Oklahoma § 62-860 - Incentives or exemptions from local taxation

§ 62-860. Incentives or exemptions from local taxation

A. A project plan may contain a provision that certain local

taxes may be subject to incentives or may be exempted in

reinvestment areas, historic preservation areas or enterprise areas.

B. The governing body may grant incentives or exemptions from

local taxation only on the new investment made. No ad valorem tax

Oklahoma Statutes - Title 62. Public Finance

incentives or exemptions may be granted on the value of property

which has been assessed or which is subject to assessment prior to

the adoption of the project plan. No ad valorem tax incentives or

exemptions authorized in this section may be granted for retail

establishments. If a retail establishment is located in property

which otherwise qualifies for an incentive or exemption pursuant to

this section, the incentive or exemption shall not be allowed for

that portion of the property used for such retail establishment. As

used in this subsection, “retail establishment” shall not include an

establishment that provides lodging including but not limited to a

hotel, apartment hotel, public rooming house, or motel. No ad

valorem tax incentives or exemptions authorized in this section may

be granted if the property is located in an increment district or as

long as the property is subject to the ad valorem tax exemption for

new or expanding manufacturing facilities as authorized by Section

6B of Article X of the Oklahoma Constitution. In the event of

disposition by lease or sublease to a lessee not entitled to an ad

valorem tax exemption, the improvements placed thereon shall not be

entitled to an ad valorem tax exemption provided for in Section 850

et seq. of this title. Except as otherwise provided by this

subsection, the incentives, or exemptions, which may be full or

partial, may be granted for a period not to exceed five (5) years.

With respect to an establishment, the business of which is described

by U.S. Industry Number 518210 of the North American Industry

Classification System (NAICS) Manual, 2017 revision, such incentives

or exemptions may be granted for a period not to exceed twenty-five

(25) years.

C. No incentives or exemptions may be granted to any business

or firm that is relocating from within the state and is subject to

or in the process of recruitment by two or more governmental

entities within the state unless the governmental entity in which

the business or firm does not locate adopts a resolution giving

their approval to the granting of incentives or exemptions to the

business or firm locating in the competing governmental entity. No

incentives or exemptions may be granted to an out-of-state business

or firm that is subject to or in the process of recruitment by two

or more governmental entities within the state except as otherwise

provided for in this subsection. The prohibition against incentives

or exemptions to a business or firm relocating within the state may

be waived upon application by the governing body to, and approval

of, the Director of the Oklahoma Department of Commerce. In order

for the Director to approve the waiver, the Director must find that

the incentives or exemptions are necessary and sufficient to attract

the business or firm and that the benefits generated by the business

location outweigh the costs of the business location.

D. A project plan may contain a provision that ad valorem taxes

may be exempted in a commercial historic preservation area that is

Oklahoma Statutes - Title 62. Public Finance

adjacent to and serves designated historical residential areas for

neighborhood commercial preservation purposes in order for the

neighborhood to retain its basic character and scale. No ad valorem

tax exemption may be granted on the value of property which has been

assessed or which is subject to assessment prior to the adoption of

the project plan. No ad valorem tax exemption shall be granted

pursuant to the provisions of this subsection for single-family

residences. The governing body may grant the exemption only on the

increase in value of the property. The exemptions may be granted

for a specific period of time as determined by a written agreement

between the property owners of the area and the governing body and

may be renewed. Uses of the property eligible for this exemption

may include but not be limited to commercial, office, or multifamily

residential use.

E. For increment districts in operation for nine (9) months or

more, on or before the ninetieth day following the end of each

fiscal year, the governing body of a city, town, or county shall

submit a report to the Oklahoma Department of Commerce. The

Department shall provide a copy of the report to any member of the

public upon request. The disclosure report shall include the

following information:

1. The amount and source of revenue captured and apportioned

pursuant to the project plan;

2. The amount and purpose of expenditures;

3. The amount of principal and interest due on outstanding

bonded indebtedness;

4. The tax increment base and current captured appraised value

or the other local tax or fee collections retained by the area;

5. The captured appraised value or the other local tax or fee

collections shared by the city, town, or county and other taxing

entities, the total amount of tax increments received, and any

additional information necessary to demonstrate compliance with the

plan adopted by the city, town, or county;

6. The name of the person who is currently in charge of the

implementation of the plan; and

7. The names of the persons who have disclosed an interest as

required pursuant to Section 857 of this title and the interest

disclosed.

F. For those incentive districts in operation for nine (9)

months or more, on or before the ninetieth day following the end of

each fiscal year, the governing body of a city, town, or county

shall submit a report to the Oklahoma Department of Commerce. The

Department shall provide a copy of the report to any member of the

public upon request. The disclosure report shall include the

following information:

1. The parties receiving incentives or exemptions;

Oklahoma Statutes - Title 62. Public Finance

2. A general description of the property and the improvements

to be made;

3. The portion and fair market value of the property to be

exempted or that portion of the local taxes to be subject to

incentives or to be exempted;

4. The duration of the incentives or exemptions;

5. Any additional information necessary to demonstrate

compliance with the tax incentives or exemptions;

6. The name of the person who is currently in charge of the

implementation of the plan; and

7. The names of the persons who have disclosed an interest as

required pursuant to Section 857 of this title and the interest

disclosed.

Added by Laws 1992, c. 342, § 11. Amended by Laws 1994, c. 183, §

2, emerg. eff. May 9, 1994; Laws 2000, c. 351, § 3, emerg. eff. June

6, 2000; Laws 2001, c. 121, § 1, emerg. eff. April 23, 2001; Laws

2001, c. 382, § 1, eff. Nov. 1, 2001; Laws 2021, c. 571, § 2, eff.

Nov. 1, 2021; Laws 2023, c. 145, § 1, eff. Nov. 1, 2023.