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Hoping to ease taxes on housing Falls weighs incentives for rehab of rental units, new home construction

The City Council is considering a new local law that would give tax breaks for improvements to residential rental properties and new home construction throughout the city.

The Council, in its meeting tonight, is expected to schedule a Jan. 22 public hearing on the proposed change.

If approved, the law would waive a percentage of the increase in city, school and county property taxes that would normally be charged because of the rehabilitation or construction of a rental residence with four or more units, and for new construction of owner-occupied homes.

"My hat's off to whoever put this together," said Chris DeFranco, owner of DeFranco True Value Rental & Hardware. "It's a good plan, and things from City Hall have to start going citywide."

DeFranco, whose family has been selling home-improvement supplies in the city since 1922, says residents in all parts of the city need all the incentive they can get to work on the city's decaying housing stock.

The local law is based on state legislation passed last summer -- co-sponsored by Assemblywoman Francine DelMonte, D-Niagara Falls, and then-State Sen. Marc A. Coppola, D-Buffalo -- allowing Niagara Falls to amend its tax law in favor of new construction.

DelMonte said the bill grew out of discussions with City Assessor Dominic Penale Jr., who gave her office information about a similar law from another part of the state.
"It's a very generous offer to people who own property, and I think it will spur a lot of landowners who are potential home builders to invest in their city and in their property," DelMonte said.

If approved:

* An existing or new rental residence with at least four units and improvements of more than $15,000 per unit made after March 1 will qualify for an eight-year tax break. During the first year, 100 percent of an increase in assessed value because of the improvements or construction will be waived; 87.5 percent will be waived the second year; and subsequently decreased exemptions will be granted until a figure of 12.5 percent in the last year.

* New home construction that began on or after the first day of this year, and costing more than $70,000, will qualify to receive a 10-year tax break. In the first year, 50 percent of the increase in assessed value because of the new construction would be exempt, and the amount would gradually decrease each year until a 5 percent exemption is given in the final year.

"Any time we can make it easier for any type of development is good," said Councilman Lewis Rotella. "The [New York] Empire Zone and downtown incentives are great, but we can't forget about the rest of the city with development."

Council Chairman Charles Walker Sr. agrees. "It's important because, of a lot of programs we've put in place, LaSalle has been left out," he said.

"If you look in LaSalle, they have just the same problems, and a person may be more willing to build a house in LaSalle or DeVeaux if those incentives were in place."

Walker said one problem to which he is referring is vacant lots that are left behind in residential neighborhoods when a deteriorated house is demolished. The city demolished more decrepit homes than usual last year.

"We've gotten rid of the blight," Walker said. "But because we've done so much demolition over the last few years, a lot of streets have those empty lots, and now hopefully people would like to build."


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