Opinion Number

Dear Mr. Williams:

Your request for an Attorney General's Opinion regarding the restoration tax abatement ("RTA") has been assigned to me for research and reply. You ask whether a property owner who entered into an RTA contract over two years ago can challenge the correctness of an assessment by claiming that the property is worth less than its assessed value prior to the commencement of the expansion, restoration, improvement, or development.

The short answer to your question is no. RTAs are authorized by La.Const, art. VII, § 21(H), which provides as follows:

Notwithstanding any contrary provision of this constitution, the State Board of Commerce and Industry or its successor, with the approval of the governor and the local governing authority and in accordance with procedures and conditions provided by law, may enter into contracts granting to a property owner, who proposes the expansion, restoration, improvement, or development of an existing structure or structures in a downtown, historic, or economic development district established by a local governing authority or in accordance with law, the right for an initial term of five years after completion of the work to pay ad valorem taxes based upon the assessed valuation of the property for the year prior to the commencement of the expansion, restoration, improvement, or development. Contracts may be renewed, subject to the same conditions, for an additional five years extending such right for a total of ten years from completion of the work. [Emphasis added]

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Here, the property owner expressly agreed to pay ad valorem taxes based upon the assessed value of the property prior to the commencement of the expansion, restoration, improvement, or development. Basically, the property owner has no valid grounds to demand a variation from that agreement. Thus, it is the opinion of this office the property owner cannot challenge the correctness of the assessment by establishing that the property is worth less than its assessed value prior to the commencement of the expansion, restoration, improvement, or development.

We trust this adequately responds to your request. However, if our office can be of further assistance, please do not hesitate to contact us.

Yours very truly,

JAMES D. "BUDDY" CALDWELL Attorney General

By:_________________ BENJAMIN A. HUXEN II Assistant Attorney General

J DC/BAH II