Archive for the ‘Areas’ Category

Regions Reliant on Government Spending Take Hits

Thursday, May 16th, 2013

Sequestration and its $85 billion in federal budget cuts planned for this year will bring significant challenges on the U.S. economy and the commercial real estate recovery. According to the National Real Estate Investor, the forced reductions that began March 1st will have real consequences for the U.S. economy, including eliminated and reduced government contracts, reduced private and public sector jobs and furloughed workers.

The region that will take the biggest hit is obviously the nation’s capital and surrounding states. The District of Columbia, Maryland and Virginia, all of which report 19.8% of economic activity tied to federal spending mainly due to a high concentration of government agencies and federal contractors, are all prime targets for cuts. Hawaii (15.8% federal spending), Alaska (13.3% federal spending) and Kentucky (9.9% federal spending) are also states that will experience difficult times this year.

To read the full article from the National Real Estate Investor, click here.

Posted in Eastern, Economy, Financial Services, Real Property, Sequestration | No Comments »

Bill Would Tighten Tax Incentives on Pollution in Florida

Tuesday, May 14th, 2013

The Florida Legislature has approved a bill that would cause businesses to no longer receive state tax breaks because of perceived pollution on their properties. According to the Orlando Sentinel, in 2011 and part of 2012, Florida companies received as much as $11 million in Brownfield economic-development tax breaks, even though many of which were building on ground that does not appear to be contaminated. These companies were able to get breaks anyways because the law is currently written in a way that only requires the perception of contamination, not actual proof.

The bill would change the requirements for the incentive to be only for companies who are on or next to property where a pollution-cleanup agreement with the government is in place. On top of that, it would require state economists to conduct more rigorous studies to see what benefits business tax incentives create.

To read the full article from the Orlando Sentinel, click here.

Posted in Eastern, Environment, Green Initiatives, Personal Property, Pollution Control, Real Property | No Comments »

Providence Commercial Tax Rates Highest in the U.S.

Monday, May 13th, 2013

Providence, Rhode Island property owners paid the highest commercial property tax rates in any of the nation’s 53 biggest cities in 2011. According to the Lincoln Institute of Land Policy and the Minnesota Taxpayers Association, cash-strapped Providence slapped a tax bill of $4,975 on commercial property worth $100,000 – $69 more than the second-ranked Des Moines and $75 more than third-ranked Detroit.

Providence Mayor, Angel Taveras, has proposed a seven-year freezing of the commercial tax rates, but City Council members are skeptical that the proposal may raise commercial taxes even higher. In addition to the commercial rates, Providence ranked 11th-highest for homestead property taxes, and 9th and 10th-highest for industrial property taxes on machinery, equipment, inventories and fixtures.

To read the full article from WPRI.com, click here.

Posted in Eastern, Economy, Real Property | No Comments »

Tucson All-In on Downtown Business Incentives

Friday, May 10th, 2013

Tucson, Arizona City Council has voted in favor of an incentive that when finished will waive property taxes for a multi-million dollar downtown development. According to Inside Tucson Business, the deal, a Government Property Lease Excise Tax Incentive, would exempt the developer of the 196-unit downtown student housing development The Cadence from paying property taxes for eight years. Costs of the development are estimated to be around $34 million.

The backbone of the agreement will give the city ownership of the properties during the eight years in which it will be exempt from property taxes. The ownership would be strictly for tax purposes, where the management and care of the property would still be the responsibility of the developer. The short-term benefits for the city should come in the form of new jobs and a spike in sales tax due to retail activity, and the long term should bring increased value in the properties that would provide greater property tax revenue in the future.

To read the full article from Inside Tucson Business, click here.

Posted in Construction, Economy, Multi Family, Real Property, Student Housing, Western | No Comments »

Georgia Governor Signs Fulton County Property Tax Cap Bill

Wednesday, May 8th, 2013

Georgia Governor Nathan Deal has signed House Bill 604 this week which would prohibit Fulton County from raising property tax rates for the next two years. According to The Atlanta Journal-Constitution, if a court doesn’t overturn it, the Bill will require approval by a supermajority of county commissioners for tax increases after January 2015. Many believe that this measure is a long overdue check on the County’s spending.

Those in opposition however believe that the Bill is an illegal intrusion into local government affairs. They are claiming that lawmakers are too eager to take a roll in local government and this specific item is an overreach due to the fact that the County has recently cut spending and haven’t raised property taxes since 1991.

To read the full article from The Atlanta Journal-Constitution, click here.

