My Old House
Joining the “353 Tax Abatement” Program

BACKGROUND:

The City of Independence has developed a “tool” for encouraging homeowners and landlords to fix up their property. This tool was successfully used to revitilize Harry Truman’s old neighborhood, which is just west of the “Square” in Independence.

Two years ago, this tool was modified a bit and then “opened up for applicants” to folks on the city’s west side who live NORTH of Truman Road.

This past January 1st, this same tool was made available to folks living south of Truman road, all the way to 23rd street, I believe.

The tool itself is called the “353 Tax Abatement Program”. Here is the city’s page of information on available tax abatement programs.

Signing-up

The way this program works is… the homeowner partners with the City to come up with a list of repairs and improvements that need to be done to the home. The work needs to potentially add up to a certain minimum dollar investment. When all of the projects are done and paid for by the homeowner, then the tax benefits begin:

Homeowners get 100% of their property tax (for the house, not the property, but then the house is the vast majority of what you are paying for right now with your property taxes) “abated” (reduced) for 10 years. And then, for the next 15 years after that, your property taxes are abated by 50%.

Last fall, after listening to the lady in charge of this program, Patricia Robinson, I asked what my wife and I would have to pay for the “minimum investment” and then what the tax pay-off would be.

She sent me a spreadsheet that showed we’d need to invest just over $13,000, but that the pay-off over 25 years would be over $24,000 !

Now, at the time, I poo-poo’d the whole thing, because of that $13,000 minimum price tag.

But then, just a few weeks ago, my wife and I decided we really, really needed to replace the exterior siding on our garage…. to the tune of just over $3200.

At that point, it dawned on me that I was about 25% of the way to this project’s minimum investment (for us). And then it further dawned on me that with the 353 program, a homeowner or landlord has THREE YEARS to complete that work. So, really, $13,000 spread over three years isn’t so bad!

So, I asked Ms. Robinson for an application.

The application itself…. well… I wish I’d have photocopied the darned thing before I sent it in. I was rather confused by it, and believe me, I’m pretty experienced in filling out forms.

It seemed to be asking me what I felt the current condition of the various rooms and areas of my home are in…. but at the same time it also seemed to ask me what I’d LIKE to do.

Now, that’s all well and good. Believe me, we want to do a few FUN improvements, not just necessary repairs. And I think the City understands that. But I really wish those two needs had been somehow “separated out” in the form… for reasons I’ll get into here in a minute.

The Initial Inspection

Next came the part that I know a lot of homeowners and landlords dread: The 353 program requires an inspector examine the building / property on behalf of the city (at a cost to the homeowner of $100).

The reason folks fear this is because… yes, one of the key ideas of the 353 program is that the City, in their partnership with you on this, wants you to fix up the things that truly NEED to be fixed up FIRST on your house… BEFORE you go off and start doing the “fun stuff”.

Now, I can understand this. Suppose some homeowner has “rose-colored glasses on” and totally ignores the fact that they need a roof? If the city were to go ahead with this homeowner’s “wants” only… and then… 5 years after the project, huge roof leaks cause tens-of-thousands of dollars in damage to the house, then the city “loses” in the end: the property won’t be as valuable at the end of the 25 years as it should have been!

My wife and I have a strong desire to be a “good steward” of our home. If there’s something that needs fixing… we’re going to do our best to repair it. Of course, as always, its a matter of money priorities. But I have the firm belief that, as owners of a historic home, our goals line up with the City’s Community Development Department. We both want this 1905 house to stay in top shape and remain an asset to the neighborhood. So, I didn’t have much “fear” of an inspector.

(That said, when I think about it, there are some houses in the neighborhood that appear to be in such awful shape that… if they were to join this program, the City’s inspector would basically be generating the full list of repairs required for program participation! In fact, the list of repairs required to get certain houses “up-to-code” MIGHT add up to a lot more money than whatever “minimum investment requirement” might be originally calculated for this program.

So, in reality, this “353 tool” probably isn’t the best tool for the WORST homes in the area.)

