East Wenatchee is moving forward with a program to offer a tax break for builders of multi-family housing projects. 

The city council passed an amendment to create the exemption Tuesday.

Research has shown that East Wenatchee does not meet the public need for desirable, affordable and convenient multi-family options. 

East Wenatchee Community Development Director Curtis Lillquist says the program meets the city's goal of increasing the inventory of affordable housing for people in all stages of life. 

"It does this by adding a financial incentive for developers of multi-family units to locate their projects within our city," Lillquist. 

Developers can get eight- and 12-years tax exemptions if their buildings provide a level of housing for low- and moderate-income households. 

The city is using a state law passed in 1995 called the Multifamily Housing Property Tax Exemption (MFTE) for its program. 

The state law provides an 8- or 12-year property tax exemption on new, expanded, or updated multifamily housing.  

The exemption applies only to the residential portions of newly constructed improvements, not the value of the land, retail space, or existing improvements. 

Owners will be able to make improvements to existing buildings in East Wenatchee and qualify for the exemption. 

The exemption will cover the entire structure on new housing. 

The multifamily dwellings must also contain 4 units or more to be eligible for the exemption. 

State law requires the program to be available in Residential Target Areas that are designated by the city.  

East Wenatchee is designating multifamily focused zoning districts - medium density, high density, mixed use and waterfront mixed use- within the city as Residential Target Areas. 

The program provides for an eight-year exemption for projects that offer 20% of their housing units for low-moderate income households, and a 12-year exemption for projects that offer 30% of the housing units for low-moderate income households. 

East Wenatchee city staff was instructed by the city council at an October 10th workshop to include an income component for the eight-year exemption, and require additional assistance to low-moderate income households for projects wanting the twelve-year exemption. 

Lillquist says tax break for multi-family housing is part of an effort to stimulate interest for developers to build housing in the city. 

"It's part of an overall strategy that I'm developing to try to improve knowledge about different housing options that we're working on." said Lillquist. 

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