Dallas City Code § 51A-11.201 INITIAL APPLICATION, COMPLETION OF REHABILITATION, AND FINAL APPLICATION ARE ALL REQUIRED FOR TAX EXEMPTION.
SEC. 51A-11.201. INITIAL APPLICATION, COMPLETION OF REHABILITATION, AND FINAL APPLICATION ARE ALL REQUIRED FOR TAX EXEMPTION.
(a) Initial application for a tax exemption. An initial application for a tax exemption must be filed with the director. Application may be made for a tax exemption for historic property or property pending designation. Each application must be signed by the owner, be acknowledged before a notary public, and include the following information:
(1) The legal description of the property.
(2) Photographs and drawings of the property before rehabilitation, including all protected facades and any other area where rehabilitation will be performed.
(3) Estimates of the costs for the rehabilitation project, and any other rehabilitation anticipated during the term of the tax exemption as necessary to calculate the projected tax foregone.
(4) Details about the property including: total square footage of the building and a breakdown of square footage for residential, office, and retail uses; number of residential units created; and an estimate of the number of temporary and permanent jobs that will be created as a result of the tax exemption. This information is required for tax exemptions in the urban historic districts only.
(5) A projection of the construction time and completion date of the rehabilitation project.
(6) A complete application for any necessary certificate of appropriateness or predesignation certificate of appropriateness for the rehabilitation project.
(7) The proposed use of the property.
(8) An authorization for the members of the landmark commission and city officials to visit and inspect the property as necessary to certify eligibility and verification for a tax exemption.
(9) Documentation showing that the building is a contributing structure.
(10) The duration and amount of tax foregone of any previous property tax relief granted to any portion of the property pursuant to this article or any other ordinance adopted pursuant to Section 11.24 of the Texas Tax Code.
(11) Any other information that is necessary to the city in determining eligibility, including but not limited to information showing compliance with all applicable city health and safety regulations.
(b) Determination of eligibility.
(1) If the historic property is in a reinvestment zone (also known as a TIF) designated under Chapter 311 of the Texas Tax Code, the director shall determine whether a tax exemption authorized under Section 11.24 of the Texas Tax Code is prohibited, either under state law or under the terms of any bonds issued for the reinvestment zone. If the tax exemption is prohibited, the director shall notify the applicant and the city shall not process the application.
(2) Upon receipt of a complete application for a tax exemption, the director shall schedule a hearing before the landmark commission to determine whether the property is eligible for a tax exemption.
(3) No task force review is required for determination of eligibility.
(c) Criteria for eligibility. If a property is determined to be eligible, the property is deemed to be a historically or archeologically significant site in need of tax relief to encourage its preservation. The landmark commission shall determine that the property is eligible only if the application satisfies the following requirements:
(1) The building must be a contributing or potentially contributing structure within a historic district or proposed as a contributing structure for properties pending historic designation.
(2) The proposed cost of the rehabilitation project must exceed the percentage of pre-rehabilitation value of the contributing structure specified in the applicable section of this article, if rehabilitation is required for the exemption. Only rehabilitation done after a determination of eligibility may be counted in determining whether the proposed rehabilitation project exceeds the specified percentage of pre-rehabilitation value, except that the landmark commission may, after a public hearing, make a specific finding approving rehabilitation done prior to the determination of eligibility if the rehabilitation was done within the last three years and will further the purpose of this article. Only rehabilitation may be counted in determining whether the proposed rehabilitation project exceeds the specified percentage of pre-rehabilitation value; other work will not be counted.
(d) Notice and appeal of decision.
(1) Notice of decision. The director shall notify the applicant in writing of the landmark commission’s decision on eligibility. If the landmark commission determines that the applicant is not eligible for a tax exemption, the director shall notify the applicant of the reason for that determination. Notice is given by depositing the notice properly addressed and postage paid in the United States mail. The notice must be sent to the address shown on the application.
(2) Appeal of decision on eligibility. A determination that the applicant is not eligible for a tax exemption may be appealed to the city plan commission. An appeal is made by filing a written request with the director. The request must be filed within 30 days after the date written notice is given to the applicant of the landmark commission’s decision. In considering the appeal, the sole question shall be whether the landmark commission erred in determining that the applicant is not eligible, and, in this connection, the city plan commission shall consider the same standards that were required to be considered by the landmark commission.
(e) City council review. Within 90 days after the landmark commission determines an applicant is eligible for a tax exemption, the director shall schedule applications for properties with past and projected tax foregone exceeding $50,000 for review by the city council. The city council may, by resolution, approve any portion of the application over $50,000 if it finds that the property is a historically or architecturally significant site in need of more than $50,000 in tax relief to encourage its preservation. If the city council denies all or part of the amount over $50,000, the applicant will still be eligible for a tax exemption up to a maximum of $50,000 subject to compliance with the requirements in this article.
(f) Completion of rehabilitation project.
(1) The applicant must obtain approval of any necessary certificates of appropriateness or predesignation certificates of appropriateness.
(2) A rehabilitation project must be completed by the date specified by the landmark commission when it made its determination of eligibility. If the landmark commission fails to set a completion deadline, it will be deemed to be three years from the date the landmark commission made its determination of eligibility. The landmark commission may also set a deadline for the owner to obtain a certificate of occupancy if it is necessary to further the purpose of this article. The landmark commission may, after a public hearing, extend the deadline for completion of the rehabilitation project and receipt of a certificate of occupancy for additional periods up to three years each if there has been reasonable progress towards completion and the extension will further the purpose of this article. An application for an extension may be made after the original completion deadline or the extended completion deadline.
