City Council explores new housing tax exemption program after budget approval

The Albany City Council is exploring a new housing incentive program that could reshape local property tax dynamics. During the recent work session, council members discussed the potential for a low-income rental property tax exemption program, which aims to address housing needs in the community.

City officials emphasized that this program differs from existing tax abatement initiatives. They are considering whether to pursue this new approach, which could be more appealing to local stakeholders, including counties and school districts. The council is seeking input on the program's viability and how it might integrate with other housing incentives.

Councilor Newton Azar expressed support for the initiative, noting it could be more acceptable than previous proposals. However, he raised questions about the financial implications, particularly regarding who benefits and who might be disadvantaged by the program. He sought clarity on how this initiative compares to tax increment financing, which involves sacrificing a portion of property tax revenues for a set period.

City officials clarified that the state would provide initial funding, which would be repaid through tax revenues generated from property improvements over ten years. While the program would allow local taxing jurisdictions to continue collecting taxes on the land, they would forgo taxes on the improvements during the repayment period. Fire districts would not be affected by this arrangement.

The council is now tasked with determining the level of interest in pursuing this program and scheduling further discussions with relevant stakeholders. The outcome could significantly influence Albany's approach to housing development and economic growth in the coming years.