Program focused on equity, affordable housing and new aging in place standards
Monday, February 12, 2024 — Cleveland — Online applications are live for Cleveland’s new Community Reinvestment Area (CRA) residential tax abatement program.
- Single- and Two-Family Structure Residential Tax Abatement Application
- Multi-Family Structure (3+ Units) Residential Tax Abatement Application
The updated residential tax abatement program is an incentive to encourage investment across all Cleveland neighborhoods. The abatement percentage and affordable set-aside requirements are contingent upon the type of project and the CRA where the project is located.
For single- and two-family projects, abatement values are between 85 and 100 percent of the improved value up to $350,000 for new construction projects and $450,000 for rehabilitation.
For multi-family projects, abatement values are between 85 and 100 percent and require a set-aside of units that are affordable to families making 100 percent of the Area Median Income (AMI). All projects will be subject to an audit and review every three years throughout the 15-year affordability period.
Multi-family projects may also be required to enter into a Community Benefits Agreement (CBA) to receive tax abatement if the total value of the abatement is greater than $250,000 or the development cost is greater than $20 million.
The three-tiered program, which began operating in accordance with Ordinance 482-2022 on January 1, 2024, includes special provisions for developments where 100 percent of units are affordable to families making 100 percent or less of the AMI and single-family properties that meet the city’s Aging in Place standards.
The new, tailored approach is part of the Bibb Administration's broader plan for equitable housing and neighborhood revitalization and the program was developed in accordance with the July 2020 Cleveland Tax Abatement Study.
“The tax abatement study really highlighted that a ‘one-size-fits-all' approach no longer works in the City of Cleveland,” said the city’s Director of Community Development Alyssa Hernandez. “The updated program is focused on equitable growth and affordable housing goals while also accounting for market realities and the disproportionate investment we see in certain neighborhoods.”
The 2022 legislation establishes caps for single-family development, depending upon the market, includes community benefit agreements for multi-family developments, continues the existing green building standard and enforces tax abatement termination for neglected or delinquent properties.
Set-aside and affordability requirements will help keep Cleveland neighborhoods affordable and income-diverse well into the future. In addition, in a city where 21 percent of the population is over 60, the CRA abatement program signals the importance of creating age-in-place-friendly housing in all of Cleveland’s neighborhoods.
“Cleveland's historic housing stock is often not suited for residents to age comfortably in their homes,” said Ward 15 Councilwoman Jenny Spencer, who was directly involved in the working group that created the Aging-In-Place criteria. “In addition, we hope this Aging-In-Place Standard serves as an incentive for developers to build new homes with these features — something my residents have been asking about for years. Whether through rehab of existing homes or new construction, the City's revised residential tax abatement program ensures that neighborhoods across the city can experience more of this type of investment."
To learn more about the program and access a variety of resources, visit Residential Tax Abatement | City of Cleveland Ohio
