NORWICH – A proposed local law, drafted to incentivize developers to rehabilitate some of the vacant buildings in downtown Norwich, was tabled by members of the Common Council on Tuesday, citing reasons that question the law’s purpose in working toward the city’s well-being.
Section 421-m of the New York Real Property Tax Law permits the city to adopt a local law that would exempt developers from taxation of higher property tax assessments after undergoing building renovations. Under the law, developers who rehabilitate a structure with commercial space and room for at least three apartments – 20 percent of which must be available to families and individuals of low to moderate income – would be taxed according to assessments of the property prior to repairs for at least 12 years.
After the 12-year benchmark, property owners would then be taxed according to the new property assessment, which is bound to increase due to repairs to the property. For example, if a developer purchased a building assessed at $30,000 and restored it to be worth $50,000, said developer would pay property taxes based on the original $30,000 assessment for the first 12 years. According to the law, a tax exemption would be in place for a total of 20 years but gradually decline from 100 percent to 20 percent between year 12 and year 20.