Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 268 Third Substitute (2024GS)

Sponsor

Sen. Harper, W.

Final action

Governor Signed 3/21/2024

Outcome

Became law — signed by Gov. Spencer J. Cox

Summary

What it does

• This bill:
• enacts the First Home Investment Zone Act;
• defines terms;
• allows a municipality to create a first home investment zone to:
• provide affordable, owner-occupied housing;
• encourage mixed use development;
• encourage strategic and efficient land use planning;
• improve access to opportunities; and
• increase opportunities for home ownership;
• allows a first home investment zone to capture tax increment to finance the objectives of a first home investment zone;
• provides certain requirements regarding housing density, affordability, development size, and other characteristics of a first home investment zone;
• requires the housing and transit reinvestment zone committee to review and approve first home investment zone proposals; and
• makes technical changes.

Every vote on this bill

Bill text

FIRST HOME INVESTMENT ZONE ACT
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Wayne A. Harper
House Sponsor: 
____________
LONG TITLE
General Description:
This bill enacts the First Home Investment Zone Act.
Highlighted Provisions:
This bill:
▸ enacts the First Home Investment Zone Act;
▸ defines terms;
▸ allows a municipality to create a first home investment zone to:
• provide affordable, owner-occupied housing;
• encourage mixed use development;
• encourage strategic and efficient land use planning;
• improve access to opportunities; and
• increase opportunities for home ownership;
▸ allows a first home investment zone to capture tax increment to finance the
objectives of a first home investment zone;
▸ provides certain requirements regarding housing density, affordability, development
size, and other characteristics of a first home investment zone;
▸ requires the housing and transit reinvestment zone committee to review and approve
first home investment zone proposals; and
▸ makes technical changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
63N-3-602
, as last amended by Laws of Utah 2023, Chapter 357
63N-3-603
, as last amended by Laws of Utah 2023, Chapter 357
63N-3-605
, as last amended by Laws of Utah 2023, Chapter 357
ENACTS:
63N-3-1301
, Utah Code Annotated 1953
63N-3-1302
, Utah Code Annotated 1953
63N-3-1303
, Utah Code Annotated 1953
63N-3-1304
, Utah Code Annotated 1953
63N-3-1305
, Utah Code Annotated 1953
63N-3-1306
, Utah Code Annotated 1953
63N-3-1307
, Utah Code Annotated 1953
63N-3-1308
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
63N-3-602
 is amended to read:
63N-3-602.
Definitions.
As used in this part:
(1) "Affordable housing" means housing occupied or reserved for occupancy by
households with a gross household income equal to or less than 80% of the median gross
income of the applicable municipal or county statistical area for households of the same size.
(2) "Agency" means the same as that term is defined in Section 
17C-1-102
.
(3) "Base taxable value" means a property's taxable value as shown upon the
assessment roll last equalized during the base year.
(4) "Base year" means, for a proposed housing and transit reinvestment zone area, a
year beginning the first day of the calendar quarter determined by the last equalized tax roll
before the adoption of the housing and transit reinvestment zone.
(5) "Bus rapid transit" means a high-quality bus-based transit system that delivers fast
and efficient service that may include dedicated lanes, busways, traffic signal priority,
off-board fare collection, elevated platforms, and enhanced stations.
(6) "Bus rapid transit station" means an existing station, stop, or terminal, or a
proposed station, stop, or terminal that is specifically identified in a metropolitan planning
organization's adopted long-range transportation plan and the relevant public transit district's
five-year plan:
(a) along an existing bus rapid transit line; or
(b) along an extension to an existing bus rapid transit line or new bus rapid transit line.
(7) (a) "Commuter rail" means a heavy-rail passenger rail transit facility operated by a
large public transit district.
(b) "Commuter rail" does not include a light-rail passenger rail facility of a large public
transit district.
(8) "Commuter rail station" means an existing station, stop, or terminal, or a proposed
station, stop, or terminal, which has been specifically identified in a metropolitan planning
organization's adopted long-range transportation plan and the relevant public transit district's
five-year plan:
(a) along an existing commuter rail line;
(b) along an extension to an existing commuter rail line or new commuter rail line; or
(c) along a fixed guideway extension from an existing commuter rail line.
(9) (a) "Developable area" means the portion of land within a housing and transit
reinvestment zone available for development and construction of business and residential uses.
(b) "Developable area" does not include portions of land within a housing and transit
reinvestment zone that are allocated to:
(i) parks;
(ii) recreation facilities;
(iii) open space;
(iv) trails;
(v) publicly-owned roadway facilities; or
(vi) other public facilities.
(10) "Dwelling unit" means one or more rooms arranged for the use of one or more
individuals living together, as a single housekeeping unit normally having cooking, living,
sanitary, and sleeping facilities.
(11) "Enhanced development" means the construction of mixed uses including
housing, commercial uses, and related facilities.
(12) "Enhanced development costs" means extra costs associated with structured
parking costs, vertical construction costs, horizontal construction costs, life safety costs,
structural costs, conveyor or elevator costs, and other costs incurred due to the increased height
of buildings or enhanced development.
(13) "First home investment zone" means the same as that term is defined in Section
63N-3-1301
.
[
(13)
] 
(14)
 "Fixed guideway" means the same as that term is defined in Section
59-12-102
.
[
(14)
] 
(15)
 "Horizontal construction costs" means the additional costs associated with
earthwork, over excavation, utility work, transportation infrastructure, and landscaping to
achieve enhanced development in the housing and transit reinvestment zone.
[
(15)
] 
(16)
 "Housing and transit reinvestment zone" means a housing and transit
reinvestment zone created pursuant to this part.
