Due to a typographical error, the earlier version of this item in this morning’s Developments e-newsletter stated that the abatement program is an 11-year-old program. It is a 21-year-old program. The corrected text is below.
Administration Releases Report On 10-Year Abatement, While Council Debates Its Curtailment
The Kenney administration has released a study that reinforces the continued economic benefits of the city’s 10-year property tax abatement, which some lawmakers have proposed eliminating or curtailing.
The report, conducted by Jones Lang LaSalle, found that the 21-year-old abatement program is still spurring development and generating jobs in the city. The study analyzed 10 scenarios that could alter or eliminate the abatement program on residential properties, which make up 98% of those with the tax breaks, and found that any change to the abatement program would lead to a negative impact on development and its related tax revenue.
While the report makers clear that the curtailing or eliminating the abatement program would result in loss of development and tax revenue, Councilwoman Helen Gym has introduced bills to eliminate the school district portion of the abatement and to examine whether its use should be prohibited in certain neighborhoods.
The study also comes as council enters the home stretch on Mayor Kenney’s budget proposal, which calls for a 4.1% property tax hike at a time in which property owners saw soaring assessments and subsequent automatic property tax jumps.
Another recent study by the City Controller noted that due to low incomes and low sale prices in many neighborhoods, the economics of construction don’t currently work in about 70% of the ZIP codes in the city, but the 10-year abatement helps close the gap in at least four ZIP codes.