By Terry Rogers
On Wednesday, August 10, Governor Jack Markell announced an expansion of the Delaware Downtown Development District program. Five new districts were identified, including Milford, who will join Harrington, Georgetown, Smyrna and Laurel who were added this week as well as Dover, Wilmington and Seaford who were among the first identified in the program.
“This designation will provide several state and local incentives that will assist with the creation of new businesses and expansion of existing businesses within the City’s Downtown Development District,” Rob Pierce, City Planner, said. “Qualifying projects would be eligible for building permit fee waivers, utility impact fee waivers and tax abatements to assist with new construction and renovations. In addition to these local incentives offered by the City of Milford, the state is providing a 20 percent rebate of hard costs associated with these projects. There are also additional set asides for historic tax credits within the Milford Downtown Development District area.” Residential new construction and rehabilitation projects are eligible for the same types of incentives, Mr. Pierce said.
Properties that are located within the area designated as the Downtown Development District and who meet other minimum requirements are eligible for incentives. Wes Cromer of Masten Realty says that the designation will be extremely beneficial for Milford.
“If we see an influx of investors taking advantage of the grant money in the DDD area, then, hopefully, we will see more newly renovated apartment buildings and/or new construction housing. Downtown businesses only thrive if we create more market rate housing within walking distance to their shops,” Mr. Cromer said. “Current residents should be excited about this designation. There is a buzz going on right now and we already have investor activity looking at commercial buildings and commercial land downtown. Hopefully, that will culminate in updated spaces and new commercial tenants and owners.” Mr. Cromer said that existing owners who have been waiting to update their commercial spaces will want to take advantage of the grant money that is now available.
There is a larger project program through the DDD that has funds available up to $1 million. Mr. Cromer said that this larger scale program could be used for buildings like Lou’s Bootery which is currently for sale. The building needs repairs inside and out. Mr. Cromer said that the DDD program could allow a buyer to create a mix of retail on the first floor of the building with apartments on the second and third floor. He said that his agency is hoping to draw the right investor for Lou’s Bootery that will allow them to take advantage of this larger program as well as some of the Historical Preservation programs available.
Mr. Pierce said that tax abatements differ depending on whether the project involves new construction or rehabilitation structures. For new construction, an applicant could receive a full tax abatement for up to five years while rehabilitation projects could receive a tax abatement for ten years. The amount is dependent on the amount of investment versus the current value. In addition, properties converted from rental units to owner occupied housing would receive a full tax abatement for up to ten years while first-time homebuyers would be exempt from realty transfer taxes. All incentives will be approved by City Council at an upcoming meeting.
“The designation encourages developers to consider Milford and I already have a client that has contracted to purchase a duplex lot within walking distance to downtown,” Mr. Cromer said. “They hope to break ground in early 2017 as long as the grant process goes smoothly. More businesses locating downtown would be great, so hopefully we can continue to create more attractive housing in the downtown area.” Mr. Pierce said that the City has been contacted by several developers, property owners and other stakeholders regarding potential projects since the DDD was announced.
Mayor Bryan Shupe said that the DDD will encourage more private-public partnerships as they work toward realizing the Rivertown Rebirth Plan that was created by Annette Muldrow & Associates in 2015.
“This vision, which was created by our community as a whole, celebrates the beauty of our natural resources, encourages the ingenuity of our people and creates a commitment to the importance we place on the quality of life,” Mayor Shupe said. “Thank you, Governor Markell, for designating Milford as part of the Downtown Development District program.”
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