Village offering property tax incentive on new home purchase

Local leaders counting on commercial development to follow


Revenue Implications of Harveysburg Tax Abatement

The Village Council in Harveysburg has approved a tax abatement forgiving more than $3,185 a year in property taxes for each of 220 homes to be built in Caesar Creek Estates.

Annual losses are:

Warren County: $179.90

Board of Development Disabilities: $231.70

Senior levy: $77.70

Clinton-Massie Schools: $1,564.29

Great Oaks JVS: $148.40

Massie Twp.: $238

Village of Harveysburg: $595

Mental Health District: $56

Health District: $32.20

Mary L. Cook Library: $63

Source: Warren County Auditor’s Office

This small Warren County village near Caesar Creek Lake is trying to attract new residents by offering no property taxes for three years and other incentives on the purchase of a new home.

Harveysburg plans to forgive up to $2.6 million in property tax to the buyers of homes in a new 222-home subdivision on the edge of town near the state park and lake.

People who buy a $200,000 homes in Caesar Creek Estates will not have to pay more than $3,185 a year in property taxes. The homeowners also would receive a 50-percent property tax break for the next two years they owned the home.

“The reason that we’re doing this is we want commercial development,’’ Mayor Dick Verga said. “We can’t entice any commercial developers. The population’s too low.”

According to the Warren County Auditor’s Office, the abatement would cost the Clinton-Massie Local Schools $1,564 a year for every $200,000 of property value in each home purchased in the developed under construction by Peebles Homes. The district educates 1,900 students living in Warren and Clinton counties.

Other entities losing money in the deal include health and mental health districts, senior citizens and the Mary L. Cook Public Library.

Dayton-area builder Peebles Homes announced the tax break in a company release last month about the housing development off Harveysburg Road near the 3,741-acre Caesar Creek Lake State Park.

The land is owned by the new owners of the Ohio Renaissance Festival. While there have been no firm commitments, Verga indicated the village hoped the housing development would convince the new owners of the festival to build a commercial development on 18 acres they also own just east on Ohio 73.

In addition to school and other levies, the village will be forgiving property taxes that would otherwise be used to pay for fire and police protection. The council had wanted to exempt this revenue from the tax break, provided under state law for establishment of community investment areas.

The village agreed to add the local fire and police levies, after county officials indicated the proposed tax abatement would otherwise be illegal.

County Auditor Matt Nolan said it was the first time his office had seen such a tax break — typically used as an incentive to eliminate blight or attract business — offered on new housing.

“None of this will go into place until January, so we’ve got a little time. But we are trying to wrap our arms around it,” Nolan said.

Nolan said the $2.6 million would be forgiven over the time it took to build out the development, as much as 20 years, lessening the impact on the schools and other entities that would be providing services to residents of Caesar Creek Estates.

Nolan said village leaders could reduce their commitment to the tax break in coming years.

Verga said there would be an annual review, but he laid out the five-year tax break in fliers left for potential home buyers at Caesar Creek Estates.

So far, a model has been built and a second home, for the manager of the Renaissance Festival, is under construction, Verga said.

The development could double the population of Harveysburg, now home to about 600 people.

The village was isolated after Ohio 73 was rerouted and the U.S. Corps of Engineers created the 2,830-acre lake as a flood control project in the 1970’s.

In addition to Harveysburg Road, several of Harveysburg’s arterial streets dead end into the park property.

Harveysburg’s only previous use of the community investment area was for Tinch Welding, the community’s main business, Nolan said, although Verga said other new homes built in the village would be extended the tax break.

Despite the tax loss, Verga expressed confidence in the plan.

“We think in the long run we’ll come out ahead,” Verga said. “Everybody is perfectly happy with what we’re doing.”

In response to questions from a reporter, Darrell McKinney, a trustee in Massie Twp., said he would be reviewing the abatement. He indicated early discussions had called for the school district to receive payments in lieu of the lost taxes.

“We haven’t seen it yet,” McKinney said, declining to comment further until he had reviewed the abatement and talked with Verga.

Matt Baker, superintendent of the Clinton-Massie Local Schools, said the abatement would create a burden, but welcomed any development in the district.

“We absolutely support anything that brings additional development into our community, both residential, industrial or commercial,” he said.

The district would be faced with a funding gap of $2,600 to $2,800 while the taxes were abated, Baker said. Over 10 years, Baker estimated a $150,000 loss.

“We’d have to absorb that,” he said.

On Monday, Baker said he was meeting with a representative from Peebles Homes and planned to provide promotional materials to give to prospective home buyers.

However Baker said he was also working with Nolan to bring the district as much revenue as possible.

“I believe we’ll be able to find a solution,” he said.

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