HB 1892

This bill authorizes a tax increment agency to enter into a taxpayer agreement relative to a plan area. The obligation to make payments under such an agreement that guarantees, enhances, or otherwise furthers secure bonds or lease obligations of the tax increment agency, including taxpayer direct payments, must be treated in the same manner as property taxes. However, a tax increment agency must not condition approval of a plan on the execution of a taxpayer agreement. TAXPAYER AGREEMENT AS A SECURITY DEVICE This bill provides that a taxpayer agreement lien is a first and prior lien against the property on which it is imposed, from the date on which the taxpayer agreement is recorded until the lien, including any interest, penalties, or other required costs are paid. A taxpayer agreement lien takes priority over any existing or subsequent mortgage, other lien, or other encumbrance, and may be enforced and collected in all respects as real property taxes. This bill authorizes a taxpayer agreement to include specific requirements related to interest, penalties, and collection and enforcement responsibilities applicable to delinquent taxpayer direct payments, and taxpayer agreement lien enforcement proceedi ngs to ensure the fullest protection of bondholders' interests. This bill also authorizes the taxpayer agreement lien to run with the land. However, any taxpayer direct payments not yet due under the terms of the taxpayer agreement must not be accelerated or eliminated by foreclosure of a property tax lien. A provi sion of a deed of trust, mortgage, or other agreement between a lienholder and a property owner providing for the acceleration of any payment under the deed of trust, mortgage, or agreement solely as the result of entering into taxpayer agreement is unenf or ceable. TAX INCREMENT AGENCIES PERFECTING A TAXPAYER AGREEMENT This bill requires the tax increment agency to send written notification to the county trustee for the county in which the plan area is located on or before the date of filing and recording the taxpayer agreement. The county trustee must comply with the requirements in such an agreement in connection with any lien enforcement proceedings under the agreement, to the extent not prohibited by applicable law. This bill requires a tax increment agency that is a party to a taxpayer agreement to file and record each taxpayer agreement with the register of deeds of the county in which the property is located. The recording must contain all of the following infor mation:  The legal description of the property in the plan area.  The name of each property owner.  The term of the lien.  The executed taxpayer agreement. ON APRIL 2, 2026 THE HOUSE ADOPTED AMENDMENT #1 AND PASSED HOUSE BILL 1892, AS AMENDED. AMENDMENT #1 makes the following changes:  Changes when a tax increment agency is authorized to enter into a taxpayer agreement relative to a plan area to after obtaining a written statement executed by each holder of an existing, previously recorded mortgage or deed of trust on the property securing indebtedness and in which each holder consents to the taxpayer agreement and indicates that the assessment does not constitute an event of default under the existing mortgage or deed of trust.  Revises a taxpayer agreement lien from taking priority over any existing or subsequent mortgage, other lien, or other encumbrance to , instead, having parity with real estate tax liens, taking priority over any existing or subsequent mortgage, other lien, or other encumbrance.  Revises the required written notification for the tax increment agency provision to , instead, on or before the date of filing and recording the taxpayer agreement, require the tax increment agency to send written notification to the county trustee for the county in which the plan area is located of requirements described in the bill, including certification that the requirements will be administered by a third-party bond trustee. Upon an event of nonpayment, the third-party bond trustee must coordinate with the county trustee to ensure compliance with the requirements in a taxpayer agreement in connection with any lien enforcement proceedings under a taxpayer agreement, to the extent not prohibited by applicable law.