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Public hearing set for tax abatement

February 1, 2019
CJ Eilers - Editor (cjeilers@traerstarclipper.com) , Dysart Reporter

The Dysart City Council approved to move forward in the process to adopt tax abatement in town during a special meeting on Wednesday, Jan. 23, establishing a public hearing for the March 13 meeting.

As reported in the January 18 issue of the Dysart Reporter, the City of Dysart is considering a tax abatement project to encourage and incentivize growth in the community. The meeting on March 13 will allow community members to express their concerns with tax abatement and learn more about it. Letters will be sent to Dysart residents with information about the meeting.

"This would be a great program for the city with a start date as soon as possible," Taylor Gingrich, Councilman said. "We want to get this information out there to take advantage, especially with spring coming up."

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Tax abatement allows homeowners or business owners to remodel or build without paying taxes on increased property valuation over the course of the abatement period set, creating an incentive for construction or improvements to a home or business. The property owner(s) would still be responsible for the property taxes they paid prior to the remodel or new build. Abatements can be set at a variety of years and tiers for properties based on their value. For example residential properties worth less than $299,000 are eligible for 5 years for a project adding an "Increased Value of $25,000 or 20% of the existing value, whichever is greater" and the amount of years increases as the value does. Commercial properties are given more levels as business may reach over a million dollars in value. An assessor makes the decision if an improvement is eligible for tax abatement.

Gingrich, who has previously lived in a community that had their taxes abated, has been gathering information to present to his fellow council members and believes an "aggressive" approach of at least five years for tax abatement would benefit Dysart over the long term.

"We need to separate ourselves from La Porte City, who has a very similar program," Gingrich said. "We can't do three years like they do. La Porte is in a better position than us being closer to Waterloo as a straight bedroom community. Here in Dysart, we have our own businesses and we're more independent. If we offer the same plan as them, people will move there."

La Porte City's schedule is similar to what Dysart is proposing in terms of tiers/levels, but has approved a minimum of three years as opposed to the five years for Dysart. The only area in Dysart that would be exempt from tax abatement is the seven new lots in the south end of town. Instead, the use of Tax Increment Financing (TIF) can be used towards funding a street for the lots. Everything else could be developed under tax abatement, but both programs cannot be used for the same property.

Concerns still remain over tax abatement and how it could affect the community in the short term after taking a hit without increased value and questions were made if TIF would be a better option. Members of the council also asked what the process would look like to extend tax abatement if necessary.

Citizens would not have to take advantage of tax abatement if they do not wish to. Having tax abatement in the community does not mean a resident can't take advantage of a TIF agreement as long as both aren't used on the same property. A roll call vote was taken to approve the public meeting 3-0, with Tim Glenn absent and Gingrich abstaining.

"If we pass this, which I feel we should in some form, this is not the golden ticket," Mayor Pam Thiele said. "There's a lot of other things that need to be done to attract people here. We need to look at the big picture of what this town offers. Our new daycare is a great aspect to bring young families here. If we can make Dysart a great place to live, people will accept the fact we are 20 minutes away from Waterloo."

Check back with the Dysart Reporter for further updates on this developing story as they are made available. Again, the public hearing will be held during the regular monthly meeting of the City Council on March 13. If adopted after the hearing, implementation could begin as soon as April or May.

 
 

 

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