The Lacey City Council held a public hearing on Tuesday, Jan. 21, on plans to expand the Multi-Family Tax Exemption (MFTE) program.
The MFTE program currently offers tax exemptions for developers who meet specific criteria.
Options range from eight years for market-rate projects to 12 and 20 years for developments with affordable housing units.
The new proposal would introduce the exemptions to the newly designated Residential Target Area in the Neighborhood Commercial Districts, as outlined in Resolution No. 1161, which was adopted earlier this month.
“This is about ensuring permanent affordable homeownership,” Lacey Housing Coordinator Jennifer Adams explained, emphasizing that affordable units would remain accessible for at least 99 years.
Adams said the program would target households earning 80% or less of the area median income, as defined by the Washington State Department of Commerce.
“Maybe people will be interested in taking advantage of this to produce the units that we need because we're so far behind,” Deputy Mayor Malcolm Miller said.
Council members also discussed extending the MFTE program to the Neighborhood Commercial District and expanding options in the Woodland District.
Under the proposal, existing projects could apply for a 12-year extension if they incorporate affordable units.
“I am hopeful that this is successful and that it’s sort of a pilot for us to test out incentivizing low-income housing because we need more of it,” noted Lacey City Council member Robin Vazquez.
Mayor Andy Ryder highlighted the importance of engaging the community to ensure the program’s success.
“I think we have to be strategic … It’s crucial to make this information accessible," Ryder said.
He is optimistic that the city is heading in the right direction, but noted "it would be horrible if we pass this and nothing happens.”
Despite the opportunity for community input, no residents came forward to speak during the public hearing.
The council plans to revisit the ordinance once staff drafts a proposal reflecting their direction. If approved, the MFTE ordinance is expected to be adopted by the end of the first quarter of 2025.
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longtimeresident
No one came forward because they are tired of hearing about what you are GOING to do, and then nothing happens. This story is getting old.
Friday, January 24 Report this
MrCommonSense
This type of tax incentive, though well intentioned, simply transfer the responsibility of these taxes to other taxpayers in the City.
There is no reason to believe a property owner would charge less rent because of this incentive. Paying taxes will impact the future expenses of ownership, will not charge the rents that are charged to tenants as they will be the same as competitive properties built without incentives. that haven't had tax incentives.
There is no information in the article that states what an "affordable unit" is? So it impossible to evaluate how beneficial this part of the program would be w/o the additional information. The only way this makes sense is if there is rent control on these units that guarantees the rents will be a specific percentage below the rent for a similar properties. So the savings can be measured and ensure future affordability.
Even with the "affordable units" the tax burden becomes that of the rest of the citizens in the jurisdiction. We might as well simply have market rate units and raise the minimum wage so folks can afford them. Or reduce City regulations and red tape, making them less expensive to build. It would make more sense to provide deferred LOTT fees for sewer service, or utility credits for building where previously paid for infrastructure (sewer, water, gas, etc.) already exist. Then the City will at least receive the on-going revenue from property taxes.
Not to mention the additional administrative costs these programs are for the City to manage.
No public input does not mean "no interest" by the general public. If the true impact was explained, there would be interest. A cost/benefit analysis is essential for these ideas. Has there been one?
Friday, January 24 Report this
ChuckCross
With a goal of producing "permanent, affordable home ownership", for folks earning 80% or less of the area median income, one would think city leaders would look at the numbers and talk with the bankers RE their qualifications for mortgage loans. Median income in Thurston county is somewhere close to $91,500. 80% of this number is $73,200.00. Lenders have a mortgage payment to income ratio plus a credit score requirement. There is more income breakdown with respect to Thurston County income levels. Those living within Lacey city limits should be checking the numbers with Lacey folks responsible for plans seeking "permanent affordable home ownership, at their expense.
Saturday, January 25 Report this