An Enterprise Zone is a specific geographic area in which the state and the town target programs to directly and indirectly aid business expansion and job creation. Rhode Island Enterprise Zones are authorized by the state legislature. They are designated for five-year periods with the approval of the Rhode Island Economic Development Corporation. Enterprise Zone boundaries are set by U.S. census tracts. The map shows the portions of Portsmouth that are included in the Enterprise Zone. Businesses must be registered for the program in advance of any new hiring.
The Portsmouth Tax Stabilization Program can be beneficial for construction of a new commercial building, expansion of an existing facility, renovation of an existing facility, or leasehold improvements in the Enterprise Zone.
Extension of EZ to December 2019
The State of RI has sunset the EZ Program. However, the Town of Portsmouth was granted a five-year program extension in 2014. By a Town Council Resolution (2014-12-8-B) of December 8, 2014 ) , the EZ Program for Portsmouth was extended until December 31, 2019
How much would be exempt?
The percentage of new added taxable assessment as a result of the new construction or expansion shall be exempt as follows:
|Year||% Exempt From Tax|
GENERAL RULES and STANDARDS
Tax Stabilization will not relate to the value of land, but only to the value of building improvements, nor does it change or affect any pre-existing valuation. Tax Stabilization shall apply to all value not assessed as of the previous December 31, regardless of whether the building permit therefore was issued before or after the beginning of the year. New and expanding businesses must apply for designation with the Director of Business Development in the same year as the issuance of a building permit. Tax Assessment and collection practices will be the same as for any other property, except for a final calculation on the portion of exempt from taxes.
In no event shall total assessment on which the exemptions are based exceed the then current assessment on the improvements. Leasehold improvements will be classified as tangible personal property in order to qualify, as long as they are attached to the building.
The only requirements to benefit from this program are for the business to be located in the Enterprise Zone, be current on property tax payments, and be in conformance with the zoning ordinance. There are no thresholds for minimum size or value, or a minimum number of jobs to be created.
OTHER CONDITIONS of PARTICIPATION
In the event that the applicant defaults on any quarterly tax or other payment due the Town on property receiving exemption here under for a period of more than 45 days (real estate, motor vehicle, or personal property), the stabilization shall cease immediately. Notice of delinquency shall be sent to property owner by registered mail not more than 30 days after delinquency.
Tax stabilization is transferable to new owners of eligible property, to the extent that only the remaining balance of eligible time a property may be in the tax stabilization program is transferable, or a pro rated portion of the original property thereof in the case of a conversion and transfer of property to condominium ownership, or other split ownership, provided that payment of property taxes due on said property in the Tax Stabilization program are not delinquent, and that the new and/or prior owner are not delinquent on payment of other taxes to the Town. All transfers of continuing participation must be registered with and approved by the Director of Business Development. The Director of Business Development will forward notice of eligible transfers of participation to the Tax Assessor.