Overview: HB 544, Taxes, Ad Valorem - As introduced, creates the commercial development board; with respect to new commercial property developed by private entities in certain taxing jurisdictions, authorizes the private entities to enter into agreements for payments in lieu of ad valorem taxes and leases with the commercial development board. - Amends TCA Title 4; Title 5; Title 6; Title 7; Title 9; Title 13; Title 48 and Title 67.
Status: Taken off notice for cal in s/c Cities & Counties Subcommittee of State & Local Government Committee
Introduced: November 12, 2024
Purpose and Intent: The main goal of HB 544 is to incentivize commercial development by allowing private entities to enter into agreements with a newly created commercial development board for payments in lieu of ad valorem (property) taxes. This is intended to spur economic growth and investment in certain taxing jurisdictions.
Key Provisions:
- Establishes a commercial development board to oversee these payment-in-lieu-of-taxes (PILOT) agreements
- Authorizes private entities developing new commercial property to enter into PILOT agreements and leases with the board
- Specifies that PILOT agreements can last up to 20 years and must be approved by the local governing body
- Requires the board to distribute PILOT payments to affected taxing jurisdictions (e.g. counties, cities, school districts)
- Exempts PILOT properties from regular ad valorem taxation during the agreement period
Affected Parties and Impacts:
- Private commercial developers who can utilize the PILOT program to reduce their tax burden and incentivize new projects
- Local governments (counties, cities, school districts) that may see reduced ad valorem tax revenue but could benefit from increased economic activity and development
- Taxpayers in the affected jurisdictions, who could see a shift in the tax burden depending on the PILOT agreements
Procedural and Timeline Considerations:
The bill has been taken off the calendar in the Cities & Counties Subcommittee of the State & Local Government Committee, indicating it is currently stalled in the legislative process. Further action and potential amendments would be required for the bill to advance.
