P.R. Laws tit. 21, § 5051a
(a) An Interagency Committee is hereby created, to be composed of the Secretary of the Department of the Treasury, the Executive Director of the CRIM, and the President of the Government Development Bank for Puerto Rico, who shall be its Chair. Furthermore, the President of the Puerto Rico Mayors’ Federation, or his/her designated representative, and the President of the Puerto Rico Mayors’ Association, or his/her designated representative, shall be members of the Interagency Committee but shall not have voting rights on Interagency Committee affairs. The Interagency Committee shall have the task of creating a mandatory register for unappraised real properties and unappraised improvements on commercial and industrial real properties (the “Register”) and seeing to the execution of an action plan (“Action Plan”) for the land subdivision and/or appraisal and the imposition and collection of a property tax under the provisions of this section for fiscal years 2010-2011 and 2011-2012.
(b) Any natural or juridical person who owns a property, or the person authorized in writing to represent the former, shall have seventy-five (75) calendar days, or up to an additional term of thirty (30) days if, after the recommendations from the CRIM and the Interagency Committee, it is determined to be necessary and convenient to enforce the provisions of this chapter, to register his/her unappraised real properties or his/her unappraised improvements on commercial and industrial real properties, from the date on which the general orientation campaign for the property registration process begins, as established in this chapter. The information needed to keep the Register shall be obtained from an application prepared for such purposes, to be completed on the Internet or at the orientation centers, or by any other method recommended by the CRIM with the previous approval of the Interagency Committee.
The Interagency Committee shall prepare a public notice to inform the date on which the Register will start. Such notice shall be published in a newspaper of general circulation at least three (3) days before the start of the general orientation campaign. Furthermore, the Interagency Committee shall coordinate the launch of a general orientation campaign through any communications media available, such as the press, radio, and television, and through the orientation centers set up for these purposes, where written material and any necessary forms can be distributed and any other orientation that the Interagency Committee may deem convenient can be provided. The Interagency Committee is hereby authorized to devote the necessary resources to launch the general orientation campaign and implement the provisions of this chapter, without being subject to the provisions of any other law or regulations that could limit the use of such resources.
(c) The Interagency Committee shall evaluate and certify municipalities that prove to individually have the structure, capacity, and experience to assist in the land subdivision, appraisal, assessment, and collection of taxes on their properties through their employees, resources under contract, or a combination thereof, in order for these to become part of the resources to be used in the development of the Action Plan; Provided, That the municipalities certified by the Interagency Committee shall have all the powers and authorities necessary to conduct the efforts of land subdivision, appraisal, assessment, and collection of taxes on properties within their territorial limits.
(d) Those municipalities that (i) Are entitlement municipalities, and (ii) have proven their capacity and experience in works conducted under working agreements between the CRIM and such municipalities, may be certified by the Interagency Committee as Coordinating Municipalities. Coordinating segregating, appraising, assessing, and collecting taxes on properties within the territorial limits of their own municipalities. They may also enter into cooperation agreements with other municipalities that voluntarily request their services to coordinate, administer, and conduct the efforts of the Action Plan in such municipalities. The Operations Office shall periodically evaluate the performance of Coordinating Municipalities in terms of compliance with the Action Plan and may, with the previous approval of the Interagency Committee, revoke its certification when any such municipality fails to comply with the Action Plan. The Interagency Committee may designate the Operations Office as coordinator in substitution for any municipality that has had its certification revoked for noncompliance with the Action Plan.
(e) Municipalities that do not individually have the structure, capacity, or experience to work in the implementation of this Action Plan through their employees, resources under contract, or a combination thereof, shall receive the services through the Operations Office or may voluntarily select a Coordinating Municipality. In the case they voluntarily select a Coordinating Municipality to represent them in the coordination and administration of the works and processes provided in this chapter, the municipalities shall execute memoranda of understanding or collaboration agreements whereby the powers to be assumed by the Coordinating Municipality and those being transferred by the represented municipality shall be established.
(f) The Operations Office shall develop an Action Plan to conduct the works established in this chapter. The Action Plan shall have the previous approval of the Interagency Committee before its implementation.
