The Roanoke City Council will consider a new special tax that would affect owners of blighted and derelict properties, as part of an effort to address a housing deficit in the city.
The proposal, recommended by the Office of Real Estate Valuation, calls for a 5% property tax increase for properties deemed blighted. This would bring the rate from $1.22 to $ 1.28 per $100 of assessed value.
Properties identified as derelict would be taxed at an extra 10%, bringing the rate to $1.34 per $100 of assessed value.
During a presentation at Monday’s council meeting, Jillian Papa, the city’s new director of planning, building and development, cited a Roanoke Valley-Alleghany Regional Commission housing study that said Roanoke has a need for 2,162 housing units this year.
“Our growth depends on efficient use of our remaining land,” Papa said.
If approved later this month, the ordinance would take effect July 1. Property owners, who receive reassessments in early January, will be able to appeal their reassessments.
KC Bratton, director of real estate valuation for the city, said he does not have an estimate of how much revenue this could bring into the city, but he said Roanoke has between 50 and 300 blighted and derelict properties total.
“This isn’t a revenue generator,” Bratton said after Monday’s council session. “It’s primarily to bring on responsible ownership and then allow citizens to feel safe.” Other objectives listed in the office’s presentation include neighborhood revitalization, equity in enforcement and financial accountability. This includes shifting the tax burden and the cost to appraise these properties from taxpayers onto the property owners, Bratton said.
Waynesboro, Petersburg and Winchester have adopted similar ordinances, Bratton said.
The General Assembly in 2021 enacted a law that allows localities deemed fiscally stressed to include derelict and blighted properties in their own separate class and to constitute a separate classification for local taxation of real property.
Definitions of blighted property and derelict buildings will be the same in Roanoke as they are in state code.
Blighted property is defined as an area that endangers public health, safety or welfare because structures or improvements are dilapidated or deteriorated.
Derelict buildings pose the same concerns, but by definition, “for a continuous period in excess of six months” have been vacant, boarded up, not connected to electric, water or sewer services.
“We have looked at other localities in terms of how their plans are structured, and we think this is a valuable tool as we move forward,” City Manager Valmarie Turner said.
The city will hold a public hearing on the special tax May 19.
Bratton also talked about a new piece of Virginia state legislation that could allow the city to take over properties that have been vacant for five years.
This legislation was requested by officials in Bristol, who had been searching for a way to deal with the long-vacant Virginia Intermont College campus.
Effective July 1, Roanoke will be able to petition the circuit court to appoint a special commissioner to hand properties to the locality, its land bank entity or a designated nonprofit. The city does not have to adopt an ordinance in order to implement this law.
Qualifying properties must be vacant for at least five years, be declared blighted or derelict, and tax-delinquent, Deputy City Attorney David Collins said.
The council was generally supportive of the new special tax and legislation.
“This is a huge tool for helping us with affordable housing,” Councilman Peter Volosin said. “It’s something that citizens have wanted, and we have wanted for quite a long time.”
Councilman Phazhon Nash pointed out that the tax is also applicable to commercial properties, which he said is another “big factor” to providing resources to the community.
Mayor Joe Cobb said that these moves are in line with the city’s 2040 City Plan, and he thinks neighborhoods will be excited.
“What we recognize is these properties, when they sit idle, are used for squatting and other things that endanger public safety, potentially, and so by removing these properties as derelict and blighted and creating housing out of them is a testament to the collaborative work,” Cobb said.
