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Snohomish tax exemption for developers goes to City Council vote Tuesday, Sept. 20

SNOHOMISH — The City Council’s decision nears for whether to introduce a temporary property tax waiver for developers to build multimillion-dollar affordable housing buildings in the Midtown District, the special development zone along Avenue D.
A public hearing and council’s vote are scheduled for Tuesday, Sept. 20 at the council meeting that starts at 6 p.m.
If the City Council approves, and a developer bites, personal property tax rates for the broad area would increase.
A developer would need to commit to building affordable housing to obtain the waiver.
In the exemption system, what a developer doesn’t contribute in unpaid tax would be spread as a price increase upon all other property owners in the area to cover the difference.
Developers will not build any affordable housing in Snohomish without this in place, the city says in a frequently asked questions list published late last week on its website.
In Snohomish’s plan, the proposal pairs the multi-family tax exemption with a requirement that a small percent of the units are price-limited as “affordable” housing to even qualify for the eight-year exemption. Another change would allow the expanded 12-year exemption only if developers allocate 25% of the units for affordable housing or if 20% of the units are “affordable,” with 10% of those units price-restricted for “very low-income” housing.
The Pilchuck District, on the town’s eastside, already has a tax exemption but without an affordable housing requirement. The council’s vote also would amend the Pilchuck District rules to require affordable housing to get the waiver.
Snohomish County Public Works wants the city to introduce the exemption. It is selling its large former yard along Avenue D opposite 13th Street. A tax exemption boosts its marketability.
The Avenue D site goes to bid for developers Oct. 17, county Public Works Director Kelly Snyder said last week.



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