Could a tax abatement zone work in Mountain View?
Under a tax abatement ordinance passed by the Anchorage Assembly this summer, utilities like Chugach Electric or Enstar Natural Gas could receive tax breaks for certain infrastructure upgrades.
Or, according to former municipal CFO Lucinda Mahoney, an oil company like Tesoro could get a tax break for cleaning up its own environmental contamination.
“Right now, they could come in today and they could apply and they could get tax abatements,” Mahoney warned Assembly members before leaving her position with the municipality Sept. 12. “I don’t think that the intent here was to give these major oil companies tax abatements, and let them off the hook for their contamination.”
The ordinance in question – approved in late July — aims to spur revitalization within a t-shaped swath of Fairview by declaring the entire area “deteriorated,” making new development eligible for certain tax abatements under current municipal code. Developers can offset property tax increases for up to 10 years by completing infrastructure and utility work or environmental cleanup.
It’s sparked conversations about similar measures in neighborhoods from Spenard to Mountain View.
“Fairview might be a model for other places in the city,” said Assemblywoman and Title 21 Committee member Jennifer Johnston.
Meanwhile, Mahoney urged members of the Assembly land use committee to take a second look at all the ramifications of the new tax abatement measure. While lawmakers are still working to identify the full implications and parameters of the Fairview ordinance, it’s becoming a hot topic in other areas of town.
“You can see how it’s snowballing,” Johnston said.
For properties across Anchorage, tax abatement is a big part of the equation.
At a land use committee meeting in early September, Assemblyman Dick Traini said one developer hopes to use tax abatement to remove dozens of mobile homes from the Riviera Terrace Mobile Home Park. Using tax breaks to displace lower income Alaskans doesn’t seem right, Traini said.
Downtown, he said, another developer seeks tax abatement before redeveloping property at the corner of 6th Avenue and H Street; a vacant lot where the Inlet Inn once stood. A few blocks farther away, local developer Marc Marlow applied for tax abatement for several tracts of land along downtown’s northern edge. While he had no concrete plans for redevelopment, he said he hoped a tax break could pave the way to new investment.
If you ask Assemblyman Ernie Hall, West Anchorage is the next neighborhood headed for a location-based tax abatement policy similar to Fairview’s.
“I’ve already got people in Spenard saying, ‘Ok, we’re ready for regulation and code,’” Hall told his fellow Assembly members earlier this month.
The possibility of another new tax abatement district also came up at a Mountain View Community Council meeting Sept. 8. Joshua Spring, an aid to Downtown Assemblyman Patrick Flynn, told council members the idea was gaining momentum in other areas of town. It might be something to consider in Mountain View too, he said.
With Assembly members still working to hammer out the practical details of the tax abatement measure, though, not everyone is jumping aboard the tax break bandwagon.
Jewel Jones, executive director of the Anchorage Community Land Trust, said she’d prefer to wait and see how things play out in Fairview before advocating for a similar tax abatement measure in Mountain View. The land trust was founded more than a decade ago as a nonprofit community development engine, and while Jones said “there’s absolutely a need” to focus on reinvestment and revitalization throughout Anchorage, Mountain View might benefit from a different approach than the one used down the road.
Like Fairview, Spenard, Midtown and others, Mountain View has its share of land issues. Environmental contamination left behind by previous owners can make redevelopment costly and time consuming. But in a few ways, Jones said, Mountain View’s different.
Compared to Fairview or Spenard, it’s off the beaten path and away from major thoroughfares like Gambell Street or Minnesota Drive. While the Fairview tax abatement measure incentivizes higher density housing development alongside business growth, Mountain View is already seeing a spike in those areas.
For the last decade or so, Jones said a push to build more affordable housing and stimulate business growth has been paying off, slowly but surely.
“What we are seeing, in the fruits of all of this, is the fact that affordable housing and multi-family housing is now becoming a reality,” she said.
This year alone, Cook Inlet Housing Authority is building 44 new housing units throughout the neighborhood, and construction of a 70-unit apartment complex on Mountain View Drive is set to begin later this fall. Alongside the housing comes commercial construction.
At the Glenn Square Shopping Center, Bass Pro Shops recently opened the doors to a new, 80,000-square-foot outpost. A burger restaurant and a new craft brewery — both firsts for the area — are also setting up shop in Mountain View.
Of course, Jones still sees needs in the neighborhood.
“We need accountants. We need health clinics,” she said. “We need realtors that really promote this community as a good place to live.”
That’s where a special tax structure might come in to play. Jones spoke about the Downtown Improvement District, where special assessments help pay for amenities like safety ambassadors on downtown streets. She spoke about Spenard, which made the transformation from derelict to hip with the help of community nonprofits like NeighborWorks. Strategies employed in both of those neighborhoods could work in Mountain View, she said.
Ultimately, Jones said it comes down to community support. And change doesn’t come overnight, she said. Tax abatement isn’t a once-size-fits-all deal.
“Everybody’s nibbling at it, in a way, but I want to see what happens in Fairview,” she said.