[
(16)
] 
(17)
 "Housing and transit reinvestment zone committee" means a housing and
transit reinvestment zone committee created pursuant to Section 
63N-3-605
.
[
(17)
] 
(18)
 "Large public transit district" means the same as that term is defined in
Section 
17B-2a-802
.
[
(18)
] 
(19)
 "Light rail" means a passenger rail public transit system with right-of-way
and fixed rails:
(a) dedicated to exclusive use by light-rail public transit vehicles;
(b) that may cross streets at grade; and
(c) that may share parts of surface streets.
[
(19)
] 
(20)
 "Light rail station" means an existing station, stop, or terminal or a
proposed station, stop, or terminal, which has been specifically identified in a metropolitan
planning organization's adopted long-range transportation plan and the relevant public transit
district's five-year plan:
(a) along an existing light rail line; or
(b) along an extension to an existing light rail line or new light rail line.
[
(20)
] 
(21)
 "Metropolitan planning organization" means the same as that term is
defined in Section 
72-1-208.5
.
[
(21)
] 
(22)
 "Mixed use development" means development with a mix of multi-family
residential use and at least one additional land use.
[
(22)
] 
(23)
 "Municipality" means the same as that term is defined in Section 
10-1-104
.
[
(23)
] 
(24)
 "Participant" means the same as that term is defined in Section 
17C-1-102
.
[
(24)
] 
(25)
 "Participation agreement" means the same as that term is defined in Section
17C-1-102
, except that the agency may not provide and the person may not receive a direct
subsidy.
[
(25)
] 
(26)
 "Public transit county" means a county that has created a small public
transit district.
[
(26)
] 
(27)
 "Public transit hub" means a public transit depot or station where four or
more routes serving separate parts of the county-created transit district stop to transfer riders
between routes.
[
(27)
] 
(28)
 "Sales and use tax base year" means a sales and use tax year determined by
the first year pertaining to the tax imposed in Section 
59-12-103
 after the sales and use tax
boundary for a housing and transit reinvestment zone is established.
[
(28)
] 
(29)
 "Sales and use tax boundary" means a boundary created as described in
Section 
63N-3-604
, based on state sales and use tax collection that corresponds as closely as
reasonably practicable to the housing and transit reinvestment zone boundary.
[
(29)
] 
(30)
 "Sales and use tax increment" means the difference between:
(a) the amount of state sales and use tax revenue generated each year following the
sales and use tax base year by the sales and use tax from the area within a housing and transit
reinvestment zone designated in the housing and transit reinvestment zone proposal as the area
from which sales and use tax increment is to be collected; and
(b) the amount of state sales and use tax revenue that was generated from that same
area during the sales and use tax base year.
[
(30)
] 
(31)
 "Sales and use tax revenue" means revenue that is generated from the tax
imposed under Section 
59-12-103
.
[
(31)
] 
(32)
 "Small public transit district" means the same as that term is defined in
Section 
17B-2a-802
.
[
(32)
] 
(33)
 "Tax Commission" means the State Tax Commission created in Section
59-1-201
.
[
(33)
] 
(34)
 "Tax increment" means the difference between:
(a) the amount of property tax revenue generated each tax year by a taxing entity from
the area within a housing and transit reinvestment zone designated in the housing and transit
reinvestment zone proposal as the area from which tax increment is to be collected, using the
current assessed value and each taxing entity's current certified tax rate as defined in Section
59-2-924
; and
(b) the amount of property tax revenue that would be generated from that same area
using the base taxable value and each taxing entity's current certified tax rate as defined in
Section 
59-2-924
.
[
(34)
] 
(35)
 "Taxing entity" means the same as that term is defined in Section
17C-1-102
.
[
(35)
] 
(36)
 "Vertical construction costs" means the additional costs associated with
construction above four stories and structured parking to achieve enhanced development in the
housing and transit reinvestment zone.
Section 2. Section 
63N-3-603
 is amended to read:
63N-3-603.
Applicability, requirements, and limitations on a housing and transit
reinvestment zone.
(1) A housing and transit reinvestment zone proposal created under this part shall
promote the following objectives:
(a) higher utilization of public transit;
(b) increasing availability of housing, including affordable housing, and fulfillment of
moderate income housing plans;
(c) improving efficiencies in parking and transportation, including walkability of
communities near public transit facilities;
(d) overcoming development impediments and market conditions that render a
development cost prohibitive absent the proposal and incentives;
(e) conservation of water resources through efficient land use;
(f) improving air quality by reducing fuel consumption and motor vehicle trips;
(g) encouraging transformative mixed-use development and investment in
transportation and public transit infrastructure in strategic areas;
(h) strategic land use and municipal planning in major transit investment corridors as
described in Subsection 
10-9a-403
(2);
(i) increasing access to employment and educational opportunities; and
(j) increasing access to child care.
(2) In order to accomplish the objectives described in Subsection (1), a municipality or
public transit county that initiates the process to create a housing and transit reinvestment zone
as described in this part shall ensure that the proposal for a housing and transit reinvestment
zone includes:
(a) except as provided in Subsection (3), at least 10% of the proposed dwelling units
within the housing and transit reinvestment zone are affordable housing units;
(b) at least 51% of the developable area within the housing and transit reinvestment
zone includes residential uses with, except as provided in Subsection (4)(c), an average of 50
dwelling units per acre or greater;
(c) mixed-use development; and
(d) a mix of dwelling units to ensure that a reasonable percentage of the dwelling units
has more than one bedroom.
