HUMBOLDT — Humboldt is aiming to kick-start more residential construction with a three-year tax exemption on new builds.
Joe Day, the city manager, said the city recognized that there is already a demand for housing in the community, and that as BHP builds its new potash mine and other employers increase their staffing requirements, there will be an increased demand for housing. With the increasing cost of land, labour, materials, and interest costs, the housing construction industry is apprehensive to rapidly increase the pace of construction for residential homes. The city is providing this tax incentive as a way to help offset some of the risk to builders and homeowners with the construction of new housing.
The new bylaw was passed at the July 24 council meeting. The new bylaw will exempt all taxes, school and municipal from the increased assessment for three years (existing land taxes will continue). The exemption will begin when the building is completed, Day said.
“Properties will automatically be eligible if the building permit was taken out this year and the construction is compliant. Any tax calculation for housing completed during this year will not be calculated until later in the year.”
The bylaw states in instances of modular homes moved into an approved R5 zone that is subject to monthly trailer licensing fees, the principles of this incentive will apply as much as practical to the monthly trailer licensing fees. The incentive will waive up to 36 months of trailer fees for each net additional eligible modular home added. The calculation of total incentive for an approved trailer park will be reconciled in a manner where the removal of any existing modular home will reduce the calculated incentive.
Day said the Housing Accelerator Fund (HAF) is a grant program being administered through CMHC that can provide funding to municipalities that take actions to increase the pace of residential development. It is a grant program that the City of Humboldt has applied to, but has not yet been accepted into. The money that the City of Humboldt could receive from the HAF program would help offset a large portion of the costs that the City will incur with the Residential tax incentive program, however the two programs are not directly dependent upon each other.
The intent of this bylaw is to provide properties with a property tax exemption from the tax increase that would normally result from eligible construction that increases the number of residential dwelling units for a defined exemption period.
