Manassas wants more home and business owners to improve their properties, and it has sweetened its tax incentives to prove it.
This week, the City Council loosened the requirements of the city's rehabilitation ordinance, making it easier for individuals who renovate their properties to qualify for tax exemptions. The changes take effect today.
"We're trying to look at incentives for folks to revitalize, and not just to put a new roof on their property but to make more significant improvements," said John P. Grzejka, the city's commissioner of revenue. "We don't have many tools, but this is one of the few that we have to encourage investment in our city."
Property owners can now qualify for tax exemptions on residential and commercial buildings that are as young as 30 years old, down from 60 years for residences and 40 years for commercial properties. They have to make fewer improvements to qualify, and the city is extending the length of the tax relief from five years to nine years.
Creston Owen, a local landowner and developer, said the measure helped persuade him to invest $1.5 million in Old Town's West Square property, which now includes Foster's and Subway restaurants.
"It's an incentive in my eyes," Owen said.
Qualifying property owners will not have to pay taxes on any increase in assessed value for five years, as long as market conditions don't falter. For example, if improvements increase a property's value from $200,000 to $250,000, property taxes will continue to be based on $200,000 for those five years. The percentage of the exemption decreases each year for the next four years.
Grzejka said that over the past five years, the program cost the city about $45,000 in lost potential revenue. He said he didn't have an estimate on how much the new exemptions would cost.
He also said that his research, completed a year ago, indicates that about 24 percent of the city's residential and commercial properties would qualify under the new requirements.