Raised Bill No. 1240 Summary

• Caps commercial and industrial real property mill rate at 31.25 mills statewide effective October 1, 2023, with state reimbursement to municipalities for resulting revenue losses through a dedicated municipal mill rate reimbursement account.

• Establishes a municipal tax revenue sharing program that deposits excess tax revenue from income, corporate, insurance, and public service company taxes into a municipal tax revenue account when collections exceed projected growth rates, with distributions to municipalities starting when the account reaches $100 million.

• Creates a tax credit voucher program for new or expanded commercial office leases in downtown areas of distressed municipalities with 80,000+ population, offering up to 10% credit on lease payments and capital improvements for businesses meeting investment and employment requirements.

• Creates a tax credit voucher program for residential conversions of vacant or underutilized commercial office buildings in downtown distressed municipalities, offering 25-30% credits on qualified expenditures with enhanced credits for opportunity zones or affordable housing inclusion.

• Directs Department of Revenue Services to track tax revenue attribution by municipality starting July 1, 2023, and requires annual reporting on revenue sources and municipal needs gap metrics.