law22282

Chapter 282

2022 -- H 7724
Enacted 06/29/2022

A N A C T

RELATING TO TOWNS AND CITIES -- TOURISM IMPROVEMENT DISTRICTS

Introduced By: Representatives Carson, Vella-Wilkinson, Slater, McEntee, Solomon, Barros, and Cortvriend

Date Introduced: March 02, 2022

It is enacted by the General Assembly as follows:

SECTION 1. Title 45 of the General Laws entitled "TOWNS AND CITIES" is hereby

amended by adding thereto the following chapter:

CHAPTER 59.1

TOURISM IMPROVEMENT DISTRICTS

45-59.1-1. Short Title.

This act shall be known and may be cited as the "Tourism Improvement Districts Act."

45-59.1-2. Legislative findings and purpose.

(a) It is found and declared that:

(1) Tourism is a major source of employment, income, and tax revenues in this state, and

the expansion of the tourism industry is vital to the growth of the state's economy.

(2) The tourism industry is important to this state, not only because of the number of people

it serves and the vast human, financial, and physical resources it employs, but because of the

benefits tourism and related activities confer on individuals and on society as a whole.

(3) Local government oversight and resources are needed to implement a coordinated and

effective marketing program consistent with the needs of specific areas of this state, and to optimize

the considerable investment of time, energy, capital, and resources being made by the tourism

industry.

(b) It is the purpose of this chapter to authorize municipalities to create tourism

improvement districts for the purpose of providing the services and undertaking the activities

described in this chapter to supplement, not supplant, existing funding provided by the state and

municipalities implementing a tourism investment district.

45-59.1-3. Definitions.

As used in this chapter:

(1) "Activity" means any programs or services provided for the purpose of conferring

specific benefits upon the businesses that are located in the tourism improvement district and to

which an assessment is charged.

(2) "Assessment" means a levy for the purpose of providing activities and improvements

that will provide benefits to businesses located within a tourism improvement district that are

subject to the tourism improvement district assessment. Assessments may be based on a percent of

gross business revenue, a fixed dollar amount per transaction, or any other reasonable method based

upon benefit, and approved by the municipality.

(3) "Authorizing resolution" means a resolution adopted by the municipality that authorizes

the formation or renewal of a tourism improvement district and the levying of assessments.

(4) "Business" means any business establishment of the type or class that is described in

the tourism improvement district plan and the authorizing resolution.

(5) "Business owner" means any person recognized by the municipality as the owner of the

business. The municipality has no obligation to obtain other information as to the ownership of

businesses, and its determination of ownership shall be final and conclusive for the purposes of this

chapter. Wherever this chapter requires the signature of the business owner, the signature of the

authorized representative of the business owner shall be sufficient.

(6) "Improvement" means an acquisition, construction, installation, or maintenance

relating to tangible property, with an estimated useful life of five (5) years or more that is designed

to provide benefits to assessed businesses.

(7) "Lead municipality" means the municipality in which the tourism improvement district

plan is filed for the establishment of a tourism improvement district where such district includes

more than one municipality.

(8) "Municipality" means any city or town in the State state of Rhode Island.

(9) "Owners' association" means a new or existing nonprofit corporation charged with

promoting tourism within the area of the tourism improvement district that is under contract with

the municipality to administer the tourism improvement district and implement activities and

improvements specified in the tourism improvement district plan.

(10) "Tourism improvement district" means a tourism improvement district established

pursuant to this chapter.

(11) "Tourism improvement district plan" means a plan as prescribed in § 45-59.1-5.

45-59.1-4. Boundaries of a tourism improvement district -- Requirement of consent.

(a) Municipalities may create tourism improvement districts pursuant to this chapter.

(b) A municipality may form a tourism improvement district that assesses any business

located within the boundaries as determined by the municipality. Should any lead municipality

choose to include other municipalities within the boundaries of a tourism improvement district,

each participating municipality must provide written consent from the governing body of each

participating municipality. In the event there are multiple consenting municipalities, upon

successful receipt of consent from all participating municipalities, the lead municipality shall

govern and administer the tourism improvement district.

boundaries of another tax, assessment, or special tax assessment area or management district

created pursuant to Rhode Island law.

45-59.1-5. Contents of tourism improvement district plan.

A tourism improvement district plan shall include, but not be not limited to, all of the

following:

(1) A map that identifies the tourism improvement district boundaries in sufficient detail

to allow a business owner to reasonably determine whether a business is located within the tourism

improvement district boundaries. The boundaries of a tourism improvement district may overlap

with other tourism improvement districts established pursuant to this chapter.

(2) The name of the proposed tourism improvement district.

(3) The name of the owners' association.

