Mayor’s office, cosponsors preview 15–25 year multifamily tax-abatement to spur rental housing

A proposed multifamily property-tax abatement ordinance designed to spur new rental housing in Anchorage was presented to the Anchorage Community and Economic Development Committee on March 6, 2025, by Nolan Clowdine of the mayor’s office. The ordinance would provide a baseline 15-year abatement for new multifamily rental buildings of eight or more units, with bonus years available for projects in targeted areas, that meet labor or affordability criteria, up to a 25-year maximum.

The proposal matters because Anchorage and the administration estimate the city needs roughly 1,000 new or renovated rental units per year to narrow the housing gap; developers and the administration said market fundamentals often make multifamily projects financially unviable without public incentives. Nolan Clowdine, policy director in the mayor’s office, described the abatement as intended to “make financial sense to a developer” by increasing project cash flow while leaving land on the tax rolls. He said the ordinance will be introduced March 18 and that a public hearing is planned for April 8.

Under the ordinance presented: the abatement would apply only to rental housing with at least eight units (owner-occupied and short-term rentals would not qualify), while land and any nonqualifying buildings on a parcel would remain taxable. The baseline is 15 years; bonus years can raise the total to 25. Bonus categories explained in the presentation include location inside a mapped tax-incentive area composed of downtown, Midtown and a transit corridor; designation as a deteriorated area (an assembly ordinance) for a five-year bonus; projects located in federal opportunity zones; a five-year bonus for projects meeting prevailing-wage and apprenticeship utilization standards; a three-year bonus for projects that set aside affordable units (the draft ties that bonus to 20% of units at 20% of area median income); and a three-year bonus to encourage mixed-use development (residential portion only).

Applications and oversight: the draft assigns application review to the Municipal Assessor, creates provisional and final approvals, and requires annual owner reports verifying continued eligibility (occupancy, unit status, material changes). The assessor would report annually to the assembly, including amounts of exempted taxes by property and a roll-up of program activity. Termination triggers in the draft include conversion of residential units to an ineligible use, falling below the eight-unit threshold, documented unfair labor practices, or failure to file required reports.

Proponents framed the abatement as a tool to unlock conversions and new construction in corridors already served by infrastructure. Nolan Clowdine said the ordinance aligns with the Anchorage 2040 Land Use Plan and the administration’s 10,000-homes strategy and noted the map in the ordinance traces parcel boundaries to avoid ambiguity about which parcels qualify. At the March 6 meeting, private-sector developer Kevin Cross of The Collective Investors, who said his firm is working on adaptive reuse projects in Midtown, praised the proposal and urged applying the abatement to commercial-to-residential conversions and vacant or abandoned buildings above eight units. “This is an excellent step in the right direction,” Cross said during public comment.

Assembly members raised questions about the length of abatements, cost implications for existing taxpayers and how the city will ensure net new housing rather than subsidizing projects that would be built without incentives. Committee members and staff noted the 25-year cap is intended to correct the underlying pro forma for projects that otherwise “don’t pencil,” and that the design ties the longer benefits to public objectives (labor standards, affordability, location). Clowdine said the package was intentionally conservative: 15 years citywide baseline, additional years only when projects meet stated public priorities.

Next steps: the administration expects the introduction March 18 and the public hearing April 8; staff said the ordinance text will be posted when available and that the assembly will receive the assessor’s annual reporting required by the draft. Committee members requested additional fiscal and side-by-side analyses comparing earlier incentives and the proposed changes before final action.

Ending: The ordinance remains a draft. Committee members and the administration signaled willingness to refine bonus tiers, reporting requirements and the geographic map during the public-review process and potential subsequent assembly hearings.