Commercial Rehabilitation Program

Guidelines for Certain Rehabilitated & Renovated Structures


The City of Colonial Heights allows partial exemption from real estate taxes (tax relief) for qualifying Commercial structures that have been rehabilitated, renovated or replaced. For those properties that qualify, the initial increase in real estate taxes caused by rehabilitation, renovation or replacement will be excused for five (5) years. For full information, including the provisions for qualifying for this partial tax exemption, see Ordinance 9-25 (Article IIA of Chapter 258, Taxation, of the Colonial Heights City Code; namely “Partial Real Estate Tax Exemption for Certain Substantially Rehabilitated, Renovated or Replaced Commercial Structures”.

Application


Download Rehabilitation Program Application


Requirements to Classify a Commercial Structure as Rehabilitated, Renovated or Replaced


  • Shall be located in one of two (2) designated districts
  • The commercial structure must be at least twenty (20) years old
  • Application and a processing fee of fifty dollars ($50) must be paid before proceeding with the process
  • The Assessor must inspect the property prior to any rehabilitation or renovation or replacement of the structure
  • Any and all delinquent or past due real estate taxes, penalties and interest must be paid prior to the property being accepted in the program. The partial exemption for each tax year shall be conditioned upon payment of non-exempt amount of real estate taxes on or before May 15 or November 15 of each tax year. Failure to pay taxes due on or before the established dates will result in forfeit of the remaining exemption period and cancellation of the credit issued for that year.
  • No improvements made upon previously vacant land shall be eligible
  • Rehabilitated, renovated or replaced structure must meet zoning requirements and plans for project must be approved by City of Colonial Heights Engineering Department and all permits for work must have been acquired prior to applying for this program.

Districts and Program Stipulations


Boulevard District


The “Boulevard District”, as depicted on an exhibit maintained by the Assessor, which shall consist of all commercial structures fronting on the Boulevard (Route 1) within the Colonial Heights City limits or contained within the Boulevard Overlay District as provided in Chapter 286 of this Code.

Any commercial structure at least twenty years old within the Boulevard District whose base assessed value is increased by at least twenty-five percent due to rehabilitation, renovation, or replacement shall be eligible for an exemption from real estate tax equal to the increase in assessed value attributable to the rehabilitation, renovation, or replacement. Such exemption shall commence on January 1 of the year following completion of the rehabilitation, renovation, or replacement, and shall run with the real state for five years

Southpark District


The “Southpark District”, which shall consist of all commercial structures within the geographic boundaries depicted on an exhibit maintained by the Assessor entitled “The Southpark Commercial Structure Tax Exemption District”.

Payment of the real estate tax attributable to any structure at least twenty years old within the Southpark District may be exempted by an amount up to fifty percent of the cost of the structure’s rehabilitation, renovation, or replacement as long as such cost is at least $100,000. Such exemption shall commence on January 1 of the year following completion of the rehabilitation, renovation, or replacement, and shall run with the real estate for five years.

DO NOT START REHABILITATION UNTIL CITY ASSESSOR HAS INSPECTED THE PROPERTY

General Information


  1. During each of the five years of the exemption period specified in §258-16.2, no annual exemption in tax shall be granted for that portion of any increase in assessed value, or that portion of the cost of a structure’s rehabilitation, renovation, or replacement, whichever is applicable, exceeding $2,000,000.
  2. An exemption shall not be permitted for any year if a structure’s assessed value for such year falls below its base assessed value.
  3. An exemption shall continue only while the rehabilitated, renovated, or replaced structure is a commercial structure.
  4. No improvements upon vacant land shall be eligible for an exemption under this article.
  5. The Assessor may promulgate written rules and regulations, consistent with this article, he deems necessary for effective administration thereof.
  6. The Assessor, in his sole discretion, shall administer this article and make decisions pursuant to its provisions.

Definitions


For the purposes of this article, the following words and phrases shall have the meanings respectively ascribed to them by this section:

Assessor: The City Assessor for Colonial Heights, Virginia

Base Assessed Value: The assessed value of the structure as of January 1 of the year in which the rehabilitation, renovation or replacement of the structure begins.

Commercial Structure: Any structure or other improvement that is lawfully being used or may be used for a commercial purpose. If any such structure is lawfully being used for both a commercial and non-commercial use, it shall be deemed to be a commercial structure if more than fifty (50) percent of its total square footage is used for commercial purposes.

Rehabilitation, renovation, or replacement: Expenditures associated with any internal or external, structural, mechanical, or electrical improvements necessary to rehabilitate, renovate, expand, or replace a commercial structure, and excavations, grading, paving, driveways, roads, sidewalks, landscaping, or other land improvements; including, but not limited to, costs associated with demolition, carpentry, sheetrock, plaster, painting, ceilings, fixtures, doors, windows, fire suppressant systems, roofing and flashing, exterior repair, cleaning and cleanup.