(i) Where a newly formed nonprofit corporation is designated as the owners' association,

the certificate of incorporation or bylaws shall provide that the owners' association's governing

board shall be composed of a majority of business owners, or their authorized representatives, who

pay the tourism improvement district assessment.

(ii) Where an existing nonprofit corporation is designated as the owners' association, the

nonprofit shall create a committee composed of a majority of businesses owners, or their authorized

representatives, who shall be charged with managing the funds raised by the tourism improvement

district and fulfilling the obligations of the tourism improvement district plan.

(iii) The owners' association shall have full discretion to select the specific activities and

improvements within the authorized parameters of the tourism improvement district plan that shall

be funded with tourism improvement district assessment revenue.

(4) The activities and improvements proposed for each year of operation of the tourism

improvement district and the estimated cost thereof. If the activities and improvements proposed

for each year of operation are the same, a description of the first year's proposed activities and

improvements and a statement that the same activities and improvements are proposed for

subsequent years shall satisfy the requirements of this subsection.

(5) The estimated annual amount proposed to be expended for activities and improvements

during each year of operation of the tourism improvement district. This amount may be estimated

based upon the assessment rate. If the estimated annual amount proposed to be expended in each

year of operation of the tourism improvement district is not significantly different, the amount

proposed to be expended in the initial year and a statement that a similar amount applies to

subsequent years shall satisfy the requirements of this subsection.

(6) The proposed source or sources of financing, including the proposed method and basis

of levying the assessment in sufficient detail to allow each business owner to calculate the amount

of the assessment to be levied against their business. The tourism improvement district plan may

set forth increases in assessments for any year of operation of the tourism improvement district.

Any business of the type or class of businesses that are subject to the assessment that commences

operations during the tourism improvement district's term shall be subject to the assessment.

(7) The time and manner of collecting the assessments and any interest or penalties for

non-payment nonpayment.

(8) The specific number of years in which assessments will be levied. In a new tourism

improvement district, the maximum number of years shall be ten (10). Upon renewal, a district

shall have a term not to exceed twenty (20) years. The tourism improvement district plan may set

forth specific increases in assessments for each year of operation of the district;.

(9) Any proposed rules to be applicable to the tourism improvement district.

(10) A definition describing the types or classes of businesses to be included in the tourism

improvement district and subject to the tourism improvement district assessment.

45-59.1-6. Initiation of proceedings -- Petition for a proposed tourism improvement

district.

(a) Upon submission to the clerk of a municipality of a written petition, the municipality

may initiate proceedings to form a tourism improvement district by adopting a resolution

expressing its intention to form a tourism improvement district. The written petition may be signed

by either:

(1) Business owners or their authorized representatives who will pay sixty percent (60%)

or more of the assessments proposed to be levied; or

(2) Business owners or their authorized representatives who constitute sixty percent (60%)

or more of the total rooms within the tourism improvement district.

(b) The petition of business owners required under subsection (a) of this section shall

include a summary of the tourism improvement district plan. That summary shall include all of the

following:

(1) A map showing the boundaries of the tourism improvement district.

(2) The types or classes of businesses that will be subject to the assessment.

(3) The assessment rate for the types or classes of business that will be subject to the

assessment.

(4) Information specifying where the complete tourism improvement district plan can be

obtained.

(5) Information specifying that the complete tourism improvement district plan shall be

furnished upon request.

45-59.1-7. Hearing on establishment or renewal.

(a) If the municipality has received a successful petition pursuant to § 45-59.1-6, the

municipality shall hold a public hearing on the establishment or renewal of the tourism

improvement district prior to adoption of the authorizing resolution. Notice of the public hearing

shall be mailed to the owners of the businesses proposed to be subject to the assessment.

(b) The municipality shall provide at least thirty (30) days' written notice of the public

hearing at which the municipality proposes to establish or renew the tourism improvement district

and levy the assessment.

assessment. Every protest shall be in writing and shall be filed with the municipality at or before

the time fixed for the public hearing. The municipality may waive any irregularity in the form or

content of any written protest. A written protest may be withdrawn in writing at any time before

the conclusion of the public hearing. Each written protest shall contain a description of the business

in which the person subscribing the protest is interested that shall be sufficient to identify the

business and, if a person subscribing is not shown on the official records of the municipality as the

owner of the business, the protest shall contain or be accompanied by written evidence that the

person subscribing is the owner of the business or the authorized representative. A written protest

that does not comply with this section shall not be counted in determining a majority protest. If

written protests are received from sixty percent (60%) or more of business owners or their

authorized representatives, as determined via the same majority calculation method chosen in § 45-

59.1-6, and protests are not withdrawn so as to reduce the protests to less than sixty percent (60%),

the municipality shall not levy the assessment.

