Overview

The Community Reinvestment Area (CRA) Program is a direct incentive tax exemption program benefiting property owners who renovate existing or construct new buildings.  This program permits municipalities or counties to designate areas where investment has been discouraged as a CRA to encourage revitalization of the existing housing stock and the development of new structures.

Benefits

Local municipalities or counties can determine the type of development to be supported by the CRA Program by specifying the eligibility of residential, commercial and/or industrial projects.

CRA Program Benefits

The exemption percentage and term for commercial and industrial projects are to be negotiated on a project specific basis. If the proposed exemption exceeds 50%, local school district consent is required unless the legislative authority determines, for each year of the proposed exemption, that at least 50% of the amount of the taxes estimated that would have been charged on the improvements if the exemption had not taken place will be made up by other taxes or payments available to the school district (often called PILOT – “payment in lieu of taxes.”). Upon notice of a project that does not meet this standard, the board of education may approve the project even though the new revenues do not equal at least 50% of the projected taxes prior to the exemption.

Term Exemptions in Columbia Township

Residential        

For residential properties, tax exemptions on the increase in the assessed valuation resulting from improvements are granted upon proper application by the property owner and certification thereof by the designated housing officer; the percentage and term of those exemptions are as follows:

 

  • Seventy five percent (75%) exemption for a period of ten (10) years for improvements to single family residential properties, and upon which the cost of remodeling is at least $2,500. The term for Leadership in Energy and Environmental Design (LEED) certified construction shall be one hundred (100%) for ten (10) years.
  • Fifty percent (50%) exemption for a period of ten (10) years for construction of new single family residential properties. The term for Leadership in Energy and Environmental Design (LEED) certified construction shall be one hundred (100%) for ten (10) years.

 

  • Fifty percent (50%) exemption for a period of ten (10) years for improvements to existing multi-family residential properties, and upon which the cost of remodeling is at least $5,000. The term for Leadership in Energy and Environmental Design (LEED) certified construction shall be one hundred percent (100%) for ten (10) years.

 

There are no exemptions for the construction of new multi-family residential properties.  Multi-family residential properties include any residential property, which contains two (2) to four (4) housing units. Any property containing in excess of four (4) housing units is to be classified as commercial.

Commercial

The percentage of tax exemptions on the increase in the assessed valuation resulting from improvements to commercial and industrial real property and the term of those exemptions are as follows:

  • The percentage (up to 100%) and term (up to twelve (12) years) for existing commercial or industrial facilities is negotiated on a case-by-case basis in advance of construction or remodeling, and upon which the cost of remodeling is at least $5,000. Leadership in Energy and Environmental Design (LEED) certified construction shall be abated for the full twelve year period.
  • The percentage (up to 100%) and term (up to fifteen (15) years) for new commercial or industrial facilities shall be negotiated on a case-by-case basis in advance of construction. Leadership in Energy and Environmental Design (LEED) certified construction shall be abated for the full fifteen (15) year period.

 

Commercial and industrial properties include, but are not limited to, condominium developments, retail properties, office properties, distribution facilities, service facilities, research and development facilities, laboratories, and manufacturing.

 

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