By CRAIG FREILICH

POTSDAM – The village is reinstating property tax exemptions for businesses in the village that increase the value of their property through substantial improvements.

A business would qualify if they spend at least $10,000 and not more than $50,000 on improvements.

Village Director of Planning and Development Fred Hanss, who explained the plan to village trustees at their Monday night meeting, said a business would qualify “for painting your building, probably not, but for building an addition, yes.”

The abatement is structured as reduction in county and village taxes on the increase in the tax on the property’s new higher assessment. Over a 10-year term, the reduction is 50 percent in the first year, 45 percent in the second year, and dropping by five percent a year through year 10 when there is a five percent reduction in taxes.

The resolution approved by the Board of Trustees says the specific purpose of the plan is “to provide tax relief to businesses that construct, alter, install or improve commercial and industrial buildings used for buying, selling, storing or development of goods and services, the manufacture or assembly of goods or the processing of raw materials, hotels and motels” through provisions in the state Real Property Law under Section 485-b for exemptions for business investment.

“Ordinary maintenance and repairs are excluded from abatement,” the resolutions says.

Town and school taxes are not included in this measure, since those entities have not adopted the exemption, while the county has and the village is doing so.

The village had a property tax abatement provision in local law for business property improvements, but it was allowed to sunset as the last recession caught up with village finances, and the 485-b rules were never reinstated in the village until now.

Village Administrator Greg Thompson said this was “an opportunity to attract business to the area” with the new incentive.

Trustee Abby Lee said it also incentivizes existing businesses with an opportunity to improve their properties at less of a net expense.

The abatement would apply to businesses in all of the appropriate village business and industrial zoning districts, and not including residences, schools, health care zones at and around the hospital, and nature conservation zones mostly at the river and its islands.

The change in local law will go into effect as soon as the state secretary of state’s office notifies the village that they have recorded the change.

To apply for the abatement, a business would get the appropriate form from the office of Town Assessor Jim McGuire, fill it out and return it. He would be responsible for reassessing the property.