Details were shared with North Battleford council Monday night about what is described as an “aggressive” downtown revitalization incentive program for the city.
Tax abatements covering a wide range of downtown improvements and buildings were unveiled at the meeting, all part of the downtown revitalization efforts that are moving into full gear in 2017.
This program is to go along with the “disincentive” special mill rate on vacant commercial buildings that received final approval at Monday’s meeting.
“This sends a signal that our downtown and our key commercial corridor is a priority,” said Mayor Ryan Bater. He added that the downtown incentives complemented with the vacant buildings disincentive “makes both of them more effective.”
The goal of the incentive program, according to a memo from Director of Planning and Development Jennifer Niesink, is to address five major economic development issues currently plaguing the downtown core.
Those five include promoting new development, addressing the condition of existing buildings and their facades, addressing a lack of residential units downtown, addressing the vacant buildings issue, and addressing brownfields: properties that have contamination issues such as former gas stations or garages.
What administration is proposing is a sweeping policy that waives not only the portion of the tax assessment related to improvements, but the entire assessment of the building.
This would apply only to the municipal portion of the property tax; it would not apply to school, UPAR, BID levy and the recreation capital tax portions.
Niesink explained “what we wanted was to have something available for anyone looking to do positive work with their buildings.” As well, businesses could only apply for one of these incentives.
Administration is proposing six incentive programs will be available as part of this effort.
The first is the building façade and site improvements incentive program. This will rebate 25 per cent of the combined total cost of eligible façade or site improvements. Eligible projects will include such things as awnings, canopies, lighting, entrances, windows, siding, landscaping, signage, curbing and sidewalks, painting and brick repair, among other things.
The idea is to encourage improvements to the look of buildings downtown.
“We have a number of buildings that could use a refresher,” Niesink explained at council. A few have already done some work and “it really does make an impact.”
A second is a building improvements and expansion incentive program. This will abate taxes for existing buildings and businesses that improve their property through new construction or interior renovations.
The length of the tax exemption increases based on the project value on the building permit. Interior renovations, structural alterations and building additions are all eligible.
A minimum spend of $100,000 is going to be required to be eligible, and the greater the commitment, the greater the exemption.
A project value of over $500,000 would be eligible for a five-year exemption. It would be four years for over $250,000 (up to $499,999), three years for over $200,000, two years for over $150,000 and one year for over $100,000 up to $149,999.
“It’s a real commitment to take on an improvement,” Niesink explained. “So we wanted to make sure that people are putting money into revitalizing these buildings.”
Third is a vacant property tax incentive program, which is coming in alongside the mill rate changes increasing taxes on vacant commercial buildings.
This proposed incentive is aimed at potential new owners, and will abate taxes to offset the cost of bringing a property up to code and current standards. Eligible properties will be buildings that have been vacant for a minimum of two years. The incentive would be 100 percent for the first year and 50 percent for year two.
A new construction incentive program is also proposed, and this program is to encourage new development in the downtown. New construction on vacant properties is eligible and construction value must be greater than $500,000. Demolition costs are not eligible under the program.
The incentive runs at 100 per cent for years one-to-three, 75 per cent for year four, and 50 per cent for year five.
A new residential incentive program is being proposed as well, to encourage developers to build medium- to high-density units downtown. The thinking, according to Niesink, is it “could add to the vibrancy of the population” and increase the amount of people in the downtown area.
What could happen, Niesink explained, is commercial units on the ground floor and residential units upstairs.
New constructions of medium- to high-density residential units (five or more) are covered. The incentive for years one and two are 100 per cent, for year three it is 50 per cent and year four 25 per cent.
Finally, there is the brownfield tax incentive, designed to abate taxes for properties that are contaminated. This is designed to encourage owners or developers to clean up the land for redevelopment.
To be eligible, it must involve a contaminated site requiring remediation, provide a closure report from the Saskatchewan Environmental Resource Management Department certifying the property has been remediated to their standards, and copies of environmental reports must be provided from a certificated Professional Engineer.
This incentive would run at 100 per cent through years one through four, and at 75 per cent in year five.
There are some common requirements for all the incentives. It must be commercially assessed property located within the downtown business improvement district (BID) area and all taxes and charges must be current.
For each incentive, only one application can be made per property over a 24-month period. Building codes, the zoning bylaw and various other regulations must be complied with and building inspections must be done, and the eligibility of projects must be determined by city council.
“This is part of the overall plan to revitalize downtown,” said City Manager Jim Puffalt.
“It’s certainly a component we can’t miss. It’s very aggressive, it’s very intensive, it talks about a number of incentive packages.”
There was generally positive reaction from councillors.
Councillor Greg Lightfoot said he was “really in favour” and had some positive discussions with the downtown BID members about it the previous week. They were generally very positive about it, he said.
“I like it for the simple fact that it will bring the value of downtown buildings back up again,” said Lightfoot.
“So we may be giving up some tax in the short term but in the long term we will benefit from that because the assessed values will go back up for these buildings, which will increase the tax payable on those, which should offset any of these incentives in the short term.”
Councillor Don Buglas said he liked the idea of the approach of “project by project to be examined on its own merits,” because “there isn’t one-shoe-fits-all” for the downtown area.
Councillor Kent Lindgren also liked the incentives, calling it “bold and out there, and I think it’s what we kind of need right now.”
There was a question from Councillor Kelli Hawtin about the implications for the rest of the “key commercial corridor” of 100th Street and Railway Ave. that wouldn’t be covered under the policy.
But city officials made clear they would consider proposals from developers elsewhere looking to improve their properties.
“Every area of the city is able to come and apply for an incentive,” said Niesink, adding, “anyone looking to develop in the city, we’re always willing to sit down and talk with them.”
Puffalt added that it was his thinking that perhaps the same areas impacted by the vacant properties mill rate should be included as well.
“Some of our buildings wouldn’t fit there, but it’s important they get redeveloped as well. Certainly, it’s something we can ask people what they think about it.”
As for a question from Bater about whether the city’s planning and development department had the resources to be able to work with developers if there was an uptick in the program, Puffalt responded the city was absolutely committed to downtown redevelopment.
“We’ll find a way to make this happen,” said Puffalt.
Council received the incentives proposal at Monday’s meeting. The plan now is for the city to gauge public reaction and get further feedback about it.
The incentive policy is likely to be back for further consideration or adoption in July.
