Property Tax Exemptions and Deferral Criteria

The City of Cordova has various property tax exemptions and deferments that are available to its residents. Thoroughly read each exemption you are interested in applying for as they each have specific qualifications. Knowingly lying on any exemption or deferment application is punishable by up to$1,000/per fine, per day. Any misstatement of or error in fact may render an application null and void and may be cause for the revocation of any tax exemption or deferral adopted in reliance on such information.

Chapter 5.06 PROPERTY TAX EXEMPTIONS AND DEFERRALS

The granting of property tax exemptions and deferrals is one of the primary tools available to the City to achieve its objectives, including those regarding economic development, housing, and community resources. The City’s authority and discretion to grant property tax exemptions and deferrals is subject to the limitations of this Chapter, Chapter 5.07, and any applicable state or federal laws. The City Clerk, assessor, and City Council may:

  1. Require the applicants for any exemption and/or deferral to provide information in support of their application;
  2. Require applicants to pay property taxes on a percentage of assessed valuation, a fixed property tax payment of any amount, or any other fraction of property taxes that would otherwise be due to the City; and
  3. Require the payment of initial application and annual review fees reasonably necessary to cover the costs of administration.

The grant or denial of a tax exemption or deferral under this Chapter, or Chapter 5.07, is a discretionary act by the City. The completion of an application for a tax exemption or deferral shall not give rise to any right or claim against the City for its failure to grant the application. For all Exemption code and definitions see Ordinance 1217

Senior Citizen and Disabled Veteran Exemptions

(5.07.010) Senior Citizen and Disabled Veteran Exemptions.

  • The real property owned and occupied as the primary residence and permanent place of abode by a:
    • (1) resident sixty-five years of age or older;
    • (2) disabled veteran; or
    • (3) resident at least sixty years old who is the widow or widower of a person who qualified for an exemption under subsection (A)(1) or (2) of this section,
  • is exempt from taxation on the first one hundred fifty thousand dollars of the assessed value of the real property.
  • Only one exemption may be granted for the same property and, if two or more persons are eligible for an exemption for the same property, the parties shall decide between or among themselves who is to receive the benefit of the exemption. Real property may not be exempted under this subsection if the assessor determines, after notice and hearing to the parties, that the property was conveyed to the applicant primarily for the purpose of obtaining the exemption. The determination of the assessor may be appealed under AS 44.62.560—44.62.570.
  • To be eligible for an exemption under subsection (A) of this section for a year, the individual applying for an exemption must also be eligible for a permanent fund dividend under AS 43.23.005 for that same year or for the immediately preceding year.
  • An exemption may not be granted under subsection (A) of this section, except upon written application for the exemption on a form approved by the State Assessor.
  • An applicant who qualifies for the exemption under this section need not file an application for successive tax years if there is no change in ownership, in residency or permanent place of abode, or other factor affecting qualification for the exemption.
  • Applications must be filed no later than January 15 of the first year for which the exemption is sought. The City Council, for good cause shown, may authorize the assessor to accept as timely filed an application filed after January 15 and before May 1 of the assessment year for which the exemption is sought. An application received after May 1 will be accepted as an application for the following assessment year. If the application is filed within the required time and is approved by the assessor, the assessor shall allow an exemption in accordance with the provisions of this section.
  • The assessor shall require proof in the form they consider necessary of the right to, and amount of an exemption claimed under subsection (B) of this section and shall require a disabled veteran claiming an exemption under subsection (B) of this section to provide evidence of the disability rating. The assessor may require proof under this subsection at any time.
  • If property is occupied by a person other than the eligible applicant and his/her spouse and minor children, an exemption applies only to the portion of the property permanently occupied by the eligible applicant and his/her spouse and minor children as a permanent place of abode.
  • It shall be the responsibility of every person who obtains an exemption under this section to notify the assessor of any change in ownership, residency, permanent place of abode or status of disability. A disabled veteran who has less than a permanent disability must submit an official disability percentage letter each year prior to January 15 showing a fifty percent or greater disability.
Non-Profit Exemption

