The 200-plus apartment development River and Rich is nearing completion on Franklinton’s east side. The hum of heavy machinery and the staccato thump of nail guns played in the background last week as city leaders gathered to pitch a revamped tax abatement plan.
“We were encouraged by the city to build affordable housing and that’s what we wanted to do,” says Robert Weiler, one of the developers behind the project. “And we said we will definitely do that, and we put all the numbers together and unfortunately the numbers didn’t work.”
One of the elements that balanced the equation was a tax break from the city.
Columbus has been working on a new policy for giving out property tax incentives, known as abatements, for about two years. A city-funded study released in 2017 showed the program raised property values, but was too generous in already-flush neighborhoods like the Short North, for which residents have long criticized the city.
On Monday afternoon, Columbus City Council will meet with the public to discuss their ideas for a new residential tax abatement policy. It will tie abatements to affordable housing, but there’s a lot of fine print.
The city’s proposal won’t do away entirely with abatements in those bustling districts—instead, it demands an increased investment in affordable housing, which city officials say hasn’t kept pace with population growth.
“While the city cannot control development, we know we can influence it, and it is our responsibility to insure that these public resources are being used for the public good," said Mayor Andrew Ginther in a speech at River and Rich.
The new plan divides Columbus’ 12 community reinvestment areas, or CRAs, into three tiers. The highest, known as “market ready,” includes the Short North, AC Humko and Fifth By Northwest.
Council member Elizabeth Brown explains new developments will have to set aside a chunk of their units for mid- and low-income renters in exchange for incentives.
“If you want an abatement,” Brown said after the event, “then you have to put in these affordability requirements so that families making between about $40,000 and $60,000 a year, based on household size, can rent in your development.”
Those provisions apply to one-fifth of a developer’s units. In market-ready districts, abatements are also limited to mid- and high-rise developments.
Most of the CRAs fall in the second tier—areas like Milo Grogan, Near East and the South Side. Incentives in those neighborhoods carry the same affordability requirements for one-fifth of units, but they’re available for any size multi-family project.
That doesn't mean Columbus will suddenly see a spike in affordable housing. Property owners also have a number of options for avoiding the affordability demands. Builders can get credit for one affordable unit for every:
- 25,000 square feet of Class A office space they add to their plans.
- $1 million spent on environmental remediation.
Failing that, property owners can buy their way out of the requirements by paying money directly into the affordable housing trust fund. They’d have to pay 125 percent of the additional dollars brought in by renting those units meant for affordable housing at market rate.
Even though developers have alternatives to actually building affordable units, Ginther believes the measure’s language is strong enough.
“They will have to make a very significant investment into the construction and building of affordable housing units,” he insists.
The lowest tier of CRAs includes just two neighborhoods, Franklinton and Linden, and the city plan allows tax abatements for any project. But here, in the city’s most distressed neighborhoods, there are no affordable housing requirements at all.
Particularly in Franklinton, rents in less affluent parts of the neighborhood are creeping higher as shiny new developments like River and Rich move in. But even if new projects won’t carry affordability requirements, Jack Storey from the community development group Franklinton Urban Empowerment Lab remains optimistic about the new plan.
“We’re not going to stop doing affordable housing in Franklinton, and I think that’s important,” Storey said. “New rules, old rules, no rules, we’re still going to keep building affordable housing here and I’m confident the city is going to keep supporting that.”
City Council will host a public hearing on their plan in council chambers at 3 p.m. on Monday afternoon.