D.C. Code § 47-3802: Tax exemption.

*NOTE: This section includes amendments by emergency legislation that will expire on November 11, 2026. To view the text of this section after the expiration of all emergency and temporary legislation affecting this section, click this link: Permanent Version.*

(a)

(1)

The development of a qualified supermarket shall be eligible for:

(A)

A 5-year or 10-year real property tax exemption as provided in § 47-1002(23);

(B)

An exemption from the license fee under § 47-2851.04 for:

(i)

Ten years, if the exemption has been certified pursuant to this title before October 1, 2026; or

(ii)

Five years, if the exemption has been certified pursuant to this title on or after October 1, 2026;

(C)

A 5-year or 10-year personal property tax exemption as provided under § 47-1508(a)(9); and

(D)

A sales and use tax exemption under § 47-2005(28) on the purchase of all building materials related to the development of the qualified supermarket.

(2)

A qualified supermarket that experienced hardship in each of the 2 tax years prior to the supermarket's request for certification of eligibility for the exemption shall be eligible for:

(A)

A 5-year real property tax exemption as provided in § 47-1002(23);

(B)

A 5-year exemption from the license fee under § 47-2851.04; and

(C)

A 5-year personal property tax exemption as provided under § 47-1508(a)(9).

(b)

A qualified restaurant or retail store shall not be eligible for an exemption beginning on or after October 1, 2010 until the fiscal effect of any such new exemptions is included in an approved budget and financial plan.

(c)

(1)

Effective for applications filed on or after January 1, 2011, to be eligible for any exemption provided under subsection (a) of this section, an applicant shall file with the Mayor, in such manner and form as the Mayor may prescribe, an application requesting certification of eligibility for the exemption. In the case of an applicant seeking an exemption as a qualifying supermarket that experienced hardship, the application shall include a profit and loss statement for the supermarket for the previous 2 tax years. As part of the application, and as a condition of certification, an applicant seeking an exemption for a qualified supermarket shall agree in writing to:

(A)

Become authorized to accept Supplemental Nutrition Assistance Program ("SNAP") benefits as payment at the qualified supermarket, and to accept SNAP benefits for payment after such authorization;

(B)

Apply to the Department of Health ("DOH") for approval to accept Special Supplemental Nutrition Program for Women, Infants, and Children ("WIC") benefits as payment at the qualified supermarket, and accept WIC benefits as payment at the qualified supermarket if approved by DOH to accept WIC benefits; and

(C)

Conduct community listening sessions on the store's product offerings and operations at least once every 2 years.

(2)

The Mayor shall, as nearly as practicable, complete review of requests for certification within 45 days after receipt.

(3)

The Mayor shall certify to the Office of Tax and Revenue each taxpayer and property eligible for an exemption. The certification shall identify:

(A)

The tax to which the certification applies;

(B)

The specific taxpayer (including taxpayer identification number) and property (by square and lot or parcel or reservation number) eligible;

(C)

The type or portion of the property that is eligible;

(D)

The effective date of eligibility;

(E)

The date on which eligibility is to terminate; and

(F)

Such other information as the Office of Tax and Revenue shall require to administer the exemption.

(4)

The Office of Tax and Revenue shall, as nearly as practicable, review and process certifications by the Mayor for real property tax exemptions under subsection (a)(1)(A) and (2)(A) of this section within 10 days after receipt.

(5)

The Mayor shall notify the Office of Tax and Revenue if any taxpayer or property certified as eligible under paragraph (3) of this subsection becomes ineligible for an exemption under subsection (a) of this section. The notification shall identify:

(A)

The type of tax to which the notice applies;

(B)

The taxpayer (including taxpayer identification number) and property (by square and lot or parcel or reservation number);

(C)

The type or portion of the property ineligible;

(D)

The date on which the taxpayer or property became ineligible; and

(E)

Such other information as the Office of Tax and Revenue shall require to administer the termination of the exemption.

(6)

This subsection applies to the application requirements otherwise applicable to requests for exemption from the taxes listed in subsection (a) of this section, but shall not affect any other provision governing administration of the taxes.

(d)

A qualified supermarket certified by the Mayor pursuant to this section shall be eligible for the tax exemptions provided by subsection (a)(1)(A) through (C) and (2)(A) through (C) of this section throughout the certified tax exemption period even if, during the certified period, the boundary of the eligible area in which the qualified supermarket was located at the time of certification changes and, as a result of the boundary change, the supermarket is no longer located in an eligible area.

(e)

To remain eligible to continue to receive the tax benefits provided by this chapter, a qualified supermarket shall:

(1)

Accept SNAP benefits for payment at the qualified supermarket;

(2)

Accept WIC benefits for payment at the qualified supermarket, unless determined ineligible by DOH to accept payments by WIC benefits; and

(3)

Conduct a community listening session on the store's product offerings and operations at least once every 2 years.

(f)

The Mayor shall review the definition of the term "eligible area" at least once every 5 years to determine whether it continues to appropriately reflect the areas of the District where tax incentives for new supermarkets provide substantial benefits to District residents and neighborhoods.

(g)

At the Mayor's discretion, the Mayor may extend, in whole or in part, a tax exemption received or previously extended pursuant to this section in an increment of no more than 5 years, if:

(1)

The qualified supermarket submits to the Mayor the application required by subsection (h) of this section; and

(2)

The Mayor determines:

(A)

The entity continues to be a qualified supermarket;

(B)

An extension of the tax exemption is necessary to maintain the financial or operational viability of the qualified supermarket; and

(C)

The qualified supermarket is fulfilling a need that would otherwise not be met in the surrounding community by providing access to a variety of food and grocery options.

(h)

To be eligible for an extension pursuant to subsection (g) of this section, a qualified supermarket shall, no later than 60 days before the expiration of its existing tax exemption, submit to the Mayor an application that includes:

(1)

An enumeration of the sales and income tax generated by the qualified supermarket over the prior 5 years;

(2)

An enumeration of the amount and type of tax exemptions received by the qualified supermarket during the prior 5 years;

(3)

A detailed description of the financial or operational need for the extension of the tax exemption;

(4)

A description of how the qualified supermarket met community needs during the previous 5 years, including a description of the cleanliness and appearance of the qualified supermarket, the quality and variety of products carried, the adequacy of staffing levels, and how the qualified supermarket has addressed concerns raised during the community listening sessions required by subsection (c) of this section and a description of how the qualified supermarket intends to continue to meet community needs and address concerns raised during listening sessions in the subsequent 5 years; and

(5)

Data showing the percentage and dollar amount of transactions in which a customer used SNAP benefits, WIC benefits, the Summer Electronic Benefit Transfer program, or other federal or District benefit programs identified by the Mayor.