Ask Mr. Answer Person: "Can you provide a refresher course on how Decorah's tax abatement program works?"
Posted: Wed, Sep 12, 2018 11:10 AM
(Daina e-mails: "I was wondering if we can get a refresher course on the Tax Abatement Program in Decorah. Reading the wording of the program is a bit confusing. I thought it had to do with a specific person building a specific house for themselves, not for construction that has no buyer yet. Why would a house that is over $300,000 with no current buyer get a tax abatement while the rest of us have seen our property taxes increase ? What is the reasoning as to why this is beneficial?"):
Mr. Answer Person says: "We've gotten more comments about property tax abatements in recent weeks after property owners got their higher property tax bills. So let's go to the ordinance to get some answers:
The renewed residential tax abatement program has no cap on eligible improvements and no end date. That means a $300,000 property qualifies for the tax abatement. Actually, a $600,000 property qualifies, as does a $900,000 property.
'All real property situated within the incorporated municipal limits of the City of Decorah as of November 1, 2017' qualifies for the tax abatement if it falls in one of these categories:
--Residential new construction: This category includes multi-residential facilities.
--Improvements to existing residential property. The rehabilitation of and additions to existing multi-residential and/or residential facilities.
All qualified real estate assessed as residential property is eligible to receive an exemption from taxation on 100 percent of the actual value added by the improvements for a period of five years.
The tax abatement plan will continue 'until, in the opinion of the City Council, the desired level of revitalization has been attained or economic conditions are such that the continuation of the exemption granted would cease to be of benefit to the city, in which case the City Council may repeal the ordinance (all exemptions granted prior to such repeal shall continue until their expiration).'
Mr. Answer Person hopes this answers not only questions about the specific property you mentioned, but about the program in general."