Harwich To Consider Affordable Housing Tax Exemption

HARWICH – The board of assessors is proposing expanding affordable housing through a property tax reduction of $1,000 to $1,500 annually for units that meet specific criteria. The select board on Monday welcomed the proposal.

In a presentation to the board, board of assessors chair Richard Waystack said a state law approved last October allows towns to establish a tax exemption applying to residential property owners who rent their units to income-qualifying persons at affordable rates on a year-round basis. Waystack presented the select board with a draft article for the next town meeting. Affordable housing property tax exemption programs are already in place in Wellfleet and Provincetown, he said.

According to the explanation accompanying the article, the exemption provides a tax credit of $1,000 or $1,500, depending on unit size. The number of exemptions would be capped at 30 per fiscal year.

The estimated cost would be $30,000 a year. But Waystack made it clear that the board is not looking for an appropriation, noting that the funds necessary for this program will come out of the annual overlay account used annually to address abatements.

“Having been following affordable housing the past couple of years with the impetus to get a shovel in the ground, we believe this program will be another tool in the arsenal for affordable housing,” Waystack said.

The town can create the rules through which the program will function. He said the assessing department would be the best agency for vetting requests for the exemption, noting that the town has a number of exemption programs and approves about 240 exemptions each year.

The initial concept called for a $500 exemption for units under 500 square feet and $1,000 for units of greater size. But Waystack said the board reconsidered, increasing the exemptions to $1,000 and $1,500 because members did not think the lower exemption provided enough incentives. He also said it was capped at $1,500 because so as not to exceed the senior citizen exemption.

“There are a lot of people overhoused,” Waystack said. “There are seniors living alone in three-, four- and five-bedroom homes, and this is an opportunity for people to create an affordable unit in their house and get a property tax credit for doing so.”

The criteria for the program is based on Barnstable County affordable housing figures, he said. Applications will have to be submitted annually

According to the guidelines released by the Division of Local Services in the state Department of Revenue, units must be rented on an annual basis and be occupied by qualifying persons for the entirety of the applicable fiscal year. If a unit is occupied as such by successive but separate annual leases to qualifying persons, without a significant gap between said leases, the unit is still eligible for exemptions.

Select Board member Jeffrey Handler wanted to know why an annual limit of 30 units is proposed. Waystack said the assessing department wants to “walk before they run.” Ten units would be a good start in the first couple of years, he added.

Select Board member Michael MacAskill said he supports the proposal and offered a motion to place the article in the 2025 annual town meeting. Waystack said the assessors would like to get the program going as soon as possible, recommending that if the board calls a special town meeting, as has been discussed for later in November, that the article be placed on that warrant.

MacAskill agreed with that request, but the board would have to check with town counsel to see if a tax exemption can be approved in a special town meeting. Town Administrator Joseph Powers said he would do so.