City Council to vote on abatement proposal

A vote by Marietta City Council today could save $49,000 for a new business being planned at 180-184 Front St., the former Ohio Valley Grocery building.

If council approves, for the next 12 years Kenneth and Dagmar Kupsche of Parkersburg won't have to pay 49 percent of the property taxes on any improvements they make to the building, the first floor of which will house their kitchen supply business. The couple would pay 51 percent of the property tax on those improvements, but will continue to pay 100 percent of the taxes on the existing property.

The Kupsches plan to make $600,000 worth of improvements to the structure, and have requested the property tax abatement through the city's Community Reinvestment Area program.

The couple did not return a call for comment Tuesday.

The Community Reinvestment Area encompasses most of Marietta's downtown central business district and a portion of Harmar Village.

But some Marietta school board representatives have questioned the abatement, saying local schools stand to lose an estimated $17,000 in their portion of anticipated property taxes over the 12-year abatement period.

"That's half a teacher's salary," said Marietta Board of Education President Jack Moberg.

The money may be a drop in the bucket when looking at the district's $29 million annual budget but "we fill that bucket with drops," Moberg said.

Moberg said he supports new business and residents coming into Marietta but wants to see the schools get all the money they're entitled to.

The Kupsches are the first to request an abatement since the new Community Reinvestment Area legislation was enacted in November, 2007.

"There was a five- to six-year period when the city didn't have CRA legislation, so no abatements could be granted," said Vinnie Mele, specialist with the Marietta Department of Development.

"The idea is to focus on revitalization of the downtown and Harmar areas, and the abatement only applies to any improvements on the property. The developer will still pay 100 percent on the unimproved portion," he said.

Mele noted that before anyone can apply for an abatement they must own the building and have development plans completed.

"So they can get caught in a sort of Catch-22 situation if the abatement isn't approved," he said.

By law, the Kupsches could have applied for a 100 percent abatement on the property, but if an abatement of more than 49 percent is requested it requires additional approval from the Marietta Board of Education. The decision to pay 51 percent tax on the improved property helped speed up the process somewhat.

Mayor Michael Mullen noted that a CRA was in effect when the condominiums that line Ohio Street near the Ohio River levee were built and a tax abatement played a key role in that development.

"That area of town was mostly vacant, and the houses that were there were deteriorating," he said. "The area was not contributing much to the city's tax base, but with the abatement, this property now generates a great amount of taxes for the schools and city.

"I know the tough situation schools are in, and the last thing we want to do is undermine their ability to do business," Mullen said, adding that if the schools consider this as a long-term investment in the development of downtown, the improved properties will generate positive results that far outweigh their current concerns.

He said in addition to the schools receiving 100 percent taxes on the improvements after the 12-year abatement period, downtown development has a ripple effect of creating jobs and generating more sales tax for the community.

"But if this project doesn't go forward, no one will get anything more than they're getting now," Mullen added. "And if we're not on a continuous path of improvement, we'll lose the core of our downtown and become like other communities up and down the Ohio Valley, whose businesses have moved into strip malls or big box stores."