While an agreement entered into pursuant to NRS 353.500 to 353.630, inclusive, is in effect, the property that is the subject of the agreement is exempt from ad valorem property taxation by this State and its political subdivisions if:

1. 1. An improvement is being constructed on the property pursuant to the agreement; or
2. 2. This State or a state agency is in possession of the property.

(Added to NRS by 2001, 2480; A 2007, 831)