The City of Norwalk offers tax abatement for improvements made to commercial and industrial properties.
“It is basically an incentive package to help incentivize people to make improvements to their properties or to build new within the community,” Josh Haggen, director of Community Development in Norwalk, said.
The tax abatement applies to the value improvements add to an existing building.
“What (an improvement) has to be is it actually has to increase the actual value to the building,” said Haggen. “It doesn’t necessarily have to be adding square footage, but if they completely remodel and a commercial building goes from $100, 000 to $200,000, they could apply for that $100,000 of added value that was there to have an exemption to property taxes, the additional value created.”
Improvements must increase the value of property by a certain amount to qualify.
“For commercial, it has to increase the value by $5,000 or five percent of the (total) assessed value,” said Haggen.
Newly built commercial and industrial buildings can qualify for the tax abatement, as well.
“Let’s say they build a $100,000 commercial building and the assessor had assessed the value at $100,000, basically 75 percent of that value is not counted on their taxes,” Haggen said. “So instead of being taxed at $100,000, they’re taxed that first year as a $25,000 building.”
The percentage of tax abatement changes over a five-year period.
“It is a gradual decrease,” Haggen said. “So, the tax exemption for the first year is 75 percent, the second year is 60, then 45, then 30 and then 15 percent for commercial and industrial.”
Commercial and industrial property owners wishing to apply for the tax abatement can find the application on the City of Norwalk’s website.