Payments in lieu of taxes are authorized under several sections of the law, wherein local government are permitted to approve such payments. These agreements may affect state, county, and/or municipal taxes.

When an agreement is made, the local assessment office must be notified and provided with the following:

1. the name of owner;
2. the name of the project;
3. a copy of the executed agreement; and
4. the calculation method or amount of payment in lieu of taxes.

No change in the status of the account is to be made unless this information is provided. Upon receipt of this data, the Supervisor will calculate the necessary abatements. Because the number of Exempt Codes has been expanded, it is no longer necessary to change the use of the property. The Use Code should identify the property’s current use or intended use as indicated by zoning if the property is vacant. From the following list, the appropriate exempt class code should be selected and entered into AAVS.

805 – Payment in Lieu of Taxes – (exempt from all real property taxes)
806 – Payment in Lieu of Taxes – (county exempt, municipal exempt, state taxable),
807 – Payment in Lieu of Taxes – (county exempt, state taxable, municipal taxabl,e)
808 – Payment in Lieu of Taxes – (county exempt, state exempt, municipal taxable)

This coding provides a method of identification, makes the property exempt from applicable taxes, and yet will continue to produce an assessment notice as required by Tax-Property Annotated Code §8-401.

Payments to the Comptroller for the state portion of a payment in lieu shall be separately estimated on the Office of the Comptroller reports without an assessable base amount for the payment in lieu.