Pass a resolution electing to participate in tax abatement programs.
b. Adopt Guidelines and Criteria
- The guidelines and criteria:
- Must allow for abatement of new and expanded/modernized facilities (Sec. 312.002(a)).
- Must be adopted following a public hearing (Sec. 312.002(c-1)).
- Must be posted online if the taxing unit has a website (Sec. 312.002(c-2)).
- Are valid for 2 years and can only be changed with a ¾ vote of the governing body.
c. Applicant’s Initial Considerations
- Applicant must:
- Identify property location within the potential or designated Reinvestment Zone.
- Ensure project aligns with local guidelines, including potential restrictions (e.g., proximity to military aviation facilities — Sec. 312.0021).
2. Designation of Reinvestment Zone
a. Public Hearing & Designation
- Municipality or county must:
- Hold a public hearing (Sec. 312.201(d), Sec. 312.401(b)).
- Publish notice in a newspaper and notify affected taxing units 7 days prior (Sec. 312.201(d), Sec. 312.401(b)).
- Make findings that the zone:
- Promotes economic development,
- Meets criteria such as combating deterioration or encouraging primary employment (Sec. 312.202).
b. Adopt Reinvestment Zone Ordinance or Order
- Official designation is made via ordinance (municipality) or order (county) (Sec. 312.201(a), Sec. 312.401(a)).
- The zone duration is typically 5 years but can be renewed (Sec. 312.203, Sec. 312.401(c)).
3. Application for Tax Abatement
a. Submit Formal Application
- The applicant must submit:
- A complete application (may include a fee, max $1,000 — Sec. 312.002(e)).
- Project details including:
- Nature and scope of improvements,
- Employment impact,
- Project timeline.
b. Confidentiality of Proprietary Information
- Business-sensitive details are confidential until the agreement is executed (Sec. 312.003).
4. Negotiation and Drafting of Tax Abatement Agreement
a. Key Required Terms (Sec. 312.205(a))
- List of proposed improvements.
- Access for inspection.
- Limitations on property use.
- Recapture provisions in case of non-compliance.
- Annual compliance certification by the property owner.
- Right for the taxing unit to cancel or modify the agreement.
b. Optional Provisions (Sec. 312.205(b))
- Infrastructure improvements by the municipality or county.
- Economic feasibility study.
- Maps, zoning changes, etc.
5. Notice to Other Taxing Units & Approval Process
a. Notices
- At least 7 days before signing, notify:
- Other taxing units where the property is located (Sec. 312.2041).
- Include copy of proposed agreement.
b. Public Notice for Agreement Approval
- Provide 30 days public notice before the meeting to approve the agreement (Sec. 312.207(c)).
c. Governing Body Approval
- Approval requires a majority vote at a regular meeting (Sec. 312.207).
6. Execution of Agreement
- Signed by the municipality/county and the property owner.
- Duration may not exceed 10 years (Sec. 312.204(a), Sec. 312.402).
7. Post-Approval Follow-up & Compliance
a. Filing and Reporting
- A copy of the agreement is submitted to:
- Comptroller’s Office (Sec. 312.005(a)).
- Chief Appraiser of the appraisal district.
b. Annual Certification
- Owner must annually certify compliance to each taxing unit (Sec. 312.205(a)(6)).
c. Monitoring & Inspections
- Taxing unit may conduct inspections to verify compliance (Sec. 312.205(a)(2)).
d. Recapture & Modification
- If performance benchmarks are not met:
- Taxes may be recaptured.
- Agreement may be modified or terminated (Sec. 312.205(a)(4), Sec. 312.208).
8. Post-Abatement Period
a. Reporting to Comptroller
- For 3 years post-expiration, chief appraiser must report property values to the Comptroller (Sec. 312.005(a-1)).
b. Record Maintenance
- Agreements and related information must be made accessible, including links on the taxing unit’s website (Sec. 312.008).
Special Considerations
| Topic | Key Point |
| Military Installations | No abatements for wind projects within 25 nautical miles of military aviation facilities (Sec. 312.0021). |
| School Districts | School districts are prohibited from granting abatements (Sec. 312.002(f)). |
| Voluntary Cleanup Properties | Special provisions for brownfield redevelopment (Sec. 312.211). |
| Enterprise Zones | Automatic reinvestment zone designation (Sec. 312.2011, 312.4011). |
✅ Summary Checklist
| Step | Action |
| 1. | Taxing unit adopts guidelines & elects eligibility. |
| 2. | Designate Reinvestment Zone via public hearing. |
| 3. | Applicant submits formal application. |
| 4. | Draft and negotiate agreement terms. |
| 5. | Issue notice to other taxing units & public. |
| 6. | Governing body approval and execution. |
| 7. | Monitor compliance and annual reporting. |
| 8. | Complete post-abatement reporting and compliance checks. |