Multi-Family Tax Exemption Program Target Area Being Modified by the City of Bellingham

MFTEP_TargetArea1The multi-family tax abatement program target area in the City of Bellingham’s downtown core will soon be slightly modified by City Council. The City Center Targeted Area map is being amended to align with the revised Downtown Bellingham Plan boundary.

The multi-family tax exemption program makes 8 and 12-year property tax abatements available to property owners that redevelop multi-family housing in Urban Village zones within the City of Bellingham city limits. The tax exemptions apply only to new residential improvements and the owner continues to pay taxes on the value of the land, any pre-existing units that have not be redeveloped, and any non-residential improvements made to the property. The exemption is in addition to any exemptions received for historical preservation, and if the property is on the historical register, it must preserve all parts of the building deemed historic in order to qualify for the multi-family tax abatement program.

An 8-year abatement gives a property owner/developer a complete exemption from paying property tax for 8 years on those improvements, while a 12-year abatement exempts the property owner/developer from paying property tax for 12 years if the development includes at least 20% low income housing units in the mix. Multi-family tax abatements can be added in addition to historical preservation tax abatements.

To qualify for inclusion in the exemption, a Multi-family Tax Abatement Program application must be submitted before any building permits for the project have been issued.

More details of the program are available on the City of Bellingham’s Municipal Code Web page detailing Chapter 17.82: Multifamily Tax Exemption.