(d) If a tourism improvement district includes multiple municipalities or portions thereof,

the notice and hearing process set forth in this section shall be conducted by the lead municipality.

45-59.1-8. Changes to proposed assessment.

At the conclusion of the public hearing to establish or renew a tourism improvement

district, the municipality may adopt, revise, change, reduce, or modify the proposed assessments,

the boundaries of the tourism improvement district, or the types or classes of businesses within the

tourism improvement district that would be subject to the assessment. Proposed assessments may

only be revised by reducing them, either independently or together in a uniform manner. The

proposed tourism improvement district boundary may only be revised to exclude territory that will

not benefit from the proposed activities and improvements. The types or classes of businesses that

will be subject to the proposed assessment may only be revised to exclude the business types or

classes that will not benefit from the proposed activities and improvements. Any modifications,

revisions, reductions, or changes to the proposed tourism improvement district plan shall be

reflected in the tourism improvement district plan prior to the municipality's adoption of the

resolution creating or renewing the tourism improvement district.

45-59.1-9. Authorizing resolution.

(a) If the municipality, following the public hearing, decides to establish or renew a

proposed tourism improvement district, the municipality shall adopt an authorizing resolution that

shall include, but is not limited to, all of the following:

(1) A brief description of the proposed activities and improvements, the amount of the

proposed assessment, a statement as to the types or classes of businesses that will be subject to the

assessment, and a description of the exterior boundaries of the tourism improvement district, which

may be made by reference to any plan or map that is on file with the municipality. The descriptions

and statements need not be detailed and shall be sufficient if they enable an owner to generally

identify the nature and extent of the activities and improvements and the location and extent of the

tourism improvement district.

(2) The time and place where the public hearing was held concerning the establishment or

renewal of the tourism improvement district.

(3) A determination regarding any protests received. The municipality shall not establish

or renew the tourism improvement district or levy assessments if a majority protest was received

as described in § 45-59.1-7(c).

(4) A statement that the businesses in the tourism improvement district established by the

resolution shall be subject to any amendments to this chapter.

(5) A statement that the activities and improvements to be conferred on businesses in the

tourism improvement district will be funded by the proceeds of assessments. The revenue from the

assessments within a tourism improvement district shall not be used for any purpose other than the

purposes specified in the tourism improvement district plan, as authorized or modified by the

municipality at the hearing concerning establishment or renewal of the tourism improvement

district.

(6) A finding that the businesses within the tourism improvement district will benefit from

the activities and improvements funded by the tourism improvement district assessments.

(b) The adoption of the authorizing resolution shall constitute the levy of assessments in

each of the years referred to in the tourism improvement district plan.

45-59.1-10. Expiration of tourism improvement district term.

If a tourism improvement district expires due to the term specified in § 45-59.1-5(a)(8), a

new tourism improvement district plan may be created and the tourism improvement district may

be renewed pursuant to this chapter.

45-59.1-11. Time and manner of collection of assessments -- Delinquent payments.

(a) The collection of the assessments levied pursuant to this chapter shall be made at the

time and in the manner set forth by the municipality in the authorizing resolution. All delinquent

payments for assessments levied pursuant to this chapter may be charged interest and penalties.

(b) Any delinquent payments for assessments, along with any interest or penalties, shall

constitute a debt owed the municipality and may be collectable by the municipality as a debt under

law.

section shall be expended in the same manner as provided in the authorizing resolution for proceeds

of the assessment.

45-59.1-12. Validity of assessment.

The validity of an assessment levied under this chapter shall not be contested in any action

or proceeding unless the action or proceeding is commenced within thirty (30) days after the

authorizing resolution is adopted pursuant to § 45-59.1-9. Any appeal from a final judgment in an

action or proceeding shall be perfected within thirty (30) days after the entry of judgment.

45-59.1-13. Certification to establish levels of services and funding.

The tourism improvement district is intended to provide supplemental funding and services

and not to supplant existing funding or services. After establishing a tourism improvement district,

the municipality shall not decrease the level of publicly funded tourism promotion services in a

tourism improvement district existing prior to the creation of such tourism improvement district.

45-59.1-14. Modification to the tourism improvement district plan.

(a) The owners' association, at any time, may request that the municipality modify the

tourism improvement district plan. Any modification of the tourism improvement district plan shall

be made pursuant to this chapter. The tourism improvement district plan shall not be modified,

except by the request of the owners' association and only in the manner requested by the owners'

association.

(b) Upon the written request of the owners' association, the municipality may modify the

tourism improvement district plan by adopting a resolution determining to make the modifications

after conducting one public hearing on the proposed modifications. If the modification includes the

levy of a new or increased assessment or the expansion of the tourism improvement district's

geographic boundaries, the municipality shall comply with all procedures required for

establishment of a new tourism improvement district provided by this chapter. Notice of all other

public hearings pursuant to this section shall comply with both of the following:

(1) The resolution of intention to modify shall be published once at least seven (7) days

before the public hearing in a newspaper of general circulation in the municipality.

