Six Grand Rapids Renaissance Zones slated for first leg of tax phase-ins

By: Deborah Johnson Wood

The residents and businesses in six of Grand Rapids’ 10 tax-free Renaissance Zones begin the first tax phase-in period on January 1, 2009—a phase-in of 25 percent of their 2008 assessed property, income and business tax values, and 25 percent of the state education tax.

Renaissance Zones are 15-year tax free zones designated by the city to spur revitalization of blighted areas. The phase-in adds 25 percent of the assessed taxes each year until 2012, when 100 percent of the taxes are due.

In 1997 the city selected 530 acres as the first six Renaissance Zones, then added four more zones in 2002. Those four will begin the tax phase-in in 2015. To-date over 800 properties are in Renaissance Zones.

“I think [the Renaissance Zones] were absolutely successful in Grand Rapids,” says Kara Wood, the city's economic development director. “They helped us drive the development in the downtown and that attracted people to live in the center city. They’ve driven redevelopment of properties that wouldn’t otherwise have been developed.”

Roughly $361 million in total development investment has occurred in the 10 zones since 1997, Wood says. That development brings some 2,430 jobs to the city and will generate some $319,000 in new property tax revenue to the city in 2009 for the six zones.

“The investment drives up the property value, which increases the property’s taxable value,” Wood says.

“In addition we get more jobs out of the properties and that increases our income tax revenues,” Wood adds. “The bigger, broader picture is that revitalized properties bring employment for our citizens.”

Source: Kara Wood, City of Grand Rapids Economic Development Office

Deborah Johnson Wood is development news editor for Rapid Growth Media. She can be contacted at [email protected].