Code of the District of Columbia

§ 47–1002. Real property — Exemptions.

Only the following real property shall be exempt from taxation in the District of Columbia:

(1) Property belonging to the United States, unless the taxation of same has been authorized by Congress;

(2) Property belonging to the District of Columbia and used for governmental purposes (as determined by the Mayor), unless otherwise provided by law;

(3) Property authorized as exempt from real estate taxes by the United States Department of State's Office of Foreign Missions on the basis of its use for diplomatic or consular purposes or for the official business of an international organization;

(4) Repealed.

(5) Property heretofore specifically exempted from taxation by any special act of Congress, in force December 24, 1942, so long as such property is used for the purposes for which such exemption is granted. The Council of the District of Columbia shall report annually to the Congress the use being made of such specifically exempted property, and of any changes in such use, with recommendations;

(6) Art gallery buildings belonging to and operated by organizations which are not organized or operated for private gain, and are open to the public generally, and for admission to which no charge is made on more than 2 days each week;

(7) Library buildings belonging to and operated by organizations which are not organized or operated for private gain and are open to the public generally;

(8) Buildings belonging to and operated by institutions which are not organized or operated for private gain, which are used for purposes of public charity principally in the District of Columbia;

(9) Hospital buildings, belonging to and operated by organizations which are not organized or operated for private gain, including buildings and structures reasonably necessary and usual to the operation of a hospital;

(10) Buildings belonging to and operated by schools, colleges, or universities which are not organized or operated for private gain, and which embrace the generally recognized relationship of teacher and student;

(10A)(A) A building belonging to a foundation that is not organized or operated for private gain and that is organized and operated exclusively for the benefit (within the meaning of sections 170(b)(1)(A)(iv) or 509(a)(3) of the Internal Revenue Code of 1986, approved October 22, 1986 (68A Stat. 58 and 83 Stat. 496); 26 U.S.C. §§ 170(b)(1)(a)(iv) and 509(a)(3)) of a college or university as described in paragraph (10) of this section that directly uses the building under a lease with a term of at least one year to provide dormitory, classroom, and related facilities for its students;

(B) The owner of a building exempted from real property taxation pursuant to subparagraph (A) of this paragraph shall notify the Office of Tax and Revenue within 30 days after the occurrence of any event, including the expiration or cancellation of a lease, that terminates the building’s entitlement to the exemption.

(11) Buildings belonging to and used in carrying on the purposes and activities of the National Geographic Society, American Pharmaceutical Association, the Medical Society of the District of Columbia, the National Lutheran Home, the National Academy of Sciences, Brookings Institution, the American Forestry Association, the American Tree Association, the Carnegie Institution of Washington, the American Chemical Society, the American Association to Promote the Teaching of Speech to the Deaf, and buildings belonging to such similar institutions as may be hereafter exempted from such taxation by special acts of Congress;

(12) Cemeteries dedicated to and used solely for burial purposes and not organized or operated for private gain, including buildings and structures reasonably necessary and usual to the operation of a cemetery;

(13) Churches, including buildings and structures reasonably necessary and usual in the performance of the activities of the church. A church building is one primarily and regularly used by its congregation for public religious worship;

(14) Buildings belonging to religious corporations or societies primarily and regularly used for religious worship, study, training, and missionary activities;

(15) Pastoral residences actually occupied as such by the pastor, rector, minister, or rabbi of a church; provided, that such pastoral residence be owned by the church or congregation for which said pastor, rector, minister, or rabbi officiates; and provided further, that not more than 1 such pastoral residence shall be so exempt for any 1 church or congregation;

(16) Episcopal residences owned by a church and used exclusively as the residence of a bishop of such church;

(17) Buildings belonging to organizations which are charged with the administration, coordination, or unification of activities, locally or otherwise, of institutions or organizations entitled to exemption under the provisions of §§ 47-1002, 47-1005, and 47-1007 to 47-1010, and used as administrative headquarters thereof;

(18)(A) Grounds belonging to and reasonably required and actually used for the carrying on of the activities and purposes of any institution or organization entitled to exemption under the provisions of §§ 47-1002, 47-1005, and 47-1007 to 47-1010.

(B)(i) Additional grounds belonging to and forming a part of the property of such institutions or organizations as of July 1, 1942. Such exemption shall be granted only upon the filing of a written application to the Mayor of the District of Columbia, supported by an affidavit that such additional grounds are not held for profit or sale but only for the enlargement and expansion of said institution or organization.

