Exemption could save big bucksPublished 12:04am Saturday, January 19, 2013
NATCHEZ — The City of Natchez is looking for participants for a program that could save potential business owners some tax dollars while spurring development in the downtown historic district.
Community Development Director James Johnston said the city’s tax abatement ordinance allows the city to give developers exemptions from municipal property taxes, except ad valorem taxes set aside for the school district, for three to seven years.
County taxes are not affected by the tax abatement program, Johnston said.
The period of exemption is based on the amount of money a developer spends on renovations to a building or new construction in the city’s downtown historic district.
For example, Johnston said, if someone spent $20,000 to renovate a building downtown to open a business, the city could declare that business exempt from municipal taxes for three years.
The tax freeze only applies to revenue producing commercial properties that will be available for new construction or renovation.
The investments eligible for tax abatement are:
4$20,000 to $29,999 for a three-year period.
4$30,000 to $44,999 for a four-year period.
4$45,000 to $64,999 for a five-year period.
4$65,000 to $89,999 for a six-year period.
4$90,000 and above for a seven-year period.
Twenty-five percent of the minimum investment must be spent on the public facades of the building. Property acquisition costs are not eligible for the program.
The tax abatement program area includes Under-the-Hill, parts of Canal, Broadway, Main, Jefferson, Martin Luther King Jr., Franklin, State, Pearl and Union streets.
Johnston first worked with the city on the program in 1999 and said the idea is to stimulate downtown development by giving businesses a chance to save money.
“The goal is to give people a break on their taxes, so it will spur development in the downtown historic district,” he said.
Mayor Butch Brown said he inquired about the tax abatement program when he bought his apartment on South Commerce Street more than a year ago.
“No one in City Hall knew anything about it,” he said.
Brown said Historic Natchez Foundation Executive Director Mimi Miller informed him that the program was still in place and provided paperwork on it.
“When James came on board, he started digging and resurrected it,” Brown said. “It’s a good program, it’s been there and unutilized. We just want to inform people about it, and we’re hoping people take advantage of it.”
An application for the tax abatement program can be picked up in the planning and community development department upstairs in City Hall. The department can be reached at 601-445-7518.