Tax plan proposed to spur development

Tue., Aug. 3, 2004

By Mike Prager mikeprager15@gmail.com (509) 459-5454

Spokane City Council members are considering a development-oriented property tax exemption that one proponent is touting as a way to provide economic stimulus in four older urban centers across the city.

Council members on Monday unanimously approved a resolution setting a public hearing for Aug. 30 on the proposal.

Councilman Al French wants to extend property tax exemptions for multifamily housing to officially designated centers and corridors across Spokane. The exemptions are good for 10 years.

French said the city is seeking to attract new multifamily projects in areas of the city that are suitable for greater housing density. He said increased density improves the efficiency of land use, traffic circulation and transit service. Also, higher residential density creates a more robust economy for merchants.

Currently, there are four designated urban centers, including the area around Holy Family Hospital east of Division Street; the business district at Ninth and Perry; the business district on West Broadway Avenue and the commercial area along Market and Regal streets in Hillyard.

Additional centers and transportation corridors are expected to be designated throughout Spokane in coming years, and as those are approved, they would be added to the areas where the tax exemptions could apply, French said.

Four years ago, the city enacted property tax exemptions in portions of west Spokane, including parts of Peaceful Valley, West Central and Riverside neighborhoods. Several projects have taken advantage of the exemption.

“This is one of a variety of tools we are going to bring forward to encourage development,” French said.

He said the city would give up property taxes for 10 years, but if the exemption spurred development, the city would gain in sales taxes charged for construction and then would collect property taxes after the exemption expires.

“Quite frankly, the property is sitting idle,” he said of land in the areas that might benefit from the tax exemption.

French said there are other economic stimulus ideas under consideration, including new zoning regulations that could ease parking requirements on some commercial parcels. Also, French said centers and corridors could benefit from jointly financed traffic studies, environmental reviews and street improvements.

Well-planned development and the taxes it would generate are seen as a solution to the city’s ongoing budget problems, French said. Currently, the city is facing a $6 million budget shortfall, and the mayor’s office is preparing budget cuts that may include layoffs as well as reductions in city services.

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