Conway Town Planner’s Approach to Tax Relief and Affordable Housing

Conway Town Planner Ryan O’Connor presented an innovative idea to the select board aimed at addressing the critical need for affordable housing in the area. He proposed the development of a warrant article that would adopt the provisions of RSA 79-E, the “Community Revitalization Tax Relief Program” in the state.

Under O’Connor’s proposal, if a single-family home were converted into a three-family residence with one of the new units designated as “affordable,” the property could qualify for tax relief for a period of up to 10 years. This tax incentive would be instrumental in supporting larger developers like Avesta in their efforts to create affordable housing projects.

The primary goal of this initiative is to provide a boost to projects offering affordable housing, recognizing that the initial years of financing can be particularly challenging until the property begins to generate revenue, O’Connor explained. By offering tax relief, the program aims to encourage the development of affordable housing options in the community.

To qualify for this tax relief program, a property must meet specific conditions, ensuring that property taxes remain stable for a set period. The term “affordable” in this context refers to homes rented or mortgaged to individuals with an income of 80% or less of the area’s median income, which is approximately $47,400. Consequently, the rent or mortgage for these homes cannot exceed $1,185.

A crucial requirement for eligibility is that a minimum of one-third of a structure, such as an apartment building, must consist of affordable units. Additionally, significant rehabilitations must amount to at least 15% of the structure’s assessed valuation or $75,000, whichever is lower. The selectboard has the authority to determine the duration of tax relief, ranging from up to 10 years or even 14 years if the structure is deemed historic.

It’s essential to note that the town does not forfeit all tax revenue when granting relief. The property continues to be taxed based on the current assessment until the relief period concludes. Furthermore, the program mandates that the affordability of rent or mortgage must be maintained for double the duration of the tax incentive. For instance, if the selectboard grants 10 years of tax relief, the unit must remain affordable for a minimum of 20 years.

The selectboard would have the flexibility to decide the duration of benefits for each project, taking into account factors such as the contribution to affordable housing creation or the rehabilitation of historic structures. This approach allows for a tailored and community-centric approach to incentivizing affordable housing development in Conway.

Overall, O’Connor’s proposal reflects a forward-thinking strategy to tackle the affordable housing crisis by leveraging tax incentives to encourage developers and property owners to participate in the creation of much-needed affordable housing options. The public hearing on this proposal is scheduled for January 2, offering an opportunity for community input and discussion before any decisions are made.