County searches for specifics in tax abatement concept

After further review of the regulations, Union County will need to be very specific about the areas and details needed to have an effective rural-residential tax abatement program.

During the Union County Board of Supervisors meeting Monday, supervisors discussed the project with John Danos of Dorsey and Whitney, a legal firm with an office in Des Moines that assists with interpretation and implementation of Iowa Code. Union County initially began research on the program during the summer with the same firm. Through a conference telephone call, Supervisor Rick Friday asked Dorsey what is the next step.

“I think that largely depends on the kind of specific goals and objectives that we want to try and meet,” Dorsey said. He referred to determining areas and degree of abatement benefits to be available. Abatements could be offered only for new construction or can be applied to additions or renovations of existing properties.

The program can also be applied to improve an area with deterioration which the county considered with the former municipality of Kent.

“We need to examine the particular facts and circumstances of the ground you want to cover,” Dorsey said.

Friday asked to define an area wondering if the entire unincorporated part of the county can be included. Dorsey does not think the entire county can be in the program. He said the exclusion is property used as agriculture.

“That makes it pretty difficult to make a Union County wide revitalization area. A dramatic majority of the property of the unincorporated will be used as ag land,” Dorsey said. “That makes us a little bit more surgical about identifying properties that we know that will be used as residential. We have to be a little bit more precise how we define our area geographically.”

Union County Development Association Executive Director Wayne Pantini asked Dorsey if the program can be applied across all unincorporated parts of the county. Dorsey said the areas need to be specified.

“You’re going to have to identify the geography, these 40 acres, those 80 acres, whatever make a determination. We think those are going to be used for residential purposes. Then you set up your urban revitalization areas,” Dorsey said.

Homesteads on an agriculture property could be used under certain circumstances.

“You have to know somebody is getting read to build a new home on their farm and we would need to take step to get the revitalization area set up ahead of construction,” Dorsey said. “You can’t set these up after the house is built.”

Dorsey said rules allow abatements for only new construction or renovations of existing properties.

Places in deterioration, like Kent, the requirements for abatement must have specific guidelines at the time the abatement area is being determined. Blighted areas can have up to 10 years of 100% tax abatement for new single-family, owner-occupied housing. “That is pretty extraordinary benefit,” he said.

In other areas with housing, the rules allow five years of 100 percent abatement but only on the first $75,000 of valuation of new home construction. Multi-family residential properties, like apartment buildings, allows up to 10 years of 100% abatement.

“The first thing identifying where do you think the housing is going to go and identifying the land,” Dorsey said.

Once the area has been determined, supervisors will have public hearings and can require to notify property owners in the area of the proposal 30 days before a public hearing. Residents can petition to schedule an additional public hearing before supervisors’ final approval of the program through an ordinance.

Union County Assessor Mindy Schaefer asked if the areas have to be contiguous. Dorsey said there are ways to use the county’s right-of-way to make them contiguous, if not, each area would require the same public hearing and ordinance procedure.

“The initial goal is to try to provide abatement opportunity to spur housing development in rural areas,” Pantini said. “You can creatively create zones that are going to hit the most targeted areas that most likely will have housing.

In other county news...

Union County had 16 new COVID-19 cases last week. The county’s seven-day positivity rate was 4.4%.

Supervisors rescinded a a public hearing on utility permit application changes. Supervisors need additional time to further study the matter. A new date for a public hearing is expected.

Supervisors also tabled a request to purchase a skid loader for the secondary roads department.