(2) A complete copy of the resolution of intention to modify shall be mailed by first class

mail, at least ten (10) days before the public hearing, to each business owner affected by the

proposed modification.

proposed modification prior to the public hearing required by this section. The public hearing shall

be held not more than ninety (90) days after the adoption of the resolution of intention to modify.

45-59.1-15. Reports.

(a) The owners' association shall cause to be prepared a report for each fiscal year, except

the first year, for which assessments are to be levied and collected to pay the costs of the activities

described in the report. The owners' association's first report shall be due ninety (90) days after the

first year of operation of the tourism improvement district.

(b) The report shall be filed with the municipality and shall refer to the tourism

improvement district by name, specify the fiscal year to which the report applies, and, with respect

to that fiscal year, shall contain all of the following information:

(1) The activities and improvements to be provided for that fiscal year.

(2) An estimate of the cost of providing the activities and improvements for that fiscal year.

(3) The method and basis of levying the assessments in sufficient detail to allow each

business owner to estimate the amount of the assessment to be levied against his or her business

for that fiscal year.

(4) The estimated amount of any surplus or deficit revenues to be carried over from a

previous fiscal year.

make recommendations for approval to the annual report within forty-five (45) days of receiving

the annual report. The annual report shall be final and approved within ninety (90) days following

its submission by the owners' association to the municipality.

45-59.1-16. Renewal of tourism improvement district.

(a) Any tourism improvement district previously established whose term has expired, or

will expire, may be renewed by following the procedures for establishment as provided in this

chapter.

(b) Upon renewal, any remaining revenues derived from assessments, or any revenues

derived from the sale of assets acquired with the revenues, shall be transferred to the renewed

tourism improvement district.

of a renewed tourism improvement district be the same as the original or prior tourism improvement

district.

45-59.1-17. Dissolution of district.

(a) A tourism improvement district established or extended pursuant to this chapter may be

dissolved by adoption of a resolution by the municipality pursuant to this section when there is no

indebtedness, outstanding and unpaid, incurred to accomplish any of the purposes of the tourism

improvement district, and when either of the following circumstances apply:

(1) The municipality finds there has been misappropriation of funds or other malfeasance.

(2) The municipality finds there has been a violation of law in connection with the

management of the tourism improvement district.

(b) During each year of operation of the tourism improvement district, there shall be a thirty

(30) day period in which businesses subject to the assessment may request dissolution of the

tourism improvement district. The first period shall begin two (2) years after the date of

establishment of the tourism improvement district and shall continue for thirty (30) days. Each

successive year of operation of the tourism improvement district shall have such a thirty (30) day

period. Upon the written petition of sixty percent (60%) or more of business owners or their

authorized representatives, as determined via the same majority calculation method chosen in § 45-

59.1-6, the municipality shall pass a resolution of intention to disestablish the tourism improvement

district. The municipality shall give public notice of any hearing on disestablishment.

improvement district prior to the public hearing required by this section. The resolution shall state

the reason for the potential dissolution, shall state the time and place of the public hearing, and

shall contain a proposal to dispose of any assets acquired with the revenues of the assessments

levied within the tourism improvement district. The notice of the hearing on dissolution required

by this section shall be given by mail to the owner of each business subject to assessments in the

tourism improvement district. The municipality shall conduct the public hearing not less than thirty

(30) days after mailing the notice to the business owners. The public hearing shall be held not more

than sixty (60) days after the adoption of the resolution of intention. At the conclusion of the public

hearing, the municipality shall adopt a resolution dissolving the tourism improvement district.

(d) After holding a noticed hearing, the municipality shall notify the owners' association to

remedy the findings of the municipality within thirty (30) days. Such public hearing shall be held

and notice given to the benefited businesses and the owners' association not less than thirty (30)

days prior to the hearing. If the owners' association does not remedy the violations within thirty

(30) days of notification, or the municipality has not approved a plan to remedy the violation, at

the conclusion of a hearing conducted under this section, the municipality may vote to terminate

the tourism improvement district.

45-59.1-18. Remaining revenues.

Upon the dissolution or expiration without renewal of a tourism improvement district, any

remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or

derived from the sale of assets acquired with the revenues, shall be spent in accordance with the

tourism improvement district plan or shall be refunded to the owners of the businesses then located

and operating within the tourism improvement district in which assessments were levied by

applying the same method and basis that was used to calculate the assessments levied in the fiscal

year in which the tourism improvement district is disestablished or expires.

SECTION 2. This act shall take effect upon passage.

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LC004801

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