(3) A municipality or public transit county that, at the time the housing and transit
reinvestment zone proposal is approved by the housing and transit reinvestment zone
committee, meets the affordable housing guidelines of the United States Department of
Housing and Urban Development at 60% area median income is exempt from the requirement
described in Subsection (2)(a).
(4) (a) A municipality may only propose a housing and transit reinvestment zone at a
commuter rail station, and a public transit county may only propose a housing and transit
reinvestment zone at a public transit hub, that:
(i) subject to Subsection (5)(a):
(A) (I) except as provided in Subsection (4)(a)(i)(A)(II), for a municipality, does not
exceed a 1/3 mile radius of a commuter rail station;
(II) for a municipality that is a city of the first class with a population greater than
150,000 that is within a county of the first class, with an opportunity zone created pursuant to
Section 1400Z-1, Internal Revenue Code, does not exceed a 1/2 mile radius of a commuter rail
station located within the opportunity zone; or
(III) for a public transit county, does not exceed a 1/3 mile radius of a public transit
hub; and
(B) has a total area of no more than 125 noncontiguous acres;
(ii) subject to Section 
63N-3-607
, proposes the capture of a maximum of 80% of each
taxing entity's tax increment above the base year for a term of no more than 25 consecutive
years on each parcel within a 45-year period not to exceed the tax increment amount approved
in the housing and transit reinvestment zone proposal; and
(iii) the commencement of collection of tax increment, for all or a portion of the
housing and transit reinvestment zone, will be triggered by providing notice as described in
Subsection (6).
(b) A municipality or public transit county may only propose a housing and transit
reinvestment zone at a light rail station or bus rapid transit station that:
(i) subject to Subsection (5):
(A) does not exceed:
(I) except as provided in Subsection (4)(b)(i)(A)(II) or (III), a 1/4 mile radius of a bus
rapid transit station or light rail station;
(II) for a municipality that is a city of the first class with a population greater than
150,000 that is within a county of the first class, a 1/2 mile radius of a light rail station located
in an opportunity zone created pursuant to Section
1400Z-1, Internal Revenue Code; or
(III) a 1/2 mile radius of a light rail station located within a master-planned
development of 500 acres or more; and
(B) has a total area of no more than 100 noncontiguous acres;
(ii) subject to Subsection (4)(c) and Section 
63N-3-607
, proposes the capture of a
maximum of 80% of each taxing entity's tax increment above the base year for a term of no
more than 15 consecutive years on each parcel within a 30-year period not to exceed the tax
increment amount approved in the housing and transit reinvestment zone proposal; and
(iii) the commencement of collection of tax increment, for all or a portion of the
housing and transit reinvestment zone, will be triggered by providing notice as described in
Subsection (6).
(c) For a housing and transit reinvestment zone proposed by a public transit county at a
public transit hub, or for a housing and transit reinvestment zone proposed by a municipality at
a bus rapid transit station, if the proposed housing density within the housing and transit
reinvestment zone is between 39 and 49 dwelling units per acre, the maximum capture of each
taxing entity's tax increment above the base year is 60%.
(d) A municipality that is a city of the first class with a population greater than 150,000
in a county of the first class as described in Subsections (4)(a)(i)(A)(II) and (4)(b)(i)(A)(II) may
only propose one housing and transit reinvestment zone within an opportunity zone.
(e) A county of the first class may not propose a housing and transit reinvestment zone
that includes an area that is part of a project area, as that term is defined in Section 
17C-1-102
,
and created under Title 17C, Chapter 1, Agency Operations, until the project area is dissolved
pursuant to Section 
17C-1-702
.
(5) (a) For a housing and transit reinvestment zone for a commuter rail station, if a
parcel is bisected by the relevant radius limitation, the full parcel may be included as part of the
housing and transit reinvestment zone area and will not count against the limitations described
in Subsection (4)(a)(i).
(b) For a housing and transit reinvestment zone for a light rail or bus rapid transit
station, if a parcel is bisected by the relevant radius limitation, the full parcel may be included
as part of the housing and transit reinvestment zone area and will not count against the
limitations described in Subsection (4)(b)(i).
(6) The notice of commencement of collection of tax increment required in Subsection
(4)(a)(iii) or (4)(b)(iii) shall be sent by mail or electronically to:
(a) the tax commission;
(b) the State Board of Education;
(c) the state auditor;
(d) the auditor of the county in which the housing and transit reinvestment zone is
located;
(e) each taxing entity affected by the collection of tax increment from the housing and
transit reinvestment zone; and
(f) the Governor's Office of Economic Opportunity.
(7) (a) The maximum number of housing and transit reinvestment zones at light rail
stations is eight in any given county.
(b) Within a county of the first class, the maximum number of housing and transit
reinvestment zones at bus rapid transit stations is three.
(c) Within a county of the first class, the maximum total combined number of housing
and transit reinvestment zones described in Subsections (7)(a) and (b) and first home
investment zones created under Part 13, First Home Investment Zone Act, is 11.
(8) (a) This Subsection (8) applies to a specified county, as defined in Section
17-27a-408
, that has created a small public transit district on or before January 1, 2022.
(b) (i) A county described in Subsection (8)(a) shall, in accordance with Section
63N-3-604
, prepare and submit to the Governor's Office of Economic Opportunity a proposal
to create a housing and transit reinvestment zone on or before December 31, 2022.
(ii) A county described in Subsection (8)(a) that, on December 31, 2022, was
noncompliant under Section 
17-27a-408
 for failure to demonstrate in the county's moderate
income housing report that the county complied with Subsection (8)(b)(i), may cure the
deficiency in the county's moderate income housing report by submitting satisfactory proof to
the Housing and Community Development Division that, notwithstanding the deadline in
Subsection (8)(b)(i), the county has submitted to the Governor's Office of Economic
Opportunity a proposal to create a housing and transit reinvestment zone.
