2023 District of Columbia Code › Title 47 - Taxation, Licensing, Permits, Assessments, and Fees. [Enacted title] › Chapter 10 - Property Exempt from Taxation › § 47–1099.10. Children's Hospital Research and Innovation Campus tax exemptions

§ 47–1099.10. Children's Hospital Research and Innovation Campus tax exemptions.
*NOTE: This section includes amendments by temporary legislation that will expire on April 28, 2024. To view the text of this section after the expiration of all emergency and temporary legislation affecting this section, click this link: Permanent Version.*
(a) Only that portion of real property currently described for assessment and taxation purposes as Square 2950, Lot 808, which is to be subdivided in part into Square 2950, Lots 824 and 826, effective for tax year 2020, and the buildings located thereon ("Property"), owned by Children's National at Walter Reed, LLC, a wholly-owned subsidiary of Children's Hospital, a District of Columbia nonprofit corporation, shall remain exempt from real property taxation to the extent the Property is validly exempt as of the day before the date any lease is granted to certain business entities known as Building 52/53 NMTC Borrower, LLC, and Building 54 NMTC Borrower, LLC (controlled directly or indirectly by Children's Hospital), and for the period during which the Property is eligible to receive federal tax benefits, including New Markets Tax Credits under 26 U.S.C. § 45D, Opportunity Zone tax benefits under 26 U.S.C. § 1400Z-1,
et seq.
, or Historic Rehabilitation Tax Credits under 26 U.S.C. § 47; provided, that the Property shall be subject to subsection (c) of this section and §§ 47-1007 and 47-1009. The Property shall be subject to the provisions of §§ 47-1005, 47-1007 and 47-1009 where a sublease or lease is made to another entity (other than the certain business entities referenced in this subsection) that would not qualify for exemption under § 47-1002 if it were both the owner and user of the property.
(b) Any transfer, assignment, or other disposition of all or any portion of the Property, including an assignment of leasehold interest in the Property or a sublease of the Property, between Children's National at Walter Reed, LLC, and Children's Hospital, any business entity controlled directly or indirectly by Children's Hospital, or a security interest instrument, including a deed of trust, secured by the Property or any interest therein, shall be exempt from the tax imposed by §§ 42-1103 and 47-903.
(c)(1) The buildings located on the Property, owned by Children's National at Walter Reed, LLC, or any subsidiary of Children's Hospital ("Children's") shall remain exempt from real property taxation; provided, that for any contract entered into for architectural design services, construction services, or materials, including design, professional and technical services, construction management and trade work, development, renovation, and suppliers ("services and materials") needed for the development, remodel, or construction of Phase II of the Children's National Research & Innovation Campus ("Project"), Children's submits to the Department of Small and Local Business Development ("Department") for approval a plan to set and adhere to a Project goal to spend at least 35% of its adjusted budget ("spend goal") spread out over the remaining term of the federal tax credit with small business enterprises ("SBE"), as defined in [§ 2-218.02(16)].
(2) The adjusted budget shall consist of costs associated with the services and materials listed in paragraph (1) of this subsection, all construction costs less qualifying expenses, including acquisition and financing related costs, those construction-related costs in areas with no SBE representation, and government fees and permit costs.
(3) If there are insufficient SBEs to fulfill the annual spend goal set forth in paragraph (l) of this subsection, then Children's may count its spend with qualified and certified business enterprises, as defined in [§ 2-218.02(1D)], toward its annual spend goal.
(4) Pursuant to [§ 2-218.51], Children's may request a waiver in writing to the Director of the Department. The Director may approve the waiver if Children's reasonably demonstrates that there is insufficient market capacity for the goods or services that comprise the project and that the lack of capacity leaves Children's commercially incapable of achieving its subcontracting requirements at a project level.
(d)(1) The Department shall certify Children's Project spend numbers and submit certification of that spend to the Office of Tax and Revenue.
(2) If Children's fails to meet its SBE spend goal, Children's shall remit to the District the amount it would have otherwise had to pay in real property tax on behalf of the buildings on the Property at a sum proportionate to the difference between the Project spend goal and the actual SBE expenditure or, if necessary, § 2-218.01
et seq.
expenditures during the timeframe of the Project.
(3) If Children's exceeds its SBE spend goal for any one year, the excess spend will be attributed to the subsequent year's goal.
(Mar. 16, 2021, D.C. Law 23-224, § 2(b), 68 DCR 00110; Sept. 16, 2023, D.C. Law 25-56, § 2, 70 DCR 10704.)
Emergency Legislation
For temporary (90 days) amendment of this section, see § 2 of Children's National Hospital Research and Innovation Campus Equitable Tax Relief Emergency Amendment Act of 2023 (D.C. Act 25-167, July 10, 2023, 70 DCR 9741).
For temporary (90 days) amendment of this section, see § 2 of Children's National Hospital Research and Innovation Campus Equitable Tax Relief Congressional Review Emergency Amendment Act of 2022 (D.C. Act 24-590, Oct. 25, 2022, 0 DCR 0).
For temporary (90 days) amendment of this section, see § 2 of Children's National Hospital Research and Innovation Campus Equitable Tax Relief Emergency Amendment Act of 2022 (D.C. Act 24-538, July 27, 2022, 0 DCR 0).
For temporary (90 days) creation of this section, see § 2 of Children's Hospital Research and Innovation Campus Equitable Tax Relief Congressional Review Emergency Act of 2021 (D.C. Act 24-17, Feb. 26, 2021, 68 DCR 002576).
For temporary (90 days) creation of this section, see § 2 of Children's Hospital Research and Innovation Campus Phase 1 Emergency Amendment Act of 2020 (D.C. Act 23-298, Apr. 27, 2020, 67 DCR 5048).
For temporary (90 days) creation of this section, see § 2(b) of Children's Hospital Research and Innovation Campus Phase 1 Emergency Amendment Act of 2019 (D.C. Act 23-68, June 20, 2019, 66 DCR 7610).
Temporary Legislation
For temporary (225 days) amendment of this section, see § 2 of Children's National Hospital Research and Innovation Campus Equitable Tax Relief Temporary Amendment Act of 2023 (D.C. Law 25-56, Sept. 16, 2023, 70 DCR 10704).
For temporary (225 days) amendment of this section, see § 2 of Children's National Hospital Research and Innovation Campus Equitable Tax Relief Temporary Amendment Act of 2022 (D.C. Law 24-198, Dec. 13, 2022, 69 DCR 12677).
For temporary (225 days) creation of this section, see § 2 of Children's Hospital Research and Innovation Campus Phase 1 Temporary Amendment Act of 2020 (D.C. Law 23-124, June 24, 2020, 67 DCR 8984).
For temporary (225 days) creation of this section, see § 2 of Children's Hospital Research and Innovation Campus Phase 1 Temporary Amendment Act of 2019 (D.C. Law 23-21, Sept. 11, 2019, 66 DCR 9726).