The board of aldermen supported a proposal that will provide the developer with five years of tax relief under the city's Community Revitalization Tax Relief Incentive Program.
This is Nashua's first application for the program that was adopted by the city nearly two years ago.
There was very little discussion about the application that was unanimously approved by aldermen. Noting that the housing development will be available for mixed-income residents, will improve the vitality of the downtown area and is consistent with the city's master plan, the application was granted.
The Cotton Mill Square project, a $25 million housing plan that was originally proposed in 2006 but stalled because of the economy, is now finally getting off the ground. The revitalization of a 108-year-old historic building on Front Street is about to be converted to more than 100 apartment units by developer John Stabile.
During a public hearing on the tax relief application earlier this month, city officials said that by investing in blighted areas within the city, it will ultimately help reduce taxes.
The cost to rehabilitate the aging building is more than $24 million, according to Dean Jackson, who works with Stabile. He said earlier that Cotton Mill Square, LLC, will not return in five years seeking an extension on the tax relief, which is estimated to be about $250,000 throughout the five years.
The tax relief will enable Stabile to pay property taxes on the current assessed value of the property - less than $2 million - as opposed to the new assessed value once the project is complete, a number that has not yet officially been determined.
"This really is the key to future economic development," Alderman Mike Tabacsko, Ward 5, said previously, stressing the city will still be collecting taxes throughout the five-year period.
Once the eight-story building is revitalized, it will offer mixed-income housing with 55 affordable apartments and 54 market-rate apartments.
In order to qualify for tax relief under the program, the rehabilitation must provide a public benefit such as enhancing the economic vitality of the downtown, increasing residential housing, or improving a culturally or historically important structure.
The board of aldermen agreed that the Cotton Mill redevelopment meets those requirements.