HB 665 Summary

• Creates Downtown Redevelopment Districts: Authorizes municipal corporations to establish downtown redevelopment districts (not more than 10 acres with at least one historic building) and declare improvements within them as public purposes exempt from taxation for up to 10 years (extendable to 30 years with school district approval).

• Tax Exemption and Service Payments: Property improvements in districts are exempt from taxation on a percentage basis (up to 70%), while owners make service payments in lieu of taxes to the municipality, which are deposited into a municipal downtown redevelopment district fund.

• Revenue Use: Revenue from service payments and redevelopment charges may be used to finance loans/grants to historic building owners, contribute to special improvement districts, finance public infrastructure improvements, or fund non-historic building repairs.

• School District Approval: Districts extending beyond 10 years require school district board approval; school districts can negotiate compensation agreements or approve exemptions with specific conditions regarding payment of foregone tax revenue.

• Economic Development Plan Required: Municipal corporations must adopt ordinances specifying district boundaries, parcel numbers, rehabilitation details, district lifespan, exemption percentages, and comprehensive economic development plans describing purposes, community collaboration, estimated service payments, and revenue use.