(g) Letter of verification.
(1) Application. At any time after completion of the minimum expenditure on rehabilitation but no later than the completion deadline, and in order to receive a tax exemption, an owner must apply to the director for a letter of verification and submit the following information:
(A) A signed statement, acknowledged before a notary public, certifying that the minimum expenditure on the rehabilitation project has been made in compliance with any certificates of appropriateness or predesignation certificates of appropriateness along with receipts or other documentation such as pay affidavits or schedules of value provided by a licensed architect or engineer proving that the minimum expenditure on the rehabilitation project has actually been made.
(B) An executed commitment to repay that complies with Paragraph (3).
(C) A copy of the city council resolution if the previous and projected tax foregone combined exceeds $50,000.
(D) For applications based upon residential conversion, the applicant must provide records showing that the requisite percentage of floor area has been changed to residential uses.
(E) Proof, such as a tax certificate, that property taxes and any city fees, fines, or penalties are not delinquent on the property.
(F) Proof that there are no pending city code violations on the property.
(2) Properties in reinvestment zones. If the historic property is in a reinvestment zone (also known as a TIF) designated under Chapter 311 of the Texas Tax Code, any additional requirements or limitations of state law or bonds issued in connection with the TIF must be met before issuance of the letter of verification.
(3) Commitment to repay.
(A) The owner must commit to repay any taxes foregone in the event of unauthorized alteration or demolition of the historic property.
(B) The commitment to repay must be approved as to form by the city attorney.
(C) The commitment to repay must run with the land and bind the owner and his successors, heirs, and assigns.
(D) The commitment to repay must provide that any unpaid repayment is a lien against the historic property.
(E) The commitment to repay must indemnify the city against all claims arising out of the granting of a tax exemption.
(F) The commitment to repay must be filed in the deed records of the appropriate county and with the appraisal district as the instrument governing the terms of the tax exemption.
(G) The commitment to repay must contain:
(i) the address of the property;
(ii) whether the exemption is 100 percent of the value of, or the added value of, the land and structure;
(iii) if there is more than one structure on a tax account or a lot and only one structure is a contributing exempt structure, a description of the structure sufficient to notify the appraisal district which structure is exempt;
(iv) if the exemption is on the added value of the land and structure, the dollar amount of the pre-rehabilitation value, with an indication that if the appraised value is reduced during the term of the tax exemption, the pre-rehabilitation value equals the value after reappraisal for the remaining duration of the tax exemption;
(v) required completion date of rehabilitation;
(vi) date by which a certificate of occupancy must be granted, if applicable;
(vii) a statement that property taxes and any city fees, fines, or penalties are not delinquent on the property or on any other real property owned in whole or in part, directly or indirectly, by the owner, and must not be delinquent for the term of the tax exemption in order to qualify for the exemption on an annual basis. For the purpose of this statement, an interest in real property does not include any interest in real property held indirectly through a mutual or common investment fund such as a real estate investment trust that holds real estate assets unless the person in question participates in the management of the fund;
(viii) a statement that the appraisal district shall not provide a tax exemption until the city provides the appraisal district an annual letter of verification;
(ix) a statement that the appraisal district shall not provide a tax exemption unless the owner applies annually to the appraisal district for the exemption within the time set forth under the Texas Tax Code;
(x) if city council approval of the tax exemption is required, a statement that the tax exemption is subject to the terms of the city council resolution;
(xi) an authorization for the members of the landmark commission and city officials to visit and inspect the property as necessary to certify eligibility and verification for a tax exemption;
(xii) a statement that a failure to complete the rehabilitation project or get a certificate of occupancy by any completion date stated in the determination of eligibility, as extended if applicable, may result in penalties pursuant to this article.
(4) Review by director. The director shall inspect the historic property to verify compliance with the requirements of this division.
(5) Director’s decision.
(A) Issuance of letter of verification. If the director determines that the applicant has met all applicable requirements and qualifies for a tax exemption, the director shall send a letter of verification to the appraisal district and the applicant on an annual basis for the duration of the tax exemption, indicating the applicable tax exemption and the duration of the tax exemption. The first letter of verification for a tax exemption on a property, or for a new tax exemption on the same property, must include a copy of the commitment to repay and, if applicable, the city council resolution.
(B) Notice of denial. If the director denies the letter of verification, the director shall notify the applicant of this fact in writing, stating the deficiencies that must be corrected or the specific reasons for denial. Notice is given by depositing the notice properly addressed and postage paid in the United States mail. The notice must be sent to the address shown on the application. If the applicant remedies the deficiencies in time for the appraisal district to provide that year’s tax exemption, the director shall send a letter of verification to the appraisal district and the applicant, otherwise, the tax exemption must be sent to the appraisal district for the next year’s tax exemption.
(6) Appeal. The decision of the director to deny the letter of verification may be appealed to the city plan commission. An appeal is made by filing a written request with the director. The request must be filed within 30 days after the date of written notice is given to the applicant of the director’s decision. In considering the appeal, the sole question shall be whether the director erred in determining that the applicant does not qualify, and, in this connection, the city plan commission shall consider the same standards that were required to be considered by the director.
(7) Annual application to appraisal district. The director shall provide letters of verification to the appraisal district on an annual basis for the duration of the tax exemption, but in order to receive the tax exemption, the owner must make an annual application to the appraisal district in addition to the letter of verification provided by the director. (Ord. Nos. 21874; 22026; 22392; 23506; 24584; 24843; 25271; 25509; 27016)