CRA considers allowing owners of larger parcels to apply for demolition grants
The South Cape Community Redevelopment Agency is starting discussions to change its demolition grant incentive to include larger parcels.
City Manager Michael Ilczyszyn, who also acts as the CRA’s executive director, said when they initially set forward the Demolition Grant program it was geared mostly towards getting spots of blight demolished.
“Speaking with the first-ever person to utilize it, it favors smaller buildings,” he said. “The larger parcels have the greatest return on investment for us.”
City Economic Development Manager Sharon Woodberry said the purpose of Wednesday’s presentation to Cape Coral City Council sitting as the CRA Commission, was to talk through increasing the demolition cap, so they can provide more equitable grants on a greater amount of investment.
“The issue is the current funding structure favors small parcels,” she said.
Three options were presented
The first is maintaining the current grant structure up to $100,000 with 100% of reimbursement for the first $50,000, 50% reimbursement for costs between $50,001 and $100,000 with the maximum grant at this level of $75,000.
The second tier provides greater funding for larger projects – $200,000 and larger. For every $100,000 spent over $100,000, the grant increases by $75,000.
The second option removes the cap on the second tier.
The third option has a flat 75% of total eligible demolition costs.
“The purpose is to have properties that are down there that are older contributing to slum and blight taken down to unapproved property, so they can be marketed for redevelopment,” Ilczyszyn said. “We have had this program a little over a year now. We have only had one person utilize this grant program so far.”
He said conversations with developers and property owners that own bigger buildings said why should they pay to demolish the building if smaller properties are receiving 100% funding to do so.
Mayor John Gunter said whatever direction they agree upon, there should be a maximum threshold rather than a percentage.
Ilczyszyn said with property appraisals they know for older structures the value is in the land. He said the property appraiser removes the value for anything more than 30 years old.
Gunter suggested that if the cap is $200,000, maybe the applicant should be eligible for the first $100,000 upfront with the second $100,000 at the end – at the time of the development. The grant will be discussed more at another meeting.
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