Lakewood planning commission reopens debate on multifamily tax exemption and possible RTA expansions

Lakewood Planning Commission members heard a staff presentation and public comment on proposed expansions of the city’s multifamily tax exemption (MFTE) program and on code language to allow a 12‑year exemption in parts of the Central Business District outside the city’s tax‑increment finance area.

The discussion centered on where to designate new residential target areas (RTAs), how to preserve ground‑floor commercial space and how to ensure MFTE projects meet parking, sewer and affordability goals. Becky Newton, Lakewood economic development manager, told the commission the council asked staff to forward several candidate areas for planning commission review and a public hearing set for Feb. 5 with a return to commission planned for Feb. 19.

Newton said the MFTE is designed to encourage redevelopment and higher residential densities in targeted areas and provides a property‑tax exemption as a development incentive. "The exemption that we offer currently is an eight‑year market rate," Newton said. "We also offer a 12 year if 20% is affordable." She told commissioners projects must be at least 15 units, achieve at least 50% permanent residential occupancy of the building, and have a proposed completion within three years of approval.

Why it matters: Council and staff said the program is a primary tool to attract housing and support the downtown regional center designation, which helps secure regional transportation funding. Residents and some commissioners warned the incentive as proposed could accelerate demolition of small businesses or displacement in low‑income neighborhoods unless…