Rehabilitation, renovation, or replacement, shall not include:
  • The cost of acquiring any real property or building;
  • The cost of furnishings; any expenditure associated with appraisal, architectural, engineering and interior design fees, loan fees, points, or capitalized interest; legal accounting, Realtor, sales and marketing, or other professional fees; bids, insurance, exterior signage, utilities, bonding, copying, rent loss, or temporary facilities incurred during construction; utility hook-up or access fees; or outbuildings and
  • The cost of rehabilitating, renovating, or replacing a structure damaged by explosion, fire, earthquake, tornado, hurricane, flood, or other acts of God.

Affected Districts


A. The Boulevard District.


There is hereby created a Boulevard Commercial Structure Tax Exemption District (the “Boulevard District”), as depicted on an exhibit maintained by the Assessor, which shall consist of all commercial structures fronting on the Boulevard (Route 1) within the Colonial Heights City limits or contained within the Boulevard Overlay District as provided in Chapter 286 of this Code. Any commercial structure at least twenty years old within the Boulevard District whose base assessed value is increased by at least twenty-five percent due to rehabilitation, renovation, or replacement shall be eligible for an exemption from real estate tax equal to the increase in assessed value attributable to the rehabilitation, renovation, or replacement. Such exemption shall commence on January 1 of the year following completion of the rehabilitation, renovation, or replacement, and shall run with the real state for five years.

B. The Southpark District.


There is hereby created a Southpark Commercial Structure Tax Exemption District (the “Southpark District”), which shall consist of all commercial structures within the geographic boundaries depicted on an exhibit maintained by the Assessor entitled “The Southpark Commercial Structure Tax Exemption District”. Payment of the real estate tax attributable to any structure at least twenty years old within the Southpark District may be exempted by an amount up to fifty percent of the cost of the structure’s rehabilitation, renovation, or replacement as long as such cost is at least $100,000. Such exemption shall commence on January 1 of the year following completion of the rehabilitation, renovation, or replacement, and shall run with the real estate for five years.

Application procedure and processing fee


A. The owner of an eligible commercial structure within the Boulevard or the Southpark District shall file an application for exemption with the Assessor on a form prescribed by the Assessor and provided for such purpose. A separate application shall be submitted for each commercial structure for which an exemption is requested.

B. All building or demolition permits shall be acquired prior to filing of the application and the beginning of the rehabilitation, renovation or replacement.

C. The Assessor shall require the applicant to submit all documentation deemed necessary to establish eligibility for an exemption. All such requested documentation shall be furnished to the Assessor before an application will be considered complete and ready to be processed.

D. An owner shall pay a processing fee of fifty dollars ($50) to the City with each application.

E. The exemption shall not automatically attach to any commercial structure. Exemptions shall be granted only after the requirements of this article have been met as determined by the Assessor.

Inspections; notification to the Assessor


A. Upon receipt of a completed application for an exemption pursuant to this article and prior to commencement of the proposed rehabilitation, renovation or replacement, the Assessor shall physically inspect the structure for which an exemption is requested.

B. An owner shall notify the Assessor in writing within thirty (30) days after the rehabilitation, renovation or replacement of the structure is complete.

C. During the period of time between the receipt of a completed application and completion of the rehabilitation, renovation or replacement, the structure shall be subject to taxation upon the full assessed value thereof.

D. No structure shall be eligible for an exemption if the Assessor has been denied access to any portion thereof, either before, during or after the rehabilitation, renovation or replacement for which an exemption is requested, provided that the requested access is for the purposes of assessing the structure and determining whether the requirements for this article have been met.

Commencement of exemption; land books


A. The exemption shall commence on January 1 of the year following completion of the rehabilitation, renovation or replacement of the structure; inspection thereof by the Assessor; and verification by the Assessor that the rehabilitation, renovation, or replacement described in the application has been fully completed.

B. Nothing in this article shall be construed to permit the Assessor to list upon the land book any reduced assessed value due to the exemption created by this article.

Miscellaneous


A. During each of the five years of the exemption period specified in §258-16.2, no annual exemption in tax shall be granted for that portion of any increase in assessed value, or that portion of the cost of a structure’s rehabilitation, renovation, or replacement, whichever is applicable, exceeding $2,000,000.

B. An exemption shall not be permitted for any year if a structure’s assessed value for such year falls below its base assessed value.

C. An exemption shall continue only while the rehabilitated, renovated, or replaced structure is a commercial structure.

D. No improvements upon vacant land shall be eligible for an exemption under this article.

E. The Assessor may promulgate written rules and regulations, consistent with this article, he deems necessary for effective administration thereof.

F. The Assessor, in his sole discretion, shall administer this article and make decisions pursuant to its provisions.