(A) Pursuant to SDCL § 9-19 and SDCL § 10-6-35.2, a redevelopment neighborhood shall be established within the City of Lead. The boundaries of the redevelopment neighborhood shall be described as: the entire area within the boundaries of the city limits of the City of Lead.
(B) The following properties shall be, and hereby are, specifically classified for the purpose of taxation pursuant to SDCL § 10-6-35.2:
(1) Any new industrial or commercial structure, or any addition, renovation, or reconstruction to an existing structure, located within a designated blighted area as defined in SDCL § 11-8-3, if the new structure, addition, renovation, or reconstruction has a full and true value of $30,000 or more;
(2) Any new industrial structure, including a power generation facility, or an addition to an existing structure, if the new structure or addition has a full and true value of $30,000 or more;
(3) Any new nonresidential agricultural structure, or any addition to an existing structure, if the new structure or addition has a full and true value of $10,000 or more;
(4) Any new commercial structure, or any addition to an existing structure, except a commercial residential structure as described in SDCL § 10-6-35.2(5), if the new structure or addition has a full and true value of $30,000 or more;
(5) Any new commercial residential structure, or addition to an existing structure, containing four or more units, if the new structure or addition has a full and true value of $30,000 or more;
(6) Any new affordable housing structure containing four or more units with a monthly rental rate of the units at or below the annually calculated rent for the state's 60% area median income being used by the South Dakota Housing Development Authority, for a minimum of ten years following the date of first occupancy, if the structure has a full and true value of $30,000 or more;
(7) Any new residential structure, or addition to or renovation of an existing structure, located within a redevelopment neighborhood established pursuant to SDCL § 10-6-56 if the new structure, addition, or renovation has a full and true value of $5,000 or more. The structure shall be located in an area defined and designated as a redevelopment neighborhood based on conditions provided in SDCL § 11-8-3; or
(8) Any commercial, industrial, or nonresidential agricultural property which increases more than $10,000 in full and true value as a result of reconstruction or renovation of the structure.
(C) Any structure classified pursuant to this section shall, following construction, initially be valued for taxation purposes in the usual manner, and that value shall be referred to in this section as the “pre-adjustment value.”
(D) The assessed value to be used for tax purposes of any structure classified pursuant to this section shall, following construction, be calculated as follows:
(1) For the first tax year following construction, 20% of the pre-adjustment value;
(2) For the second tax year the following construction, 40% of the pre-adjustment value;
(3) For the third tax year following construction, 60% of the pre-adjustment value;
(4) For the fourth tax year following construction, 80% of the pre-adjustment value;
(5) For the fifth tax year following construction, 100% of the pre-adjustment value.
(E) The City of Lead Commission may, if requested by the owner of any of the above described property, not apply the above formula, in which case the full assessment shall be made without application of the formula. In waiving this formula for the structure of one owner, the Lead City Commission is not prohibited from applying the formula for subsequent new structures by that owner.
(F) For the purpose of this section, the assessed valuation during any of the five years may not be less than the assessed valuation of the property year preceding the first year of the tax years following construction.
(G) Any structure that is partially constructed on the assessment date may be valued for tax purposes pursuant to this section and the valuation may not be less than the assessed valuation of the property in the year preceding the beginning of construction.
(H) Following the five-year period under this section, the property shall be assessed at the same percentage as is all other property for tax purposes.
(I) A city building permit will be required prior to any work commencing on any qualifying property per this section and the City Building Inspector will be required to provide a copy of this section to the owner of the qualifying property at the time the building permit is issued.
(J) This incentive is transferable to any subsequent property owner, but the five-year term of the incentive will not change.
(Ord. 1075-20, passed 9-21-2020)
Statutory reference:
For related provisions, see SDCL § 10-6-35.2