Hobart officials look to retire existing residential tax abatements

2013-08-04T00:00:00Z Hobart officials look to retire existing residential tax abatementsDeborah Laverty deborah.laverty@nwi.com, (219) 762-1397, ext. 2223 nwitimes.com

HOBART | The city hasn't issued any new tax breaks for residential construction for a number of years.

There are, however, a dozen or more existing properties which received the residential tax abatement designation but have never used it because nothing was built on the lots, City Councilman John Brezik, D-5th, said. 

It's for those existing tax abated properties Brezik and other council members propose eliminating any more extensions.

"We want to seek a fair solution for all," Brezik said.

Brezik, who is a member of the tax abatement committee, said the group plans to discuss the issue after a list of all residential tax abated properties is compiled. An expiration date would then be set.

The issue recently came to light last month at a City Council meeting when developer Carole Gilbert was granted a one-year tax abatement extension on Gilbert's Cove.

Gilbert, who began developing the nine-lot subdivision in 2005, said she had sold only two lots out of nine before the economy took a turn for the worse.

Gilbert said she hasn't sold any more lots in the development, off Sixth and Indiana streets, despite lowering prices and hiring a real estate broker to provide extensive marketing.

City Councilman David Vinzant, D-4th, said there are several residential tax-abated properties throughout the city.

"At some point we need to sunset the program so they all end at the same time," Vinzant said.

Residential and commercial tax abatements have been offered in the city since the early 1990s.

The residential tax abatements were offered in Hobart because no new homes had been built in the city for about 15 years because of a sewer moratorium, Vinzant said.

The residential tax abatement, or six-year tax break, was offered as an incentive by the developer to future homeowners who could use the abatement once the lot was built on, Vinzant said.

"The purpose was to promote residential development and it was a success. We got a lot of houses in town we wouldn't have had without it, but now our focus is on what we can do to bring commercial development in that brings in jobs," Vinzant said.

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