Page 41 - Cuero, TX Downtown Plan

Cuero could potentially implement an additional mechanism
to encourage appropriate building renovations that are
scaled to the City’s more modest market, by offering tax
abatements or “freezes,” or tax credits against local property
taxes.
Under a tax credit program, property owners would
essentially be buying credits with the dollars they put toward
their renovations. The credits could be used over a period
of years and once they’re exhausted, owners would return to
paying a full, regular amount of taxes. Alternatively, the City
could offer a sweetener tax credit to be used in conjunction
with federal historic credits.

Under a more normalized tax structure, some form of local
tax credit program could be a very powerful incentive in that
it would allow investor/owners to essentially pay their taxes
with their construction invoices – basically giving them a
“double bang” for the buck. It eliminates the double hit that
investors face when they do major rehabs, and then they are
faced with an increased tax bill for the trouble.

It needs to be pointed out, however, that this type of system
could drastically strain tax collections and the public services
that they support if it becomes widely used. It also can’t be
used concurrently with more traditional tools such as tax
increment finance (TIF/TIRZ). In this case, such a policy
should have a sunset or scale-down provision that gives the
greatest rewards to the “first-in” investors who help establish
the market. This type of provision would also instill some
urgency by establishing a window in which to take advantage
of the program. As stated earlier, property owners should be
forced to adhere to some basic building design standards in
order to be eligible.

Encourage More Live-Work
Getting more people to live Downtown is critical to reviving
it. Given the complications and expense associated with
making upper floors of historic buildings compliant with
the American With Disabilities Act (ADA) requirements,
the most likely candidates for above-the-storefront living are
the street-level merchants themselves. This, in fact, is the
situation with several of the existing upper-floor living units.
The City should encourage more upstairs-downstairs live-
work arrangements by educating property owners about
the potential lifestyle and tax advantages of such living
arrangements (portions of the living space used for business
can be depreciated for instance), and by offering its richest
incentives for projects that include a housing component. It
should conduct workshops in conjunction with the Texas’
historic preservation office toward identifying creative ways
to work around ADA standards.

ADOPTED 03.04.13 41