Rooks County Neighborhood
(Re-adopted January 1, 2023)
QUESTIONS AND ANSWERS
What is the Tax Rebate Program?
During the 1994 legislative session, lawmakers passed Senate Bill #732, which provides tax rebates for new construction and the rehabilitation of existing structures. In order to implement the legislation locally, each municipality must adopt a plan and designate an area in which they want to promote revitalization and development or redevelopment.
What is a “tax rebate”?
It is a refund of the property taxes which are paid on the actual value added to a property due to the improvement. Under the Neighborhood Revitalization Plan legislation, the taxes relating to the assessed value on the property prior to the improvement may not be reduced and will continue to be payable.
What is “qualified improvement”?
Qualified improvement includes new construction, some rehabilitation and additions.
How is “structure” defined?
“Structure” means any building wall or other structure, including the building and improvements to the existing structures and fixtures assimilated to the real estate. Includes residential, commercial, or agricultural properties.
What kind of “improvements” will increase the assessed value?
New construction, additions and major rehabilitation will increase the assessed value. Repairs generally will not increase the assessed value unless there are several major repairs or improvements completed at the same time.
Does “one dollar” spent on work equal “one dollar” of increased value?
One dollar spent is not necessarily equal to one dollar of increased value.
What determines eligibility for a tax rebate?
New, as well as existing improvements must conform with all codes, rules and regulations in effect. You should secure a building permit for most improvements, where applicable. Call the city office to find out if you need a building permit.
If qualified improvements have been made, how does one obtain a tax rebate?
The property owner must file, and have approved, an application with the County Appraiser before construction begins. There will be no exceptions.
The property owner. Even if as a lessee you are doing the improvements and your lease agreement has you paying the taxes, the property owner must apply. The tax rebate does not follow the sale of the property within the 10-year term of the sale.
How often do I need to apply?
Apply each year that you make a qualifying improvement to the property, even though the improvements may not actually be completed during the year. If no further improvements are made, the initial application will be sufficient without the property owner having to file an additional application for succeeding years in which a tax rebate is received.
Will the schedule of tax rebates, as determined by the increase in assessed value in the first year, ever change?
Yes. All tax rebates under this plan (a) shall be based on the tax increase from the assessed valuation, (b) shall be paid commencing in the first calendar year following the year of completion, and (c) may change upward or downward depending on the change in applicable mill levies.
What happens if I am late paying my taxes?
If an approved NRP recipient is late in paying their property taxes (not paid in full by May 10) they will be eliminated from the NRP program for that improvement.
If I plan to purchase or build a home with the specific purpose of selling the home to a third party, does the rebate carryover to the new homeowner?
Generally, when a property sales, the rebate does not carryover to the new owner. However, an amendment was added to the program that allows a speculative build or renovation to be carried over to the new owner. To qualify, the person doing the building or renovation must sign an affidavit stating that they are building/renovating specifically for the purpose of conveying it to a new owner. This must be done in advance in the County Appraiser’s Office.
* NOTE: No applicant having delinquent taxes due in Rooks County will be eligible for this program. In the event any such taxes become delinquent during the ten (10) year period, all current and future tax rebates shall be forfeited in full.
Prior to filing the application for tax rebate, you will need to do the following:
- Meet with and obtain an application from the County Appraiser’s Office.
- Prior to the commencement of construction on any improvement or new construction for which a tax rebate will be requested, the applicant-owner will complete Part 1 of the application. Requests must be received and approved before commencement of construction. There will be no exceptions.
- Part 1 of the application must be filed with the County Appraiser’s Office with non-refundable $50 application fee prior to the commencement of construction.
- The County Appraiser’s Office will return a copy of Parts 1 and 2 to the applicant within fifteen (15) working days, indicating approval or denial of the project.
- The County Appraiser’s Office will forward a copy of Parts 1 and 2 to the County Clerk for notification and information purposes.
- Copies of the application will also be forwarded to the Economic Development Office for monitoring purposes.
- For any improvement that is only partially completed as of January 1, following the commencement of construction: The owner-applicant will file Part 3(a) of the application with the County Appraiser indicating the status of construction on January 1.
- For any improvement that is completed on or before January 1, following the commencement of construction: The owner-applicant will file Part 3(b) of the application with the County Appraiser on or before December 1, preceding the commencement of the tax rebate period, certifying the completion of construction.
- Soon after January 1, the County Appraiser will conduct an on-site inspection of the construction project (improvement, rehabilitation, or new) and determine the new valuation of the real estate accordingly. The valuation is then reported to the County Clerk by June 15. The tax records will be revised.
- Upon completion of the project and final filing of Part 3, and the determination of the new valuation of said real estate, the form will be filed with the County Clerk and the County Appraiser certifying the project is in compliance with the eligibility requirements for a tax rebate. The owner-applicant will be notified within five (5) working days.
There is a three-year open application period. The tax rebate will be for a length of ten years. Rebate will be 100% of the county mill levy the first year, decreasing 10% annually, with the taxpayer paying 100% of real estate taxes by the 11th year. (Rebates will not include State mill levy or State school mill levy.)
Some Specific Benefits Of The Tax Rebate Program Are:
- It will provide incentives for housing improvements through property tax refunds.
- The benefits of the program will apply to individual home owners as well as businesses.
- It does not interfere with current property tax revenues.
- The program will create new, long-term tax revenue, without creating a fiscal burden for the cities and county.
- The open application period will end on December 31, 2025. The tax rebate will be for a length of ten (10) years. The rebate will be 100% of the county mill levy the first year, decreasing 10% annually, with the taxpayer paying 100% of real estate taxes by the 11th year. (Rebates will not include State mill levy or State school mill levy).
- It will offer incentives for development where development might not otherwise occur.
- It will help create jobs because, historically, jobs follow development.
- It will help reverse the outward migration of residents, and the resulting deterioration of neighborhoods within the county.
- It will help stabilize land values.
- It will strengthen the fiscal capacity of our city and county government to grow and serve our area.
- It provides a limited window of opportunity for participation, thereby prompting immediate response.
- It will encourage housing, commercial, agricultural, and industrial development in the county.