                                 CODE OF VIRGINIA

TAXATION OF CERTAIN LEASEHOLD INTERESTS; CONCESSIONS (§ 58.1-3203)

A. All leasehold interests in real property that is exempt from assessment for
taxation from the owner shall be assessed for local taxation to the lessee. If
the remaining term of the lease is 50 years or more, or the lease permits the
lessee to acquire the real property for a nominal sum at the completion of the
term, such leasehold interest shall be assessed as if the lessee were the owner.
Otherwise, such assessment shall be reduced two percent for each year that the
remainder of such term is less than 50 years; however, no such assessment shall
be reduced more than 85 percent. If the lessee has a right to renew without the
consent of the lessor, the term of such lease shall be the sum of the original
lease term plus all such renewal terms.

B. When any real property is exempt from taxation under Section 6 (a)(1) or (2)
or by designation under Section 6 (a)(6) of Article X of the Constitution of
Virginia, the leasehold interest in such property may also be exempt from
taxation, provided that the property is leased to a lessee that is exempt from
taxation pursuant to &#xA7; 501(c) of the Internal Revenue Code or to a lessee
that is entitled to or has received federal rehabilitation tax credits relating
to the property pursuant to 26 U.S.C. &#xA7; 47 or any successor thereto, and is
used exclusively by such lessee primarily for charitable, literary, scientific,
cultural, or educational purposes. No leasehold interest or concession, as
defined in &#xA7; 33.2-1800, of tax exempt property of a governmental agency
shall be subject to assessment for local property tax purposes where the
property is leased to a public service corporation or subsidiary thereof or a
nonstock, nonprofit corporation whose occupation, use, or operation of the tax
exempt property is in aid of or promotes the governmental purposes set out in
Chapter 10 (&#xA7; 62.1-128 et seq.) of Title 62.1 or to a private entity that
is party to a concession agreement with a responsible public entity pursuant to
the Public-Private Transportation Act of 1995 (&#xA7; 33.2-1800 et seq.) or to
similar federal law.

C. When any real property is exempt from taxation under &#xA7; 15.2-7510, the
leasehold interest in the property shall also be exempt from taxation.

D. The provisions of this section shall not apply to any leasehold interests
exempted or partially exempted by other provisions of law.

HISTORY: Code 1950, § 58-758.1; 1975, c. 374; 1976, c. 418; 1979, c. 359; 1981,
c. 431; 1983, c. 549; 1984, c. 675; 1992, c. 842; 1996, c. 478; 2006, c. 922;
2015, cc. 87, 234; 2018, c. 437.