The City of Rochester wants to continue giving 10-year tax breaks to rich people who buy condos downtown.
The city first started giving incentives to downtown homeowners in 2007. Anyone who buys a newly-constructed or converted unit in an existing building gets 90 percent off his tax bill the first year, 80 percent off the second year and so on. The goal is to increase home ownership and the availability of affordable housing units downtown.
The program expires in May and the city wants to renew it. According to legislation submitted to City Council, the program hasn’t substantially met its goals. Of 2,914 downtown housing units, only 94 are owner-occupied. Only 20 homes have been built since the program went into effect.
Most downtown housing is high-end and the tax breaks have done nothing to change the dynamic. The average assessment of the 20 new homes built is $230, 323. That’s not exactly affordable housing. People who want to live downtown are choosing a lifestyle and the market indicates price isn’t a concern.
Finally, most downtown developers get tax breaks and other incentives before they sell a single unit. For example, the state awarded $335,000 in Restore NY grants to a developer building only two condos and retail space on East Ave. for $1.2 million. The developer plans to live in one of the units, which he won’t have to pay full taxes on for 10 years.
I understand wanting to get people to own homes downtown. But the market says only the wealthy can afford it right now – tax breaks or not.