ARIZONA STATE SENATE
Phoenix, Arizona
school site donation; tax
credit
Purpose
Establishes new tax credits
for land and improvements donated for school site construction and extends the credit for public school fees to all
curriculum conducted in the school.
Background
Students FIRST legislation enacted in 1998 (Laws 1998, Fifth Special Session, Chapter 1, Section 1) set guidelines regarding the purchasing of land as sites for the construction of new schools. Current law requires the School Facilities Board to distribute monies to school districts from the new school facilities fund for the purchase of land for new school construction. The purchase price must be lower than or equal to the fair market value of the land. If a site is donated, the School Facilities Board will distribute an amount equal to 20 percent of the fair market value of the land, which the school district must place in the unrestricted capital outlay fund.
H.B. 2451 provides an
incentive for developers to donate the land for new school sites. The
incentive is an income tax credit equal to 50 percent of the fair market value
of the land and improvements donated to a school district.
Provisions
1. Allows an individual and corporate income tax credit in the amount of 30 percent of the appraised value of property and improvements that are donated to a school district or charter school as a site for the construction of a new school. Requires a school district to notify the School Facilities Board of any property donation that the district accepts for the purposes of this section. Requires a charter school to notify the sponsor of the charter school of the donation.
2. Requires charter schools to establish a school on the property within 48 months after the donation or reimburse the state general fund for the amount of the tax credit granted plus an inflation factor. Requires a charter school to reimburse the state general fund for the amount of the tax credit granted plus an inflation factor if the charter school ceases to operate the school or instruct students for 24 consecutive months.
3. Provides that in the event of a donee=s financial failure, will reimburse the state general fund for the amount of the tax credit granted plus an inflation factor.
4. Provides that a donee may sell the property, but requires the proceeds from the sale to be sued for capital projects or other educational purposes. Allows a donee to refuse a donation.
5. Allows a charter school to sell any donated property however, if the buyer is not a school district the charter school will reimburse the state general fund for the amount of the tax credit granted plus an inflation factor.
6. Makes technical and conforming changes.
7. Provides for a retroactive effective date beginning in tax year 1999.
Health Action
WM 1/25/00 DP 9-1-0-2
3rd Read 2/29/00 49-2-9-0
Prepared by Senate Staff
March 8, 2000