(ii) If, however, at any future date the grounds so exempted, or any portion thereof, shall be sold and a profit shall result from such sale the taxes thereon for each year from the date of acquisition of such property for which no tax has been paid shall immediately become due and payable, without interest; provided, however, that the total of such taxes shall not exceed 50% of the net profit derived from such sale. The Mayor shall be furnished a copy of the contract of sale together with other evidence necessary to establish the amount of profit or loss therefrom at least 10 days prior to the date of settlement of such sale. Taxes assessed under this subparagraph shall constitute a lien upon such property;

(19) Buildings owned by and actually occupied and used for legitimate theater, music, or dance purposes by a corporation which is not organized or operated for commercial purposes or for private gain, which buildings are open to the public, generally, and for admission to which charges may be made to cover the cost of expenses and the real property (and any interest therein) situated on any portion of the lot that is designated, as of October 1, 2003, as lot 878 in square 456 and that is owned, occupied, and used, directly or indirectly through one or more wholly-owned subsidiary organizations, by a legitimate theater company is hereby exempt from all real property taxation so long as the property continues to be so owned and occupied, and used for the exempt purposes described in § 47-1002(18) and § 47-1002(19), providing for exemption of certain real properties;

(20)(A) Multifamily and single family rental and cooperative housing for, and individual condominium units rented to low and moderate income persons which are receiving assistance through 1 or more of the following federal programs:

(i) interest reduction payments made under § 236 of the National Housing Act (§ 1715z-1 of Title 12, United States Code);

(ii) payments made for new construction, substantial rehabilitation, or moderate rehabilitation under § 8 of the United States Housing Act of 1937 (§ 1437f of Title 42, United States Code) or payments made under any renewal of a contract originally made under the new construction, substantial rehabilitation, or moderate rehabilitation under section 8 that entitled the property to the exemption;

(iii) payments made under § 101 of the Housing and Urban Development Act of 1965 (§ 1701s of Title 12, United States Code);

(iv) mortgage insurance under § 221 (d)(3), BMIR, of the National Housing Act (§ 1715l (d)(3) of Title 12, United States Code);

(v) direct loans made under § 202 of the Housing Act of 1959 (§ 1701q of Title 12, United States Code); and

(vi) rental rehabilitation funded under § 17 of the United States Housing Act of 1937 (42 U.S.C. § 1437o), if 80% or more of the units in the housing project are provided to low-income persons or families receiving assistance under 42 U.S.C. § 1437o; provided, however, that the owner(s) of such exempt property shall submit by March 1st of each year an annual income and expense statement to the District of Columbia Department of Finance and Revenue and shall make a yearly payment in lieu of taxes in an amount calculated in the following manner:

(I) If the owner(s) is not organized for profit, no payment shall be required; and

(II) If the owner(s) is organized as a limited dividend or limited profit owner, or a profit owner, a payment for such building, in an amount equal to 5% of the gross income derived from the operation of such building during the latest completed annual accounting period, shall be required.

(B) If the owner(s) of exempt property fail to make the payment in lieu of taxes in a manner which the Office of Tax and Revenue shall prescribe, the property shall be subject to the provisions of Chapter 13A, and the payment in lieu of taxes shall be deemed a delinquent real property tax from the day it was due and not paid for purposes of the real property sale.

(C) This paragraph (20) shall not apply to those properties granted an exemption before January 5, 1971, under paragraph (8) of this section.

(D) For purposes of this paragraph, the term:

(i) “Condominium” means the ownership of a single dwelling unit in a horizontal property regime as that term is used in § 42-2003; and

(ii) “Individual condominium units” means a portion of the condominium designed and intended for individual ownership together with the undivided interest in the common elements to which they appertain.

As the exemption provided for in subparagraph (A)(vi) of this paragraph applies to the Southern Court project located at 845, 855, 865, 875, and 885 Chesapeake Street, S.E., and 860, 870, 880, and 890 Southern Avenue, S.E., on lot 39 in Square 6210 in the District of Columbia, it shall be effective for the tax year beginning July 1, 1986;

(21) Property transferred to a qualifying lower income homeownership household in accordance with § 47-3503(c);

(22) Property transferred to a qualifying nonprofit housing organization in accordance with § 47-3505(d);

(23)(A) Subject to the provisions of subparagraph (B) of this paragraph, the development of a qualified supermarket, as defined in § 47-3801.

