Title 48, Chapter 5, Section 31
(a) As used in this Code section, the term:
(1) "Developer" means a person constructing a development.
(2) "Development" or "development property" means a major
industrial project which will employ at least 200 persons during
construction or operation of the project.
(3) "Local board of education" means the county or area board of
education, or in the case of an independent school district the
board of education or other body, having authority over and
responsibility for a school district.
(4) "Local government" means any county or any municipal
corporation which has the authority to collect ad valorem taxes.
(5) "Program of public improvement" includes any or all projects
for which a local government or local board of education is
authorized by any provision of law to impose or recommend the
imposition of taxes and shall include programs of school
construction or expenditures for other educational purposes for
which a local board of education is authorized by any provision of
law to impose taxes.
(6) "School district" means any area, county, independent, or
local school district within which all or any part of any
development is located.
(7) "School tax" includes any tax authorized by any provision of
law to be assessed by a local government or by a local board of
education for educational purposes, including but not limited to
the construction of schools and the repayment of bonds issued for
(b) Notwithstanding any provision of law to the contrary, and
subject to the conditions specified in this Code section, any
developer may enter into an agreement with any local government or
local board of education, or both, for the prepayment of ad valorem
taxes or school taxes or both. Any such agreement may include
programs of public improvements adopted by the local government or
the local board of education, or any combination thereof, and shall
be a lawful and binding contract enforceable by and against the
local government, local board of education, developer, and the
beneficial owners of any development property assessed for taxation
which is the subject of a tax prepayment agreement.
(c) Each tax prepayment agreement shall become effective upon its
adoption by resolution of the governing body of the local government
or by resolution of the local board of education, or both, as the
case may be, agreement by the developer, and the subsequent
prepayment of taxes by the developer. Such tax prepayment agreement
shall provide for the prepayment to the local government or the
local board of education, or both, of not more than two times the
estimated ad valorem tax, school tax, or both, which will be due for
(1) the year in which the development is anticipated to be
completed, (2) its first year of commercial use, or (3) its first
year of productive use. The amount of taxes thus prepaid, without
interest, shall be subsequently credited by the local government or
local board of education, or both, against taxes due following an
assessment of the development property by the county tax assessor or
the Department of Revenue, as appropriate, in five equal annual
installments beginning not earlier than the year described above for
which the tax prepayment amount was calculated. In no event may the
sum of credits exceed the amount of prepayment made.
(d) A local government may adopt by resolution of its governing
authority or a local board of education may adopt by resolution a
public improvement program to be included as part of tax prepayment
agreements. Prepayment proceeds may be used for any public purpose
except that the local government, local board of education, or both,
may adopt a program of public improvements which is reasonably
related to the anticipated increased demand for public services
resulting from the development for which prepayment of taxes is
made, to be funded in whole or in part by prepayment proceeds. The
local government, local board of education, or both, may, by
adoption of such program, provide that such funds shall be
maintained in separate accounts and not be expended except for
projects included in such program of public improvements.
(e) Notwithstanding any other provision of law, no tax prepayment
shall create a debt of the local government or school district. To
the extent that annual credits for prepaid taxes may exceed taxes
due in any particular year pursuant to annual assessments of
development property, the excess annual credit otherwise due that
year shall be forfeited and in no event shall the developer or any
other person be allowed to claim a refund of any part of a
(f) The determination by any local government's governing authority,
by any local board of education, or both as to the necessity for the
public improvements to be funded by prepayments under a program
established by a tax prepayment agreement shall be final and not
subject to review.
(g) Nothing contained in this Code section shall be construed to
require a local government, a local board of education, or any
developer to enter into a tax prepayment agreement.
(h) Notwithstanding the fact that tax prepayments made in accordance with this Code section do not create a debt of any local government or school district, the validity of any such tax prepayment and the related tax prepayment agreement or agreements may be determined by application of the validation procedure set forth in Code Sections 36-82-73 through 36-82-83. However, the petition filed in such validation proceeding pursuant to Code Section 36-82-75 shall be amended as appropriate to reflect that no bonds are being issued and no debt is being incurred, and the relevant tax prepayment agreement and program of public improvements shall be filed as an exhibit to the petition.