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Retaining Neighborhood Character
in Distressed Communities
By Kara Norman, AICP, San Antonio Planning Department
Neighborhood character is expressed in at least two distinctive
elements: the physical landscape and the social dynamic. Many inner
city neighborhoods have the physical building blocks present to
be successful, sustainable communities that provide homes for residents
throughout their life cycles. Single-family homes come in small,
medium and large sizes and price ranges. Duplexes and small apartment
buildings are sprinkled in, encouraging today's renters to become
tomorrow's home purchasers. Nearby commercial structures offer the
potential for locating neighborhood services within walking distance.
Other physical elements can enhance the area - street trees and
wide sidewalks for shaded walking, varied architecture for an interesting
streetscape.
Neighborhood character is not solely created through the physical
landscape. The people who live in a neighborhood provide the flavor
and attitude for that section of the city. The flavor can be ethnic,
provided by long-time residents or created simply because a preferred
lifestyle is more easily accomplished in that particular physical
landscape.
When working to protect neighborhood character in areas needing
revitalization, the struggles come in the effort to adopt strategies
that balance the need to protect the physical landscape as well
as the social character. Investing dollars in distressed communities
is likely to increase property values. To a degree, this process
may be a welcome change, creating the possibility of a greater mix
of incomes and improved buildings. However, when property values
increase to a point that homeowners are forced to leave and marginal
businesses close, many will question whether the effort was a success.
In San Antonio, the Planning Department is proposing a range of
city property tax incentives aimed at addressing the need to protect
the social as well as physical character of neighborhoods. These
tax incentives are geared to three groups: 1) new homeowners, 2)
existing property owners and 3) renters.
To attract new investment to distressed historic neighborhoods,
a residential rehabilitation tax exemption is proposed. This strategy
can help achieve the goals of better housing quality and a mix of
income levels.
Studies completed by Planning Department staff and the findings
in the Economic Impacts of Historic Preservation in Texas indicated
an 18 - 20 percent increase in property values for historically
designated structures compared to non-designated properties. To
partially address this issue, the Planning Department is proposing
that the designation process result in an immediate benefit through
a reduction in city property taxes for all property owners in the
new historic district. This tax exemption can be extended for long-time
residents.
A final proposal would reduce city property taxes if 40 percent
or more of the units in a rehabilitated historic rental property
are provided at "affordable" rates. This strategy helps to create
quality rental units that serve a mix of income levels.
While the goals of spurring redevelopment of historic areas are
laudable, many city governments will have concerns related to foregone
revenue. In San Antonio, the Planning Department is estimating that
the lost revenue will be recovered in about 6.5 years for the new
rehabilitation exemption and about 1.8 years for the new historic
district exemption assuming a conservative 1.5 percent rate of annual
appreciation.
City property tax incentives are only one potential mechanism in
the toolbox cities must create to effectively address the dual needs
of retaining a neighborhoods' physical landscape and social character.
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