(g) The segregations and appraisals provided in this act shall be made under the valuation and appraisal standards in effect at the CRIM. The appraised value pursuant to this section shall be the appraised value upon which the property tax shall be determined and shall be effective on January 1, 2010. As part of the Action Plan, the Interagency Committee shall establish the necessary mechanisms to expedite the segregation, appraisal, and assessment of structures that have not been segregated by the CRIM. The appraisal, assessment, and collection of taxes under this Act on structures not registered or appraised within a property that has not been segregated for registration purposes, shall not have the legal effect of a registered segregation of such property.
(h) Any natural or juridical person that owns a property registered pursuant to the provisions of this act shall be exempt from the retroactive tax imposition on appraised property for up to five (5) fiscal years prior to January 1, 2010, as provided in this part, for which reason, such person shall pay taxes starting on Fiscal Year 2010-2011; Provided, That in the case of commercial and industrial properties, the exemption under this section shall be limited to the fifth, fourth, and third fiscal years prior to Fiscal Year 2010-2011, for which reason, these shall pay taxes for Fiscal Year 2010-2011 and for the immediately preceding fiscal year.
(i) In lieu of the basic real property tax established in § 5001 of this title, a tax shall be imposed, notified, and collected under this Section for fiscal years 2010-2011 and 2011-2012 based on a tax rate equal to that existing at each municipality, applied on the appraisal value of the unappraised real property or the unappraised improvements on commercial and industrial properties, as established in this act. During the effective term of this Special Law, a moratorium shall be declared, which shall apply to municipalities, prohibiting any increase in the tax rate during such term of effectiveness, regardless of the provisions of any other applicable law. It is hereby provided that, in the event that the tax rate in a municipality changes by means of an ordinance, such change shall have the same effect on the tax rate used to compute taxes under this section. Furthermore, properties subject to taxes established under this section shall be subject to the imposition of the existing special real property tax of the Department of the Treasury, pursuant to Section 37.01 of Subtitle CC of Act No. 120 of October 31, 1994, as amended. The tax established in this Section shall be imposed, notified, and collected by municipalities pursuant to the provisions of this Section and following the same standards for the imposition, notice, and collection (including attachment, sale, and redemption) of property taxes imposed under § 5001 of this title. It shall also be subject to the administrative and judicial review procedures of § 5098a of this title. Provided, further, That the tax established under this section shall constitute the first preferred lien on the real property upon which the tax is imposed, and the ranking of the lien established in § 5080 of this title, shall apply after the ranking established herein.
(j) If an unappraised real property or unappraised improvements on commercial and industrial properties, as established in this act, are not registered, but are identified and appraised within the period between the closing date of the mandatory property registration and June 30, 2012, they shall be subject to a penalty for failure to comply with the mandatory registration. For unappraised residential properties, the penalty shall be equal to ten percent (10%) over the tax determined during the effective term of this act; for commercial and industrial properties, the penalty shall be equal to ten percent (10%) of the appraised value of such unappraised properties or improvements. In addition, a fine of one thousand dollars ($1,000) shall be imposed for unappraised residential properties, a fine of five thousand dollars ($5,000) for unappraised commercial properties or commercial properties with unappraised improvements, and a fine of two hundred fifty thousand dollars ($250,000) for unappraised industrial properties or industrial properties with unappraised improvements.
(k) The CRIM shall create a Central Operations Office pursuant to the Action Plan and with the previous approval of the Interagency Committee, which office shall be responsible for defining the structure of the services necessary to meet the purposes of the Action Plan to be developed by the Interagency Committee and of § 5098a of this title. This Office, with the previous approval of the Interagency Committee, shall identify human and technical resources within the CRIM or other government structures, or contract the same to carry out the mapping, appraisal quality control and required documentation, approval of cases submitted and entry of data into the systems, issue of payments receipts resulting from the appraisal process, and collection efforts of the payment receipts issued.
(l) A “Fund for the Registration and Appraisal of Unappraised Real Properties and Unappraised Improvements on Commercial and Industrial Properties”, hereinafter the Fund, is hereby created to be attached to the Bank, with the purpose of covering expenses related to the works to be conducted pursuant to the Action Plan. The Bank shall establish such Fund as a special fund, separate from any other government funds. The functions of the Fund shall be governed by the Interagency Committee.
