Tax rebate would revitalize

Plan would encourage improvements in neighborhoods, downtown

The City of Lawrence is trying to create incentives for some business owners and homeowners to spruce up their properties. Under a plan being considered tonight by the City Commission, certain homes and businesses, such as Wild Territory in the 900 block of Massachusetts Street, would receive tax rebates for improvements.

Neighborhood revitalization

Commission to discuss apartment inspections

The idea of requiring every apartment in Lawrence to be registered with City Hall will be discussed at tonight’s City Commission meeting.

Commissioners are scheduled to discuss the idea – proposed by the Lawrence Association of Neighborhoods – as part of their 2008 budget deliberations.

City Hall leaders have said the registration program, which would require a city inspection of apartment complexes, ultimately would be self-supporting through fees. But the program likely would need upward of $300,000 in city funds to start.

The city has a registration and inspection program for rental units in single-family zoned neighborhoods. But apartment complexes and other rental units in multifamily zoned areas are not required to be registered with the city.

Neighborhood leaders have argued for an expanded registration program to help ensure living conditions are being well-maintained. Leaders in the apartment industry have argued against the proposal, saying it would add unnecessary costs onto rents and that there hasn’t been evidence of widespread problems in apartment complexes.

Commissioners meet at 6:35 tonight at City Hall, Sixth and Massachusetts streets.

For property owners in downtown Lawrence and five of the city’s older neighborhoods, soon the check really may be in the mail.

And the check may be coming from an unlikely source: the tax man.

City commissioners tonight are scheduled to discuss a new policy that would allow property owners in the downtown, Brook Creek, East Lawrence, North Lawrence, Oread and Pinckney neighborhoods to receive significant property tax rebates if they revitalize or redevelop their homes or businesses.

“It sounds like a great idea,” said Tom Wilcox, owner of Round Corner Drug and Cheese Shop, 801 Mass. “I think every time a building is improved, it saves a little piece of our soul. I think there are a lot of people who have the potential to do more with their buildings, but they need a little push.”

The push may come from the Neighborhood Revitalization Act, a state law that allows cities to rebate a portion of property taxes on improvements made in targeted neighborhoods. Here’s how it would work:

¢ Property owners who make improvements that increase the value of their property by at least $10,000 in the five target neighborhoods – or $5,000 downtown – would be eligible for the rebate program.

¢ The program envisions a 95 percent rebate on certain property taxes paid to the city, county and school district. The rebate would last for 10 years.

¢ Property owners would receive a rebate only on the taxes paid on the improvements. For example, if the owner of a $100,000 home made $20,000 in improvements, the property owner would continue to pay the full amount of property taxes on the $100,000 portion of the home. But for the $20,000 worth of improvement, the property owner essentially only would pay 5 percent of the property taxes on that portion of the home’s value.

Plenty of potential

Wilcox said that would have been a welcome policy when several years ago he spent about $120,000 to add office space on the upper floor of his downtown building.

“I possibly would have done more improvements if there would have been a program like that,” Wilcox said. “I originally wanted to put apartments in there, but it just got too expensive.”

Leaders in the neighborhoods also are excited about the possibilities the rebate program could have.

“One thing about our neighborhood is that there are a lot of economically modest homeowners there,” said Steve Braswell, president of the Pinckney Neighborhood Association. “Anything that could help them figure out how to make an improvement would be a help.”

The city chose the neighborhoods because they are the only five in Lawrence with a majority of low- to moderate-income households as defined by the Census Bureau.

Neighborhood leaders have said they think the rebate program could be particularly attractive to people looking to build affordable housing on vacant lots in the area.

That’s because if a lot is vacant a property owner could build a home there and pay 100 percent of the property taxes on the land’s value but only 5 percent of property taxes on the home for the first 10 years.

A boon for businesses

Downtown leaders think property owners there would find the rebate program particularly useful in adding apartments or condos on the upper floors of buildings. They said that, in turn, would help retail businesses downtown.

“The old saying goes that retail follows rooftops,” said Shay Elder, an owner of the furniture shop Eangee, 933 Mass. Elder has been studying the Neighborhood Revitalization Act for Downtown Lawrence Inc. “If you add people living downtown, you are going to have more customers on a more regular basis.”

Martin Moore, president of Advanco Inc., a Lawrence-based development firm, said the rebate program could spur even larger redevelopment of downtown.

“It probably will make people look at consolidating properties a little harder than they have before,” Moore said. “It is the type of thing that could make some deals become feasible that maybe weren’t previously.”

City commissioners will review the proposed policy at their 6:35 p.m. meeting today at City Hall. Commissioners are being asked to provide feedback on the policy and direct staff to begin discussing the program with county and school district leaders. The county and school district would have to sign off on the program if property owners were to receive a rebate from those two governments.