Council Committee Approves Tax Break That CFO Called Unnecessary
A D.C. Council committee approved an $11 million tax break today for the Howard Town Center development on Georgia Avenue NW—despite the fact that Chief Financial Officer Natwar Gandhi deemed the break unnecessary.
The Council's finance and revenue committee approved the 10-year, 100 percent property tax abatement, plus three other tax breaks, in less than a minute with no discussion, according to a tweet from the Washington Business Journal's Michael Neibauer.
The D.C. Fiscal Policy Institute, a policy research group, has been pressing the Council not to approve the tax break and lobbied every councilmember on the committee to oppose the measure. DCFPI's Ed Lazere sums up Gandhi's reasons for deeming the abatement unnecessary:
- The project, which includes an affordable housing component, should be able to get funding using Low-Income Housing Tax Credits. The developer hasn’t been able to get a tax credit investor yet, but the CFO thinks that will change soon.
- The project should be able to charge higher rents than the developer is claiming.
- The developer can save money by deferring a portion of the developer’s fee from the project, a common practice with developments that include affordable housing.
You can read Gandhi's full analysis here.
The bill was introduced by Ward 1 Councilmember Jim Graham, and its passage was spearheaded by committee chairman Jack Evans of Ward 2. It now heads to the full council.
Rendering from DMPED