(m) The Bank is hereby authorized to grant a loan to the Fund for up to a maximum of twenty million dollars ($20,000,000.00), plus the interest agreed upon. This loan shall not affect the borrowing capacity of the CRIM or that of the municipalities, and shall be paid, as well as any interest thereon, with funds originating from the proceeds of taxes imposed under this section, as provided in subsection (n) thereof. The loan shall be disbursed through the Operations Office and the municipalities qualified under subsections (c) and (d) of this section, pursuant to the sound administration criteria of the Bank.
(n) The proceeds from taxes imposed under this section shall be covered into the Fund at the time of their receipt. The first fifteen percent (15%) of the revenues shall be set aside and used for the payment of the loan and interest. After the loan and interest thereon have been paid in full, the remaining revenues received on account of such fifteen percent (15%) of the taxes imposed under this section shall be destined to supplement the revenues received on account of the special property tax established in Act No. 7 of March 9, 2009, as amended, regarding the aggregate sum of $600 million established in said act.
(o) The revenues in excess of the fifteen percent (15%) referred to in the preceding subsection shall be distributed as follows: fifty percent (50%) shall be remitted to the Secretary of the Treasury to be covered into the General Fund of the Commonwealth of Puerto Rico, and fifty percent (50%) shall be remitted to the CRIM to be, in turn, allocated as basic tax to the respective municipalities, as appropriate. Of the portion to be transferred to the General Fund of the Commonwealth of Puerto Rico, twelve point five percent (12.5%) shall be used to supplement revenues on account of the special property tax established in Act No. 7 of March 9, 2009, as amended, regarding the aggregate sum of $600 million established in said act.
(p) The CRIM shall remit to the municipalities the funds attributable to the basic tax as provided in subsection (o) of this section, in payments separate from all other taxes on the value of properties and all other revenues to be allocated to municipalities.
(q) Up to one hundred fifty thousand dollars ($150,000) of the valuation of a property, as computed by the valuation system used by the CRIM, shall be exempt from the tax imposed under this section if the owner uses such property as his/her main residence. As for properties partially used for residential purposes, the exemption shall only be granted with regards to the part of the property devoted to such purposes, up to one hundred fifty thousand dollars ($150,000.00) of the appraisal value, following the same criteria used under § 5002 of this title, by Act No. 7 of March 9, 2009.
(r) All exemptions and exonerations provided in this part, or in any other law, decree, or concession that establishes or recognizes any exemption or exoneration for purposes of appraisal and imposition under §§ 5001 and 5002 of this title, shall apply to the imposition of the real property tax established in this section. Real properties that constitute newly-built housing units that have not been sold or delivered shall not be subject to the imposition of the real property tax established in this section while the project developer or the financial institution that finances or shall finance the newly-built housing project holds the ownership thereof.
(s) Financial institutions that keep withheld amounts for the payment of real property taxes corresponding to unappraised properties shall be under the obligation to provide the Department of the Treasury and the CRIM with a list containing the names, identification, and amounts withheld in escrow for the payment of said taxes, together with the location and description of such property.
(t) The Interagency Committee may request any information, statistics, data, and studies as necessary from the Department of the Treasury, the CRIM, the Bank, the Puerto Rico Planning Board, the municipalities, or any other public or private entity to ensure compliance with the Action Plan. Such entities shall have the duty and obligation to provide such information without delay and free of charge. Any information thus obtained and distributed shall be used only for the purposes for which it was requested and shall be treated as confidential. Likewise, with the previous authorization of the Interagency Committee, the Operations Office may request the technical assistance of any of the aforementioned entities for purposes of planning and developing its Action Plan and such entity shall be under the obligation to supply such assistance promptly. The Operations Office, the coordinating municipalities, and any municipalities that are individually certified shall be under the obligation to submit a bimonthly financial report on the development and execution of the Plan to the Interagency Committee and the Legislative Assembly.
(u) After fiscal years 2010-2011 and 2011-2012 have elapsed, the tax imposed under this section shall be replaced by the tax and distribution established pursuant to § 5002 of this title.
(v) The CRIM shall have fifteen (15) days, or the term to be established by the Interagency Committee, to carry out the tasks assigned by such Committee. In the event that the CRIM fails to carry out such tasks within the applicable term, the Interagency Committee may directly carry out these tasks to ensure the implementation of this act.
History —Aug. 30, 1991, No. 83, added as § 3.01A on July 2, 2010, No. 71, § 14; Dec. 1, 2010, No. 180, § 1.