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Home My WebLink AboutA004 - City Assessor comments on proposed ordinance, March 26, 1985 F� It A MES CITY ASSESSOR Human Services Building Richard L. Horn March 26, 1985 City Assessor ?F(-F[VFD ?ECElVED Mr. Steve L. Schainker [VAR . R Ames City Manager Pearl and Main Street Ll.l.r Ul A�v�tS Ames, Iowa 50010 Dear Steve: Thank you for the opportunity to comment on this prior to making a recommendation to the council. I feel this is an exemption ordinance which is long overdue for Ames. My personal feeling is that the maximum exemption schedule should be recommended if this program is to be effective. There will be no problem implementing such a program. I have had experience with this particular exemption in Clarke County. The Iowa Department of Revenue provides adequate, standard forms which must be filed with my office. I suggest that after the ordinance is passed, potential applicants will need to be reminded that an application must be filed with my office by February 1st, or they will receive no exemption. This reminder should be made at the time of initial contact with the city, which is typically in either Planning and Housing or Building Permits. The industrial exemption ordinance is similar to our current urban revitalization ordinance. In each case, if no initial application is made, the entire three, five, or ten year exemption is forfeited. I suggest a reminder in the hope that the problems which we've had with urban revitalization exemptions will be avoided. The AEDC report is mistaken in stating that this exemption would apply to "new machinery and equipment that would be taxed as personal property." Industrial machinery and equipment is taxed as real property, and it is generally subject to partial exemption (since the 1982 assessment) under 427B .10 - .14 without council action, so most M&E will not be affected by passage of the ordinance. It should be mentioned that the major portion of a several hundred thousand dollar building addition to Bourn's will be assessed for the first time in 1986, so passage of this ordinance in 1985 would likely render them eligible for an exemption. Sincerely, Richard L. Horn Ames City Assessor 0 713 S. Duff Avenue • Ames, Iowa 50010 (515) 232-2001 alai TO; Mayor and City Council n O Steven L. Schainker, city Mana er --(g � DATE: March 29, 1985 SUBJECT: Proposed Industrial Property Tax Exemption Ordinance The Executive Board of the Ames Economic Development Commission has requested that the City Council once again consider establishing an industrial property tax exemption ordinance as provided for in Chapter 427(B) of the Iowa Code. As you will recall, the City Council has established as one of its highest prior- ities the identification of seed money to stimulate industrial development in Ames. It appears that the establishment of this ordinance will accomplish this Council target without requiring the appropriation of "up front" tax funds. Furthermore, it should be emphasized that at no time will the City of Ames receive less tax receipts than it currently realizes on any piece of industrial property because the partial tax abatement which is allowed under this ordinance is only for the value added to the property. This particular tax abatement program seems to be more attractive than other similar programs which the City has sponsored. For example, the abatement period of five years is a relatively short period. In addition, in accordance with the program, even in the first year of this program the City will receive 25 percent more tax revenue on the value added to this property than would have been the case if no industrial improvements had taken place. Finally, partial property exemptions under this ordinance will not be granted if the property for which the exemption is claimed has received any other property tax exemption authorized by law. If the City Council is truly committed to this highest priority target, then the passage of this ordinance would be preferred to the allocation of tax funds for seed money. Given the fact that the business of economic development is a very competitive endeavor and 154 communities in Iowa have already adopted this partial industrial property tax exemption program, I would recommend that the City Council also adopt this ordinance. Like any other ordinance, if the City Council is not satisfied with the results of this legislation, it may be elimi- nated at any time. /lw Attachments