                                 CODE OF VIRGINIA

ADOPTION OF LOCAL ENTERPRISE ZONE DEVELOPMENT TAXATION PROGRAM (§ 58.1-3245.8)

A. The governing body of any county, city, or town may adopt a local enterprise
zone development taxation program by passing an ordinance designating an
enterprise zone located within its boundaries as a local enterprise zone;
however, an ordinance may designate an area as a local enterprise zone
contingent upon the designation of the area as an enterprise zone pursuant to
Chapter 49 (§ 59.1-538 et seq.) of Title 59.1. If the county, city, or town
contains more than one enterprise zone, such ordinance may designate one or more
as a local enterprise zone. If an enterprise zone is located in more than one
county, city, or town, the governing body may designate the portion of the
enterprise zone located within its boundaries as a local enterprise zone. An
ordinance designating a local enterprise zone shall provide that all or a
specified percentage of the real estate taxes, machinery and tools taxes, or
both, in the local enterprise zone shall be assessed, collected and allocated in
the following manner:

   1. The local assessing officer shall record in the appropriate books both the
   base assessed value and the current assessed value of the real estate or
   machinery and tools, or both, in the local enterprise zone.

   2. Real estate taxes or machinery and tools taxes attributable to the lower of
   the current assessed value or base assessed value of real estate or machinery
   and tools located in a local enterprise zone shall be allocated by the
   treasurer or director of finance as they would be in the absence of such
   ordinance.

   3. All or the specified percentage of the increase in real estate taxes or
   machinery and tools taxes, or both, attributable to the difference between (i)
   the current assessed value of such property and (ii) the base assessed value
   of such property shall be allocated by the treasurer or director of finance
   and paid into a special fund entitled the &#8220;Local Enterprise Zone
   Development Fund&#8221; to be used as provided in &#xA7; 58.1-3245.10. Such
   amounts paid into the fund shall not include any additional revenues resulting
   from an increase in the tax rate on real estate or machinery and tools after
   the adoption of a local enterprise zone development taxation ordinance, nor
   shall it include any additional revenues merely resulting from an increase in
   the assessed value of real estate or machinery and tools which were located in
   the zone prior to the adoption of a local enterprise zone development taxation
   ordinance unless such property is improved or enhanced.

B. The governing body shall hold a public hearing on the need for a local
enterprise zone development taxation program in the county, city, or town prior
to adopting a local enterprise zone development taxation ordinance. Notice of
the public hearing shall be published three times in each newspaper of general
circulation in such county, city, or town, with the first publication appearing
no more than 35 days before and the third publication appearing no less than
seven days before the hearing. The notice shall include the time, place and
purpose of the public hearing; define local enterprise zone development
taxation; indicate the proposed boundaries of the local enterprise zone; state
whether all or a specified percentage of real property or machinery or tools, or
both, will be subject to local enterprise zone development taxation; and
describe the purposes for which funds in the Local Enterprise Zone Development
Fund are authorized to be used.

HISTORY: 1997, c. 314; 2005, cc. 863, 884; 2023, cc. 506, 507; 2024, cc. 225,
242.