Incentive package aims to beef up FD housing
Growing local businesses are on a hiring spree that local leaders believe will draw hundreds of people to Fort Dodge in the next few years.
They’ll be coming to a community where the supply of homes has been described as inadequate and outdated because of years of low demand for new housing starts.
City officials are moving to address that housing shortage with a program that will provide property tax breaks for building new single-family homes and apartment buildings.
It also gives tax incentives for significant remodeling and rehabilitation jobs.
”The most important goal of it is to encourage additional housing so we can meet the demands of the workforce coming in,” said Vickie Reeck, the city’s community development manager.
Mayor Matt Bemrich said he has talked to people who have recently moved to Fort Dodge and are having a tough time finding the kind of homes they want.
”I think there is a demand and the market isn’t responding quickly enough to meet that demand,” he said.
”This will create an opportunity for developers and builders to provide some of that housing that’s needed to meet the demand,” Bemrich added.
Although housing is the emphasis of the program, incentives will also available for industrial and commercial development.
The program does not require anyone to move or do anything to their homes, according to Reeck. She said some residents have called her because they’re concerned that the program will force them to move. That’s not true, she said.
The City Council gave preliminary approval to the incentives package on April 8. It must be approved two more times to become law.
Dennis Plautz, the chief executive officer of the Greater Fort Dodge Growth Alliance, said the group is ”completely supportive” of the program.
Need for the incentives
The Growth Alliance has estimated that 365 new jobs will be created in Webster County by 2014. Many of those jobs are being created by Boehringer Ingelheim Vetmedica Inc., Cargill and CJ Bio America.
Plautz said there is an ”exponential increase in hiring going on.”
Newly hired workers coming to Fort Dodge will find a community in which 59.8 percent of the homes were built before 1960, according to Reeck.
”That’s a pretty old housing stock,” she said.
The biggest need, according to Plautz, is for multi-family residential housing.
”The real value of their urban revitalization program is that it matches very well with our highest need, which is multi-family,” he said.
The proposal before the council would establish the 2013 Consolidated Urban Revitalization Area encompassing the entire city.
After the plan is approved, property tax breaks will be available for the construction of new homes and apartments anywhere in the city.
Incentives will also be available for significant improvements to existing houses and apartments anywhere in the city. Those improvements would have to increase the value of the property by at least 15 percent, according to Reeck.
Larger incentives would be available for new construction or remodeling jobs in blighted areas and at sites considered to be abandoned properties. For this program, the northwest side of the city and a large portion of the area south of Fifth Avenue South are considered blighted. Downtown Fort Dodge and the Pleasant Valley neighborhood are also designated as blighted.
Under state law, an abandoned property is a structure that is vacant and has not been in compliance with the city building code for six consecutive months.
The incentives enable a property owner to forgo paying the property tax on a portion of the home’s value for up to five years or gradually phase in the new property tax burden over a decade.
The incentives will no longer be offered after December 2014, although incentives awarded before then will remain in place. Plautz said it’s hoped that the housing market will equalize itself by that time, making the incentives unnecessary.
New homes built in the city’s existing enterprise zone can qualify for state tax breaks in addition to the local incentives now under consideration. The enterprise zone includes downtown plus southern and western Fort Dodge.
Those state incentives include a refund of sales, service and use taxes paid during construction and investment tax credits.