(c) (i) A county described in Subsection (8)(a) may not propose a housing and transit
reinvestment zone if more than 15% of the acreage within the housing and transit reinvestment
zone boundary is owned by the county.
(ii) For purposes of determining the percentage of acreage owned by the county as
described in Subsection (8)(c)(i), a county may exclude any acreage owned that is used for
highways, bus rapid transit, light rail, or commuter rail within the boundary of the housing and
transit reinvestment zone.
(d) To accomplish the objectives described in Subsection (1), if a county described in
Subsection (8)(a) has failed to comply with Subsection (8)(b)(i) by failing to submit an
application before December 31, 2022, an owner of undeveloped property who has submitted a
land use application to the county on or before December 31, 2022, and is within a 1/3 mile
radius of a public transit hub in a county described in Subsection (8)(a), including parcels that
are bisected by the 1/3 mile radius, shall have the right to develop and build a mixed-use
development including the following:
(i) excluding the parcels devoted to commercial uses as described in Subsection
(8)(d)(ii), at least 39 dwelling units per acre on average over the developable area, with at least
10% of the dwelling units as affordable housing units;
(ii) commercial uses including office, retail, educational, and healthcare in support of
the mixed-use development constituting up to 1/3 of the total planned gross building square
footage of the subject parcels; and
(iii) any other infrastructure element necessary or reasonable to support the mixed-use
development, including parking infrastructure, streets, sidewalks, parks, and trails.
Section 3. Section 
63N-3-605
 is amended to read:
63N-3-605.
Housing and transit reinvestment zone committee -- Creation.
(1) For any housing and transit reinvestment zone proposed under this part, 
or for a
first home investment zone proposed in accordance with Part 13, First Home Investment Zone
Act,
 there is created a housing and transit reinvestment zone committee with membership
described in Subsection (2).
(2) Each housing and transit reinvestment zone committee shall consist of the
following members:
(a) one representative from the Governor's Office of Economic Opportunity, designated
by the executive director of the Governor's Office of Economic Opportunity;
(b) one representative from each municipality that is a party to the proposed housing
and transit reinvestment zone 
or first home investment zone
, designated by the chief executive
officer of each respective municipality;
(c) a member of the Transportation Commission created in Section 
72-1-301
;
(d) a member of the board of trustees of a large public transit district;
(e) one individual from the Office of the State Treasurer, designated by the state
treasurer;
(f) one member designated by the president of the Senate;
(g) one member designated by the speaker of the House of Representatives;
(h) one member designated by the chief executive officer of each county affected by
the housing and transit reinvestment zone 
or first home investment zone
;
(i) one representative designated by the school superintendent from the school district
affected by the housing and transit reinvestment zone 
or first home investment zone
; and
(j) one representative, representing the largest participating local taxing entity, after the
municipality, county, and school district.
(3) The individual designated by the Governor's Office of Economic Opportunity as
described in Subsection (2)(a) shall serve as chair of the housing and transit reinvestment zone
committee.
(4) (a) A majority of the members of the housing and transit reinvestment zone
committee constitutes a quorum of the housing and transit reinvestment zone committee.
(b) An action by a majority of a quorum of the housing and transit reinvestment zone
committee is an action of the housing and transit reinvestment zone committee.
(5) 
(a)
 After the Governor's Office of Economic Opportunity receives the results of the
analysis described in Section 
63N-3-604
, and after the Governor's Office of Economic
Opportunity has received a request from the submitting municipality or public transit county to
submit the housing and transit reinvestment zone proposal to the housing and transit
reinvestment zone committee, the Governor's Office of Economic Opportunity shall notify each
of the entities described in Subsection (2) of the formation of the housing and transit
reinvestment zone committee.
(b) For a first home investment zone, the housing and transit reinvestment zone
committee shall follow the procedures described in Section 
63N-3-1304
.
(6) (a) The chair of the housing and transit reinvestment zone committee shall convene
a public meeting to consider the proposed housing and transit reinvestment zone.
(b) A meeting of the housing and transit reinvestment zone committee is subject to
Title 52, Chapter 4, Open and Public Meetings Act.
(7) (a) The proposing municipality or public transit county shall present the housing
and transit reinvestment zone proposal to the housing and transit reinvestment zone committee
in a public meeting.
(b) The housing and transit reinvestment zone committee shall:
(i) evaluate and verify whether the elements of a housing and transit reinvestment zone
described in Subsections 
63N-3-603
(2) and (4) have been met; and
(ii) evaluate the proposed housing and transit reinvestment zone relative to the analysis
described in Subsection 
63N-3-604
(2).
(8) (a) Subject to Subsection (8)(b), the housing and transit reinvestment zone
committee may:
(i) request changes to the housing and transit reinvestment zone proposal based on the
analysis, characteristics, and criteria described in Section 
63N-3-604
; or
(ii) vote to approve or deny the proposal.
(b) Before the housing and transit reinvestment zone committee may approve the
housing and transit reinvestment zone proposal, the municipality or public transit county
proposing the housing and transit reinvestment zone shall ensure that the area of the proposed
housing and transit reinvestment zone is zoned in such a manner to accommodate the
requirements of a housing and transit reinvestment zone described in this section and the
proposed development.
(9) If a housing and transit reinvestment zone is approved by the committee:
(a) the proposed housing and transit reinvestment zone is established according to the
terms of the housing and transit reinvestment zone proposal;
(b) affected local taxing entities are required to participate according to the terms of the
housing and transit reinvestment zone proposal; and
(c) each affected taxing municipality is required to participate at the same rate as a
participating county.
