Caledonia Argus

City approves tax abatement for Witt pharmacy

Posted: 8/5/03

The city council has given its approval to a tax abatement for the Witt Pharmacy now being constructed in Caledonia.

The amount that the city is abating amounts to approximately $800 per year for the first five years of the abatement and $533 a year for the last four for a total abatement of $6,900.

In a tax abatement, the property owner pays all the taxes on his property, and then is refunded a portion of the taxes that represent the difference between the starting value of the property and the value of the property after improvements. In the case of Wittís Pharmacy, the city has agreed to abate 75 percent of the difference in the taxes.

Mayor Robert Burns noted that the city will still receive the taxes generated by the original parcel, plus 25 percent of the taxes on the improved value.

The county has also been approached for a tax abatement and has not yet made a decision. The countyís abatement amounts to $12,418 for the 10-year period.

At a meeting of the county board in July, board chair Dave Corcoran said that he questions the need for the tax abatement because the project is already well underway, which calls into question the need for the abatement. The county board was to discuss the abatement at its August 5 meeting.

The school district wll not be approached on an abatement.

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