Community Reinvestment Area Tax Abatement information

CRA FACT SHEET

What is a Community Reinvestment Area (CRA)?

A CRA is a program authorized by the State of Ohio that allows a local government (like the City of North College Hill) to offer real property tax abatements to incentivize new construction, expansion and rehabilitation in areas where there is a demonstrated need for reinvestment.

How can a CRA tax abatement help me?

If you are a business, homeowner or landlord who would like to build, expand or substantially rehabilitate a building, a CRA real property tax abatement can result in a significant annual savings to you over a period of 10-15 years. The tax savings keeps more money in your pocket that you can invest in your project.

If you are someone who does not have plans to improve your property, you will indirectly benefit from the CRA program because it will encourage improvement of other City of North College Hill property owners as well as business attraction and expansion, which can improve the value of your property as well as the overall community as a whole.

How does a CRA tax abatement work?

When you are building a new home, store or office or investing in renovation to your personal property you may notice your real property taxes increase. The reason for the increase is because improvements to a property make the property's value, and real property taxes increase. The property value and real property taxes are calculated as a percentage of the taxable real property value. A real property tax abatement in a CRA makes it possible for property owners to avoid all or a portion of the tax increase caused by the improvements over a 10-15-year period.

How can I qualify for a CRA tax abatement?

You must own a residential or business property within the CRA and do one of the following:

1. Undertake new construction of a commercial/industrial building or one or more residential units

2. Expand or rehabilitate an existing residential, commercial or industrial building to an extent that it increases the taxable real property value.

How much of a tax abatement can I receive?

Below are the types and levels of tax abatements available:

- a. Ten (10) years, for the remodeling of every residential dwelling unit as defined by the North College Hill Ordinances and upon which the cost of remodeling is at least $2,500, as described in ORC Section 3735.67, and with such exemption being Fifty percent (50 %) for each of the ten (10) years.

- Commercial/Industrial, 10 years/up to 100% Term length/percentage to be negotiated on a case-by-case basis in advance of construction occurring.

Will a CRA tax abatement reduce the taxes that I paid on the property prior to new construction, expansion or renovation?

No. A CRA tax abatement only applies to increases in real property taxes caused by improvements to a property. Pre-improvement real property taxes must still be paid.

What happens to my tax bill at the end of the tax abatement period?

After a tax abatement expires, you will begin paying the full amount of real property taxes on both the pre-improvement and post-improvement value of a property.

Who reviews and approves my CRA application?

The Housing Officer Bill Knight will review the application to ensure proper documentation has been submitted and will inspect the property to ensure that the application information is consistent with actual work completed. Then the application will be forwarded with a certification to the County Auditor. The County Auditor will then make a final determination on the actual increase in taxable value generated by the new construction, expansion or renovation project. The Auditor will then apply the approved abatement to future tax bills.

If I receive a CRA tax abatement, will my taxes go up or down during the abatement period if my property is re-assessed or if a tax levy is passed?

Possibly. You will still be responsible for paying pre-improvement real property taxes on the property, which could go up or down due to periodic County Auditor re-assessments or tax levies.