Program aims to freeze downtown property taxes

Now that phase I of the downtown economic revitalization project is complete, attention is being turned to the buildings. A financial incentive plan to encourage commercial real estate development downtown has recently been approved by the city of McMinnville.

The program is designed to freeze both city and county real estate taxes at the pre-development rate for up to 15 years in the case of building renovations, and 10 years for new construction projects in a defined area downtown. The tax freeze is in exchange for an investment of at least 6 percent of the appraised market value of a building or raw land by a property owner. Certain fees, costs, and restrictions apply.

Property may be part of the program for varying terms. Renovation of general use property will be up to five years. Renovation of ground-floor retail use property will be up to 10 years. Renovation of upper-floor residential use property can add up to five years.

Terms will also vary for new construction. New construction, office only, will be up to five years. New construction, retail only, will be up to 10 years. New construction, mixed use, will be up to 10 years.

The PILOT (payment in lieu of taxes) program will be administered by the McMinnville Downtown Revenue Finance Corporation, which was also approved recently. MDRFC is expected to be in place some time this summer.

The PILOT program is restricted to the downtown area. All projects under the program will go through a design review. Not all projects will be eligible for the program. If eligible, the program requires the property owner transfer title to the MDRFC in order to freeze the taxes.

To learn more, please contact Main Street McMinnville at 506-5335.