Code of Massachusetts Regulations › 810 CMR - DIVISION OF CAPITAL ASSET MANAGEMENT AND MAINTENANCE › Title 810 CMR 51.00 - Generating new state tax revenues and local tax revenues by stimulating sustainable economic development through infrastructure improvements › Section 51.02 - Definitions

Current through Register 1525, July 5, 2024
Unless otherwise provided in
				801 CMR 51.00, terms shall
				have the meanings assigned to them in St. 2006, c. 293, §§ 5 through
				12, as amended by St. 2008, c. 129, §§ 2 through 17. The following
				terms shall have the following meanings or, if such terms have been assigned
				meanings in St. 2006, c. 293, §§ 5 through 12, as amended by St.
				2008, c. 129, §§ 2 through 17, and St. 2012, c. 238, §§ 60
				through 63, the following modified meanings in addition to the meanings so
				assigned:
Annual Certification of New State Tax
				Revenues
, the annual certificate the Commissioner is required to
				make to the Secretary and the Treasurer pursuant to St. 2006, c. 293, §
				10(a) regarding the Commissioner's determination of the New State Tax Revenues
				generated with respect to each Project Component in the prior fiscal year of
				the Commonwealth, which annual certificate shall be issued in accordance with
				801 CMR 51.00 and the DOR
				Guidance and shall clearly identify, for the prior fiscal year of the
				Commonwealth: the total state tax revenues generated from each Project
				Component; the portion of such state tax revenues that constitutes New Revenues
				from each Project Component, including the Annual Data and Displacement Factors
				upon which such determination is based; the portion of any such New Revenues
				that constitutes Dedicated Revenue from each Project Component; the New State
				Tax Revenues generated from each Project Component; the Shortfall amount, if
				any, with respect to each Project Component; the cumulative New State Tax
				Revenues with respect to each Project Component for all prior fiscal years of
				the Commonwealth; and a statement as to whether the cumulative New State Tax
				Revenues with respect to an Project Component equal or exceed the Net Debt
				Service on the Bonds allocable to the Project Component.
Annual Data
, the data that the Owner
				of each Project Component is required to submit to the Department pursuant to
				the DOR Guidance in order for the Commissioner to determine the New Revenues
				and New State Tax Revenues for the prior fiscal year of the Commonwealth and to
				issue the Annual Certification of New State Tax Revenues.
Application Fee
, a fee in the amount
				of $50,000 payable by the Developer to the Commonwealth upon the filing of a
				Preliminary Economic Development Proposal with the Secretary for administrative
				costs of the Secretary, the Department and the Agency related to the evaluation
				and processing of the Preliminary Economic Development Proposal.
Bond Anticipation Notes or "BANs"
,
				bonds or notes issued to fund Project Costs maturing no later than the date of
				expected substantial completion of the Project Component or two years,
				whichever is sooner, for which all interest and other costs are to be paid by
				the Developer, and principal is to be refunded from the proceeds of permanent
				long-term financing.
Bond Issuance Fee
, a fee payable by
				the Developer to the Agency upon the issuance of the Bonds for the Agency's
				role as the issuer of the Bonds; the amount of such fee shall be determined by
				the Agency in accordance with the fee schedule it customarily uses in
				connection with the issuance of bonds.
Bonds
, includes, all bonds issued by
				the Agency pursuant to
				801 CMR 51.00, without
				limitation, including Bond Anticipation Notes and refunding bonds issued to
				refinance Bond Anticipation Notes or bonds issued to finance Costs of Public
				Infrastructure Improvements.
Commitments
, written commitments from
				prospective tenants or purchasers of all or a portion of a Project Component
				that the Developer has provided to the Secretary and that the Secretary
				determines, in his or her sole discretion, to be sufficient evidence of the
				prospective tenants' or purchasers' commitment to lease for the specified term
				or to purchase all or a portion of a Project Component. New State Tax Revenue
				projected during a lease for less than ten years shall only count as projected
				New State Tax Revenues during the term of the lease. New State Tax Revenue
				projected during a lease of ten years or longer shall count as projected New
				State Tax Revenues during the term of the lease and shall also serve as the
				basis for, and shall be taken into account in, projecting New State Tax Revenue
				from the Project Component which shall be counted through the term of the
				Bonds. If there is a compelling reason in connection with the facts related to
				a specific development to believe that a lease commitment of less than ten
				years but not less than five years resulting in New State Tax Revenues is
				indicative of the level of New State Tax Revenues that will be generated from
				the related Project Component following the term of the lease, the Secretary
				may, in his or her discretion, direct the Commissioner to assume the same level
				of projected New State Tax Revenues from the related Project Component
				following the lease term through the term of the Bonds.
Convention Center District
, the
				convention center finance district, as defined in St. 1997, c. 152, § 2,
				and the Springfield civic and convention center finance district, as defined in
				St. 1997, c. 152, § 10b½.
