At last week’s city council retreat, council member Petso reiterated her opposition to view condominiums, in particular the Point Edwards development, as a form of economic development. Actually she expanded her opposition to include all residential housing. Some months ago I did an analysis of Point Edwards. I determined that there are 261 condos there having a 2012 tax value of $133 million.
Imagine the very significant amount of construction sales tax they have yielded, as well as the real estate excise tax (REET) our city gets every time one of those condos is sold. Much of the 2005/2006/2007 bubble in REET was surely attributable to Point Edwards.
Additionally, there’s the property tax our city collects every year – $274,757 in 2011. It would take retail sales of $32.3 million to generate that amount of revenue for us. And, of course, the 500 or so residents of Point Edwards are potential customers for our merchants.
In addition to the Edmonds property taxes, in 2011 Point Edwards owners paid $1.033 million in property taxes to the other taxing authorities. With the biggest chunk of that going to schools, their payments help to reduce the amount of school taxes paid by the rest of us. Ms. Petso, you can call those condos on the hill whatever you’d like to. To me there is no doubt that they have benefitted the Edmonds economy.
Now council member Plunkett thinks a lot like Ms. Petso – at least about this topic. Back in July he wrote that “taller buildings do not equal economic development. If downtown doubled the number of condos it would bring in an additional $360,000 in property tax revenue.”
The amount of property taxes from downtown condos is not a sum that’s readily available. Suspecting that $360,000 was too low a figure, I decided to determine the real number. So I walked the streets and collected the addresses of all of the condo buildings in the downtown. Then I went home and analyzed the tax records of 97 buildings containing 902 condos. A very time-consuming process!
The assessed value for 2012 taxes is $326 million. In 2011 the owners of those condos paid Edmonds property taxes of $685,427 – almost double Mr. Plunkett’s figure. And my figure still understates reality, because many of the 97 buildings are mixed-use buildings and I did not factor in the revenue received from the commercial portions of those buildings.
One final important point, if your position is that residential development is not a form of economic development then that means that you probably view mixed-use projects simiIarly.
Without the residential component of mixed use there will be few if any such projects, because we have learned that it’s the residences that make the mixed-use projects financially viable.
Once again, the facts clearly show that condominiums, and apartments, benefit the Edmonds economy.