If you build a new house on vacant land, Mayor Harry Tutunjian wants to make it tax-free for five years.

TROY   Tutunjian said in his state of the city address last month he is modeling the program on one in Columbus, Ohio, that began a little more than a year ago.

Mark Barbash, director of development for that city, said the tax break there lasts 15 years.

"The hope is that we will spur redevelopment in our older neighborhoods by lowering the costs to own or develop a house," he said.

Tutunjian has similar hopes. He has yet to speak with anyone in Columbus, but said he has reviewed the description of the program on that city's Internet site. "Theirs is a little bit different and a little more complex," he said.

The mayor is still formulating his idea, and he said it will be several months before any legislation goes to the City Council.

In Columbus, the tax break is not available citywide but in one of five zones.

Mayor Michael B. Coleman chose neighborhoods that were not the city's most economically distressed; he wanted to work on correcting other problems in those areas first, Barbash said.

"They were somewhat distressed. They also had development going on that actually said there was interest," Barbash said. "We picked five areas we call our neighborhood investment districts."

Tutunjian said he also plans to offer the tax breaks in specific neighborhoods, but he will include the city's most economically distressed areas, like North Central.

"We're going to target specific areas in the city that need investment and have been victims of destruction of buildings by fire and that have gaps in rows of housing," he said. "It would give an incentive to an owner to buy a lot."

For the first five years, Tutunjian said, the owner would pay taxes only on the value of the vacant land. Any building also would have to fit in with surrounding structures, so, for example, a modular home could not be built in a row of brownstones.

In Columbus, the program gives tax breaks for both new buildings and improvements to existing ones. Tutunjian said he wants to phase in higher assessments for building improvements, though he is not modeling that idea on what Columbus has done.

So far, 693 housing units have been built, Barbash said.

"Most of them are in multifamily, affordable-housing projects," he said. Some 160 single-family homes have been built. There also have been 50 apartments for the homeless, 215 senior-citizen units and 268 multifamily apartments.

But the biggest challenge, he said, has been what Tutunjian proposes to do: Occupy vacant space with new homes. "In Columbus, the hardest challenge we've had is in the single-family infill development," Barbash said. "That kind of development for our community is very important." But developers are more comfortable building on large, open tracts of land, rather than in vacant lots spread throughout the city. Tutunjian said Troy does not have many large stretches of land, and he does not intend the breaks to go to large developments like Vanderheyden Estates.

He will offer the incentive, however, to builders of multifamily homes, which he said are prevalent in sections of the city like North Central and South Troy.

While he first wanted to offer the program only to owner-occupants, he said, he now is considering making it available to a developer who builds homes on vacant lots and sells them to owner-occupants. He first is asking the city's attorney to determine the legalities involved if ownership is transferred.

"I'm still in the formative stages of the program," he said, but he already is getting inquiries. At the scene of a fire last week that destroyed three River Street buildings in North Central, Tutunjian said he was asked if the properties would be eligible for the tax break.

In Ohio, the program is set to last five years, and it will be reassessed after three to see if it is working, Barbash said. "It's been pretty well-received. We have to do a lot of education of the citizens, of the real-estate developers," he said. "You have to be constantly going out and reminding people that it is available."

Asked if he had any advice for the city of Troy, Barbash said officials here should not expect too much.

"Abatements in and of themselves don't create a market. It's one tool you have to decrease the costs of a development," he said. "Housing in older parts of the city is a challenge. The best advice I could offer would be not to set your sights too high at the beginning. Give it time to work."

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