new financial incentives for economic development
TRANSCRIPT
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New Financial Incentives forEconomic Development
Elizabeth Hagg, Community Revitalization Section DirectorDepartment of Planning and Development
G-7April 14, 2021
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The Case for Economic Incentive Program (EIP)
• Targets areas with:• Limited development activity
relative to Comp Plan potential • Declining competitiveness• Outdated land development and
architectural designs
• Initiatives already in place: • Updated Comprehensive Plans• Regulatory incentives
• Need for financial incentive
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How the Economic Incentive Program came to be
• 2017 VA enabling legislation to create local economic revitalization zones
• Adds a new tool to the toolbox
• Other revitalization efforts have yielded mixed or as yet unproven results
• On September 15, 2020, the Board adopted an ordinance to establish EIP
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Financial Incentives Could Turn the Tide
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EIP Financial Incentives
1. Reduction of Site Plan Fees by 10%
2. Partial Real Estate Tax Abatement
equal to increment between the Base Value (pre-development)
and the Fair Market Value (post-development)
- The abatement would be applied beginning January 1st of the next tax year following the abatement trigger
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Ten-Year Abatement
on $115M Increment
yields
= $13,225,000 *
Tax Abatement Could be a Game Changer
Pre-Development Value of $5M
Post Development Value of $120M
• Note: Assumes current tax rate of $1.15 per $100 of assessed value.
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Eligibility Requirements – LAND USE
7
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Eligibility Requirements – SIZE
8
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Eligibility Requirements – DEVELOPMENT
REDEVELOPMENT REPURPOSING
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Eligibility Requirements – LOCATION
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Economic Incentive Areas (EIAs) - Timing
July 1, 2022 June 30, 2032
July 1, 2024
January 1, 2025
June 30, 2034
December 31, 2034
Richmond Highway and Springfield EIAs
Annandale, Lincolnia and McLean EIAs
Baileys Crossroads/Seven Corners EIA
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Applicant files an Eligibility Application with
DPD
Does Application meet Eligibility Criteria?
YesNo
DenialLetter
DPD Forwards
to DTA
DTA calculates estimatedBase Value of property
Rezoning or Site Plan proposal undergoes
regular development review process
BOS Action Item on Eligibility Application for By-Right development
or Rezoning* Application
If Eligibility approved by BOS, property becomes a
Qualifying Property
Owner requests in writing to DTA for determination
of final Base Value
Step 1 Step 2 Step 3
After substantial completion of any
structure, owner requests in writing to DTA for final
inspection and Fair Market valuation
DTA provides written notification to property owner regarding partial tax exemption amount
and period of exemption
* Economic Incentive Program applications can proceed concurrently with a rezoning application to the BOS.
Economic Incentive Program Application Process
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Applicant files an Eligibility Application
with DPD
Does Application meet Eligibility
Criteria?
DTA calculates estimated
Base Value of property
Step 1
Economic Incentive Program Application Process
Yes
NoDenialLetter
DPD Forwards
to DTA
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Rezoning or Site Plan proposal undergoes
regular development review process
BOS Action Item on Eligibility Application for By-Right development
or Rezoning* Application
If Eligibility approved by BOS, property becomes a
Qualifying Property
* Economic Incentive Program applications can proceed concurrently with a rezoning application to the BOS.
Step 2
Economic Incentive Program Application Process
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Owner requests in writing to DTA for determination
of final Base Value
After substantial completion of any
structure, owner requests in writing to DTA for final
inspection and Fair Market valuation
DTA provides written notification to property owner regarding partial tax exemption amount
and period of exemption
* Economic Incentive Program applications can proceed concurrently with a rezoning application to the BOS.
Economic Incentive Program Application Process
Step 3
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First Application In - Skyline
Image of three office buildings today
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Revitalization Website Provides One-Stop Shop
www.fcrevite.org/economic-incentive-program
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Start Spreading the News
Help promote the program with your professional contacts
Spread the word via social media
Request a presentation to your group or organization
Refer potential applicants our way