HORACE — Area home buyers, Realtors and builders will look to make a case for government officials in hopes of reestablishing Horace’s tax abatement program, which was not renewed after it expired on Jan. 1.
Horace’s tax abatement program, which is similar to that authorized by the North Dakota Century Code, gives buyers of new homes a two-year break on property taxes for certain new single-family residential properties and condominiums and townhouses. According to state law, the maximum exemption allowed is $150,000 of true and full valuation of improvements only and land is still taxable.
Horace Mayor Kory Peterson said the City Council every two years decides whether to continue the program or not. This summer, the council did not have a particular appetite for continuing the program, he said.
“I still think it’s a good idea, but we just didn’t have a council that wanted to keep it active at that time,” Peterson said. “It didn’t get brought up again and so it expired.”
The absence of the program, however, took some new buyers by surprise, said Kevin Fisher, a Realtor and former president of the Fargo Moorhead Area Association of Realtors.
Fisher at the last Horace City Council meeting requested the city thinker, on behalf of area realtors. Some learned of the abatement expiration at the time of closing on a new home, and the lack of a program has already stopped some deals from moving forward, he said.
“We were out gunned and told we were outnumbered and basically the city administrator said it would be in the city’s best interest to let that expire instead of holding a vote,” said Horace City Council member Sarah Veit.
The tax abatement program can help young families as well as the community, Fisher said, noting the costs of moving into new construction can rise quickly with skyrocketing overall prices. Savings from the program can also allow homeowners to make early installments and improvements, he added.
It also encourages residents to build in a city, which in turn helps those already in a city like Horace.
“We really have a shortage of homes, especially affordable homes right now,” Fisher said. “All the money that is generated for each house that is built puts a lot of money back in the community.”
Fargo, Moorhead and West Fargo all have similar abatement programs for housing construction, Fisher pointed out.
“Horace is the only one that is letting it expire,” he said.
The council agreed to hear from Fisher again, while others affected by the program, including potential buyers of new homes, are encouraged to attend the upcoming Horace City Council meeting at 6 pm on Tuesday, Jan. 24 at the Fire Hall Event Center, 413 Main St.
“To me, this abatement thing is a way to help younger families get into housing like a first-time home buyer,” Major Peterson said. “I think it’s a good idea and I’m glad it will be revisited.”
Readers can reach West Fargo editor Wendy Reuer at [email protected] or 701-241-5530 . Follow her on Twitter
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