City Wants Extension On CPS Tax Abatement Agreement
A 20-year tax abatement between Cincinnati and the public school district expires on Dec. 31, and there's still not a new plan to take its place. Some council members want the current one extended for 90 days while negotiations continue.
Council Member David Mann supports an extension and wants a couple things to happen.
"Identifying an independent party or parties that we are willing to agree could analyze the impacts of tax abatements on school revenues under the school funding formula and otherwise to develop a report for us," Mann said. "Secondly, the negotiated agreement hold the school system harmless from any adverse impacts from tax abatements."
The city and district have been negotiating the issue for months.
The main sticking point is how much money developers will pay the school district when they receive property tax abatements. Those are called PILOTs, or payments in lieu of taxes. Right now it's 25-27% of abated property value. The school district wants it increased to 33%.
"Why is the exact number of percent important?" said Council Member Greg Landsman. "Because it's what the schools need, and any less would hurt them, and any more will undermine our ability to attract investments and invest in better jobs and more affordable housing."
Cincinnati has also been making a $5 million annual payment to the school district. The city wants to end that payment. The school district says that's another reason for changing the PILOT amount to 33%.
The 1999 blanket agreement allows the city to offer property tax abatements to developers working on commercial projects in the city, and in return those developers make PILOT payments to the school for 25-27% of the abated value.
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