5.07.020 Non-Profit Exemption.

  • Property used exclusively for nonprofit religious, charitable, cemetery, hospital, or educational purposes is exempt from taxation under this Chapter.
  • Property or a part of the property exempt under this section but from which rentals or income are derived is not exempt from taxation unless the income derived from the rentals does not exceed the actual cost to the owner of the use by the renter.
  • An application for an exemption claimed under this section must include:
  • Evidence of the applicant’s nonprofit status;
  • A detailed description of the applicant’s planned or current use of the property;
  • Records showing any rental or other income derived from the property and the comparative cost to the owner for such rental or use, to include: documentation of utility payments and other maintenance and financing costs associated with the rented space.
  • A non-profit exemption claimed under this section may only be granted if the property for which the exemption is sought is in use for the purposes set forth in subsection (A) of this section as of January 1 of the year for which the exemption is claimed.
  • The City Clerk and/or assessor shall require proof in the form they consider necessary of the right to, and amount of an exemption claimed under subsections (A) and (B) of this section.
  • The City may require such proof under this subsection at any time to ensure ongoing compliance with the eligibility requirements of subsection (A) and (B). It shall be the responsibility of every person who obtains an exemption under this section to notify the City of any change in use, ownership, or rental income. 
  • Applicants for the non-profit exemption must apply annually.
Low-Income Housing Exemption

5.07.030 Low-Income Housing Exemption.

Interests other than record ownership in real property that has been developed, improved, or acquired with federal funds for low-income housing and is owned or managed as low-income housing by the Alaska Housing Finance Corporation under AS 18.55.100 – 18.55.960 or by a regional housing authority formed under AS 18.55.996 are exempt from City taxes as to the individual residing on the property. However, the corporation may make payments to the City for improvements, services, and facilities furnished by it for the benefit of a housing project, and this subsection does not prohibit the City from receiving those payments or any payments in lieu of taxes authorized under federal law.

Temporary Subdivision Exemption

5.07.040 Temporary Subdivision Exemption.

The portion of the increase in assessed value directly attributable to the subdivision of a single parcel of property into three or more parcels and any improvements made to the property necessitated by its subdivision is exempt from City taxes for up to five years. The exemption is terminated when a lot in the subdivision is sold, or a residential or commercial use is established on a lot in the subdivision.

Temporary Landscape Exemption

5.07.050 Temporary Landscape Exemption.

  • There is an exemption from taxation for the increase of assessed value that is directly attributable to landscaping, or new exterior maintenance or repair of an existing structure, and if the landscaping, exterior maintenance, or repair, when completed, enhances the exterior appearance or aesthetic quality of the land or structure. An exemption may not be allowed under this subsection for the construction of an improvement to a structure if the principal purpose of the improvement is to increase the amount of space for occupancy or nonresidential use in the structure or for landscaping as a consequence of construction activities. An exemption under this subsection continues for three years commencing with the year in which the exemption is approved by the assessor.
  • An application for exemption under this subsection shall be filed with the assessor no later than March 1 of the year immediately following the year in which the landscaping, or exterior maintenance or repair of an existing structure, that is the subject of the application in whole or in part, may be appealed to the Board of Equalization, as provided in Section 5.06.090 of this Chapter.
  • An exemption granted under this subsection expires at the end of three years and cannot be renewed. The granting of an exemption under this subsection does not affect changes in the assessed value of property that are attributable to causes other than the landscaping or exterior maintenance or repair of an existing structure that is the basis for the exemption. A reappraisal will be required prior to granting of a subsequent exemption.
Economic Development Property Exemption

5.07.060 Economic Development Property Exemption.

A. The assessed value of property used for economic development, as defined in this Chapter, may be exempt from City property taxes or receive a deferral from City property taxes under the conditions listed in this section.
B. “Property used for economic development” as used in this section, means that part of real or personal property, as determined by the assessor, that is being developed or redeveloped in a manner intended to result in an outcome that causes an increase in, or avoids a decrease of, economic activity, gross domestic product, or the City tax base in such a manner that City Council has determined an exemption or deferral from property tax is in the best interest of the Cordova community.
C. Property used for economic development may be:
1. Exempted from property taxes on up to one hundred percent of the assessed value of the property for a period determined by City Council and adopted by ordinance;
2. Deferred from payment of taxes for a period determined by City Council and adopted by ordinance; or
3. Deferred from payment of property taxes until substantial completion of construction if a property owner is in the process of developing or building property used for economic development but has not yet completed construction on such property.
D. City Council shall approve the economic development exemption and deferral application form, and any substantive changes to that application, by ordinance. The application shall specify the specific types of land use that causes an increase in or avoids a decrease of economic activity, gross domestic product, or City tax base in such a manner that an exemption or deferral from property tax is in the best interest of the Cordova community. The application shall specify the terms and conditions of an exemption or deferral. The approved application form and any changes to the form shall be published at least 30 days before taking effect. Except as otherwise provided in this section, an application under this section shall be processed in the same manner as all applications under this Chapter and Chapter 5.06.
E. In addition to the application requirements and specifications adopted in the application itself or otherwise specified in this Chapter or Chapter 5.06, an applicant seeking a construction deferral must also submit a development plan to be approved by the city assessor. Upon construction of the economic development property satisfactory to the City, the City may change deferral under this subsection into an exemption which shall not exceed the remainder of the five-year period from the date the deferral was approved.
F. If the property to be used for economic development is not developed or created within the time specified in the application, the City may immediately terminate the deferral and take any other action permitted by law including, but not limited to, collecting all property taxes accrued on the property during the construction deferral, collecting penalties and interest on the taxes owed from the date such taxes would have been due if no deferral had been granted, and attaching a tax lien to the property.