(B) The real property tax exemption granted by subparagraph (A) of this paragraph shall apply only:

(i) For 10 consecutive real property tax years beginning with the tax year in which a certificate of occupancy was issued for the development;

(ii) During the time that the real property is used as a supermarket;

(iii) In the case of the development of a qualified supermarket, on real property not owned by the supermarket, if the owner of the real property leases the land or structure to the supermarket at a fair market rent reduced by the amount of the real property tax exemption; and

(iv) During the time that the supermarket is in compliance with the requirements of subchapter X of Chapter 2 of Title 2;

(24) Property transferred to a resident management corporation in accordance with § 47-3506.01;

(25) The improvements located on that portion of Lot 800 of Square 1112 known as the Correctional Treatment Facility, only during the time that the improvements are operated as a correctional facility housing inmates in the custody of the District of Columbia Department of Corrections;

(26)(A) The real property (and any improvements thereon) described as Square 454, Lots 41, 824, 838, 857, 877, 878; the portion of the public alley that reverted to (i) former Lot 820, (which is currently known as Lot 866), and (ii) former Lot 821 (which is currently known as Lot 867) pursuant to the Plat of Alley Closing filed with the Surveyor of the District of Columbia in Liber 17 at folio 74; the portions of the public alley that will revert to Lots 41, 824, 838, 857, 877 and 878, all in Square 454, pursuant to the alley closing approved by the Closing of Public Alleys in Square 454 and Square 455, S.O. 98-194 Act of 1999, effective October 22, 1999 (D.C. Law 13-48; 46 DCR 6768), during the period commencing November 8, 2000 and terminating with respect to any portion of such real property on the date that a final certificate of occupancy shall have been issued with respect to improvements on such portion of such real property.

(B) The amount of all taxes, fees, and deposits exempt, abated, or waived under this paragraph, section 2(b) of the Gallery Place Economic Development Amendment Act of 2000, effective April 3, 2001 (D.C. Law 13-241; 48 DCR 610) [D.C. Code § 2-1217.31(b)], and §§ 47-902(17), 45-922(24) [§ 42-1102(24)], and 47-2005(28) [§ 47-2005(30)], shall not exceed, in the aggregate, $7 million;

(27)(A) The real property (and any improvements thereon) described as Square 299, Lot 831, during the period commencing October 1, 2001 and terminating, with respect to any portion of the real property, on the date that a final certificate of occupancy shall have been issued with respect to improvements on the portion of the real property, until the Development Sponsor sells the Mandarin Oriental Hotel Project, as evidenced by the recordation of a deed conveying title to Square 299, Lot 831, at which time such amounts shall be due and payable without penalty or interest.

(B) The amount of all taxes, fees, and deposits deferred under this paragraph, section 2(b) of the Mandarin Oriental Hotel Tax Deferral Act of 2002, passed on 2nd reading on September 17, 2002 (Enrolled version of Bill 14-466) [D.C. Law 14-232], and §§ 42-1102(25), 47-902(19), and 47-2005(33) [§ 47-2005(34)], shall not exceed, in the aggregate, $4 million.

(C) For purposes of this paragraph, the term:

(i) “Development Sponsor” means Portals Hotel Site, LLC, a Delaware limited liability company, and its successors and assigns.

(ii) “Mandarin Oriental Hotel Project” means the acquisition and initial development, construction, equipping, and furnishing of a Mandarin Oriental hotel within the Portals project, located on Square 299, Lot 831, consisting of a 400-room hotel with approximately 33,000 square feet of associated meeting and banquet space, 2 restaurants, a health spa and fitness center totaling approximately 10,000 square feet, and approximately 90,000 square feet of public parking space for approximately 200 cars.

(iii) “Mandarin TIF Bonds” means the tax increment financing bonds issued in connection with the Mandarin Oriental Hotel Project pursuant to the Tax Increment Revenue Bonds Mandarin Hotel Project Emergency Approval Resolution of 2000, effective March 7, 2000 (Res. 13-510; 47 DCR 2133), and the Mandarin Hotel Project Modification Approval Resolution of 2000, effective December 19, 2000 (Res. 13-745; 48 DCR 83).

(D) This paragraph shall apply upon the closing of the sale of the Mandarin TIF Bonds;

(28)(A) Land and improvements that are located in the Housing Overlay District established pursuant to section 1706 of Title 11 of the District of Columbia Municipal Regulations (11 DCMR § 1706), the Arts Overlay District established pursuant to section 1704 of Title 11 of the District of Columbia Municipal Regulations (11 DCMR § 1704), and the Historic Preservation District established pursuant to section 1707 of Title 11 of the District of Columbia Municipal Regulations (11 DCMR § 1707), and not otherwise exempt pursuant to this section, for the period specified in subparagraph (C) of this paragraph; provided, that the land and improvements satisfy at least one of the requirements set forth in subparagraph (B) of this paragraph.

