2006 Code of Virginia § 59.1-548 - Enterprise zone real property investment grants

59.1-548. Enterprise zone real property investment grants.

A. As used in this section:

"Facility" means a complex of buildings, co-located at a single physicallocation within an enterprise zone, all of which are necessary to facilitatethe conduct of the same trade or business. This definition applies to newconstruction as well as to the rehabilitation and expansion of existingstructures.

"Mixed use" means a building incorporating residential uses in which aminimum of 30 percent of the useable floor space will be devoted tocommercial, office or industrial use.

"Qualified real property investment" means the amount properly chargeableto a capital account for improvements to rehabilitate, expand or constructdepreciable real property placed in service during the calendar year withinan enterprise zone provided that the total amount of such improvements equalsor exceeds (i) $50,000 with respect to a single building or a facility in thecase of rehabilitation or expansion or (ii) $250,000 with respect to a singlebuilding or a facility in the case of new construction. Qualified realproperty investments include expenditures associated with (a) any exterior,interior, structural, mechanical or electrical improvements necessary toconstruct, expand or rehabilitate a building for commercial, industrial ormixed use; (b) excavations; (c) grading and paving; (d) installing driveways;and (e) landscaping or land improvements. Qualified real property investmentsshall include, but not be limited to, costs associated with demolition,carpentry, sheetrock, plaster, painting, ceilings, fixtures, doors, windows,fire suppression systems, roofing, flashing, exterior repair, cleaning andcleanup.

Qualified real property investment shall not include:

1. The cost of acquiring any real property or building.

2. Other acquisition costs including: (i) the cost of furnishings; (ii) anyexpenditure associated with appraisal, architectural, engineering, surveying,and interior design fees; (iii) loan fees, points, or capitalized interest;(iv) legal, accounting, realtor, sales and marketing, or other professionalfees; (v) closing costs, permits, user fees, zoning fees, impact fees, andinspection fees; (vi) bids, insurance, signage, utilities, bonding, copying,rent loss, or temporary facilities incurred during construction; (vii)utility connection or access fees; (viii) outbuildings; (ix) the cost of anywell or septic or sewer system; and (x) roads.

3. The basis of any property: (i) for which a grant under this section waspreviously provided; (ii) for which a tax credit under 59.1-280.1 waspreviously granted; (iii) which was previously placed in service in Virginiaby the qualified zone investor, a related party as defined by InternalRevenue Code 267 (b), or a trade or business under common control asdefined by Internal Revenue Code 52 (b); or (iv) which was previously inservice in Virginia and has a basis in the hands of the person acquiring it,determined in whole or in part by reference to the basis of such property inthe hands of the person from whom it was acquired or Internal Revenue Code 1014 (a).

"Qualified zone investor" means an owner or tenant of real property locatedwithin an enterprise zone who expands, rehabilitates or constructs such realproperty for commercial, industrial or mixed use. In the case of a tenant,the amounts of qualified zone investment specified in this section shallrelate to the proportion of the property for which the tenant holds a validlease.

B. For any qualified zone investor making less than $2 million in qualifiedreal property investment, a real property investment grant shall be allowedin an amount equaling 30 percent of the amount of qualified real propertyinvestment not to exceed $125,000 within any five-year period for anybuilding or facility. For any qualified zone investor making $2 million ormore in qualified real property investments, a real property investment grantshall be allowed in an amount equaling 30 percent of the amount of qualifiedreal property investment not to exceed $250,000 within any five-year periodfor any building or facility.

C. A qualified zone investor shall apply for a real property investment grantin the calendar year following the year in which the property was placed inservice. Real property investments that were placed in service in calendaryear 2004 that were not eligible to submit a tax credit request as a smallqualified zone resident pursuant to former 59.1-280.1 because of the timingof their tax year may apply for a real property investment grant in 2006.

(2005, cc. 863, 884.)