Chapter 219

2008 -- H 7541 SUBSTITUTE A

Enacted 07/05/08

A N A C T

RELATING TO TOWNS AND CITIES -- AMENDING THE TAX INCREMENT FINANCING

ACT

Introduced By: Representatives Rose, Savage, and Dennigan

Date Introduced: February 26, 2008

It is enacted by the General Assembly as follows:

     SECTION 1. Chapter 45-33.2 of the General Laws entitled "Tax Increment Financing" is

hereby amended by adding thereto the following section:

45-33.2-21. Tax Limitations. – (a) Except as provided below, a tax increment shall be

included in the calculation of the maximum tax a city or town may levy pursuant to the provisions

of section 44-5-2 of the general laws.

(b) To the extent that inclusion of a tax increment in a tax levy causes a municipality to

exceed the maximum tax a city or town may levy pursuant to the provisions of section 44-5-2 of

the general laws, such excess shall be excluded from such calculation for a period not to exceed

twenty-five (25) years if:

(1) such excess tax increment is allocable to: (i) the payment of the principal of or interest

on any special obligation bonds issued under the provisions of section 45-33.2-6, to fund a project

as described in subdivisions 45-33.2-3(2)(i), (ii) or (iii); (ii) any requirement to fund any reserve

or other account or satisfy any other financial requirement which must be satisfied in connection

with the issuance of such bonds or any other indebtedness or obligation incurred in connection

with any such project or portion of one; or (iii) any payments made to directly fund any project

described in subdivisions 45-33.2-3(2)(i), (ii) or (iii); and

(2) the project is determined by the division of property valuation in the department of

revenue to be: (i) within or contiguous to the tax increment area; or (ii) substantially related to

the improvements giving rise to the tax increment; or (iii) reasonably necessary to assure the

private investment required to generate the tax increment.

(c) The tax assessor in each city and town shall include calculations reflecting any tax

increment excluded from the tax cap provisions of section 44-5-2 of the general laws when

submitting the municipality's adopted tax levy and rate to the division of property valuation in

accordance with section 44-5-2 of the general laws.

(d) The division of property valuation in the department of revenue may issue such

regulations as may be required to implement and enforce the provisions of this section.

     SECTION 2. This act shall take effect upon passage.

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LC02163/SUB A/2

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