Des Moines to consider all-electric rule for property tax abatement

Des Moines would require residents and businesses looking to reduce property taxes through abatement to use all-electric energy under an idea the City Council will consider in coming months.

Why it matters: It's a critical step to help Des Moines achieve a goal to completely divorce itself from fossil fuel electricity by 2035, Councilperson Josh Mandelbaum told council members.

• But it could also increase construction costs and halt some future development, Dan Knoup, executive officer of the Home Builders Association of Des Moines told Axios.

How it works: Tax abatement is a development incentive DSM has used for decades. It reduces or eliminates the property taxes owners pay on new construction or major building rehabilitations for years.

• The all-electric requirement would mean that an eligible property's heating and cooking appliances could no longer use natural gas to qualify for the property tax breaks in the future.

State of play: The City Council narrowed its abatement program Monday for properties that don't meet new enhanced efficiency standards.

• Under the changes, electric vehicle charging stations and better insulated exterior walls are required to qualify for the enhanced abatement incentive.
• 10-year tax abatement schedules will be reduced by as much as two years for projects started in 2022 or later that don't meet the higher standards.

What they're saying: Mandelbaum — an attorney for the Environmental Law & Policy Center — argued the update unanimously passed this week doesn't go far enough to reduce greenhouse gas emissions.

• Meanwhile, City Councilperson Linda Westergaard is worried the program doesn't do enough to encourage affordable housing development.

What's next: DSM will hold work sessions and stakeholder meetings in coming months to possibly rework the program again next year.

• A new proposal that could include the all-electric requirement will be presented to the council in April.