Under state law (RCW 84.14), cities can waive property taxes to encourage development in depressed areas.

The Des Moines City Council is considering granting this exemption for a proposed development of between 1,800 and 5,500 new residential units on Pacific Ridge (a depressed area just east of Hwy 99).

The waiver could be for up to eight years on the value of the residential property improvements, but does not include the value of the land (remains taxed per assessed value). Over time, this waiver will result in considerable tax savings to the developer and/or the property owners.

However, the impact of this waiver affects not only the revenues of the currently strapped City of Des Moines, but other local taxing entities.

If approved, these exemptions would also waive state, county, school district, and fire district property taxes on these new residential units.

While the city, county and state may recover some revenue over time through sales tax on construction and potential increased retail sales from the commercial areas, the schools and fire department will not.

Can the state, county, city, school, and fire districts afford these waivers? No one really knows. In mid-December, the City confirmed that no Independent Financial Analysis of this proposal had been done.

Please attend a public hearing on Jan. 15th (7:30 p.m. at City Hall) and ask the council to either vote against this measure, or request that an independent financial analysis be conducted so that the school and fire districts can review the proposed exemptions and provide their non-biased assessment to the council and the public before a final decision is adopted.

If you cannot attend, you may also express your opinion or ask for more information by e-mailing the city council at citycouncil@desmoineswa.gov.

Bob Polwarth

Des Moines