TRUMBULL COUNTY Officials look into construction program

Dayton offers 10-year, 100-percent property tax abatements on improvements.
By DENISE DICK
VINDICATOR TRUMBULL STAFF
WARREN -- City and HBA officials are exploring whether a program that saw $50 million to $75 million of new construction in Dayton over 10 years could work here.
Mayor Michael J. O'Brien and Mike Wilson, executive director of the Homebuilders and Remodelers Association of the Mahoning Valley, have discussed starting a program in the city modeled after one in Dayton.
In Dayton, the city owns houses in bad condition. Contractors from the HBA fix them up -- an endeavor that takes from six months to a year -- and the homes are sold. The contractors get the money for the sale of the houses while the city gets an improved neighborhood and the benefits that accompany it.
Wilson, who also has spoken with Youngstown officials about a program in that city, said the discussion is still in the early stages.
"We still have a lot of questions that need answered and a lot of relationships to build," he said.
Though Dayton is the model, some of the details could be different.
"We're still finding out with the city officials what they want to do and what they're able to do, but I do think we'll make steps forward with it," he said.
About program in Dayton
Dayton's program started in 1993.
"Over the course of those 10 years, [Dayton] has realized $50 million to $75 million in new construction -- new construction meaning renovation and new homes," said David Bohardt, executive director of the HBA in Montgomery County, Ohio.
The city would get market-rate housing in neighborhoods where that may be scarce.
Bohardt said the houses built through the Dayton program fall into the $150,000 to $250,000 range. That city also grants a 10-year, 100-percent property tax abatement on the improvements or new construction on the properties.
The school district must agree to the abatement, but Bohardt points out that many of the purchasers of the rehabilitated houses are young couples who have children, bringing more pupils and more funding for the district.
Once finished, the homes are showcased in an event similar to the Parade of Homes, but Bohardt said most of the houses sell before the event.
Michael Keys, community development director, pointed out that in Warren, the city doesn't own a roster of houses like Dayton does. To make the program work, the city would have to buy the houses or get landlords to agree and have the landlords pay the contractors when the rehabilitated houses sell.
"We'd need to find a pot of money that isn't from a federal source" to buy the houses, Keys said.
If the city uses Community Development Block Grant funds for the house purchases, federal guidelines require that the houses be sold to low- to moderate-income buyers. People at that income level may not be able to afford a house at that price.
Possible area
Keys listed Porter Street, in the city's northeast quadrant, as an area where the program may be useful. Many homes there are in disrepair and occupied by renters.
The program would likely require involvement of a bank.
"It's something that I think could work," he said. "With everyone working on it together, I think it could be done."
The Dayton HBA director stressed that in order to be effective, the program is done in block areas, on both sides of a street rather than one house on one street and another on a different one.
Prospective buyers would be less likely to buy a rehabilitated home on a street where other houses remain in bad shape.
The program selects the worst houses in a neighborhood because those likely wouldn't appeal to a contractor otherwise. Rehabilitating the worst houses and selling them at a market rate also may prompt others to buy homes in the neighborhood that require less attention and renovate them, Bohardt said.
He points to Dayton's commitment to renovate housing on the edges of its downtown as an impetus for projects like a $40 million performing arts center and a Riverscape project.
"If you were in downtown Dayton in 1992 and in downtown Dayton in 2004, you would see a remarkable transformation," Bohardt said.