EXEMPTIONS REQUIREMENTS
1) The economic development property tax exemptions outlined here apply only to improvements to real property. The
exemptions do not apply to the value of land on which the development or redevelopment is to be located.
2) The exemptions under no circumstances transfer following sale of the real property for which an exemption has been granted.
3) All development that is granted an exemption per the terms set forth below and entails construction must be subject to
inspection as required by the Codes adopted by the authority having jurisdiction (the State Fire Marshal) at the cost of the
Applicant.
Single-Family Residential
The Single-Family Residential Exemption is an eight-year exemption from the property taxes owed on the first one hundred fifty
thousand dollars of the assessed value of improvements for the construction of single-family homes to include standalone homes and
townhomes. If granted, the exemption goes into effect upon substantial completion of the development for which the exemption is
sought.
Affordable Housing
The Affordable Housing Exemption is an exemption of 100 percent of the property taxes owed on the assessed value of the
improvements under the circumstances and for the durations detailed below. If granted, the exemption goes into effect upon substantial
completion of the development for which the exemption is sought.

Maximum Eight-Year Exemption Maximum Twelve-Year Exemption Maximum Fifteen-Year Exemption
Multifamily housing of any kind (duplex,
triplex, condominiums, apartments)
offered for rent at market rates for
duration of exemption. No requirement to
establish below market rate rents.		 Multifamily housing consisting of four
units or more, with at least 25 percent of
units offered for rent as affordable units
for duration of exemption.		 Multifamily housing consisting of four
units or more, with at least 25 percent of
units providing three bedrooms or more,
offered for rent as affordable units for
duration of exemption.

Multifamily Residential
The Multifamily Residential Exemption is an exemption of 100 percent of the property taxes owed on the assessed value of
improvements under the circumstances and for the durations detailed below. If granted, the exemption goes into effect upon substantial
completion of the development for which the exemption is sought.

Five- Year Exemption Eight-Year Exemption Twelve-Year Exemption
Construction of one or more duplexes or
provision/installation of a new
construction trailer home in an existing
trailer home park. In either instance, the
property must be some combination of
owner-occupied, and/or offered on a
long-term rental basis (minimum 12-
month lease) for the duration of the
exemption.		 Construction of multifamily housing of
fourplexes to eightplexes. Seventy-five
percent of units must be owner-occupied
or offered on a long-term rental basis
(minimum 12-month lease) for the
duration of the exemption.		 Construction of multifamily housing in
excess of eight units, to include
condominiums and apartments. Seventyfive
percent of units must be some
combination of owner-occupied and
offered on a long-term rental basis
(minimum 12-month lease) for the
duration of the exemption.

Mixed-Use Development
The Mixed-Use Development Exemption is an exemption of 100 percent of the property taxes owed on the assessed value of improvements for the construction of mixed-use development for a period of fifteen years. If granted, the exemption goes into effect upon substantial completion of the development for which the exemption is sought.
Commercial Development
The Commercial Development Exemption is an exemption of 100 percent of the property taxes owed on the assessed value of improvements for new commercial or industrial construction for a period of ten years. If granted, the exemption goes into effect upon substantial completion of the development for which the exemption is sought.

Rehabilitation
The Rehabilitation Exemption is an exemption of 100 percent of the property taxes owed on the assessed value of improvements to blighted commercial or residential properties. The exemption requires the redevelopment of a parcel, in the form of either significant upgrades or full replacement of existing blighted improvements. The Rehabilitation Exemption can be applied for prior to January 15 of the year in which construction is meant to encourage the redevelopment of blighted properties in the City. If the proposed development is not completed upon the timeline set forth in the Applicant’s application, the one-year exemption shall be revoked, and all taxes previously waived per the exemption will become due immediately.

Contacts

City Clerk

Susan Bourgeois

Deputy City Clerk

Colette Gilmour

Accounts Receivable Clerk/Receptionist

Tami Merritt

Office Location

601 First Street

Cordova, AK 99574

Mailing Address

PO Box 1210

Phone

907-424-6200