With Deal Dead, What Happens to Howard Town Center Tax Break?
I reported yesterday that Howard University has terminated its agreement with the developer of the planned Howard Town Center, a big mixed-use project on Georgia Avenue with 445 apartments and a grocery store. It's still unclear exactly what led to the termination—a Howard spokeswoman said the developer, the Cohen Companies, "failed to meet certain benchmarks" but didn't specify what those benchmarks were—or what happens next on the long-stalled project.
And there's another thing that's up in the air: your tax dollars. In November, the D.C. Council approved an $11 million tax abatement for the project, even though D.C. Chief Financial Officer Natwar Gandhi said it was unnecessary. This week, during its budget negotiations, the Council reduced that tax abatement to $8 million.
But now that the developer agreement has been nixed, what happens to the tax abatement? No one seems to know.
David Umansky, spokesman for the Office of the Chief Financial Officer, says his office isn't sure. "The OCFO, which has only limited information concerning what may be recent developments relating to this project, cannot comment on the effect that uncertain and unknown potential changes in the development deal may have on the abatement," he says in an email. He does note, however, that the law creating the abatement "specifically identifies the owner (Howard University) and developer (Howard Town Center Developer, LLC) of the land and improvements (such as buildings) that are to benefit from the abatement." If the abatement is tied to Howard Town Center Developer, LLC—a joint venture led by the Cohen Companies—that would seem to imply that if Howard Town Center Developer, LLC is out, then the abatement is moot. But I have not been able to confirm this.
Ward 1 Councilmember Jim Graham, who introduced the legislation creating the tax break, likewise isn't sure what the effect will be on the abatement. 'I’m not sure about that," he says, "but I do know one thing: I think there’s going to be a very energetic effort to straighten all this out. And I have every reason to believe we’re going to negotiate this successfully so we don’t lose this critical project. We’ve got to have the Cohen Companies renegotiate with Howard."
The Cohen Companies' Eric Siegel has not responded to requests for comment.
Howard Town Center rendering from the Office of the Deputy Mayor for Planning and Economic Development website