The City of Columbus has long used property tax breaks to encourage economic development and revitalize struggling areas. But the city continues to hand out tax breaks to developers and owners of expensive homes in some of the city’s most vibrant neighborhoods - like the Short North.
WOSU looks at city policy through the eyes of two homeowners, one who got a tax break and one who didn’t.
“I love our kitchen," JanetStackpole said.
Stackpole and her partner, Mary Kennett, enjoy everything about the new addition to their 1926 home in Clintonville.
Stackpole looks up to her her favorite element.
“It’s a coffered ceiling that was hand done by an Amish man.”
The major renovation included a mudroom, a half bath, new hardwood floors, fresh outdoor siding and insulation. It also repaired a failing foundation. The price tag: about $180,000.
Five miles south in the heart of Victorian Village, Chris and Laura Haydocy renovated their 125-year-old house.
“They didn’t build closets much in the 1890s, so we needed closets and whatnot," Haydocy said.
Haydocy also added a master bath and a family room. Total cost: $144,000.
Both houses are in popular, but older, Columbus neighborhoods.
The major difference between the two renovations: The owners of the improved Clintonville home now face a higher tax bill because the improvements increased its value. Haydocy, in Victorian Village, got a tax break.
“As we got to exploring our options, we found out about the CRA," Haydocy said.
CRA stands for Community Reinvestment Area. The city designates CRAs to stimulate revitalization, attract new residents and private development, especially in blighted neighborhoods. Linden and Weinland Park have benefitted from them.
Here’s how CRAs work: you buy a newly-built house within the CRA, you don’t pay property taxes on the home value for 15 years, just the land it sits on. Renovations that meet a certain threshold get a 10-year tax break.
Haydocy’s home is within a CRA which covers the Short North and Victorian and Italian Villages. It was created in 2012 and expanded again a couple years ago.
The abatement saves Haydocy more than $3,100 a year on his property taxes.
There are more than two dozen homes in the Short North valued at $300,000 or more that get big tax breaks. The owner of one new half-million dollar home pays less than a $1,000 in property taxes. Thanks to abatements, some owners of $ 300,000 condos on High Street pay about $300 a year in property taxes.
The city keeps awarding abatements while the neighborhood has been thriving, arguably, for the past 15 or 20 years.
“The area is definitely running on all 8 cylinders," Haydocy noted.
Haydocy, who owns Haydocy Automotive on the far West Side, is on the fence about whether the Short North needs the help.
“The hotels, the apartments, the homes. Would they be there if not for the CRA? That’s a tough call," Haydocy said. “I would think that in the past, a CRA in the past, has definitely helped. But with all that said, are there other communities that could also use a CRA?”
When city council passed the Short North CRA expansion a couple of years ago, it pointed to seven run-down homes in the neighborhood. None of those owners took an abatement to fix up their house.
Instead, developers have used the abatements for condo and apartment complexes, like The Hub on High Street or Aston Place Apartments at Third and Dennison Avenues.
We asked Rita Parise, with the Columbus Development Department, about the Short North CRA. She said a lot of “residential development” would not have happened without the tax breaks.
“I will tell you, as we approached the Short North CRA and put it together, it was because we had inquiries from developers that there was a need in order to make development come to scale in that neighborhood to have a tax abatement," Parise said.
The developers are not strangers to city hall and its elected leaders.
Franklin County elections records show many developers have contributed tens of thousands of dollars to local campaigns in recent years.
Columbus Mayor Andrew Ginther said the city is reviewing its CRAs to see which ones are needed and whether other areas could use one.
"CRAs work, and we think they can work better," Ginther said. "That’s why we’re studying it to make sure it’s having its intended impact on our great city.”
When asked specifically, multiple times, whether properties in thriving neighborhoods like the Short North need tax abatements, Ginther would not answer the question directly.
“In 2012, the Short North appears to be booming. Did it really need tax abatements for new development and homes in that area?"
"If you’re, you know. I’ve already answered the question several times, so," Ginther replied.
"And was the answer yes? Because, sir, I’m just trying to…getting a…"
"Your opinion is that it is not, and that it has not worked, and that the Short North is an abject failure. And that’s wrong," Ginther said.
"No, that’s not..."
"The facts don’t speak to that. And you have all the records and information you need to speak to that," Ginther said.
"No, the opinion, I don’t have an opinion whether it’s failed or not. I’m asking if the area really needed tax abatements in 2012, just four years ago."
"OK. Thanks, Mandie.”
Full interview Transcript: Columbus Mayor Andrew Ginther On Short North Tax Abatements
Haydocy wants CRA abatements to help $50,000 homes on the west side rather than half million dollar homes in Victorian Village.
“I would be much more in support of a CRA in an area that truly needs it.”
City Council will decide next year whether to continue the Short North tax abatements.