(10) A housing and transit reinvestment zone proposal may be amended by following
the same procedure as approving a housing and transit reinvestment zone proposal.
Section 4. Section 
63N-3-1301
 is enacted to read:
Part 13. First Home Investment Zone Act
 63N-3-1301.
Definitions.
(1) "Affordable housing" means housing occupied or reserved for occupancy by
households with a gross household income equal to or less than 120% of the median gross
income of the applicable municipal statistical area for households of the same size.
(2) "Base taxable value" for each tax increment collection period triggered within a
proposed first home investment zone area, the calendar year prior to the calendar year the tax
increment begins to be collected for those parcels triggered for that collection period.
(3) "Base year" means the same as that term is defined in Section 
63N-3-602
.
(4) "Developable area" means the same as that term is defined in Section 
63N-3-602
.
(5) "Dwelling unit" means the same as that term is defined in Section 
63N-3-602
.
(6) "Extraterritorial home" means a dwelling unit that is included as part of the first
home investment zone proposal that:
(a) is located within the municipality proposing the first home investment zone but
outside the boundary of the first home investment zone;
(b) is part of a development with a density of at least eight units per acre;
(c) is not located within an existing housing and transit reinvestment zone or an area
that could be included in a housing and transit reinvestment zone;
(d) has not been issued a building permit by the municipality as of the date of the
approval of the first home investment zone; and
(e) is subject to a deed restriction requiring the home to be owner occupied for no less
than 25 years.
(7) "First home investment zone" means a first home investment zone created in
accordance with this part.
(8) "Home" means a dwelling unit.
(9) "Housing and transit reinvestment zone" means the same as that term is defined in
Section 
63N-3-602
.
(10) "Housing and transit reinvestment zone committee" means the housing and transit
reinvestment zone committee described in Section 
63N-3-605
.
(11) "Metropolitan planning organization" means the same as that term is defined in
Section 
72-1-208.5
.
(12) "Municipality" means the same as that term is defined in Section 
10-1-104
.
(13) "Owner occupied" means private real property that is:
(a) used for a single-family residential purpose; and
(b) is occupied by the owner of the real property.
(14) (a) "Project improvements" means site improvements and facilities that are:
(i) planned and designed to provide service for development resulting from a
development activity;
(ii) necessary for the use and convenience of the occupants or users of development
resulting from a development activity; and
(iii) not identified or reimbursed as a system improvement.
(b) "Project improvements" does not mean system improvements.
(15) "State Tax Commission" means the State Tax Commission created in Section
59-1-201
.
(16) (a) "System improvements" means existing and future public facilities that are
designed to provide services to service areas within the community at large.
(b) "System improvements" does not mean project improvements.
(17) (a) "Tax increment" means the difference between:
(i) the amount of property tax revenue generated each tax year by a taxing entity from
the area within a first home investment zone designated in the first home investment zone
proposal as the area from which tax increment is to be collected, using the current assessed
value and each taxing entity's current certified tax rate as defined in Section 
59-2-924
; and
(ii) the amount of property tax revenue that would be generated from that same area
using the base taxable value and each taxing entity's current certified tax rate as defined in
Section 
59-2-924
.
(b) "Tax increment" does not include property tax revenue from:
(i) a multicounty assessing and collecting levy described in Subsection 
59-2-1602
(2);
or
(ii) a county additional property tax described in Subsection 
59-2-1602
(4).
(18) "Taxing entity" means the same as that term is defined in Section 
17C-1-102
.
Section 5. Section 
63N-3-1302
 is enacted to read:
 63N-3-1302.
Applicability, requirements, and limitations on a first home
investment zone.
(1) A first home investment zone created pursuant to this part shall promote the
following objectives:
(a) enabling and expanding housing options, including affordable housing and for sale,
owner-occupied housing;
(b) encouraging efficient development and opportunities for home ownership by
providing housing options, including affordable housing and for sale, owner-occupied housing;
(c) improving availability of housing, including affordable housing, and fulfillment of
moderate income housing plans;
(d) overcoming development impediments and market conditions that render a
development cost prohibitive absent the proposal and incentives;
(e) conservation of water resources through efficient land use;
(f) improving air quality by reducing fuel consumption and motor vehicle trips;
(g) encouraging transformative mixed-use development;
(h) strategic land use and municipal planning in major transit investment corridors as
described in Subsection 
10-9a-403
(2);
(i) increasing access to employment and educational opportunities;
(j) increasing access to child care; and
(k) improving efficiencies in parking and transportation, including walkability of
communities and access to roadways, public transportation, and active transportation.
(2) In order to accomplish the objectives described in Subsection (1), a municipality or
county that initiates the process to create a first home investment zone as described in this part
shall ensure that the proposal for a first home investment zone includes:
(a) subject to Subsection (3), a minimum of 30 housing units per acre in at least 51% of
the developable area within the first home investment zone;
(b) a mixed use development;
(c) a requirement that at least 50% of the total of both owner-occupied homes within
the first home investment zone and extraterritorial homes include a deed restriction to ensure
the homes remain owner occupied for at least 25 years from the date of original purchase;
(d) a requirement that at least 20% of the homes inside the first home investment zone,
and at least 20% of the extraterritorial homes are:
(i) deed restricted to be owner occupied for no less than 25 years from the date of
original purchase; and
(ii) deed restricted to be affordable housing owner occupied for no less than 25 years
from the date of original purchase; and
(e) a requirement that at least 12% of homes within the first home investment zone that
are not owner occupied remain affordable housing for at least 25 years.
