Local Option - Property Tax Assessment for Energy Efficient Buildings

Summary

In March 2008, Virginia enacted legislation that would allow local jurisdictions to assess the property tax of energy efficient buildings at a reduced rate. Under this law, eligible energy-efficient buildings, not including the real property on which they are located, may be considered a separate class of property for local taxation purposes. Accordingly, the governing body of any county, city or town may, by ordinance, allow a special assessment of the property taxes for this class of property.

An energy-efficient building is defined as any building that exceeds the energy efficiency standards of the Virginia Uniform Statewide Building Code by 30%; meets performance standards of the Green Globes Green Building Rating System, the Leadership in Energy and Environmental Design (LEED) System or the EarthCraft House Program; or qualifies as an ENERY STAR home under federal ENERGY STAR criteria. 

Some of the communities that have enacted an ordinance implementing this law include:

• City of Charlottesville (see Charlottesville's city code, Chapter 30, Article V, Division 4 for more information)
• County of Spotsylvania (see Ordinance No. 21-63 for more information on the five-year county tax exemption for energy efficient buildings)
• City of Virginia Beach (see Virginia Beach's Real Estate Assessments, Special Tax Rate, for more information)
• Roanoke (see City website and City Code Sec. 32-103.20)