Olympia, WA Multi-Family Dwelling Tax Exemption

Olympia, WA, US

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Type: Municipal Code

Status: Adopted

Source File: Click here

Text:

Chapter 5.86
MULTI-FAMILY DWELLING TAX EXEMPTIONS

05.86.010 - Definitions
When used in this chapter, the following terms shall have the following meanings, unless the context indicates otherwise:

A. "Multi-family housing" means building(s) having four or more dwelling units designed for permanent residential occupancy resulting from new construction or rehabilitation or conversion of vacant, underutilized, or substandard buildings.

B. "Owner" means the property owner of record.

C. "Urban center" means a compact identifiable district where urban residents may obtain a variety of products and services.

D. "Director" means the director of the City of Olympia Community Planning and Development Department or other city official designated by the City Manager to carry out this chapter.

E. "Permanent residential occupancy" means multi-unit housing that provides either rental or owner occupancy on a nontransient basis. This includes owner-occupied or rental accommodation that is leased for a period of at least one month. This excludes hotels and motels that predominately offer rental accommodation on a daily or weekly basis.

F. "Rehabilitation improvements" means modifications to existing structures that are vacant for twelve (12) months or longer, or modification to existing occupied structures which convert nonresidential space to residential space and/or increase the number of multi-family housing units.

G. "Residential target area" means an area within an urban center that has been designated by the City Council as lacking sufficient, available, desirable, and convenient residential housing to meet the needs of the public.
(Ord. 5713 §1, 1997).

05.86.020 - Residential target area, hearing on resolution

A. For the purpose of designating a residential targeted area or areas, the City Council may adopt a resolution of intention to designate an area described in the resolution. The resolution must state the time and place of a hearing to be held by the City Council to consider the designation of the area and may include such other information pertaining to the designation of the area as the City Council determines to be appropriate to apprise the public of the action intended.

B. The City Council shall give notice of a hearing held under this ordinance by publication of the notice once each week for two consecutive weeks, not less than seven days, nor more than thirty days before the date of the hearing in a paper having a general circulation in the city. The notice must state the time, date, place, and purpose of the hearing and generally identify the area proposed to be designated as a residential targeted area.
(Ord. 5713 §1, 1997).

05.86.030 - Residential target area designation and standards

A. Criteria. Following a public hearing, with notice given by resolution pursuant to RCW 84.14.040, the City Council may, in its sole discretion, designate one or more residential target areas. Each designated target area must meet the following criteria, as determined by the City Council:

1. The target area is located within an urban center;

2. The target area lacks sufficient available, desirable, and convenient residential housing to meet the needs of the public who would likely live in the urban center if desirable, attractive, and livable places were available; and

3. The providing of additional housing opportunity in the target area will assist in achieving the following purposes:

a. Encourage increased residential opportunities within the target area; or

b. Stimulate the construction of new multi-family housing and the rehabilitation of existing vacant and under-utilized buildings for multi-family housing.

In designating a residential target area, the City Council may also consider other factors including, but not limited to: whether additional housing in the target area will attract and maintain a significant increase in the number of permanent residents; whether an increased residential population will help alleviate detrimental conditions and social liability in the target area; and whether an increased residential population in the target area will help to achieve the planning goals mandated by the Growth Management Act under RCW 36.70A.020. The City Council may, by ordinance, amend or rescind the designation of a residential target area at any time pursuant to the same procedure as set forth in this chapter for original designation.

B. Target Area Standards and Guidelines. For each designated residential target area, the City Council shall adopt basic requirements for both new construction and rehabilitation, including the application process and procedures. These requirements may include the following:

1. Requirements that address demolition of existing structures and site utilization; and

2. Building requirements that may include elements addressing parking, height, density, environmental impact, and compatibility with the existing surrounding property and such other amenities as will attract and keep permanent residents and that will properly enhance the livability of the residential targeted area in which they are to be located.

Area 1 - Downtown Residential Target Area

All properties located within the downtown commercial zoning districts of CS-H, DB, RMH, RMU, PO/RM, GC, DB UW and I, which are currently bounded by: Budd Inlet and Capitol Lake on the west; along 15th Avenue extending between Capitol Lake and Capitol Way and then south along Capitol Way to 16th Avenue, then east on 16th Avenue extending to Interstate 5 on the south; Eastside Street on the east; State Avenue between Eastside Street and East Bay Drive; and reconnecting with the Budd Inlet on the north, except for properties owned by the Port of Olympia.

Area 2 - Eastside Residential Target Area

All properties located within the PO/RM and CMR zoning districts along State Avenue and 4th Avenue which are currently bounded by: Eastside Street on the west; the alley located between Fourth Avenue and Fifth Avenue, extending from Eastside Street to Fir Street, on the south; Fir Street on the east; and the southern half of the city blocks which front on State Avenue located between Fir Street and Eastside Street.