(3) (a) Subject to Subsection (3)(b), to satisfy the requirements described in Subsection
(2)(a), a first home investment zone may include an extraterritorial home to count toward the
required density of the first home investment zone by:
(i) (A) taking the total number of extraterritorial homes related to the first home
investment zone; and
(B) adding the total number under Subsection (3)(a)(i)(A) to the number of homes
within the first home investment zone; and
(ii) dividing the total described in Subsection (3)(a)(i) by the total number of
developable acres with the first home investment zone.
(b) Extraterritorial homes may account for no more than half of the total homes to
calculate density within a first home investment zone.
(4) (a) If a municipality proposes a first home investment zone, the proposal shall
comply with the limitations described in this Subsection (4).
(b) A first home investment zone may not be less than 10 acres and no more than 100
acres in size.
(c) (i) Except as provided in Subsection (4)(c)(ii), a first home investment zone is
required to be one contiguous area.
(ii) While considering a first home investment zone proposal as described in Section
63N-3-1305
, the housing and transit reinvestment zone committee may consider and approve a
first home investment zone that is not one contiguous area if:
(A) the municipality provides evidence in the proposal showing that the deviation from
the contiguity requirement will enhance the ability of the first home investment zone to achieve
the objectives described in Subsection (1); and
(B) the housing and transit reinvestment zone committee determines that the deviation
is reasonable and circumstances justify deviation from the contiguity requirement.
(iii) The first home investment zone area contiguity is not affected by roads or other
rights-of-way.
(d) (i) A first home investment zone proposal may propose the capture of a maximum
of 60% of each taxing entity's tax increment above the base year for a term of no more than 25
consecutive years within a 45-year period not to exceed the tax increment amount approved in
the first home investment zone proposal.
(ii) A first home investment zone proposal may not include more than three tax
increment capture periods or triggers.
(iii) Subject to Subsection (4)(d)(iv), a municipality shall ensure that the required
affordable housing units are included proportionally in each phase of the first home investment
zone development.
(iv) A municipality may allow a first home investment zone to be phased and
developed in a manner to provide more of the required affordable housing units in early phases
of development.
(e) If a municipality proposes a first home investment zone, commencement of the
collection of tax increment, for all or a portion of the first home investment zone, is triggered
by providing notice as described in Subsection (5).
(f) A municipality shall ensure that each home required to be owner occupied within a
first home investment zone and each extraterritorial home include a deed restriction to prohibit
use as a short-term rental for at least 25 years.
(g) A municipality shall ensure that affordable housing within a first home investment
zone and related extraterritorial homes that are reserved as affordable housing are:
(i) not clustered within and are spread throughout the overall development; and
(ii) are of the same level of quality as all other homes within the development.
(h) A municipality shall ensure that at least 80% of extraterritorial homes included in a
first home investment zone proposal are single-family detached homes.
(5) Notice of commencement of collection of tax increment shall be sent by mail or
electronically to the following entities no later than January 1 of the year for which the tax
increment collection is proposed to commence:
(a) the State Tax Commission;
(b) the State Board of Education;
(c) the state auditor;
(d) the auditor of the county in which the first home investment zone is located;
(e) each taxing entity affected by the collection of tax increment from the first home
investment zone;
(f) the assessor of the county in which the first home investment zone is located; and
(g) the Governor's Office of Economic Opportunity.
(6) A first home investment zone proposal may not include a proposal to capture sales
and use tax increment.
(7) Within a county of the first class, the maximum total combined number of first
home investment zones and housing and transit reinvestment zones described in Subsections
63N-3-603
(7)(a) and (b) is 11.
(8) A municipality may not propose a first home investment zone in a location that is
eligible for a housing and transit reinvestment zone.
Section 6. Section 
63N-3-1303
 is enacted to read:
 63N-3-1303.
Process for a proposal of a first home investment zone.
(1) Subject to approval of the housing and transit reinvestment zone committee as
described in Section 
63N-3-1304
, in order to create a first home investment zone, a
municipality that has general land use authority over the first home investment zone area, shall:
(a) prepare a proposal for the first home investment zone that:
(i) demonstrates that the proposed first home investment zone will meet the objectives
described in Subsection 
63N-3-1302
(1);
(ii) explains how the municipality will achieve the requirements of Subsection
63N-3-1302
(2);
(iii) defines the specific infrastructure needs, if any, and proposed improvements;
(iv) defines the boundaries of the first home investment zone;
(v) includes maps of the proposed first home investment zone to illustrate:
(A) proposed housing density within the first home investment zone;
(B) extraterritorial homes relevant to the first home investment zone, including density
of the development of extraterritorial homes; and
(C) existing zoning and proposed zoning changes related to the first home investment
zone;
(vi) identifies any development impediments that prevent the development from being
a market-rate investment and proposed strategies for addressing each one;
(vii) describes the proposed development plan, including the requirements described in
Subsections 
63N-3-1302
(2) and (4);
(viii) establishes a base year and collection period to calculate the tax increment within
the first home investment zone;
(ix) describes projected maximum revenues generated and the amount of tax increment
capture from each taxing entity and proposed expenditures of revenue derived from the first
home investment zone;
(x) includes an analysis of other applicable or eligible incentives, grants, or sources of
revenue that can be used to reduce the finance gap;
(xi) proposes a finance schedule to align expected revenue with required financing
costs and payments;
(xii) evaluates possible benefits to active transportation, public transportation
availability and utilization, and air quality; and
(xiii) provides a pro-forma for the planned development that:
(A) satisfies the requirements described in Subsections 
63N-3-1302
(2) and (4); and
(B) includes data showing the cost difference between what type of development could
feasibly be developed absent the first home investment zone tax increment and the type of
development that is proposed to be developed with the first home investment zone tax
increment; and
(b) submit the first home investment zone proposal to the Governor's Office of
Economic Opportunity.