Last week, the city’s inspector came out to look at our home. The inspection took maybe 45 minutes. Once she identified a problem, she took a photo of it. (She discussed ALMOST everything with me that ended up on her final report.) In the end, I wrote her a check for $100 and she said I’d receive her full report within a few days via the mail.

The Inspection Results

Only two or three business days later, I received a “Property Inspection Summary” from the City. It is divided into two sections: “General Description of Proposed Work” and a section of things that are REQUIRED in order to meet building codes and 353 program guidelines. There are many things that are in BOTH sections.

Now, before I give you the full list of everything my wife and I have to do as a part of this program, let me go back to what I started commenting on earlier: The original application for all of this.

On that application, I put down some items that I thought MAYBE needed to be done in certain rooms. I wasn’t really sure if the condition was bad enough on some of them to REQUIRE that we do them. I figured, that was probably the whole POINT of the inspection. (Also, I was thinking about paying for one of those “home energy audits” and maybe, maybe even a structural engineer’s audit, so that I know what do do with the floor jacks in the basement.)

It turns out that just about everything that I put onto that application showed up on this final report as either proposed or required work…or both!

So, I need to contact Patricia Robinson and discuss some of these things. I need to know how changeable this document is. Also, there’s one mistake in it. And, for some of the recommendations, I’m not sure what exactly is required.

The letter that accompanied this report says I have to call Ms. Robinson anyways, so that I can come in and sign a “Memorandum of Understanding” document.

I’ll let you know how this all turns out. I’m sure we’ll be able to work out the details. But I do intend to give them some feedback on the structure of that initial application, once I understand a bit more about how we’re going to proceed.

Big “To-Do List”

Anybody who knows me knows I’m a “to-do list person” !! Heck, my pastor jokes about it from the pulpit every now and then!

Well, here’s the big To-Do list that resulted from this property inspection and my initial application! I’m dividing it into three sections: the stuff the City is asking us to do, the stuff that the City and I both suggested, and the “fun stuff” that my wife and I want to do:

Suggested / Required by the City
Install new GFCI outlets in the garage, in the bathrooms, and the kitchen.
Repair garage window(s) and remove boards covering them OR remove the windows completely and cover those areas over with siding.
Repair sidewalk cracks.
Install metal handrail for front sidewalk entry steps.
Remove duct tape from plumbing vent coming out of back porch and install vent cap.
Install junction boxes where open-wire splices have been done under kitchen sink and in attic.
Install attic insulation. (I THINK I may have put this on my application, but my intention was that I’d like to engage professionals to help me assess that.)
Install permanent laundry waste standpipe in basement. (I’m not sure what that “looks like”. ??)

Stuff both “sides” suggested
Repair cracks in the driveway and re-seal the driveway. (I reluctantly agree.)
Tuck-point stonework at front of house.
Repair leaks around chimney. (This is one item I put on application that I don’t think is all that severe yet, though.)
Replace 1st floor bathroom light fixture.

Items we initiated / suggested
Replace garage exterior siding.
Complete rain garden / drainage project.
Remodel 2nd floor bathroom (remove sink, built-in cabinets, install new wall coverings, install new floor coverings, install new pedestal sink and faucets, install new medicine cabinet and light). [ This is the one point where there's a minor mistake in the report. It says we intend to replace the bathtub. No way! It's a claw-foot! ]
Replace living room carpet and stair runner.
Install new hot water heater.

OK, there you have it. That’s the report…in a nutshell. There is an item on the report that says for any plumbing repairs or upgrades or even hot water heater installation, it will require permits and inspection by the City. (Really, even for replacing a hot water heater ??) We have a proposed timeframe of completing all of this work by December 2012.

I should mention one nice feature of the 353 that won’t apply to us, unfortunately: A homeowner can retroactively apply work that they’ve done up to ONE YEAR PRIOR to the date-of-inspection to the project. Unfortunately, we did almost zero improvements and repairs on the house in the previous year. Oh well!

( OK, long enough post. And two posts in one day, too! )

My next step is to call Ms. Robinson and discuss this plan / get some clarification on a few things. I’ve started a folder of receipts as well. Looking forward to cranking some of this work out!

Thanks for stopping by!

-= Dave =-