Area 3 - Westside Residential Target Area

All properties located within the PO/RM and CMR zoning districts along Harrison Avenue which is currently bounded by: Cushing Street on the west; Foote Street on the east; extending only two lots deep both north and south of Harrison Avenue. Also included is the third lot north, located at the northeast corner of Harrison Avenue and Milroy Street; the third lot north, located at the northeast corner of Harrison Avenue and Decatur Street; the third and fourth lots south, located at the southwest corner of Harrison Avenue and Decatur Street; and, the third lot south located at the southeast corner of Harrison Avenue at Milroy Street.

(Ord. 5734 §1; Ord. 5713 §1, 1997).

05.86.040 - Tax exemptions for multi-family housing in residential target areas authorized

A. Duration of Exemption. The value of improvements qualifying under this ordinance will be exempt from ad valorem property taxation for ten (10) successive years beginning January 1 of the year immediately following the calendar year after issuance of the Final Certificate of Tax Exemption.

B. Limits on Exemption. The exemption does not apply to the value of land or to the value of improvements not qualifying under this ordinance, nor does the exemption apply to increases in assessed valuation of land and nonqualifying improvements. In the case of rehabilitation of existing buildings, the exemption does not include the value of improvements constructed prior to submission of the completed application required under this ordinance. This chapter does not apply to increases in assessed valuation made by the assessor on nonqualifying portions of building and value of land nor to increases made by lawful order of a county board of equalization, the department of revenue, or a county, to a class of property throughout the county or specific area of the county to achieve the uniformity of assessment or appraisal required by law.
(Ord. 5713 §1, 1997).

05.86.050 - Project eligibility
A proposed project must meet the following requirements for consideration for a property tax exemption:

A. Location. The project must be located within a residential target area as designated in 5.86.030.

B. Tenant Displacement Prohibited. The project must not displace existing residential tenants of structures that are proposed for redevelopment. Existing dwelling units proposed for rehabilitation must have been unoccupied for a minimum of twelve (12) months prior to submission of an application and must have one or more violations of the City's minimum housing code. Applications for new construction cannot be submitted for vacant property upon which an occupied residential rental structure previously stood, unless a minimum of twelve (12) months has elapsed from the time of most recent occupancy.

C. Size. The project must include at least four (4) units of multi-family housing within a residential structure or as part of an urban development. A minimum of four new units must be constructed or at least four (4) additional multi-family units must be added to existing occupied multi-family housing. Existing multi-family housing that has been vacant for twelve (12) months or more does not have to provide additional units so long as the project provides at least four (4) units of new, converted, or rehabilitated multi-family housing.

D. Proposed Completion Date. New construction multi-family housing and rehabilitation improvements must be completed within three (3) years from the date of approval of the application.

E. Compliance with Guidelines and Standards. The project must be designed to comply with the City's comprehensive plan, building, housing, and zoning codes, and any other applicable regulations in effect at the time the application is approved. The project must also comply with any other standards and guidelines adopted by the City Council for the residential target area in which the project will be developed.

F. At least fifty percent (50%) of the space in a new, converted, or rehabilitated multiple unit must be for permanent residential housing.

G. The applicant must enter into a contract with City approved by City Council under which the applicant agrees to the implementation of the development on terms and conditions satisfactory to the City Council.
(Ord. 5713 §1, 1997).

05.86.060 - Application procedure
A property owner who wishes to propose a project for a tax exemption shall complete the following procedures:

A. Prior to April 1 of any year, file with the Director the required application along with the required fees. The application fee to the City shall be One Hundred Dollars and No Cents ($100).

B. A complete application shall include:

1. A completed City of Olympia application form setting forth the grounds for the exemption;

2. Preliminary floor and site plans of the proposed project;

3. A statement acknowledging the potential tax liability when the project ceases to be eligible under this chapter; and

4. Verification by oath or affirmation of the information submitted.

For rehabilitation projects, the applicant shall also submit an affidavit that existing dwelling units have been unoccupied for a period of twelve (12) months prior to filing the application and shall secure from the City verification of property noncompliance with the City's applicable building or housing codes.
(Ord. 5713 §1, 1997).

05.86.070 - Application review and issuance of conditional certificate
The Director may certify as eligible an application which is determined to comply with the requirements of this chapter. A decision to approve or deny an application shall be made within ninety (90) calendar days of receipt of a complete application.

A. Approval. The Director may approve the application if he/she finds that:

1. A minimum of four new units are being constructed or in the case of occupied rehabilitation or conversion a minimum of four additional multifamily units are being developed;

2. The proposed project is or will be, at the time of completion, in conformance with all local plans and regulations that apply at the time the application is approved;

3. The owner has complied with all standards and guidelines adopted by the city under this ordinance; and

4. The site is located in a residential targeted area of an urban center that has been designated by the City Council in accordance with procedures and guidelines of this ordinance.

