Pennsylvania city proposes property tax abatement for development
7/27/2011 | Real Estate Blog
As the recession lingers on, many Pennsylvania communities are attempting to encourage development and redevelopment. As a result, many cities and towns are considering policies that could create great opportunities for development in Pennsylvania.
One type of policy that is designed to encourage real estate developmentinvolves property tax abatement. Under property tax abatement programs, the government waives its right to collect property tax on the land for a certain period of time if the landowner invests in improving the land.
Recently, the City Council of Connellsville, Pennsylvania proposed just such a plan in the form of a new city ordinance.
If the Connellsville ordinance goes into effect, investors and developers will not have to pay property tax to the city if they make an investment into the property that is verified by the government. According to the proposal, improvements valued between $30,000 and $49,999 will earn the landowner a 100 percent property tax abatement for three years.
Larger investments would earn longer abatements. Improvements valued from $50,000 to $74,999 would earn a 100 percent property tax abatement from the city for five years. For improvements valued at more than $75,000, the property tax abatement would be 100 percent for five years and 50 percent for two years after that.
Reportedly, the proposed ordinance would only apply to new landowners, and it would expire three years after the ordinance is adopted. However, if the abatement is approved during that three-year period, then landowners would get the full property tax abatement.
The Connellsville City Council voted to introduce the property tax abatement ordinance, but it cannot become official until the ordinance sits for public comment. At the earliest, the ordinance will become official in September.
There are many development similar development opportunities throughout Pennsylvania. However, there are often strict legal requirements that need to be met in order to take full advantage of these opportunities. If you have questions about real estate development in Pennsylvania, an experienced real estate attorney can help.
Source: The Daily Courier, “Connellsville works to spur economic development,” Judy Kroeger, 21 July 2011