(2) As part of the proposal described in Subsection (1), a municipality shall:
(a) study and evaluate possible impacts of a proposed first home investment zone on
parking within the municipality and first home investment zone; and
(b) include in the first home investment zone proposal the findings of the study
described in Subsection (2)(a) and proposed strategies to address parking impacts.
(3) (a) After receiving the proposal as described in Subsection (1)(b), the Governor's
Office of Economic Opportunity shall:
(i) within 14 days after the date on which the Governor's Office of Economic
Opportunity receives the proposal described in Subsection (1)(b), provide notice of the
proposal to all affected taxing entities, including the State Tax Commission, the county
assessor, cities, counties, school districts, and metropolitan planning organizations; and
(ii) at the expense of the proposing municipality as described in Subsection (5),
contract with an independent entity to perform the gap analysis described in Subsection (3)(b).
(b) The gap analysis required in Subsection (3)(a)(ii) shall include:
(i) a description of the planned development;
(ii) a market analysis relative to other comparable project developments included in or
adjacent to the municipality absent the proposed first home investment zone;
(iii) an evaluation of the proposal and a determination of the adequacy and efficiency
of the proposal;
(iv) an evaluation of the proposed tax increment capture needed to cover the system
improvements and project improvements associated with the first home investment zone
proposal and enable the proposed development to occur, and for the benefit of affordable
housing projects; and
(v) based on the market analysis and other findings, an opinion relative to the
appropriate amount of potential public financing reasonably determined to be necessary to
achieve the objectives described in Subsection 
63N-3-1302
(1).
(c) After receiving notice from the Governor's Office of Economic Opportunity of a
proposed first home investment zone as described in Subsection (3)(a)(i), the county assessor,
in consultation with the State Tax Commission, shall:
(i) evaluate the feasibility of administering the tax implications of the proposal; and
(ii) provide a letter to the Governor's Office of Economic Opportunity describing any
challenges in the administration of the proposal, or indicating that the county assessor can
feasibly administer the proposal.
(4) After receiving the results from the analysis described in Subsection (3)(b), the
municipality proposing the first home investment zone may:
(a) amend the first home investment zone proposal based on the findings of the
analysis described in Subsection (3)(b) and request that the Governor's Office of Economic
Opportunity submit the amended first home investment zone proposal to the housing and
transit reinvestment zone committee; or
(b) request that the Governor's Office of Economic Opportunity submit the original
first home investment zone proposal to the housing and transit reinvestment zone committee.
(5) (a) The Governor's Office of Economic Opportunity may accept, as a dedicated
credit, up to $20,000 from a municipality for the costs of the gap analysis described in
Subsection (3)(b).
(b) The Governor's Office of Economic Opportunity may expend funds received from a
municipality as dedicated credits to pay for the costs associated with the gap analysis described
in Subsection (3)(b).
Section 7. Section 
63N-3-1304
 is enacted to read:
 63N-3-1304.
Consideration of proposals by housing and transit reinvestment zone
committee.
(1) A first home investment zone proposed under this part is subject to approval by the
housing and transit reinvestment zone committee.
(2) After the Governor's Office of Economic Opportunity receives the results of the
analysis described in Section 
63N-3-1303
, and after the Governor's Office of Economic
Opportunity has received a request from the submitting municipality to submit the first home
investment zone proposal to the housing and transit reinvestment zone committee, the
Governor's Office of Economic Opportunity shall notify each of the relevant entities of the
formation of the housing and transit reinvestment zone committee as described in Section
63N-3-605
.
(3) (a) The chair of the housing and transit reinvestment zone committee shall convene
a public meeting to consider the proposed first home investment zone in the same manner as
described in Section 
63N-3-605
.
(b) A meeting of the housing and transit reinvestment zone committee is subject to
Title 52, Chapter 4, Open and Public Meetings Act.
(4) (a) The proposing municipality shall present the first home investment zone
proposal to the housing and transit reinvestment zone committee in a public meeting.
(b) The housing and transit reinvestment zone committee shall:
(i) evaluate and verify whether the objectives and elements of a first home investment
zone described in Subsections 
63N-3-1302
(1), (2), and (4) have been met; and
(ii) evaluate the proposed first home investment zone relative to the analysis described
in Subsection 
63N-3-1303
(2).
(5) (a) Subject to Subsection (5)(b), the housing and transit reinvestment zone
committee may:
(i) request changes to the first home investment zone proposal based on the analysis,
characteristics, and criteria described in Section 
63N-3-1303
; or
(ii) vote to approve or deny the proposal.
(b) Before the housing and transit reinvestment zone committee may approve the first
home investment zone proposal, the municipality proposing the first home investment zone
shall ensure that the area of the proposed first home investment zone is zoned in such a manner
to accommodate the requirements of a first home investment zone described in this section and
the proposed development.
(6) If a first home investment zone is approved by the committee:
(a) the proposed first home investment zone is established according to the terms of the
first home investment zone proposal;
(b) affected local taxing entities are required to participate according to the terms of the
first home investment zone proposal; and
(c) each affected taxing entity is required to participate at the same rate.
(7) A first home investment zone proposal may be amended by following the same
procedure as approving a first home investment zone proposal.
Section 8. Section 
63N-3-1305
 is enacted to read:
 63N-3-1305.
Notice requirements.
(1) In approving a first home investment zone proposal the housing and transit
reinvestment zone committee shall follow the hearing and notice requirements for proposing a
first home investment zone as described in this section.