Posted in Eastern, Economy, Personal Property, Real Property | No Comments »

Flood of New Jersey Property Tax Appeals Exposes Flawed System

Monday, May 6th, 2013

The April 1 deadline for New Jersey property owners to challenge their property taxes saw about 116,000 appeals, the highest total in over 20 years. One main reason that the number of appeals were abnormally high this year is Hurricane Sandy, which left billions of dollars in property damage in its path. According to NJ.com, more than 81,000 of the appeals were settled out of court or succeeded, resulting in nearly $5 billion in reduced assessments in municipalities throughout the state.

While property owners may be happy with their lower values to this point, the fact remains that the income lost from lower property taxes must be made up somehow, likely in the form of higher tax rates in the future. In order to shoulder some of the burden, Legislation currently pending is urging a change in the system that would have county governments and school districts share in the appeal payouts because both of their funds come from property taxes.

To read the full article from NJ.com, click here.

Posted in Eastern, Economy, Environment, Real Property | No Comments »

Office Demand Still Catching Up With Job, Business Growth

Friday, May 3rd, 2013

Although the average employment rate of nationwide office is growing at a little over 2%, demand for that space grew at half that rate during the first quarter. According to the CoStar Group, despite moving in fits and starts, the recovery has helped stabilize the office market and support relatively high property valuations, but at the same time, modest job growth seen to date has yet to translate into meaningful demand for office space, causing rents to remain at ‘discount’ levels.

In order for things to really turn around, and for office operators to be able to charge higher rents, a lot of the excess space left over from the downturn must be eaten up. This process could take some time. Many believe that the office vacancy recovery is less than halfway done, and as it stands, there is more upside in the office sector than other areas of commercial real estate.

To read the full article from the CoStar Group, featuring insight from Paradigm Tax Group, click here.

Posted in Economy, Leased, Office, Paradigm Info, Real Property, Western | No Comments »

Property Taxes in Texas Bring Economic Advantages

Thursday, May 2nd, 2013

Despite its unpopularity among Texans, property tax collections might bring more economic advantages than once thought. While Texas property owners argue that an expanded sales tax would have a more positive impact on economic growth, many studies have found otherwise.

According to an article from Tierra Grande Magazine entitled “In Defense of the Property Tax,” it is commonly believed that property taxes are a burden to Texas citizens and a major hindrance to the economy. However, research indicates that the benefits far outweigh the perceived setbacks. If Texas were to move to a consumption-based tax, nearly all current exemptions and exclusions from the sales tax would potentially be eliminated for the extended tax base, including real estate. In fact, research indicates that a 25 percent sales tax rate would be required to uphold current revenues without such expansions. This change is so high-risk that the effects of such an increased sales tax would offset any property tax savings.

Possibly the biggest factor in favor of property taxation over an expanded sales tax is stability. According to the article, one study found that year-to-year variation in sales tax was more than 40 percent higher than property tax collections between 2000 and 2011. If the change were made, local governments would likely suffer from or unstable revenue streams.

To read the full article from Tierra Grande Magazine, click here.

Posted in Economy, Mid America, Personal Property, Real Property | No Comments »

Property Tax Exemption for Renewable Energy Passes CT Senate

Monday, April 29th, 2013

A Bill that would exempt commercial and industrial renewable generation equipment from property tax in the state of Connecticut has passed the State Senate. According to Power Engineering, Senate Bill 203 would extend an existing tax credit for residential renewable energy equipment to also include commercial and industrial installations. The Bill’s leader, Senator Bob Duff, believes that this property tax exemption will prove to be a great incentive for more renewable development as the state tries to encourage more clean energy.

The tax break should help with encouraging more commercial properties across the state to implement renewable energy. The Bill would expand a current property tax exemption for most sources of renewable electric generation, including all Class I resources, as well as solar thermal and geothermal resources used for heating. Currently the exemption only applies to such sources installed in a residential setting.

Posted in Complex, Eastern, Economy, Environment, Green Initiatives, Industrial & Manufacturing, Personal Property, Pollution Control, Real Property | No Comments »

Final Property Tax Bill Advances in Montana House, Senate

Thursday, April 25th, 2013

A proposed bill to lower the property tax on business equipment has advanced in the Montana House and Senate this week. According to the Missoulian, Senate Bill 96 aims to exempt from property taxes the first $100,000 worth of business equipment, up from the current $20,000. Additionally, the tax rate would go to 1.5% for the first $6 million worth of equipment, an increase from the current $3 million.

If passed, SB96 is expected to save businesses in Montana $17.5 million over two years. While it is still premature to consider the bill passed, both sides seem to agree that it is worthwhile in the fact that it helps out both small and mid-sized businesses.

To read the full article from the Missoulian, click here.

Posted in Complex, Economy, Industrial & Manufacturing, Personal Property, Western | No Comments »

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