All Roll Calls
Yes: 299 • No: 101
Sponsored By: Angelia Williams Graves (Democratic)
Became Law
Real property tax; partial exemption for repurposing underutilized structures for residential use; local incentives. Permits localities to provide partial real estate taxation exemptions for converted real property where such conversion establishes a residential structure that has set aside at least 30 percent of the structure for households with a per capita income at or below 80 percent of the locality's median income or where the building owner is subject to an agreement with the Commonwealth or the locality regarding the provision of affordable housing. Localities have discretion to determine (i) whether a converted building qualifies for the partial exemption, (ii) any additional restrictions and conditions, (iii) whether the exemption is the amount equal to the increase in assessed value or a percentage of such increase resulting from the repurposing of the structure, and (iv) the length of time the exemption will run with the land, not to exceed 15 years. The bill provides that, at any time a building for which its owner claims a partial exemption no longer meets the requirements to receive such exemption, the locality may recapture all or a portion of the exemption granted in the immediately preceding year. Further, if a building owner that claims an exemption as described by the bill sells the building for which he is claiming the exemption and, after the sale, the property no longer meets the requirements described by the bill, the purchaser shall be subject to a penalty. The building owner shall provide written notification of the partial exemption to the purchaser. The bill also permits localities to grant tax incentives or provide regulatory flexibility to qualifying converted real property.
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3 provisions identified: 1 benefits, 0 costs, 2 mixed.
The law lets counties, cities, and towns offer a partial property tax break when you rehab, renovate, or replace a home that is at least 15 years old. You must get permits, finish the work, and have the local assessor verify it. The break can equal the value increase, a set percent of it, or up to 50% of rehab costs. It can start at completion or the next January 1 and last up to 15 years; the exempt amount runs with the land. You get a written notice showing the exempt value and term; the exemption cannot erase the structure’s full value. Application fees are capped at $125 for homes and $250 for larger buildings. No break applies if a registered landmark or a contributing historic building was demolished and replaced.
Localities can give a partial property tax break for turning older retail, commercial, or religious buildings into homes. The building must be at least 15 years old, allow depreciation, and have certified costs above the greater of its adjusted basis or $15,000, not counting purchase or enlargement. At completion, either at least 30% of units must be offered to households at or below 80% of the locality’s median per‑capita income, or you must have a recorded affordable housing agreement. The break can be based on the value increase or a set percent of it, but it cannot exceed eligible conversion expenses, and can last up to 15 years. If you later fall short of the 30% affordable‑unit target, the locality may take back part of the prior year’s exemption in proportion to how far you missed the benchmark. If the property is sold and later fails to meet the rules, the buyer owes the difference between taxes paid and fair‑market‑value taxes for the prior five years, plus simple interest; the seller must give written notice before the sale.
Localities may set up programs to encourage these conversions. They can lower permit fees, speed up approvals, or cut local gross receipts taxes tied to conversion costs. Incentives exclude purchase and enlargement costs and may scale with population density.
Angelia Williams Graves
Democratic • Senate
There are no cosponsors for this bill.
All Roll Calls
Yes: 299 • No: 101
House vote • 4/22/2026
House concurred in Governor's recommendation
Yes: 65 • No: 31
Senate vote • 4/22/2026
Senate concurred in Governor's recommendation
Yes: 21 • No: 18
Senate vote • 3/4/2026
House substitute agreed to by Senate
Yes: 21 • No: 19
House vote • 3/2/2026
Passed House with substitute
Yes: 70 • No: 29
House vote • 2/25/2026
Reported from Finance with substitute
Yes: 17 • No: 4
House vote • 2/24/2026
Subcommittee recommends reporting with substitute
Yes: 11 • No: 0
Senate vote • 2/2/2026
Read third time and passed Senate Block Vote
Yes: 40 • No: 0
Senate vote • 1/30/2026
Engrossed by Senate Block Vote (Voice Vote)
Yes: 0 • No: 0
Senate vote • 1/29/2026
Passed by for the day Block Vote (Voice Vote)
Yes: 0 • No: 0
Senate vote • 1/29/2026
Constitutional reading dispensed Block Vote (on 1st reading)
Yes: 40 • No: 0
Senate vote • 1/28/2026
Reported from Finance and Appropriations
Yes: 14 • No: 0
House concurred in Governor's recommendation (65-Y 31-N 0-A)
Senate concurred in Governor's recommendation (21-Y 18-N 0-A)
Acts of Assembly Chapter text (CHAP0994)
Reenrolled bill text (SB181ER2)
Reenrolled
Approved by Governor-Chapter 994 (effective 7/1/2026)
Signed by President
Signed by Speaker
Governor's recommendation adopted
Governor's recommendation received by Senate
Fiscal Impact statement From TAX (3/20/2026 11:42 am)
Governor's Action Deadline 11:59 p.m., April 13, 2026
Enrolled Bill communicated to Governor on March 14, 2026
Bill text as passed Senate and House (SB181ER)
Enrolled
Signed by President
Signed by Speaker
House substitute agreed to by Senate (21-Y 19-N 0-A)
Passed House with substitute (70-Y 29-N 0-A)
Engrossed by House - committee substitute
committee substitute agreed to
Read third time
Read second time
Committee substitute printed 26108536D-H1
Reported from Finance with substitute (17-Y 4-N)
Chaptered
4/22/2026
Reenrolled
4/22/2026
Gov Recommendation
4/12/2026
Enrolled
3/10/2026
Substitute
2/26/2026
Substitute
2/24/2026
Introduced
1/9/2026
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