A request to bring back the tax incentive program for downtown beautification was met with interest from Town of St. Paul council at its April 11 council meeting, after the program was phased out a few years ago.
“You know what, I think it was an absolute awesome program that we had,” said Coun. Ken Kwiatkowski, noting many businesses got facelifts, while new construction took place to fill up once vacant lots when the incentive program was in place. “It’s a win-win for us.”
Interim CAO Holly Habiak noted a number of businesses are in their last legs of receiving the former tax credits, with the new buildings erected by JMD Group LLP and Evergreen Stationers receiving 100 per cent tax break on the municipal portion of their tax credits until 2019.
Providing a tax break to a business such as the Co-op, which will be undergoing a $16.9 million mall renovation, would equate to losing $62,000 worth of revenue a year, she said, stating that figure was based on the estimated cost of the renovation, the 2015 tax rate and using the previous bylaw as a yardstick.
The discussion came after Kevin Bernhardt, St. Paul & District Chamber of Commerce president, and Graham Getz, general manager for the St. Paul Co-op, sent letters to the Town of St. Paul, to reconsider bringing back the tax breaks, with Getz saying the Co-op benefited from the tax breaks when implementing its building material storage shed and its liquor store.
“These incentives have assisted us in moving forward by continuing investing and giving back to our communities,” said Getz in his letter, while Bernhardt noted that bringing back the incentive program would help promote rebuilding and growth in the town.
Linda Sallstrom, executive director for the chamber, said that the chamber has noted there has been and will be more development on the town’s east end, with the Centennial Plaza and a planned new hotel, among others. Implementing the program would create a “conduit to the core,” she said, and help improve the community as a whole.
The former bylaw based tax breaks on zones: businesses on the outer edges of town or other commercial zones implementing modernizations, renovations or new construction got a 25 per cent exemption on the increased assessment value on the municipal portion of their taxes for five years,. Businesses closer to the downtown core got 50 per cent exemptions for five years, while businesses in the downtown core, on 50th Avenue from 48 Street to 52nd Street, undergoing construction got a 100 per cent exemption on the increased assessment value.
Council felt the tax incentive program was successful in sprucing up the main street’s look.
“I think the ugliest block in main street became the best-looking block in main street,” said Mayor Glenn Andersen, pointing to the turnaround in the downtown core near the post office.
Coun. Edna Gervais noted the economy has faced challenges in the wake of slumping oil prices, with Coun. Norm Noel adding, “Let’s show St. Paul’s open for business; that’s the way I look at it.”
Noel also added that the businesses that would have to relocate because of the Co-op’s mall expansion could also benefit from the tax incentive program.
After some discussion on what the rates should be and over what time period, council agreed to look at bringing back a bylaw reinstating its previous program for five years. Council will need the assessor to provide some numbers and what qualifies for the incentive program before committing to anything, said Habiak.
Andersen said vacant lots remain in town, and a downturn in the economy necessitates some extra measures on the part of the town.
“Any kind of development at this time would be a good development,” he said, adding the bylaw met its goal to improve St. Paul’s downtown when it was last implemented. “Can the same thing happen again? Only time will tell.”
