Over the last two years, Danville has amended its tax abatement programming for hotel, commercial and industrial properties to encourage redevelopment. The city council will consider a further amendment to allow this program to apply to commercial properties that have been entirely converted to residences at its meeting Tuesday at 7 p.m.
This modification would also extend the number of years of the abatement from seven to 10.
If the council approves this item, commercial properties that have been converted to 100% residential will receive a partial exemption of real estate taxes. Previously, this was only the case for commercial properties that had been converted for mixed-use purposes.
The amount of the partial exception would initially be equal to the increase in assessed value resulting from the rehabilitation or renovation of the building, according to a tax code excerpt included in the meeting’s agenda packet.
The abatement rate would decrease by 10% every year for a maximum of 10 years.
The tax code also lays out conditions that must be met for the abatement to apply.
For example, the existing structure must be more than 50 years old and located within a Department of Historic Resources-approved district or on the state or national Register for Historic Places. Approved districts include the River District, North Danville, the Old West End and Schoolfield, among others.
The structure must undergo substantial rehabilitation sufficient to increase the base value by 25%. There are also requirements around square footage and project timelines.
Danville implemented these abatements at the suggestion of a 2022 housing demand analysis, requested by the city, which is facing a housing shortage.
“One strategy [from the study] is to encourage people to make repairs to existing homes and structures,” said the staff report included in the meeting’s agenda packet. “This will help to reduce future blight.”
The city staff recommends that council vote to approve this item.
Council will follow its regular meeting with a work session. Also meeting this week is the Pittsylvania Board of Supervisors at 7 p.m. Tuesday and the Danville Board of Zoning Appeals at 7 p.m. Thursday.