B. If an application is approved, the applicant shall enter into a contract with the City, approved by the City Council, regarding the terms and conditions of the project. Upon City Council approval of the contract, the Director shall issue a Conditional Certificate of Acceptance of Tax Exemption. The Conditional Certificate expires three (3) years from the date of approval unless an extension is granted as provided in this chapter.

C. Denial. The Director shall state in writing the reasons for denial and shall send notice to the applicant at the applicant's last known address within ten (10) calendar days of the denial. An applicant may appeal a denial to the City Council within thirty (30) calendar days of receipt of notice by filing an appeal with the Director with a $100 fee. The appeal will be based on the record made by the Director. The Director's decision will be upheld unless the applicant can show that there is no substantial evidence on the record to support the Director's decision. The City Council's decision on appeal will be final.
(Ord. 5713 §1, 1997).

05.86.080 - Extension of conditional certificate
The Conditional Certificate and time for completion of the project may be extended by the Director for a period not to exceed a total of twenty-four (24) consecutive months. The applicant must submit a written request stating the grounds for the extension, accompanied by a Fifty Dollar ($50) processing fee. An extension may be granted if the Director determines that:

A. The anticipated failure to complete construction or rehabilitation within the required time period is due to circumstances beyond the control of the owner;

B. The owner has been acting and could reasonably be expected to continue to act in good faith and with due diligence; and

C. All the conditions of the original contract between the applicant and the City will be satisfied upon completion of the project.
(Ord. 5713 §1, 1997).

05.86.090 - Application for final certificate
Upon completion of the improvements agreed upon in the contract between the applicant and the City and upon issuance of a temporary or permanent certificate of occupancy, the applicant may request a Final Certificate of Tax Exemption. The applicant must file with the Director the following:

A. A statement of expenditures made with respect to each multi-family housing unit and the total expenditures made with respect to the entire property;

B. A description of the completed work and a statement of qualification for the exemption; and

C. A statement that the work was completed within the required three-year period or any authorized extension.

Within thirty (30) calendar days of receipt of all materials required for a Final Certificate, the Director shall determine whether the specific improvements satisfy the requirements of the contract, application, and this ordinance.
(Ord. 5713 §1, 1997).

05.86.100 - Issuance of final certificate
If the Director determines that the project has been completed in accordance with this ordinance and the contract between the applicant and the City has been completed within the authorized time period, the City shall, within ten (10) calendar days of the expiration of the thirty-day review period above, file a Final Certificate of Tax Exemption with the Thurston County Assessor.

A. Denial and Appeal. The Director shall notify the applicant in writing that a Final Certificate will not be filed if the Director determines that:

1. The improvements were not completed within the authorized time period;

2. The improvements were not completed in accordance with the contract between the applicant and the City; or

3. The owner's property is otherwise not qualified under this chapter.

Within fourteen (14) calendar days of receipt of the Director's denial of a Final Certificate, the applicant may file an appeal with the City's Hearing Examiner, as provided in Chapter 18.82 of the Olympia Municipal Code upon payment of a $100 fee. No appeal is provided from the Hearing Examiner to the City Council. The applicant may appeal the Hearing Examiner's decision to the Thurston County Superior Court if the appeal is filed within thirty (30) calendar days of his/her receiving notice of that decision.
(Ord. 5713 §1, 1997).

05.86.110 - Annual compliance review
Within thirty (30) calendar days after the first anniversary of the date of filing the Final Certificate of Tax Exemption and each year thereafter for a period of ten (10) years, the property owner shall file a notarized declaration with the Director indicating the following:

A. A statement of occupancy and vacancy of the multi-family units during the previous year;

B. A certification that the property continues to be in compliance with the contract with the City and this ordinance; and

C. A description of any subsequent improvements or changes to the property.

City staff may also conduct on-site verification of the declaration. Failure to submit the annual declaration shall result in a review of the exemption per RCW 84.14.110.
(Ord. 5713 §1, 1997).

05.86.120 - Cancellation of tax exemption
If the Director determines the owner is not complying with the terms of the contract or this ordinance, the tax exemption will be canceled. This cancellation may occur in conjunction with the annual review or at any other time when noncompliance has been determined. If the owner intends to convert the multi-family housing to another use, the owner must notify the Director and the Thurston County Assessor within sixty (60) calendar days of the change in use.

A. Effect of Cancellation. If a tax exemption is canceled due to a change in use or other noncompliance, the provisions of RCW 84.14.110(1) will apply.

B. Notice and Appeal. Upon determining that a tax exemption is to be canceled, the Director shall notify the property owner by mail, return receipt requested. The property owner may appeal the determination by filing a notice of appeal with the Director within thirty (30) calendar days, specifying the factual and legal basis for the appeal. The Hearing Examiner will conduct a hearing at which all affected parties may be heard and all competent evidence received. The Hearing Examiner will affirm, modify, or repeal the decision to cancel the exemption based on the evidence received. An aggrieved party may appeal the Hearing Examiner's decision to the Thurston County Superior Court.
(Ord. 5713 §1, 1997).