Cost of Project
,
Project
				Costs
and
Costs
, the costs of Public
				Infrastructure Improvements to be funded from proceeds of Bonds which may
				include any of the costs identified in the statutory definition that are
				identified by the Developer in its proposal, including costs of issuing the
				Bonds and costs of acquisition of land prior to approval which are directly
				related to and needed for the Public Infrastructure Improvements, but the
				Secretary shall not approve any proposal that includes interest on the Bonds as
				a cost to be financed by the Bonds. The Secretary shall not approve costs
				incurred prior to the approval of any proposal by the Secretary unless:
(a) these costs were incurred after September 7, 2006;
(b) sufficient evidence is provided to the Secretary showing
				that the costs incurred prior to approval are preliminary costs directly
				related to the planning or design of the proposed Public Infrastructure
				Improvements or the acquisition of land directly related to and needed for such
				Public Infrastructure Improvements; and
(c) compelling evidence is provided that the Economic
				Development Project would not happen or would not happen to the same extent
				without the financing provided under St. 2006, c. 293, §§ 5 through
				12, as amended by St. 2008, c. 129, §§ 2 through 17 and St. 2012, c.
				238, §§ 60 through 63.
Displacement Factors
, discount factors
				to be used in calculating New Revenues and New State Tax Revenues to adjust for
				any estimated reduction in revenues resulting from jobs and commercial activity
				in the Commonwealth that are indirectly displaced as a result of new commercial
				activity within the Economic Development District, which factors shall be
				determined by the Commissioner of Revenue based on the Independent Consultant
				Analysis and in accordance with the DOR Guidance.
DOR Guidance
, Any
Technical
				Information Release
or any other guidance issued by the Commissioner
				pursuant to St. 2006, c. 293, § 12.
Eligible New Job
, shall not include
				any job that directly replaces a job elsewhere in the Commonwealth, as
				determined in accordance with
				801 CMR 51.00 and the DOR
				Guidance, or the retention of any job in the Commonwealth, except in
				circumstances where the Developer provides compelling evidence that the job
				would have been relocated outside of the Commonwealth if the Economic
				Development Project were not carried out.
Growth District
, a geographic area
				designated as such by the Executive Office of Housing and Economic Development
				for purposes of coordinating an effort among the Commonwealth, the Municipality
				and property owners to pre-permit the area to expedite commercial and
				residential development within the area.
Independent Consultant Analysis
, an
				analysis of an independent expert or experts in real estate development
				feasibility, market and economic impacts of development and estimating
				construction costs with respect to the cost of the Economic Development
				Project, including the Public Infrastructure Improvements, the feasibility of
				the Economic Development Proposal, the Displacement Factors recommended for the
				various Project Components and the New Revenues and New State Tax Revenues to
				be generated as a result of the Economic Development Proposal.
Infrastructure Development Assistance
				Agreement
, the agreement required pursuant to St. 2006, c. 293,
				§ 8, as amended by St. 2008, c. 129, §§ 8 and 9.
Municipality
, includes only the city
				or town or those cities or towns within which all or a portion of the Economic
				Development District is located, and does not include any city or town wholly
				outside of the Economic Development District even if Public Infrastructure
				Improvements adjacent to the Economic Development District and related to the
				Economic Development Project are located in whole or in part in the city or
				town.
Municipal Liquidity Reserve
, the
				liquidity reserve the Municipality is required to establish for each Assessment
				Parcel pursuant to St. 2006, c. 293, § 7, as amended by st. 2008, c. 129,
				§§ 5 through 7, and St. 2012, c. 238, §§ 60 through 62, and
				in accordance with
				801
				CMR 51.12 and
				51.13.
Net Debt Service
, the Debt Service
				payable on the Bonds or on any portion thereof, as the context requires,
				less:
(a) any Shortfall Payments previously made to the Commonwealth
				with respect to the payment of any portion of such Debt Service previously due
				and payable; and
(b) any infrastructure assessments collected and paid to the
				Commonwealth with respect to the payment of any portion of such Debt Service
				due and payable on any of the Bonds prior to the related Project Component
				being certified as an Occupied Project Component.
New Revenue
.
(a) shall not include any revenue that would have been realized
				by the Commonwealth if a Certified Economic Development Project had not been
				carried out under St. 2006, c. 293, §§ 5 through 12, as amended by
				St. 2008, c. 129, §§ 2 through 17 and St. 2012, c. 238, §§
				60 through 63, including any revenue resulting from commercial activity that
				has been or is expected to be relocated from elsewhere in the Commonwealth to
				the Economic Development District and from commercial activity that is
				indirectly displaced as a result of new commercial activity within the Economic
				Development District, all as determined in accordance with
				801 CMR 51.00 and the DOR
				Guidance; and
(b) shall be net of any revenue that the Commonwealth realized
				from commercial activity or jobs located in the Economic Development District
				in the fiscal year prior to the filing of the Economic Development Proposal or
				the fiscal year prior to the Developer's acquisition of the property, whichever
				fiscal year yielded more revenue to the Commonwealth from the property as
				determined in accordance with the DOR Guidance, that has been or will be
				displaced as a result of the Project and not relocated elsewhere in the
				Commonwealth.