(2) Within 30 days after the housing and transit reinvestment zone committee approves
a proposed first home investment zone, the municipality shall:
(a) record with the recorder of the county in which the first home investment zone is
located a document containing:
(i) a description of the land within the first home investment zone;
(ii) a statement that the proposed first home investment zone has been approved; and
(iii) the date of adoption;
(b) transmit a copy of the description of the land within the first home investment zone
and an accurate map or plat indicating the boundaries of the first home investment zone to the
Utah Geospatial Resource Center created under Section 
63A-16-505
; and
(c) transmit a copy of the approved first home investment zone proposal, map, and
description of the land within the first home investment zone, to:
(i) the auditor, recorder, attorney, surveyor, and assessor of the county in which any
part of the first home investment zone is located;
(ii) the officer or officers performing the function of auditor or assessor for each taxing
entity that does not use the county assessment roll or collect the taxing entity's taxes through
the county;
(iii) the legislative body or governing board of each taxing entity;
(iv) the State Tax Commission; and
(v) the State Board of Education.
Section 9. Section 
63N-3-1306
 is enacted to read:
 63N-3-1306.
Payment, use, and administration of tax increment from a first home
investment zone.
(1) A municipality may receive and use tax increment and first home investment zone
funds in accordance with this part.
(2) (a) A county that collects property tax on property located within a first home
investment zone shall, in accordance with Section 
59-2-1365
, distribute to the municipality any
tax increment the municipality is authorized to receive up to the maximum approved by the
housing and transit reinvestment zone committee.
(b) (i) Tax increment paid to the municipality are first home investment zone funds and
shall be administered by an agency created by the municipality within which the first home
investment zone is located.
(ii) Before an agency may receive first home investment zone funds from the
municipality, the municipality and the agency shall enter into an interlocal agreement with
terms that:
(A) are consistent with the approval of the housing and transit reinvestment zone
committee; and
(B) meet the requirements of Section 
63N-3-1302
.
(3) (a) A municipality and the agency shall use first home investment zone funds
within, or for the direct benefit of, the first home investment zone, related extraterritorial
housing, and for the benefit of affordable housing projects.
(b) If any first home investment zone funds will be used outside of the first home
investment zone there must be a finding in the approved proposal for a first home investment
zone that the use of the first home investment zone funds outside of the first home investment
zone will directly benefit the first home investment zone or related extraterritorial homes.
(4) In accordance with Subsection 
63N-3-1302
(4)(e), a municipality shall use the first
home investment zone funds to achieve the purposes described in Subsections 
63N-3-1302
(1)
and (2), by paying all or part of the costs associated with the first home investment zone and
extraterritorial homes, including:
(a) project improvements;
(b) system improvements; and
(c) the costs of the municipality to create and administer the first home investment
zone, which may not exceed 2% of the total first home investment zone funds, plus the costs to
complete the gap analysis described in Subsection 
63N-3-1303
(2).
(5) First home investment zone funds may be paid to a participant, if the agency and
participant enter into a participation agreement which requires the participant to utilize the first
home investment zone funds as allowed in this section.
(6) First home investment zone funds may be used to pay all of the costs of bonds
issued by the municipality in accordance with Title 17C, Chapter 1, Part 5, Agency Bonds,
including the cost to issue and repay the bonds including interest.
(7) A municipality may create one or more public infrastructure districts within the city
under Title 17D, Chapter 4, Public Infrastructure District Act, and pledge and utilize the first
home investment zone funds to guarantee the payment of public infrastructure bonds issued by
a public infrastructure district.
Section 10. Section 
63N-3-1307
 is enacted to read:
 63N-3-1307.
Applicability to an existing first home investment zone or community
reinvestment project.
If a parcel within a first home investment zone is included as an area that is part of a
project area, as that term is defined in Section 
17C-1-102
, and created under Title 17C, Chapter
1, Agency Operations, that parcel may not be triggered for collection unless the project area is
dissolved pursuant to Section 
17C-1-702
.
Section 11. Section 
63N-3-1308
 is enacted to read:
 63N-3-1308.
Tax increment protections.
(1) Upon petition by a participating taxing entity or on the initiative of the housing and
transit reinvestment zone committee creating a first home investment zone, a first home
investment zone may suspend or terminate the collection of tax increment in a first home
investment zone if the housing and transit reinvestment zone committee determines, by clear
and convincing evidence, presented in a public meeting of the housing and transit reinvestment
zone committee, that:
(a) a substantial portion of the tax increment collected in the first home investment
zone has not or will not be used for the purposes provided in Section 
63N-3-1306
; and
(b) (i) the first home investment zone has no indebtedness; or
(ii) the first home investment zone has no binding financial obligations.
(2) A first home investment zone may not collect tax increment in excess of the tax
increment projections or limitations set forth in the first home investment zone proposal.
(3) The agency administering the tax increment collected in a first home investment
zone under Subsection 
63N-3-1306
(2)(c), shall have standing in a court with proper
jurisdiction to enforce provisions of the first home investment zone proposal, participation
agreements, and other agreements for the use of the tax increment collected.
(4) The agency administering tax increment from a first home investment zone under
Subsection 
63N-3-1306
(2)(c) which is collecting tax increment shall follow the reporting
requirements described in Section 
17C-1-603
 and the audit requirements described in Sections
17C-1-604
 and 
17C-1-605
.
(5) For each first home investment zone collecting tax increment within a county, the
county auditor shall follow the reporting requirement found in Section 
17C-1-606
.
Section 12. 
Effective date.
This bill takes effect on May 1, 2024.