Posted Jun 26, 2010, 5:19 AM
|
|
Registered User
|
|
Join Date: Jan 2009
Location: Abbotsford
Posts: 68
|
|
Quote:
Kick-starting Projects
By Grant Granger - Abbotsford News
Published: June 25, 2010 3:00 PM
After some success with the strategy in small pockets, the city plans to kick-start development in all of Abbotsford with a municipal tax break for developers.
It could, however, come at a cost to city coffers, at least in the short term.
On Monday, council approved a city-wide revitalization tax exemption (RTE). It’s a three-year window to stimulate development by reducing, on a sliding scale, municipal general taxes on projects for five years.
Industrial area improvements or new projects must be worth at least $1 million, and completed within one year of starting construction. Commercial development’s minimum threshold is $10 million and must also be of superior urban design, have 70 per cent of retail parking within the structure or underground, and provide two per cent of the space for public amenities.
In return, the owners get a 100 per cent discount on general municipal property taxes for the project (school and utilities taxes still must be paid) for one year. The discount will be reduced 20 per cent annually until the full rate is being paid in the sixth year.
The city has previously introduced RTEs for historic downtown and the Abbotsford Airport.
“What we’ve found is it is a difference maker,” said Jay Teichroeb, the city’s general manager economic development and planning.
Despite the discount, Teichroeb said Abbotsford taxpayers benefit in the long run with an expanded tax base.
“Even in year two they’re paying 20 per cent of their tax obligation, and that’s 20 per cent, in theory, that we otherwise wouldn’t have had.”
One potential beneficiary, said Teichroeb, is the proposed Abby Lane shopping centre – now being called High Street by its developers, Shape Properties – at the Mount Lehman interchange. A development permit has yet to been taken out for the 20-acre project that is expected to have Walmart as its anchor tenant and cost at least $175 million to build.
He speculated if the concept Shape has proposed went ahead without the RTE, the city would receive upwards of $1.5 million.
Although he’s not worried if the project will proceed, it’s a question of when. He’d rather it be sooner than later and an RTE might provide “a significant incentive” to speed up the process.
“I don’t think they’d ever scrap it, but there’s a danger it could be deferred,” said Teichroeb. “It’s hundreds of jobs during construction. It’s hundreds, if not into the four figures, in terms of employment once the project is completed.
“It’s quite clear, this project, if it’s $175 million, is going to have huge economic spinoff in the city.”
He said there are dozens of applications working their way through the rezoning and permit process, but the economy and market conditions could be slowing construction start-up.
Last week, he announced Golden Valley Foods will be building a 74,000-square-foot, $20-million agricultural complex on Mount Lehman Road, and although it would likely go ahead even if the city wasn’t offering an RTE, it would likely qualify for one.
Mayor George Peary pointed out at Monday’s council meeting that companies will still have to pay full fare for development cost charges.
“Yes, we’re going to take a hit initially (on taxes), but these businesses will be here for a long time,” said Peary.
|
Im hoping this goes through soon.
|
Prev
Linear Mode
