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Date
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January 28, 2008
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Agenda
Item No. 23 Roll
Call No. 08- Communication No. 08-029 Submitted by: Larry Hulse, Community Development |
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AGENDA
HEADING:
Approval of two hundred and eight (208) tax abatement
applications for improvements to property completed in 2007.
SYNOPSIS:
Recommend approval of 208 tax abatement applications with an estimated value by the applicants of $26,399,744.72. There were 90 applications for the construction of new single-family homes, apartments, and new businesses with an estimated value of $14,623,527 and 118 applications for improvements to existing structures with an estimated value of $11,776,217.72.
FISCAL
IMPACT:
Amount: Tax
abatement upon property with a claimed value of $26,399,744.72.
Funding Source: Taxes are generated in the first year
from the land value, but the improvement value will be forth coming when the $26,399,744.72
comes on the tax rolls after abatement ends.
ADDITIONAL
INFORMATION:
A total of 61 applicants chose Schedule
1 with an estimated value of $1,146,304.17. Schedule 1 is
for qualified residential property. Applicants receive an exemption
from the taxation on the actual value of improvements not to exceed
$20,000. The exemption period is ten years and the exemption amount
is 115% of the actual value added by improvements.
A total of 2 applicants chose Schedule
2 with an estimated value of $2,865,000. Schedule 2
is for all qualified real estate and will receive a partial exemption for ten
years. The exemption schedule is a declining schedule and starts
with the first year at 80% and ends in year ten at 20%.
A total of one applicant chose Schedule
3 with an estimated value of $700,000. All qualified
real estate is eligible to receive an exemption from taxation on the actual
value added by the improvements for three years. This schedule applies to
commercial and industrial real estate that is eligible to receive an exemption
from taxation on the actual value added by the improvements for three years.
This schedule also applies to commercial and industrial property in specific
areas.
A total of 35 applicants chose Schedule
4A with an estimated value of $5,103,263. Schedule
4A is for qualified real estate in specific areas generally located
downtown and near the downtown area. The exemption period is ten
years and the exemption amount is 100% of the actual value added by
improvements. Qualified real estate assessed as residential or
assessed as commercial consisting of three or more living quarters with at
least 75% of the space used residentially is eligible to receive an exemption
from taxation and the actual value added by the improvements.
A total of 109 applicants chose Schedule
4B with an estimated value of $16,585,177.55. Schedule
4B is for qualified real estate for the remainder of the City for a period
of five years. Qualified real estate assessed as residential or
commercial and consisting of three or more living quarters with at least
75% of the space used residentially is eligible to receive an exemption from
taxation on the actual value added by improvements. The exemption
amount is 100% of the actual value added by the improvements.
In order to receive tax abatement on a
property, the applicant must increase the value of residential property at least
5% for residential or 15% for commercial and industrial property.
Cumulative Totals for 2007
Schedule
Count Value
1 154 $2,743,129.95
2 5 $5,600,000.00
3 4 $9,092,500.00
4a 77 $23,954,341.50
4b 239 $36,445,085.05
Total 479 $77,835,056.50
The City approved tax abatement to
stimulate growth and expansion in the City and level the playing field with
areas outside the City. Developers have identified tax abatement as
a primary reason for attracting buyers to their units. The abatement
program has also aided in upgrading deteriorating property in the city by
providing an incentive to maintain and upgrade property.
PREVIOUS
COUNCIL ACTION(S):
Date: 12/17/07
Roll
Call: 07-2369
Action:
Approving
tax abatement applications (44) for additional value added by improvements made
during 2007. (Council
Communication No. 07-732) Moved by Hensley to adopt. Motion Carried 6-1
Date: November 19, 2007
Roll
Call: 07-2191
Action: Approving
tax abatement applications for additional value added by improvements made
during 2007 (96 applications). (Council
Communication No. 07-674) Moved by Vlassis to adopt. Motion Carried 7-0.
Date: October 22, 2007
Roll
Call Number: 07-2021
Action: Approving
tax abatement applications (65) for additional value added by improvements made
during 2007. (Council
Communication No. 07-631) Moved by Vlassis to adopt. Motion Carried 7-0.
Date: September 24, 2007
Roll
Call Number: 07-1831
Action: Approving
tax abatement applications (69) for additional value added by improvements made
during 2007. (Council
Communication No. 07-574) Moved by Kiernan to adopt. Motion Carried 7-0
BOARD/COMMISSION
ACTION(S): NONE
ANTICIPATED
ACTIONS AND FUTURE COMMITMENTS:
The
tax abatement program on new improvements currently ends on December 31, 2008,
unless the City Council extends the program beyond that date. Any application received by February 1, 2009,
and approved by the City Council will receive abatement for the number of years
applied for. It is anticipated that
there will be numerous submittals of tax abatement applications on a yearly
basis until the program ends.