Readers Respond to a Property Tax Break Enjoyed by Owners of Vacant Properties

“In the scorching hot housing market that is Portland (for whatever reason), reasonable incentives like this tax waiver are needed to encourage the building of low-income housing.”

Our latest installment of the “Chasing Ghosts” series on vacant properties examined an abandoned car wash on Northeast Martin Luther King Jr. Boulevard (“It’s a Wash,” WW, Nov. 9). The developer, California timber heir George Schmidbauer, pays no taxes on the lot. He receives the exemption because he promises to build affordable housing on the land—as do the owners of 717 other properties enjoying the same holiday. Right now, the lot is housing campers who have erected tents inside the car wash. Here’s what our readers had to say:

xlator1962, via Reddit: “I might be OK with the property tax exemption if the owner were forced to drive past the site every day, like I am. It’s a disgrace.”

mutie, via wweek.com: “Don’t understand why, to incentivize results, taxes aren’t collected, then refunded when the project is complete.”

Dre, in reply: “Or perhaps tax the land value instead of the structures—that would be an incentive for people not to sit in vacant/dilapidated properties. It would prevent people from owning unused urban properties as long-term investments and instead put them to use. Check out land value tax and Georgism—it’s an economic theory with a lot of nutty followers, but actually makes some sense.”

Mid County, via wweek.com: “This property tax exemption is meant to encourage developers to build more low-income housing. In recognition that after site purchase it takes time to secure financing and grants to build, property taxes are waived. If the developer goes back on their promise and builds market-value housing instead, they will in turn owe property tax on the site going back to when the exemption was first granted.

“If they pursue but are unable to secure funding and grants to build low-income housing, then elect to sell the site to a different developer, they should owe no property tax. Why? Because they kept their end of the exemption up until it became impracticable to follow through and build.

“Schmidbauer’s cited statements show he has a full grasp of these concepts. [Reporter] Sophie [Peel], however, infers (inadvertently I hope) some sort of wrongdoing. In the scorching hot housing market that is Portland (for whatever reason), reasonable incentives like this tax waiver are needed to encourage the building of low-income housing.”

Christy Corbett, via Facebook: “Gotta love that when you Google the guy, one thing that pops up is that his group asked for an exemption to the prevailing wage law for the project. Rich people really try to hang on to that money.”

@happyhumans, via Twitter: “Tents are housing. And fuck your development desire. People are just being cool and living life in this terrible world. You going after the one by Overlook Park next?”

tas50, via Reddit: “I still have a big pile of tokens from that place. Maybe I can get a refund on those if I promise to build affordable housing or something.”

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