New State Tax Revenue
, as defined in
				St. 2006, c. 293, §§ 5 through 12, as amended by St. 2008, c. 129,
				§§ 2 through 17 and St. 2012, c. 238, §§ 60 through 63,
				shall include not more than 50% of any New Revenue attributable to
				construction-related activity and purchases in connection with the Economic
				Development Project, and, in any given fiscal year, the amount of
				construction-related New State Tax Revenue derived from a Project Component
				shall not exceed 50% of annual Debt Service allocable to the Project
				Component.
Occupied Project Component
, a Project
				Component that the Developer certifies to the Secretary and to the Agency has
				been completed and is occupied by tenants or an Owner at a level equal to or
				greater than the minimum level of occupancy for the Project Component
				established under the Infrastructure Development Assistance Agreement in
				accordance with St. 2006, c. 293, § 9. Such minimum level of occupancy
				shall not be established at a level that would result in projected New State
				Tax Revenues generated from the Project Component at that minimum occupancy
				level being less than the Debt Service payable on the related Bonds. New State
				Tax Revenue attributable to construction-related activity and purchases shall
				be allocated among all Occupied Project Components in any fiscal year on a
pro rata
basis based on the portion of the Bonds allocable to
				such Occupied Project Components. Both the Commonwealth and the Municipality
				shall have a right of review and an opportunity to contest any determination
				that a Project Component is occupied. Each shall be given 30 days to inspect
				the Project Component and to review related commitments regarding occupancy to
				confirm that the Project Component is in fact an Occupied Project Component as
				provided for in the Infrastructure Development Assistance Agreement. If either
				the Commonwealth or the Municipality challenges the Developer's certification
				of an Occupied Project Component, the Agency shall have the right to inspect
				and make the final decision and certification as to whether or not the Project
				Component is in fact an Occupied Project Component. Once a Project Component
				has been certified as an Occupied Project Component, it shall thereafter always
				be considered an Occupied Project Component.
Owner
, the current property taxpayer
				for an Assessment Parcel.
Phased Project
, an Economic
				Development Project that the Developer proposes to be approved and completed in
				phases and that is contained within one contiguous Economic Development
				District, includes at least one Commercial Component and one Public
				Infrastructure Improvement in each phase of the Project, and constitutes a
				single Economic Development Project for all purposes of St. 2006, c. 293,
				§§ 5 through 12, as amended by St. 2008, c. 129, §§ 2
				through 17 and St. 2012, c. 238, §§ 60 through 63, and
				801 CMR 51.00.
Preliminary Approval Letter
, the
				letter of the Secretary approving the Preliminary Economic Development Proposal
				under
				801 CMR
				51.08.
Preliminary Certificate of the Agency
,
				the certificate of the Agency regarding estimated Costs of the Project that may
				be supported by New State Tax Revenues under
				801 CMR
				51.06.
Preliminary Certificate of the
				Commissioner
, the certificate of the Commissioner regarding
				estimated New State Tax Revenues and other matters pursuant to
				801 CMR
				51.07 and the DOR Guidance.
Preliminary Economic Development
				Proposal
, the preliminary proposal required to be submitted to the
				Secretary, the Agency, the Municipal Officers and the Commissioner prior to
				filing the Economic Development Proposal with the Municipality as described in
				801 CMR
				51.06.
Project Component
, not more than one
				Commercial Component of an Economic Development Project, located on not more
				than one Assessment Parcel, and exclusive of any Public Infrastructure
				Improvements.
Shortfall
, the amount certified by the
				Commissioner in the Annual Certification of New State Tax Revenues by which
				Debt Service on Bonds allocable to an Occupied Project Component in any fiscal
				year of the Commonwealth exceeded the amount of New State Tax Revenues derived
				from the Occupied Project Component in that fiscal year, less the sum
				of:
(a) any New State Tax Revenues on any other Occupied Project
				Component that exceeded the Debt Service allocable to such other Occupied
				Project Component in that fiscal year that is available to reduce this amount
				plus;
(b) the portion of the cumulative amount of the New State Tax
				Revenues received through the prior fiscal year of the Commonwealth that
				exceeded the cumulative amount of the Net Debt Service due and payable on the
				Bonds through said prior fiscal year that has been transferred to the Agency
				and not yet used or legally committed to defease or pay a portion of the Bonds.
				The cumulative construction-related New State Tax Revenue used or legally
				committed through the current fiscal year shall not exceed 50% of cumulative
				Debt Service due and payable on any of the Bonds through said current fiscal
				year.
Sustainable Development Principles
,
				the sustainable development principles in
				801 CMR
				51.18.