(B) The exemption granted by this paragraph shall only apply to:

(i) Land and improvements as to which a theater company of the type described in paragraph (19) of this section is or was, as of the effective date of the Square 456 Payment in Lieu of Taxes Extension Emergency Act of 2002, passed on an emergency basis on June 18, 2002 (Enrolled version of Bill 14-701) [July 10, 2002], the contract purchaser or owner; or

(ii) Improvements developed pursuant to a vertical subdivision, horizontal property regime, condominium regime, or common building permit, or pursuant to a combined lot development method or sharing a common primary ingress or egress on a single or one or more adjoining lots of record concurrent with the development of a theater company described in paragraph (19) of this section or any wholly-owned subsidiary of the theater company, with a floor area of not less than 18,000, and not more than 100,000 square feet, to be used for theater and ancillary purposes by a theater company of the type described in paragraph (19) of this section.

(C) The exemption granted by this paragraph shall only apply if, to the extent that the property is not otherwise exempt, the property owner is obligated under § 47-1052 or any other law to make payments in lieu of taxes in furtherance of the public interest to promote the economic development of the District of Columbia and the improvement of the general public welfare and for the benefit of the District of Columbia and its residents.

(D) This paragraph shall expire on the day after the date on which the District and Qualified Theater Company have entered into a grant agreement for the making of the grant identified in § 47-1052(a)(7)(B), and the funding of that grant;

(29) Except as provided in the PILOT Agreement, property, including land, any improvements thereon, and any possessory interests therein, for which payments in lieu of taxes are being made under a PILOT agreement pursuant to part E of subchapter IV of Chapter 3 of Title 1 [§ 1-308.01 et seq.], during the term of the PILOT agreement;

(30)(A) Land (other than Lots 0074 and 0075, Square 737, and Lot 0021, Square 769, but excluding any portion of the land known as Reservation 17A which becomes part of Square 737, and land consisting of streets or alleys located within the Capper/Carrollsburg PILOT Area established pursuant to § 47-4611 upon abandonment thereof and reversion to Square 737 or 769 or lot included in Square 737 or 769) in the Capper/Carrollsburg PILOT Area and not otherwise exempt under this section and all improvements that are located in the Capper/Carrollsburg PILOT Area and not otherwise exempt under this section, for the period specified in subparagraph (B) of this paragraph. Notwithstanding the foregoing, the improvements on Lots 0074 and 0075, Square 737, and Lot 0021, Square 769 (excluding any portion of the land known as Reservation 17A which becomes part of Square 737 and land consisting of streets or alleys located within the Capper/Carrollsburg PILOT Area established pursuant to § 47-4611 upon abandonment thereof and reversion of Square 737 or 769 or lot included in Square 737 or 769) shall not be exempt from the special tax provided in § 1-204.81.

(B) This paragraph shall expire the day after the bonds, notes, or other obligations issued by the District of Columbia pursuant to the PILOT Authorization Increase and Arthur Capper/Carrollsburg Public Improvements Revenue Bonds Approval Act of 2006, effective March 8, 2007 (D.C. Law 16-244; 54 DCR 609), together with interest and premium, if any, thereon, and all costs and expenses in connection with any suit, action, or proceeding by or on behalf of the holders of the District’s bonds, notes or other obligations are fully met and discharged; and

(31)(A) Property owned by a title-holding entity that is not organized or operated for private gain, as to which all of the ownership, membership, or beneficial interest is vested in one or more organizations, each of which is entitled to an exemption under paragraphs (6) through (20) of this section, and that is used by one or more organizations, each of which is entitled to an exemption under paragraphs (6) through (20) of this section, for the activities and purposes entitling each such organization to the exemption.

(B) A title-holding entity shall notify the Office of Tax and Revenue within 30 days of any change in any of its owners, members, or beneficial interest holders.

(C) For the purposes of this paragraph, the term “title-holding entity” means an entity whose activities are limited to holding record title to a property, providing the property (with or without consideration) for the use of the one or more organizations, each of which is entitled to an exemption under paragraphs (6) through (20) of this section, for the activities and purposes entitling each such organization to the exemption, encumbering the property with indebtedness, and repaying indebtedness secured by the property.

(32)(A) Real property belonging to an organization that is not organized or operated for private gain and that maintains a current license as a continuing care retirement community, as provided by [§ 44-151.02], or any successor provision, shall be exempt from taxation; provided, that the real property is used as a continuing care retirement community.

(B) For the purposes of this paragraph, the term "continuing care retirement community" means a continuing care facility, as defined [in] [§ 44-151.01(3)], governed by [Chapter 1A of Title 44].