Incentives - Property Development & Redevelopment

Overview

Whether you're a business or a municipality, making the most use of your property is an important part of achieving a healthy bottom line. A range of incentives are available to encourage and support new development and redevelopment. Incentives in the Centers and Corridors are designed to entice businesses to these areas by offering reduced requirements and expanded options. Tax credits for disability barrier removal, brownfield assessment grants, and tax increment financing help reduce the financial costs of redeveloping property. And green incentives such as energy rebates, waste reduction and water conservation can help to save on development and operating costs. When combined together, these incentives can significantly improve the profitability of a project or business.

Empowerment Zone

For development and redevelopment projects within the Empowerment Zone a significant portion of the GFCs are waived for water and sewer connections.

Section 13.04.2042 Water General Facilities Charge – Schedule of Charges
Section 13.03.0732 Wastewater General Facilities Charge – Schedule of Charges

ADA Barrier Removal Tax Deduction & Disabled Access Tax Credit

Businesses can take advantage of two Federal tax incentives available to help cover costs of making access improvements for customers with disabilities:

  • A tax credit for small businesses who remove access barriers from their facilities, provide accessible services, or take other steps to improve accessibility for customers with disabilities, and
  • A tax deduction for businesses of all sizes that remove access barriers in their facilities or vehicles.

These two incentives can be used together by eligible businesses if the expenditures qualify.

These incentives can also be used on mixed use projects that combine housing with commercial or office space. It's a great way to bring more customers into your business! http://www.ada.gov/taxincent.htm

Center and Corridor Incentives

The City of Spokane's Comprehensive Plan contains a fundamental strategy for Spokane's physical, economic, and social growth. The plan's "Centers and Corridors" growth strategy directs growth to specific mixed-use centers (neighborhood, district, and employment) and corridors in the City. http://www.developingspokane.org/docs/C_C_incentives.pdf The Central Business District (downtown) is also a center. These areas are intended to:

  • Bring employment, shopping, and residential activities into shared locations,
  • encourage economic activity through new development and rehabilitation, and
  • make Spokane a dynamic and healthy urban center.
  • Development incentives to encourage growth in center areas include:
  • Mixed-use and higher density development
  • Broadest range of housing options
  • Reduced parking requirements
  • Increased floor area, building heights, and lot coverage
  • Reduced setback requirements
  • Credits for shade trees, and
  • Lower transportation LOS requirements

More information is available here.

Tax Increment Financing (TIF)

Tax increment financing (TIF) or community redevelopment financing is a method of redistributing property tax collections within designated areas to finance infrastructure improvements within these designated areas.

Tax-Increment Financing is an economic development tool established by the State of Washington . TIF is used to pay for publicly owned streets, sewers, sidewalks, parks, and other improvements.

TIF is considered when local government and a developer define a project with significant public infrastructure requirements that cost more than either party can pay alone. Bonds sold by local government or private financing pay for public improvements, and then a portion of the increased property taxes generated within the district is used to pay back the debt. Seventy-five percent of the increased property taxes is used to repay public infrastructure costs, and 25 percent of the increased value goes to government to pay for public services. Once the debt is paid, all the increased property taxes go to government.

More information is available here and here.

University District Revitalization Area ("UDRA")

In 2009, 2SSB 5045 created Local Revitalization Financing (LRF) districts, a new legislatively authorized type of tax increment financing in Washington. The bill identified the University District Revitalization Area (UDRA) as one of seven pilot areas in Washington.

Under 2SSB 5045, cities may create "revitalization areas" and may use certain future tax revenues which increase within the area to finance local public improvements.

The new pilot designation for UDRA allows Spokane to receive $250,000 in state tax revenue as long as it is matched by $250,000 in new local tax revenue. The local revenue will be captured through financing tools of TIF and LIFT. TIF, Tax Increment Financing tool, captures a portion of future property tax revenue. LIFT, Local Infrastructure Financing tool, captures a portion of future sales tax revenue.

Projects financed by tax increment financing must be expected to encourage private development and increase the fair market value of real property within the tax increment area.

Over the summer, there will be a series of public meetings and hearings with elected officials that describe and seek comment on the UDRA in order to obtain approval to finalize the application and meet the September 1 application deadline to DOR.

Although Spokane has previously designated TIF districts at Iron Bridge and West Quadrant (Kendall Yards area), the City has not previously had the opportunity to designate a LIFT district. The UDRA will be Spokane’s first TIF/LIFT district.

More information about Local Revitalization Funding: