Council focuses in on residential tax exemptions

The idea is to encourage new housing options

The District of Houston’s longterm vision of encouraging development within its boundaries is continuing with proposals to provide tax breaks for either residential construction or renovations.

A variety of potential incentives are now contained in a draft bylaw given first reading by council July 6 and now being distributed for comment leading toward eventual adoption.

As with the District’s other tax incentive bylaws either already in place or about to be adopted for commercial and industrial developments, the proposed residential revitalization tax exemption bylaw would provide a descending level of tax reductions over a set period of time provided there are minimum initial expenditures.

And in this proposed residential taxation bylaw, the tax breaks would last longer for developments within the downtown core area than in the more rural areas of the District.

That was one of the objectives provided by council to staffers in how the bylaw should be worded.

There should be “inclusion of incentives for residential construction throughout the District with enhanced incentives in the urban service area,” indicated council’s instructions.

For both rural and urban core expenditures, a minimum $100,000 valuation for newly constructed residential dwellings would be required to trigger exemptions.

Within the urban core there would be a 100 per cent deduction from the assessed value for two years, dropping to 75 per cent for the next three years, 50 per cent for the three years after that and to 25 per cent for the ninth and 10th years before ending completely.

For rural projects, the deduction would be five years instead of 10 and be 100 per cent the first year, 50 per cent for years two and three and 25 per cent for the fourth and fifth years.

Council is also proposing a minimum expenditure of $30,000 for renovations to residential buildings for deductions over a three-year period amountn to 100 per cent the first year, 75 per cent the second year and 50 per cent for the third year.

“Council did not amend the draft bylaw to allow for exemptions related to the construction of foundations and placement of mobile homes,” added District of Houston chief administrative officer Gerald Pinchbeck of other considerations presented to council.

“As a result, any development involving a manufactured home as defined under the bylaw will be ineligible for an exemption under the program.”

An original staff suggestion for a $150,000 valuation for residential dwellings was subsequently amended to the $100,000 figure that’s now in the proposed bylaw.

The District’s vision for residential development calls for a variety of housing options appealing to a variety of groups which would then add to the appeal of the community as a place to live, resulting in an economic boost.